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


Memorandum by the Royal Borough of Kensington and Chelsea (MARKETS 21)

SUMMARY

    — RBKC currently has traditional markets in Portobello Road, Golborne Road and Portobello Green and farmer's markets in Bute Street in South Kensington, Notting Hill Gate and Duke of York's Square. The creation of a further farmer's market at World's End is also currently under consideration.

    — The traditional market in Portobello Road has declined in terms of the number of pitches in recent years; although three new farmer's markets have opened in the borough. Pitches are available and affordable but there appears to be a problem in attracting the next generation of fruit and vegetable and antiques traders.

    — Traders have been adversely affected by vehicle emissions legislation, and the western extension of the London congestion charge, while the national fraud initiative has pushed some traders away from council run markets.

    — Traditional markets are particularly important in providing access to affordable healthy food and the opportunity for local people to set up stalls to meet the needs of their own communities. These markets have a major role to play in promoting healthy eating, however to achieve the real potential it will be necessary to re-think market opening times and how healthy eating is promoted through markets.

    — The ability of the council to proactively develop and promote markets is limited by the London Local Authorities Act that prevents the council from charging traders to establish a fund to promote the markets or improve facilities.

    — Central government could consider how Business Improvement District (BID) legislation could be applied to market traders.

1.  How has the picture changed over the last 10 years?

  1.1  In Portobello Road, over the last six years, there has been a significant reduction in the number of market pitches in regular use on a Saturday, the busiest day, from around 212 to an average of 180. From Monday to Friday the numbers have also been significantly reduced.

2.  Are the number and types of markets in decline? If so, why?

  2.1 The number of markets in the Royal borough has actually increased in recent years with the creation of new farmer's markets in Bute Street South Kensington, Notting Hill Gate and Duke of York's Square.

3.  Are there obstacles preventing the creation of more markets?

  3.1  Planning policies can be used to create a positive framework within which new markets can be permitted. However, the process allows people to object to applications, and, in this borough, as public open space is limited, there can be resistance to any development that could reduce, even temporarily, access to open space. There are also real issues of residential amenity.

4.  Are there obstacles hindering the successful business of existing market operators and traders?

  4.1  Availability and affordability of pitches is not an issue for the markets run by the council. As detailed above demand for pitches has declined and the cost of a pitch has been reduced from £54 to £52 per week for a six day licence and casual licences during the week have dropped from £22 to £12.

  4.2  There is an issue with market trader succession particularly in the antique and fruit and vegetable stalls, where younger people are less keen to go into these trades. In contrast younger people are actively selling "vintage" second hand clothing, new clothing and innovative gadgets in our markets.

  4.3  Some recent legislative changes have adversely impacted our traders. The new vehicle emissions legislation has required them to outlay for new vehicles, which may not be affordable for these often quite marginal businesses. As a result of the National Fraud Initiative the council now collects National Insurance details on all our market traders. While this is an entirely legitimate increase in bureaucracy it has had the effect of pushing some traders away from council run markets to less stringent private markets and car boot sales.

  4.4  Employees on the markets do not benefit from some Health and Safety and Employment legislation like requirements on rest breaks and hours of working etc., they are generally employed on a temporary cash in hand basis because their employers are unable to afford to provide these benefits.

  4.5  The western extension of the London congestion charge has adversely affected our week day traders who were reliant on passing traffic, and it has increased their overheads.

5.  What has been the impact of specialist markets eg continental and farmers markets, and do such markets integrate successfully with older markets?

  5.1  Farmer's markets are quite popular with our residents and supported in principle by our Councillors. As detailed above three new farmers's markets have opened in the borough and another is currently under consideration. These markets are privately run and physically separate from the traditional markets so integration is not an issue.

  5.2  The council has recently reviewed the performance of Bute Street farmer's market. This market is privately run but was established through the instigation of the council in May 2008. The market is performing acceptably and the majority of customers are sufficiently local to walk to the market.

  5.3  Visiting speciality markets have been held in Kensington Town Hall forecourt (every two months excluding Dec-March) and Portobello market where five different operators have visited on an ad hoc basis. Generally these take place on a Friday and Saturday, they are popular but relatively expensive, so they have not performed as well as could have been expected. There was no objection from the Portobello traders to the speciality market because it filled unused space and increased footfall for the whole of the market.

6.  What social and economic effects do traditional retail markets have on their local communities?

  6.1  Portobello and Golborne Road markets are unusual in that the serve some of both the richest and the poorest wards in Britain. These markets are particularly important in providing access to affordable healthy food and the opportunity for local people to set up stalls to meet the needs of their own communities, for example Moroccan food traders are particularly strong in Golborne Road. Socially these markets are places where the different communities in the borough can meet and shop.

  6.2  The market plays a particularly important part in supporting the transient population of the area, and has changed over the years to reflect the arrival of different nationalities.

  6.3  Through the consultations that have taken place as part of the preparation of planning policies in the LDF, we have received clear feedback that there are fears about "market gentrification". However, as stated elsewhere in this paper, the markets are in decline in terms of stall take up. Some form of innovation would therefore seem to be needed—but any innovation that caters more fully for the affluent residents would be perceived to be "gentrification" and thus seen to undermine the current character of the market. This is a conundrum to which there is no easy answer.

7.  What qualities contribute to a successful market delivering social and economic benefits, and are there examples of best practice that have a wider application?

  7.1  Easy availability of pitches and the active support of the Markets Office have helped to maintain the success of the markets. The Markets Office have found that maintaining, good links with the local Islamic Centre can help to resolve any difficulties that may arise. The market is open to all customers and traders and the Markets Office has a can do—open door attitude.

8.  Does local government support markets effectively?

  8.1  The Council invested in electric bollards for the pitches in Portobello Road and Golborne Road through the North Kensington Redevelopment in the 1980s. The Markets Office is self-funding.

  8.2  The ability of the Council to proactively develop and promote markets is limited by the London Local Authorities Act that prevents the council from charging traders to establish a fund to promote the markets or improve facilities. Attempts to create a London Markets brand are now only emerging under the auspices of the Mayor's office.

9.  What are the advantages and disadvantages of local authorities having powers to operate markets?

  9.1  The advantages of local authorities operating markets are that the council exercises democratically controlled powers to protect the interests of the residents, shoppers and traders. The legislation, the fees and all paper work is open to public scrutiny preventing corruption, nepotism etc.

  9.2  In contrast private operators have a freer hand, they can invest in developing specialist skills and assembling an attractive mix of niche traders and in promoting their markets. Budgetary, consultation and approval constraints make it more difficult for the council to take this kind of proactive approach.

10.  Does central government support markets effectively? If not, what additional support should be provided?

  10.1  We are not aware of any specific central government support for markets. There is a serious problem for markets across much of the country in controlling pedlars, although this is not an issue in London, because of the London Local Authorities Act 1990 (as amended).

  10.2  Central government could consider how Business Improvement District (BID) legislation could be applied to market traders who do not pay business rates and therefore cannot be charged a BID levy in the same way as retailers.

11.  Could central government make better use of markets to achieve national goals, particularly with regard to social cohesion, health and regeneration?

  11.1  Markets have a major role to play in promoting healthy eating, however to achieve the real potential it will be necessary to re-think market opening times and how markets promote themselves and healthy eating. There is also a potential to develop isolated trading sites to encourage wider access to affordable healthy food.

  11.2  In terms of social cohesion markets clearly have a significant role to play as the focus of their local communities; this has been discussed in more detail under social and economic effects.

  11.3  In terms of regeneration the market at Bute Street was developed to provide for the needs of local residents and support local shops by increasing the draw of the area.

12.  Do local and national planning regulations support or hinder the development of markets?

  12.1  Planning policies recognise the importance of markets and retail diversity, which the council supports. However, there can be an issue with consideration of residential amenity in establishing new markets.

13.  Do licensing regulations support or hinder the development of markets?

  13.1  The licensing regime is quite flexible; it did not present any difficulties in establishing the new market in Bute Street. However, the licensing requirements do ensure that traders only pay for directly attributable services like street cleansing and market management. This makes it difficult to establish funds to develop and promote the market. This means that any funds for this must come from general council resources, for which there are many competing demands.

14.  What improvements could be made to the planning and licensing regimes to aid the development of markets?

  14.1  Greater powers to control the amalgamation of units could help promote the independent retail character of unique areas like Portobello Road which in turn would support the market.









 
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