Letter to the Committee Chairman from Martin Linton Esq, MP (P 11)
Kate Hoey and I share responsibility for the New Covent Garden, the offices being situated in her constituency and the markets in mine. We have therefore worked together on this issue.
I am delighted that the Committee is now looking at the future of the Market and that it has broadened the inquiry to look at the wider situation in London.
Since 1997 Kate Hoey and I have pressed for two changes in this Government policy towards New Covent Garden which have both now occured. What are now needed are two further policy changes, first, to allow Nine Elms to develop as a one-stop-shop market for all foods and a centre for food-based industries and, second, to help it develop as an economic and environment-friendly delivery point for the hotel, catering and tourism trade in the West End.
Allow me to recap on our involvement in the issue. In early 1998 Kate Hoey and I saw the parliamentary secretary, Bernard Donoughue, to express our opposition to any measure which could threaten the future of New Covent Garden as a market. We told him it would be one thing if it were sold as a market and the obligation to run a market were transferred to the new owner. But it would be quite another if it were sold for other use.
We argued that there are many transport and regional planning reasons why New Covent Garden should remain a market. It is a hub of a larger industrial area, the East Battersea Powerhouse, concentrating on food-based industry located strategically close to the West End. In the triangle formed by Vauxhall, Battersea Park and the railway goods yards, there are hundreds of acres of industrial land and 814 businesses employing 7,000 people. At the time of the East Battersea City Challenge Bid, the London Borough of Wandsworth and AZTEC estimated that it had 70 acres of derelict, vacant or underused land, 25 development sites and 400,000 square feet of vacant commercial and industrial floorspace.
The bid set out a strategy for East Battersea as a centre for businesses in food distribution, processing and preparation and also in the communication and leisure industries. The development of Battersea Power Station would provide a focus for leisure business but, far more importantly, New Covent Garden Market would be a regional centre for the food processing industry, making it the "kitchen of London".
Any other capital city would give its back-teeth to have such a large food market so close to the main hotel, entertainment and tourism centre, especially when it also has a huge scope for development.
Nine Elms will also have the advantage that it is outside (probably just outside) the congestion tax area on which the Mayor of London is now consulting. That emphasises the point that it is a much more logical site for a London food market than the historic sites in the City. It is as close as it is possible to get to the West End without being in it. But clearly the Market would be seriously affected by a congestion charge. I have proposed extending the exemption categories to include delivery vehicles travelling from Nine Elms to the West End. Restrictions could be put on this exemption, eg time of day, use of environmentally friendly vehicles.
One of the problems is that the 1961 Act set up the Covent Garden Market Authority to run a wholesale horticultural market, in effect nationalising the Market (its previous owners were the Beecham Group). This Act of Parliament was very restrictive and there certainly was a time when the Fruit and Vegetables Market Trading Area was under-occupied because of the demise of the local greengrocer. The Fruit and Vegetable Market still sells about 20-25 per cent to the retail trade and secondary wholesalers, but it has found a new market in the hotel and catering trade in the West End. The bulk of its produce is now sold to the catering trade for the supply of fruit and vegetables to hotels, restaurants, airlines, schools and hospitals. It is difficult to see how these customers could manage without it. The Flower Market has always been 100 per cent occupied.
Altogether some 2,500 people are thought to be employed in the Market and there is of course further ancillary employment by suppliers and buyers. The Market is the biggest single centre of employment in Wandsworth after the local authority. The Market Authority has an annual turnover of some £7 million while the Market businesses have a total turnover in excess of £400 million per annum. The Authority makes a profit and (other than a small proportion which is retained for essential capital renewals each year) this is returned to the government via Corporation Tax or direct payment to MAFF. In essence, therefore, it is a nationalised industry that makes a profit, has no outstanding debt, and there seems to be no good reason for the Government to dispose of itparticularly with the consequent effects on employment and activity.
In March 1999 the Chief Secretary, Alan Milburn, visited the Market and in April the Agriculture Minister Nick Brown came to the Market to announce a change of policy. The Ministry of Agriculture would only sell the Market on condition that it continued to be run as a market and it would negotiate a new deal over the future of London's four food markets.
That lifted the threat of closure from the Market and the 2,500 jobs that were dependent on it. It was also, in our view, a huge opportunity to create a central all-purpose food market for the whole of London acting as a one-stop shop for catering, hotels and tourism as well as the retail trade.
London is very fortunate to have a large purpose-built food market in a prime site right next to the West End, but it is hemmed in by all sorts of antiquated restrictions against trading in anything but fruit, vegetables and flowers. It will be a hugh advance if New Covent Garden can have the flexibility to become a general food market acting as a one-stop shop for the catering industry and a larder for London. That will mean that food can be delivered quickly, cheaply and ecologically to shops and restuarants without the need for huge fleets of lorries coming from outside London.
Since then Joyce Quin, Minister of State, has visited the Market. More recently, she has informed the Market that the Treasury had taken out of MAFF's budget the £42 million that it had been expected to raise by realising the value of the site. That removes the pressure on MAFF to sell the site or part of the site. But it leaves open the possibility that MAFF will find a buyer or a partner who will want to develop the market on its present site.
There have been plans to rebuild the market on a smaller site, covering about half its present 50 acres, releasing the rest of the site for sale. It is certainly true that a more modern, compact food market could still provide a wider range of foods on a smaller site. An alternative approach would be to expand the types of activity that can be traded by tackling the somewhat antiquated legal constraints in the areas covered by the Corporation of London's meat and fish markets. MAFF's consent would also be required before these (or other non-horticultural) activities can be undertaken.
The constraints are supposed to apply with an area of six and two thirds miles of the City, that being the longest distance a market trader could reasonably walk in a day. This has been made obsolete not only by modern transport, but also by the growth of London beyond the City. It is now quite ludicrous that the City should have a veto on the sale of fish or meat at Nine Elms. It is also ludicrous to have separate markets for fish, meat and vegetables, since they are sold in the same shops.
I hope that the Select Committee will be able to use this opportunity to make some wide-ranging recommendations, not just on the future of Nine Elms, but also on a more logical development of food markets in the capital.
1 March 2001