Challenges in London
95. During the course of our inquiry we were appraised
of one issue that was peculiar to London, namely the extent to
which the London Local Authorities Act 1990 (and a similar Act
peculiar to Westminster) acted to constrain the ability of some
local London authorities to improve their street markets. The
submission of consultancy firm Market Place (Europe) Ltd was one
of a number to highlight "the difference between the vast
majority of markets operated throughout the country and those
operated in London."[168]
It explained that:
Elsewhere in the country markets are created by several
methods, primarily being by Royal Charter, Prescriptive Rights
or by Statute—the latest being the 1984 Food Act. The operator
is permitted to apply realistic commercial charges to the traders
and such profit generated can be re-invested in the market or
used to provide other benefits for the local community.
By contrast, in London:
The street 'markets' are not strictly markets in
the legal sense of the word. They consist of a number of individual
Licensed Street traders—licensed under the London Corporation
Act—who all congregate together at the same time and place
to give the outward appearance of a market to all intents and
purposes. The crucial difference here is that the L.A. can only
recoup certain basic operational costs and cannot derive a profit
from the operation of the 'market'.
The impact of this is that:
London local authorities often regard their 'market'
as a necessary nuisance which they would rather not have to deal
with and accordingly allocate the minimum resources—often
of indifferent quality—to manage and develop the 'market'.
Whilst the London councils we visited or took evidence
from disputed any suggestion that they neglected their street
markets, they certainly agreed that the London Local Authority
Act (or equivalent) provided an obstacle to effective management
of their markets.
96. Chris Wroe, Environmental Health Manager for
Licensing Policy and Strategy, City of Westminster Council, told
us he wanted "to designate an area as a market and then give
us rights more akin to a market operator to be able to shuffle
people about, to be able to put commodities together."[169]
Tot Brill, Executive Director for Transport, Environment and Leisure
Services, Royal Borough of Kensington and Chelsea, felt constrained
by the number of ways there were of challenging London council
decisions, observing that "it is not just the market traders,
anybody can object to anything that the local authority proposes
to do",[170] which
was stifling change and innovation. Whilst acknowledging that
market traders were concerned that change would threaten their
livelihood because they only had a right to a particular spot,
she argued, in line with Westminster, that "what you end
up with [at the moment] is isolated stalls in an empty market
street where you would want, if you were managing the market properly,
to cluster people together so they do not get lost and customers
do not give up before they get to them […]."[171]
97. Tot Brill further emphasised that London councils
would not be able to raise the money to invest in their markets
unless they were given greater flexibility to raise rents and
vary charges depending upon the position of the stall. Chris Wroe
further added to this point that, because their rent is kept artificially
low by the Act, market traders with tenancy rights that can be
passed down generation to generation "do not have to operate
efficiently […] their customer care is poor, their display
is poor and the training of their staff is poor."[172]
Stephen Douglass, Area Management
and Engagement Manager, London Borough of Southwark,
also argued that the present legislation was "quite a negative
piece of legislation", because it pushes local authorities
"down a regulatory enforcement route" rather than allowing
the flexibility to promote and develop markets, for instance by
"allowing us to generate a surplus to then reinvest."[173]
Islington Council, whose Chapel Street Market we visited, similarly
argued that, in parts, the legislation was no longer fit for purpose,
as it "was written at a time when street trading flourished
[…] This is no longer the case". Islington Council
stressed that "markets still play a vital role in our communities"
but that, crucially, they "need increased council intervention
to succeed."[174]
98. Tot Brill offered a specific example where the
legislation was being obstructive. Her council runs a farmers'
market in a street in partnership with a private sector organisation.
In her words, "putting it together in a street was a nightmare
because we ran the risk of it being designated as a street market
which we are trying to avoid because if it was a street market
then it could not be run by London Farmers' Market Limited who
guarantee that what you have got is a farmers' market and not
a collection of chancers."[175]
Because the legislation does not allow local authorities to transfer
their street market responsibilities, she was forced to establish
the farmers' market on a temporary licence. In their submission
and during our visit, Hackney Council similarly wanted greater
flexibility to "transfer management of Markets to another
organisation where the local authority do not necessarily have
the commercial expertise in-house to maximise the potential of
markets."[176]
Short of abandoning the Act altogether, Islington Council similarly
proposed allowing applications for stalls to be made by partnerships
or companies, as well as reducing the notice of intention to
revoke a licence because of unpaid rent and allowing the local
authority to "promote and invest in markets and recover these
costs from weekly rents."[177]
99. Other evidence to us, however, suggested that
the issue might not be quite as black and white as implied above.
Comments on our web forum were critical of London authorities
for seeking to maximise revenue from their markets at the expense
of market traders, by driving up rents. Some saw little evidence
that the councils were committed to improving their markets, and
were suspicious of their attempts (see below) to change the law
without, as they saw it, any consultation with traders. One market
trader, for example, who operates in Southwark, was critical of
the council, which had "not invested in the ambience of the
market" and asserted that a recently published consultancy
prepared review stated that "Southwark markets are unloved"
that "communication with stakeholders in poor" and that
numbers of market traders had declined from nearly 700 in 1998
to under 300 in 2008. The view from our web forum was that better
consultation, rather than new rules that enabled imposed solutions,
was the way forward.
100. It appears clear that the present situation
in London is unsatisfactory. Westminster City Council is currently
seeking to improve the situation through means of a private Bill,
introduced into the House of Lords, to replace the current City
of Westminster Act. Chris Wroe explained that it did not address
the financial issues, but would allow "for freedoms and discretions
to enable us to manage our markets and our street trading better."[178]
Having sought confirmation from Iain Wright MP, then Parliamentary
Under Secretary of State, that the issue had not come across his
desk—he told us "it has not been flagged up as a major
concern from London councils in the Department"[179]—we
queried why London authorities had not sought to make a combined
case to the Government to change the law. The answer appears
to lie partly in the different circumstances that pertain across
London both in terms of numbers of markets and legislation (for
example, we were told that Greenwich has a Royal Charter and so
does not have a legislative issue), and partly in scepticism that
the Government would be particularly sympathetic or willing to
take an active role. In recalling a meeting he had attended with
a Minister when the London Local Authorities Act 1990 was being
drafted, Michael Felton certainly implied a lack of sympathetic
government engagement in the past:
We made a number of suggestions and she explained
to us very nicely the difficulties of getting it absolutely right.
We pointed out to her that some of these provisions simply would
not be fair nor work effectively and it turned out that we happened
to be right.[180]
Some witnesses also complained that there was no
clear lead responsibility for markets in London—and this
is an issue that we return to in a later section.
101. We are persuaded that there
is a strong case for London authorities to be given greater powers
in respect of their street markets. Whilst
some councils would themselves admit that they have neglected
their markets in the past, from the evidence we have seen there
now appears to be a genuine desire to devote more time and resources
to improving them. During our visit to Hackney too we were struck
by the contrast between a historic tendency by the council to
let its markets run themselves, and the extent of its commitment
now. We
recommend that London local authorities and CLG, whose support
will be necessary to ensure that legislative change comes into
effect, work together to change the relevant provisions of the
London Local Authorities Act 1990 and other relevant legislation
specific to individual London boroughs. In doing so, however,
they should be mindful of the need to include a requirement to
work in partnership with market trader organisations on the development
of London street markets. Where local authorities gain additional
powers in relation to market rents, stall location and management
structures, it should be incumbent upon them clearly to articulate
their strategic vision for the future of their street markets,
and the benefits that will ensue for both traders and the wider
community, before they put these powers into practice.
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