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Mr. Graham Allen (Nottingham, North) : The debate makes the central charge that the burden of taxation has increased under Conservative rule. That charge is stated clearly in the motion for all to see. Not one Conservative Member who has spoken has refuted that central thesis of the motion. In other words, my hon. Friend the Member for Makerfield (Mr. McCartney) has won the argument hands down. Nothing said today by Conservative Members can deny the fact that the overall burden of taxation is higher under this Government than it has been under any of their predecessors. One would have expected Conservative Members to produce some facts or figures at least to act as a fig leaf to protect the Government's record on taxation. They have not found it possible even to do that.
The only disagreement seems to be over the extent of the increase in the burden of taxation. The Economic Secretary to the Treasury told me in a parliamentary answer--I referred to this earlier--that, as a percentage of GDP, the percentage taken in tax had increased from 28.3 per cent. in 1979 to 30.4 per cent. in 1988.
It was not a question of the Economic Secretary stabbing his esteemed colleague the Financial Secretary in the back by giving those figures. The Government's Budget Red Book said that non-oil taxes were forecast to rise to 37 per cent. in 1990-91 compared with 34 per cent. in 1978-79. I could give other examples. For instance, Professor Atkinson's famous recent study said the increase would be from 34 to 38 per cent.
But let us not be blinded by statistics. It is important for Opposition Members to make it clear that the Government have performed an economic miracle. They have pulled the wool over the eyes of the British people by
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concentrating on the myth that a reduction in general taxation has the same effect overall as a reduction in income tax.Income tax has undoubtedly been reduced, but virtually all indirect taxes have been increased. A classic example is that since the Conservatives came to power over 10 years ago, VAT has almost doubled. They have robbed Peter to pay Paul.
The overall tax burden has increased enormously, and I congratulate my hon. Friend the Member for Makerfield on choosing his words so precisely that the British people will know for sure, should they read the reports of this debate, that people are poorer under the Tories, especially in terms of the burden of taxation. The tax burden as a whole has increased and it is game set and match to my hon. Friend the Member for Makerfield.
The Financial Secretary made an attempt to ask some
questions--rather lamely--which were demolished by my hon. Friend the Member for Newcastle upon Tyne, East (Mr. Brown) with his usual efficiency. The Financial Secretary did not wish me to intervene to answer his questions, so I took a careful note of them and will answer them now so that the record is clear. He asked which programmes Labour would cut. We are a long way away from the next Labour Government. It may be in a year, a little less, or a little longer, depending on what the right hon. Member for Henley (Mr. Heseltine) does and what shenanigans occur within the Conservative party.
As a humble Back Bencher, let me give my view of which programmes will be cut. I think that the prime objective of the next Labour Government will be to secure economic growth. Therefore, no spending programme need necessarily be cut, but we shall certainly be looking to certain areas where prudent, planned growth in expenditure could take place on the basis of agreed priorities, which will obviously need extensive discussion by the future Labour Government's economic team.
As a caveat I must say that my view is that even the present Government are beginning to come round to consider cuts in our defence programme--the so- called peace dividend--as a result of the tremendous democratic explosion in eastern Europe and the personal efforts made by President Gorbachev to free the Soviet economy, thereby leading to less military expenditure. At the moment the Government are not seizing that opportunity, but I hope that my Front-Bench colleagues in a future Government will grasp that opportunity with both hands. Therefore, that is one opportunity for cuts.
Another opportunity will be to end the waste in so many areas, not merely economic waste, but the waste of lives. Money has been wasted in areas where it should not have been spent. One example is North sea oil revenue, which has already been referred to. It was stated earlier that people went abroad under the last Labour Government--the Mick Jaggers and all the rest, who are no doubt desparately important to the economic well-being of the country. Perhaps those people have stayed here under the Conservative Government. I do not know. Perhaps they have passed the cricket test and decided to stay at home. Certainly money has gone abroad in increasing amounts year after year. Investment abroad now exceeds investment in this country. North sea oil revenue, which could have been such a profitable well, and could have been used for expenditure, development and investment to emphasise and rebuild
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training programmes and the education of young people, has been frittered away. There is no prospect of that money coming back. We have heard the word "fairness" a number of times when talking about our spending programmes. That will be all-important. Whatever tax burden there may be under a Labour Government, be it a local tax, poll tax, roof tax or income tax at national level, the burden must be fairer. Certainly, the giveaway Budget of 1988, which was disowned so eloquently this morning by the Financial Secretary as the Budget that led to some of our current crises, which gave away money hand over fist to the richest while taking it away from some of the poorest, was one of the reasons why fairness has fallen flat on its face under the Government. I shall give way to the Minister, despite the fact that he refused to give way to me.Mr. Lilley : I did give way to the hon. Gentleman, as he is well aware. He has just said that I said something which I did not refer to. Last time that he referred to the Financial Secretary he was referring to someone else. May I take it that he is again confused, as he so often is?
Mr. Allen : The Financial Secretary to the Treasury referred this morning to the failure by the previous Chancellor of the Exchequer, the right hon. Member for Blaby (Mr. Lawson), to maintain monetary constraint. The right hon. Gentleman has gone on to richer pastures, earning six-figure sums in the City. That seems to be the reward under this Government for resigning or being sacked. His mistakes can now be openly admitted, even by Treasury spokesmen.
Mr. Lilley : I referred to the reduction in interest rates and to the easing of monetary policy after the stock market collapse in October 1987. I was a Minister then and share the responsibility. I was not seeking to blame anybody else. I did not mention the 1988 Budget, although the hon. Gentleman imagines that I did.
Mr. Allen : The Minister must live with his own conscience. He must decide whether to stay in his job and continue to accept responsibility for the failures of the past.
The Minister's second point related to tax levels. My hon. Friend the Member for Newcastle upon Tyne, East referred to yesterday's report in Hansard of the simple question that the deputy leader of the Labour party put to the deputy leader of the Conservative party in this House.
Mr. McCartney : The deputy Prime Minister.
Mr. Allen : Yes--no one more eminent than he.
Mr. McCartney : That is another well paid part-time job.
Mr. Allen : My right hon. Friend asked the deputy Prime Minister to outline what the Government's income tax level would be after their next Budget. Sadly, almost pathetically, the dead sheep fell into the elephant trap and made rather a fool of himself. One cannot predict absolutely precisely what that rate will be, even one year ahead, when one is in government. To seek, as poorly and lamely as the chairman of the Conservative party does, to pin down the shadow chancellor of the Exchequer on figures to be included in a Budget to be introduced under
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totally different economic and political circumstances in at least two years' time is more laughable than the laugh that was raised yesterday at the expense of the Lord President of the Council. One of the failings of my hon. Friend the Member for Newcastle upon Tyne, East is that he is too easy-going and generous towards top-rate taxpayers. My hon. Friend and his colleagues say that the top rate of tax for such people will be only 50 per cent. Until 18 months ago, this hard- hearted Conservative Government penalised those hard-working, well-rewarded and much-deserving top rate taxpayers to the extent of taking 60 per cent. of their income. Perhaps we are being a little too soft on them. Nevertheless, the Opposition's policy remains, and will remain in government, one of fairness in the tax system.Mr. McCartney : Following the much-vaunted press conference held by the chairman of the Conservative party at which he attacked our proposal, the remnants of Fleet street at Wapping rushed out an opinion poll, in the hope that the general public would attack the Labour party's proposals. The opinion poll that was published after the press conference suggests that the general public believe that our proposals are acceptable and will lead to a fairer redistribution of the tax burden. We have received public support for our proposals.
Mr. Allen : My hon. Friend has made another clear and strong point. The serious slide in support for the Government began with the giveaway Budget to the super rich in 1988 by the right hon. Member for Blaby--now retired to those lush pastures of Kleinwort Benson, or wherever he may have gone. That was when the reaction set in. Ordinary people felt a sense of revulsion that the Government were abusing the tremendous unitary power that we give the Executive by rewarding people on the highest salaries so crudely and grossly. It was offensive and even before the recent furore about the poll tax people started to become aware of the immorality in Government economic policy and found it unacceptable.
The Financial Secretary's third question related to the tax burden, and I am sorry to say that that is where he really began to go wrong. As I pointed out earlier, the reductions in income tax are a con. They give money with one hand and take it away with the other through indirect taxation. Unfortunately there are only two tax bands : 25 per cent. and 40 per cent. and only one in 25 people pay 40 per cent. As such a minute proportion of the population pay the top rate, we really have only one tax rate ; in effect we have a poll tax at national level which hits evenly across the board almost despite earnings, as the top rate of pay affects only one in 25 people. People increasingly consider that to be grossly unfair as it become more evident that the income tax reduction has been a con. We need to examine carefully what the Government have done in other areas of taxation. One of the recent examples was revealed in the Public Accounts Committee paper from the National Audit Office which shows that that although considerable efforts are made to prosecute individuals who may overclaim or be overpaid very minimal amounts of social security, and bands of people scour the country trying to find people who may have got away with a few pounds here and there, the Inland Revenue is now £5 billion short of taxation that should have been collected. Once again, it is a matter of economic and social priorities. Efforts are made to prosecute
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individuals who are almost always on very low incomes who may have got away with something beyond their entitlement, yet those who do not pay income tax, corporation tax or national insurance contributions on behalf of their employees can get away, almost with impunity, with creating very large tax debts that are currently sloshing around in the taxation system.Taxation other than income tax needs to be considered in some detail. The hon. Member for Eastbourne (Mr. Gow) made an eloquent speech which may be admired from afar. He was very clear about the tax that inflation places on individuals. The erosive effects of inflation blow apart the Government's policy on child benefit. Child benefit is nominally frozen, but the effect of freezing a benefit in any inflationary economy is that it loses its value. That essential truth is revealed by the fact that child benefit has not been increased in line with inflation or need as it should have been. Child benefit is being left to wither on the vine, and, electoral unpopularity apart, the Government will have to come clean about their proposals for child benefit and decide whether to keep it or do away with it.
The burdens of taxation on individuals include the endless subsidies for agriculture. Apparently, we are being asked for more subsidies for beef producers. A large amount is given away each year to maintain the various stockpiles. I understand from an answer to a question that I asked last month that every person pays out £24 to ensure that the farm subsidies are continued.
Mr. McCartney : My hon. Friend referred to farm subsidies, but we should consider a much more important and telling point--the extent of rural poverty. Considerable sums have been made available over the past decade through the European Community. Those sums have supposedly been pumped into the rural community, but those who live and work in the rural community are forming a growing percentage of the people in Britain who are described as poor and an underclass. They are poor in terms of their income and because of the house price explosion in rural areas, forcing them out of village life and the communities in which they were born and brought up.
Rural poverty is one of the most serious forms of poverty in Britain. Because of the lack of knowledge about it, few, if any, resources are spent on alleviating it--even less than has been spent on urban programmes to attack deprivation. In rural areas, if a person is poor, he is forgotten. There is no possibility of private or public funds being provided to assist such people to get out of the poverty trap. Unfortunately, the issue of the tens of thousands of rural people caught in the poverty trap has not come out in today's debate.
Mr. Allen : My hon. Friend's expertise and his commitment to alleviating rural poverty are well known. He puts his points with his usual eloquence. The poll tax has compounded the problems. Many people did not believe that a wife at home would have to pay the poll tax. They believed that they would pay less because the poll tax was less than the rates bill, but the reality is that a wife at home pays the poll tax, just as it is paid by the husband who goes out to work. The news that a wife at home had to pay it came as a tremendous shock to many people.
Local government has to extract more money because of the Government's failure to maintain support for local authorities. The Government have deliberately shifted the
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burden of taxation away from themselves to the local authorities. The extra burden on the rates was equivalent to 3.5p of the 8p in the pound reduction in the basic rate of income tax over recent years. The central Government contribution to local authorities has fallen from 59 to 42 per cent. of total local authority expenditure. The money must be found somewhere and made up somehow. Invariably, that means that the local authority must either cut services, such as education and meals on wheels, or make good that expenditure from other sources.Interest rates may now be called the John Major tax. It is not a painless way of extracting money from people to finance the mammoth trade deficit. It is not high-falutin' economics. Because we are not paying our way in the world and are importing more than we are exporting, we have to find the money to make up the difference. That is done by higher interest rates which, in turn, mean that the individual mortgage payer has to pay much more. In my constituency, an individual mortgage payer now pays £80 a month more on average for the Government's mistakes, managerial incompetence and bungling. Exactly the same applies to industry. We learn in the press today that Coloroll, a major high street company, might go into liquidation. One of the main reasons for that appears to be the high interest rates. That well-known high street name, which was probably thought to be impregnable or, in Conservative parlance, "unassailable" just a few months ago might now go down the tube causing a loss of jobs and a large number of closures throughout the economy. The press reports cite extremely high interest rates as the main reason for that. Any business that wants to borrow to develop must pay absolutely prohibitive and punitive interest rates and they find it next to impossible to maintain that borrowing because all the income to that company is committed to repaying the moneylenders.
Mr. McCartney : One of the Government's commitments to industry in the shake-out of manufacturing in the early 1980s was that they would replace our manufacturing base with a service-based economy. The new service-based economy, in the high street providing goods and services, has declined in less than a decade. Coloroll will not be the only company that will go under with the loss of hundreds, if not thousands, of jobs between now and the next general election. Substantial numbers of the so-called sunshine industries which were supposed to provide new jobs to replace the thousands of jobs lost in manufacturing will no longer exist. In less than a decade they will have been forced out of business by the Government's high interest rates.
Mr. Allen : I referred to Coloroll because that is the latest example. That example could be rendered useless if the figures show that another company has been created. The Government will say, "Oh, we've lost one, but we've gained one." However, the new company may simply be a hamburger joint that has opened up in the constituency of the Financial Secretary to the Treasury. No doubt the Government would give that concern the same kind of weight as a multi-thousand pound and multi-thousand employee concern such as Coloroll. There are other hidden taxes which the Government do not include in the equation as they claim that the tax burden has gone down when they mean that the income tax burden has gone down. Among those taxes are those that I like to call the privatisation taxes. We have all built
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up the gas, electricity and water industries over the years by contributing to them through our bills. Those bills included extra amounts for investment to build those industries up. We are now paying for those industries all over again to allow those who can afford to buy large blocks of shares to make certain speculative killings. I am not talking about the small shareholder who has one or two shares ; I mean the big institutions which make the big killings.When mentioning those privatisation taxes, we must consider the water company taxes. We have learnt today that over and above what we thought our water bills would be and what the Government admitted that they might be, there will be another 6.5 per cent. increase in taxation levied by the water companies. In other words, the consumer will have to pay more.
Those privatisation taxes apply to the gas and electricity concerns. We must also take account of the green dowry being handed to the water companies. Similarly, we must all pay a nuclear tax of £5 a week. That figure does not appear on our income tax returns or on people's weekly or monthly salary chits. However, that tax exists, we must pay it and it is part of the big con. Similarly, in the health service, prescription charges have risen by 1,000 per cent. since this Government came to power.
In connection with those hidden taxes we must bear in mind asset stripping, reports of which appear virtually weekly before the Public Accounts Committee. Reports show how the Government have sold assets that once belonged to the nation, such as Royal Ordnance or the British Airports Authority. Those reports show that major debts have been written off and that means that we, as income tax payers, must pay those debts. Money is given away because in some cases those assets are priced below their real value. We pick up the tab as income tax payers or, as is the case now, poll tax payers. It must be paid for. There is no such thing as a free lunch in these political days. The right hon. Member for Blaby may be enjoying the odd free lunch in his position, but the rest of us pick up the bill. The hon. Member for Eastbourne talked about borrowing, how the previous Labour Government borrowed and this, that, and the other. He has a nerve. Having paid back a number of borrowings, out of the revenue from resources that were created by nature in the North sea, the Government have stopped the repayment programme. The programme has not only stopped but is in reverse and borrowings have started to gear up again.
The economy is in a mess, so we can understand the Government having to start borrowing once again. But there is an even more sinister motive. It is not to invest in the future, in the education of our children or in our industries, and not to rebuild the destroyed third of manufacturing industry ; it is to invest in the 70-odd marginal seats that the Government need if they are to cling to power. We have seen how ruthless the Government can be with the poll tax. They framed the legislation so that Labour authorities were capped. At the same time, they massively funded Westminster, Wandsworth and other selected areas. Such political
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chicanery is now being funded by borrowing large amounts of money that the Secretary of State for the Environment will allocate to certain areas to ensure that the Conservatives have a better chance in marginal seats than they would if they were left to their own economic devices.Mr. McCartney : The leader of Wandsworth council said that, now that the election is over, he may have to introduce a poll tax of £409. My local authority has a poll tax of £392. After millions of pounds of cuts in education, it has found itself capped despite the fact that 106 authorities spend more money per head than it does. Money that should have been spent in our area to retain services without high levels of poll tax was syphoned off to pay for votes in Wandsworth, Westminster and other areas.
Mr. Allen : Further to that point, the Labour parliamentary candidate in Nottingham, South, Alan Simpson, has done a calculation. Our poll tax in Nottingham is £209. If we had received the same subsidy as Westminster city council, our council would not have collected £290-- it would not have collected anything. If we had had that level of subsidy we could have sent a cheque for £100 to every poll tax payer in Nottingham. Let us all have a subsidy. Let us all get that amount of money. It is going to certain areas to ensure a slightly better chance that the Conservative Government will be able to save their skin.
The Government's economic, income tax and general tax burden policies are just part of their catalogue of economic failure. They failed to control interest rates, which are now going through the roof and hitting mortgage payers and industry. They failed to control a trade deficit that is now totally out of order and is in a different realm from that of any of our competitors in the industrialised world--as a percentage of GNP, it is greater than that of any other industrialised nation in the world. That is the extent of the problem. That is the size of the trade deficit.
The exchange rate is all over the place, despite the efforts of the right hon. Member for Blaby, who got his come-uppance when he tried to do something about it. Our inflation rate is creeping higher and higher. If the Government wish to ensure that the inflation rate continues on even that path, they will have to take some serious steps.
Our investment record is absolutely appalling and falling. Even the Confederation of British Industry is saying that the Government are becoming separated from the people who were previously on their side. Conservative Members have referred to their relationship with the City. Yes, they still have a tenuous relationship with a number of people in the City, but their relationship with even the captains of industry is getting more and more tenuous
It being half-past Two o'clock, the debate stood adjourned.
BUSINESS OF THE HOUSE
Ordered,
That, at this day's sitting, the Ways and Means Motion may be proceeded with, though opposed, until any hour.-- [Mr. Nicholas Baker.]
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Orders of the Day
SEXUAL OFFENCES BILL
Order read for resuming adjourned debate on Question proposed [11 May], That the Bill be now read the Third time.
Mr. Deputy Speaker (Mr. Harold Walker) : Debate to be resumed what day? No day named.
ACCESS TO HEALTH RECORDS BILL
As amended (in the Standing Committee)
Considered, Read the Third time and passed.
GAMING (AMENDMENT) BILL [LORDS]
Bill read a Second time and committed to a Standing Committee, pursuant to Standing Order No. 61 (Committal of Bills).
POLL TAX (RESTORATION OF INDIVIDUAL PRIVACY) BILL Order for Second Reading read.
Second Reading deferred till Friday 22 June.
RAPE IN MARRIAGE (OFFENCE) BILL
Order for Second Reading read. Hon. Members : Object. Second Reading deferred till Friday 22 June.
HARE COURSING (ABOLITION) BILL
Order for Second Reading read.
Second Reading deferred till Friday 15 June.
AMUSEMENT MACHINES (PROTECTION OF CHILDREN) BILL Order for Second Reading read.
Mr. Deputy Speaker : Second Reading what day? No day named.
CHLOROFLUOROCARBONS (CONTROL) BILL [LORDS]
Order for Second Reading read.
Second Reading deferred till Friday 15 June.
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TRADE UNION ACT 1984 (AMENDMENT) BILL [LORDS] Order for Second Reading read.
Hon. Members : Object.
Second Reading deferred till Friday 22 June.
WAYS AND MEANS
Gaming (Amendment) Bill
[Lords]
Resolved,
That any Act resulting from the Gaming (Amendment) Bill [Lords] may provide for the charging of fees payable into the Consolidated Fund in respect of applications for certificates of consent under Schedule 2 to the Gaming Act 1968.-- [Mr. Nicholas Baker.]
Mr. Harry Cohen (Leyton) : On a point of order, Mr. Deputy Speaker. I did not hear any objection to the Hare Coursing (Abolition) Bill. Was it the hon. Member for Gainsborough and Horncastle (Mr. Leigh) or the hon. Member for Dorset, North (Mr. Baker) who objected? Surely we should have the right to know which hon. Member objected-- [Interruption.] One of my hon. Friends has suggested that it was the hon. Member for Sheffield, Hallam (Mr. Patnick) who objected--he is a Government Whip. It would be a new departure if the Government were objecting to that Bill.
Mr. Quentin Davies (Stamford and Spalding) : Further to that point of order, Mr. Deputy Speaker. It may be helpful to you to know that I distinctly heard my hon. Friend the Member for Gainsborough and Horncastle (Mr. Leigh) object to that Bill.
Mr. Deputy Speaker : This is becoming a well-trodden path at 2.30 pm on Fridays. The procedure that we followed was correct.
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Jones Brothers, Islington
Motion made, and question proposed , That this House do now adjourn-- [Mr. Nicholas Baker.]
2.34 pm
Mr. Chris Smith (Islington, South and Finsbury) : I wish to raise the subject of the closure of Jones Brothers department store in Holloway in Islington. The store has served the people of north London extremely well for decades. It provides a much-valued service, a wide range of goods and courteous service and maintains some rather old-fashioned concepts about treating the customer well. It is used extensively by people in my constituency and that of my hon. Friend the Member for Islington, North (Mr. Corbyn), who I hope will have an opportunity to speak in the debate.
Most of us who live in Islington or neighbouring areas shop in the store on a regular basis. It employs about 500 people, many of whom are my constituents. The John Lewis Partnership, which owns the store, announced in January to an astonished work force and an angry public, that it intended to close it on 21 July this year. That closure decision prompted me to seek this debate.
The closure has aroused massive public protest. Thousands of local people have signed petitions, written letters to the John Lewis Partnership and to the store itself, withdrawn their accounts from John Lewis and demonstrated in large numbers their dismay and distress at the decision to close the store. Yet John Lewis has remained adamant about its decision. It has been arrogantly dismissive of local feelings, local people and local elected representatives.
One of the main reasons initially advanced by the John Lewis Partnership for its decision to close the store was that the building was worn out. It said that the building was in need of major refurbishment and that an urban development grant application made about five or six years ago to assist the refurbishment had been turned down by the Government. The application for urban development grant was made by the London borough of Islington on behalf of the John Lewis Partnership in 1984. It was for a public sector contribution of some £700,000 to the rehabilitation work. The application was refused in August 1985.
It is perhaps worth analysing why the Government refused that application. We should also bear in mind that had the Government accepted the application, we might not face the prospect of the store's closure. There are several discernible reasons for the Government's rejection of the application. First, there was an unusually high proportion of public sector leverage. Of course, that could readily have been discussed and reassessed in consultation among the three parties involved.
Secondly, it appears that at that time the Government were reluctant to use urban development grants for retail purposes. Since then, urban development grant has been made available to Arlington Securities for a shopping centre in Oldham, for a mixed-use scheme in Birmingham and even for the Business Design Centre in my constituency, which has close connections with the retail trade. The bar against any major consideration of support for retail purposes cannot persist.
The major reasons were outlined in the Department of the Environment letter to the London borough of Islington of 13 August 1985 which announced the refusal
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decision. The letter is worth quoting because it shows clearly what was in the Government's mind and because it may lead us to reflect that circumstances have changed. It states :"The improvement in the store's trading performance attributable to recent management action has been noted and, whilst it is accepted that the project would be likely further to improve that performance, it did not appear that the store would be likely to close in the near future if the project was not carried out or that the project would in itself secure the future of the store if trade generally in the Nag's Head area were to fall off."
Note that the Government stated clearly that there seemed no likely prospect of closure and that that was why they did not believe that the urban development grant application should succeed. That circumstance has changed completely.
The letter continued :
"I would, however, add that this decision reflects the view taken of the merits of this particular development proposal. The Department are not ruling out in principle the use of Urban Development Grant in support of retail development in the Nag's Head area."
I ask the Government to put this case back on the agenda. The likely impact of refurbishment or non-refurbishment of the Jones Brothers store will be considerable on the whole Holloway-Nag's Head shopping area. There is a danger that closure would have a spin-off effect on other businesses and stores nearby and the potential to cause a gradual decline in the quality of the shopping facilities and community life. Already since the announcement of the closure there has been a noticeable slackening of interest by businesses in the revival of the Nag's Head which the local authority has planned for many years. If Jones Brothers goes, others are likely to follow. Any cycle of decline of this sort removes the life, bustle and heart from an inner-city community. I do not want that to happen in the Holloway area.
My major question to the Minister this afternoon is : in the light of the announced closure by John Lewis Partnership, is he now prepared to consider sympathetically a new application for urban development grant, or as it now is, city grant, for this store? To John Lewis Partnership I have the following to say : I am deeply disappointed by the way in which the announcement was made without consultation with staff or local people and by the way in which the partnership has rebuffed all attempts to urge it to reconsider and all offers of assistance to enable it to reconsider its original decision. For a firm which supposedly prides itself on its responsibility to the community, its behaviour over the closure of the store has been unbelievable.
I am amazed at the changing reasons that the partnership has given for the closure. When in February I first took up the matter, it told me that the reason was simply that the building was worn out. When I came back on that and other issues subsequently, it told me that the real problem was that although the store was making a profit and no loss was being incurred on the current trading position, it was not making enough profit. I suspect that that gives us a glimpse of the real reasons behind the decision.
We are seeing part of a worrying trend upon which John Lewis and other department chains are embarked. They are closing their inner London stores in local shopping areas like Holloway. That applies also to Streatham, where the partnership simultaneously has announced the closure of Pratts. It is keeping its flagship
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stores in central London--Oxford street and Sloane square--but otherwise it is moving to the outer fringes of the capital, catering only for motorists in new, amorphous and relatively unwelcoming superstores. Effectively they are saying, "You can shop in Oxford street or at Brent Cross, but there will be nothing in between." In an inner city area such as Islington, my constituents are left high and dry. Many of them have no form of private transport. The policy makes bad economic sense, especially when a store such as Jones Brothers is making a profit. It removes a valuable asset for the community and it leads ultimately to the decline and eventual destruction of inner city areas.I ask the Government to join me in urging the John Lewis Partnership to think again, even at this late hour. I ask the Government also to reconsider a refurbishment grant application. I ask the John Lewis Partnership, as passionately as I can, to change its mind.
2.46 pm
Mr. Jeremy Corbyn (Islington, North) : I thank my hon. Friend the Member for Islington, South and Finsbury (Mr. Smith) for securing the debate and for giving me some of his time. As he explained, Jones Brothers is a store on the Holloway road, which is the border between our constituencies. The store is sited in Islington, North but its customers and staff come from throughout the borough and neighbouring boroughs.
We are in an extraordinary set of circumstances. The John Lewis Partnership apparently decided at high management level some time ago that Jones Brothers was earmarked for closure. I suspect that that is one reason why it has not spent as much money on the refurbishment and decoration of the store as it might have done over the past few years. Senior management arrived at the store one morning, summoned a meeting of the partners--that is the term used for those who work within the partnership--and informed them that the closure was due to go ahead. It then told a number of other people that this announcement amounted to staff consultation, agreement and support for the closure. As my hon. Friend said--I strongly support him-- there is no evidence that the staff at Jones Brothers, or any other department store in the partnership, support the decision. It is interesting, too, that normally store closures are met with some ignorance and passiveness by the local community. That is not the case with the proposed closure of Jones Brothers. Immediately after the announcement posters started to appear bearing the slogan "Save Jones Brothers". A local campaign was established and public meetings have been held. Many people have written to my hon. Friend and me. It is extraordinary that public meetings should be held in support of a department store. As my hon. Friend said, however, Jones Brothers is an unusual but genuine department store. It is the centre of the Nag's Head shopping area, which is patronised for most part by those who live in the area, and who generally walk there or travel there by bus. It is not a heavily motorised shopping area, although a major road runs through it. Jones Brothers is an important part of the area.
The John Lewis Partnership has been involved, in meetings with the supporters of the campaign, representatives of the local authority and shareholders, and at a meeting that I attended with the leader and chief executive of the council, Margaret Hodge and Eric Dean, in
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