Market Failure?: Can the traditional market survive? - Communities and Local Government Committee Contents

7  The way ahead for central government


121. Iain Wright MP, then Parliamentary Under Secretary of State at CLG, told us that "the Government does think that markets are a hugely important and positive part of the retail offer".[208] He placed considerable emphasis on the need to link markets to "a wider, fundamental town centre strategy" and saw the Government's strategic planning guidance as a means of achieving this end. Indeed, he saw Government's main role with regard to markets as ensuring that their important contributions are adequately reflected in strategic planning guidance. He stressed the need for Government to "facilitate and enable local authorities to have the tools to put in place planning policies that can help markets thrive"[209] and pointed to the text which the Government had placed in the current key strategic planning guidance document Policy Planning Statement 6: Town Centres and Retail Developments as evidence that the Government took this role seriously. In full, the text reads:

Street and covered markets (including farmers' markets) can make a valuable contribution to local choice and diversity in shopping as well as the vitality of town centres and to the rural economy. As an integral part of the vision for their town centres, local authorities should seek to retain and enhance existing markets and, where appropriate, re-introduce or create new ones. Local authorities should ensure that their markets remain attractive and competitive by investing in their improvement.

122. The Government is in the process of "streamlining" its approach to strategic planning guidance, amalgamating a number of its planning statements, including PPS6, into one policy planning statement (PPS) document. A draft new PPS is currently out for final consultation,[210] with publication due later in 2009. The Government has also published draft good practice guidance for the town centre elements of the new PPS, to be read alongside the draft PPS. One of its key recommendations, the replacement of the 'need test' by a new 'impact assessment framework', is the subject of a separate, forthcoming Report by this Committee.[211] The key reference to traditional retail markets in the new draft PPS comes under "Policy EC6: Local planning approach to planning for consumer choice and promoting competition for town centre development", which includes the following advice, similar to that contained in the current PPS6:

Local planning authorities should proactively plan for consumer choice and promote competitive town centre environments by retaining and enhancing existing markets and, where appropriate, re-introducing or creating new ones, ensuring that markets remain attractive and competitive by investing in their improvement.[212]

Arguably, a later clause advising local planning authorities to take measures "to conserve and, where appropriate, enhance the established character and diversity of their town centres"[213] also has applicability to markets. Street markets are also mentioned in Annex A as a 'town centre health check' indicator.[214] The more detailed good practice guidance adds nothing substantive on markets to the PPS text. Other than a brief reference to a DETR study on the impact of food stores on market towns/district centres,[215] which emphasises the need to "take positive steps to improve the range and quality of food shopping in these centres, and adopt a cautious approach to considering the location and likely long-term consequences of the development of large food stores in non-central locations", markets get swallowed up under the generic heading of "special forms of trading".

123. Some contributors, including Simon Quin,[216] felt that Government strategic planning documents, such as the current PPS6, should place more emphasis on the role of traditional retail markets, although others were more positive about the existing guidance. George Nicholson for instance was strongly supportive of the Government for including markets within PPS6 telling us "that I think what is in PPS6 is fine because it is a call to arms. It is asking local authorities to recognise that street markets and indoor markets have an important function within their towns, city centres and villages throughout the country."[217] He did, however, add the rider that:

[…] at the very least the paragraph in PPS6 should be carried through to the new document. It is a very important paragraph and recognition from Government that DCLG, in issuing PPS6 in the first place, had a paragraph for the first time which specifically addressed in planning terms the importance of markets. It is important that it is carried through into the new guidance which emerges later this spring or summer.[218]

124. We welcome the Government's decision to include markets within its strategic planning guidance and, in particular, the advice to local governments to retain and enhance existing markets. In light of our inquiry though, we are disappointed at the current narrow emphasis on consumer choice and competition. As the cover of the Government's PPS document makes clear, as well as supporting economic objectives, planning also plays a key role in supporting the Government's wider social and environmental objectives and for sustainable communities. As we have seen in earlier sections, markets can make a significant contribution to local authorities' social cohesion and environmental agendas. We urge the Government to emphasise the wider non-economic benefits that markets can bring and to encourage local authorities also to take them into account when making planning decisions, both in the PPS document, and in the future iterations of the accompanying good practice guidance.

The case for a clearer central government focus for markets


125. Apart from setting the strategic planning framework, the Minster was cautious in terms of how pro-active he felt Government should be with regard to markets. A key theme of his evidence session was the number of times he stressed that it was up to individual local authorities to make decisions about their local markets, observing that "what I would like to see is local authorities having a vision for their town centres in which markets need to be a key consideration".[219] He defended, for instance, the lack of any central government data on traditional retail markets by asserting that "local government is in the driving seat here",[220] and argued against allocating central government funding for local markets on the grounds that "what government policy is trying to do at the moment is not to ring fence specific allocations of money but to provide as much flexibility as possible for local authorities to determine their own policies and priorities."[221]


126. A number of contributors were quite critical of what they perceived to be Government neglect of traditional retail markets. Some identified an apparent lack of clarity as to where responsibility lay in Government for traditional retail markets. The suggestion was that markets were, in a sense, victims of their own versatility, as different aspects of markets were scattered across different government departments. For Anne Coffey MP, Chair of the All Party Parliamentary Markets Group (APPMG), "getting access to central government decision-making" was a major challenge, because "at least seven government departments were involved". She argued for a "Markets Minister who would have responsibility for ensuring that support was given to markets across government departments and obviously could be a focus for government departments to send policy initiatives to, to check that they included support for markets".[222] Simon Quin, one of a number of witnesses with similar views, also observed with regard to government departments that "because everyone perhaps has them [ie markets] somewhere on their agenda, they have not been focused on or taken seriously",[223] whilst Graham Wilson stressed "we desperately need a co-ordinating role."[224]

127. Tim Hirst, Assistant Director, Commercial and Support Services, City of Bradford Metropolitan Council, and Malcolm Veigas, Assistant Director (Community Services) Bolton Metropolitan Council, felt that a lead Minister or at least a lead departmental official could act to raise the profile of markets "in the same way that central government has raised the profile, in the work they have done over the last couple of years, on, say creative industries."[225] Southwark Council criticised the absence of an "overarching holistic approach"[226] by Government. George Nicholson, Secretary NRPF, felt that there should be a Minister to champion markets, and argued that the Minister should sit in the Department for Business, Enterprise and Regulatory Reform [now the Department for Business, Innovation and Skills], as "markets have an economic purpose. They are businesses."[227] Other contributors, however, argued that the correct department for a Markets Minister was CLG because its wider planning, social cohesion and local government responsibilities better covered the wider economic and non-economic benefits that markets can deliver.

128. Witnesses and submissions suggested that a more co-ordinated approach to Government might involve Government support for "further research into the scale and value of retail and wholesale markets in the UK",[228] better national promotion of markets and, crucially, wider recognition within Government that the market industry and market traders should be eligible for national funding and support from wider national schemes. Graham Wilson, for example, argued that "if we had a minister championing markets that minister would flag up the importance of markets in terms of embracing some of the New Start schemes that come out from various agencies.[229] Other evidence suggested that central government should give clearer direction to Regional Development Agencies to ensure that they considered investment in traditional retail markets within their regional regeneration strategies.

129. Jean-Paul Auguste, head of the Geraud Group of markets, which operates Europe-wide, told us that markets "have a champion in France. There is a sort of minister for small businesses. He is our contact within the government." [230] He noted that the Minister provided practical help, for instance by helping to reduce bureaucracy for market traders by reducing the amount of commercial paperwork required by different Ministries from eight separate documents to one. He also said that this Minister had helped the markets industry to lobby the European Union again from the perspective of combating bureaucracy:

[…] there was to be a rule about stickers to be placed on every food product. A trader preparing some food—a charcuterie for example a pate—would have been obliged to give at zero point something per cent the components of his pate on the market day. Tomorrow it is impossible to get the same composition each day […][231]

Complementary to this, the consultancy firm Markets Place (Europe) promoted the adaptation of the Dutch model whereby "a civil servant in their equivalent of the DTI has special responsibility for markets and, following consultation processes with the main players and organisations within their market industry, reports to their equivalent of the Communities and Local Government Select Committee. As a result, Holland now has a well administered, progressive and thriving market industry."[232]

130. A number of witnesses felt not only that the Government should be doing more for markets, but also that the Government was missing opportunities to use markets as a vehicle to pursue a variety of national objectives. Job creation, for instance, is a major concern not just for the markets industry seeking to attract new blood to address a declining, ageing market trader population, but also for Government seeking to boost employment opportunities in a recession. As Graham Wilson's comment earlier in this section suggests, the industry has concerns that markets and market traders are not sufficiently tied in to wider Government employment initiatives. Whilst there was certainly evidence of local authority/PCT initiatives to promote the healthy eating agenda, witnesses also felt that the Government could be doing more to encourage and expand these local initiatives. Malcolm Veigas, for example, suggested that, with regard to the 'Change for Life' campaign, an NHS initiative seeking to encourage children to eat more healthily, move more and live longer:

[…] if within the nuances of the ongoing campaign over the next 12 months, or whatever, more and more references could be made to the markets generally—in terms of low-cost food staples, alternatives to go away and change your lifestyle not just by buying there but going to market once, twice or three times a week and doing it by foot etc, and you can then subliminally get that message across, in terms of the bigger picture message in terms of health generally—that would be really useful and it would not cost any money.[233]

As we have seen in previous sections, similar examples can be found in relation to the social cohesion, town regeneration and environmental agendas. We have also seen the potential for markets to convey Government information and advice on a range of issues to otherwise hard to reach groups, and in his evidence session the Minister appeared sympathetic to the opportunities presented here.


131. It should not be central government's role to intervene in the future of individual markets. Markets are nothing if not local, and it is for local authorities to be the key source of public support.[234] The future of the industry is best served by an active partnership between the key industry organisations, including market trader organisations, and local authorities.

132. We recognise too that individual government departments have a track record of working with markets—the Government evidence referred for instance to DEFRA's work promoting farmers' markets. We are concerned however that there is a lack of clarity within central government as to who has overall responsibility for markets, as opposed to an interest in certain aspects of them. We believe that this handicaps local government and the industry when they want to make a case for strategic change—for instance with regard to markets legislation, or the national promotion of markets or to tie in with wider government initiatives. We believe it also handicaps central government, as markets can end up 'off the radar', increasing the risk that individual departments miss opportunities to use markets as a vehicle to promote a key objective. There are actions that the Government could take, beyond production of strategic planning guidance, better to fulfil its proper strategic role in relation to markets.

133. A number of witnesses proposed the creation of a Markets Minister, perhaps along the lines of the Minister for Veterans, who sits in the Ministry of Defence but, in recognition of the extent to which veterans issues cross departmental boundaries, also takes responsibility for co-ordinating veterans policy across Whitehall. Veterans are obviously a central government issue. We are not convinced that there is a sufficiently strong case to appoint a Markets Minister. Because their character is so influenced by the locality that they serve, markets are rightly primarily a local government issue.

134. We do nevertheless see a need for a clear central government focus for markets, and recommend that the lead should lie with CLG in recognition both of the wider community aspects of markets and the key role of local government. Furthermore, as we have observed in successive reports on CLG's Departmental Annual Reports,[235] the achievement of many of CLG's objectives is dependent upon co-ordinating delivery with other government departments, and this too seems a good fit with the markets portfolio. The Minister appeared sympathetic to this approach, commenting that "there is a good role to play with our interaction with local authorities, our responsibility for planning frameworks and making sure of that wider sense of wellbeing. I can see CLG having a key role to play there."[236] However, we were disheartened during this inquiry to learn that the Minister who came to give evidence to us on markets had, in two and a half years as Minister, met market industry representatives on only "one or two occasions […] I think it might have been the once."[237]This points to a disturbing lack of active engagement. The Government's level of engagement must improve. We recommend, therefore, that CLG takes on responsibility for providing a clear strategic central government focus for markets, and that this is reflected in the portfolio of a named Minister, in the terms of reference of a senior civil servant in the Department and in active engagement with the market industry.

135. We further recommend that CLG lead an inter-departmental working group to ensure that departments make best use of markets as a vehicle to further wider Government objectives as set out in this report. CLG would then become the clear first point of government contact for the industry and local authorities to take concerns about legislation—and as discussed previously we are aware of at least one live issue, that involving market London legislation, that requires Government consideration—and other big picture issues, such as the national promotion of English markets.

208   Q 300 Back

209   Q 303 Back

210   Planning Policy Statement: Consultation, Consultation paper on a new Planning Policy Statement 4: Planning for Prosperous Economies. Back

211   Communities and Local Government Committee, Tenth Report of Session 2008-09, Need and impact: planning for town centres, HC 517. Back

212   PPS Consultation, p 24, EC6.1 (4) Back

213   PPS Consultation, p 4, EC6.1 (6) Back

214   PPS Consultation, p 39, Annex A (A4) Back

215   Planning for Town Centres, p 45 Back

216   Q 59 Back

217   Q 299 Back

218   Q 298 Back

219   Q 311 Back

220   Q 302 Back

221   Q 309 Back

222   Q 17 Back

223   Q 89 Back

224   Q 105 Back

225   Q 156 Back

226   Ev 79 Back

227   Q 284 Back

228   Ev 97 Back

229   Q 108 Back

230   Q 285 Back

231   Q 287 Back

232   Ev 162 Back

233   Q 156 Back

234   The Committee looked in detail at the balance of power between central and local government in its Sixth Report of Session 2008-09, The Balance of Power: Central and Local Government, HC 33-I. Back

235   Communities and Local Government Committee, Second Report of Session 2008-09, Communities and Local Government: Departmental Annual Report 2008, HC 238 and Communities and Local Government Committee, Second Report of Session 2007-08, Communities and Local Government: Departmental Annual Report 2007, HC 170. Back

236   Q 308 Back

237   Qq 329-330 Back

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