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

Examination of Witnesses (Questions 300 - 319)



  Q300  Chair: Welcome, Minister. In the evidence that we have been taking thus far, a lot of people have been explaining to us how important markets are, but there seems to be an absence of any quantitative data. What people are saying is qualitative. How important does the Government believe markets are as part of the retail sector? Has the Department done any work on quantifying their importance?

  Mr Wright: I really welcome what the select committee is doing on this. I think it is a really important issue, which sort of answers the question to some extent. The Government does think that markets are a hugely important and positive part of the retail offer. One of the things I would be keen to explore with the Committee is to what extent this is all part of a wider, fundamental town centre strategy, because I think markets are intrinsically linked to town centres. You mentioned quantitative data. There have been some academic exercises carried out with regard to this. In 2005 there was data. Also, in terms of the local authorities' role in monitoring what is needed, in terms of data and the retail offer, in terms of changes in numbers of commercial spaces, retail units. That is part of the annual monitoring return that local authorities provide to government officers. We do collate things. I would be willing to negotiate and discuss with the Committee what else you think needs to be done, but the data is there.

  Q301  Chair: The Department itself has not taken any steps to commission research or collect data?

  Mr Wright: Only in terms of the annual monitoring returns that local authorities provide in terms of the wider retail offer.

  Q302  Sir Paul Beresford: It is very important but you have not looked at it?

  Mr Wright: It is very important. One of the key things is this interchange and potential conflict between central and local government. I do think local government is in the driving seat here. I will mention PPS6 and the paragraph that the previous witness referred to. We do think that is an extremely important part of the planning framework that provides local authorities with the tools and incentives to make sure that they can retain and enhance local markets as part of that wider—

  Q303  Sir Paul Beresford: Some of the local authorities are saying you are getting in the way with the legislation. They are worried about approaching you because you will only make it worse and add to it.

  Mr Wright: That is certainly not something that has come across my desk. I do not want to have a hands off approach. What we want to be able to do is to facilitate and enable local authorities to have the tools to put in place planning policies that can help markets thrive.

  Anne Main: There have been comments when we have been out and about that central government could get more involved with people at a local level by having advice shops, one stop market stalls for example, the equivalent to Citizens' Advice, advice on benefits, getting out there and talking to people rather than expecting people to turn up at offices. Are you looking to make government more accessible to local people through the use of markets? I gather there was a pilot. We were told about it. I cannot remember where it was operating.

  Q304  Chair: I think that was an initiative of Sheffield Council.

  Mr Wright: I think you raise a really important point. There is an opportunity at the moment in the recession when there are vacant units both in markets and in traditional shopping centres to provide government services and advice for people. What we are keen to see is a wider vision for the town centre which includes markets, which will also have advice about benefits, employment, health, skills and retraining. I think that is a key part of what we need to be doing.

  Q305  Anne Main: Would you strengthen the guidance in PPS6 when it comes out and suggest a wider role for markets in delivering social, economic community benefits?

  Mr Wright: I think there is an important point that the Committee has as part of this inquiry which is the importance of social inclusion. I think a key part of that is providing information that is of use to consumers and citizens in the form of benefits, jobseekers' advice, health, training, and we can use some of the vacant units that are there because of the recession and unfortunately because of the demise of some retail units like Woolworths to help push that vision.

  Q306  Anne Main: A market stall would be cheaper for the taxpayer.

  Mr Wright: In my own constituency in years gone by, local authorities have put in place stalls in traditional markets that have provided skills and training advice for certain members of the community. Local authorities can be in the driving seat with regard to this but I do see the recession as an opportunity in terms of what our town centres are for. Shops are important. The retail offer is important but, in the face of other ways in which we can purchase things like the internet, it needs to be something else and civic and cultural amenities within our town centres which can include really good markets can help enforce and consolidate that vision which is so important.

  Q307  Sir Paul Beresford: The legislation in London is different. We have heard that from one of the witnesses. Effectively, local authorities are licensing; they are not managing and running the markets. The witnesses from the London Local Authority said that the legislation is very restrictive. Some of it is ancient. Some of it needs sorting. One of the concerns some of the witnesses had was that it needed to be diminished. Have you looked at this?

  Mr Wright: One of the great beauties of select committees is looking at oral evidence, seeing an issue that has emerged and then going away to officials to say, "This has not come across my desk. What is happening with this?" It has not been flagged up as a major concern from London Councils in the Department. It certainly has not come across my desk when I have had regular meetings with London Councils but I understand in talking to the Government Office for London that there are issues with regard to the 1990 Act. I think Mr Hands mentioned restrictive practice. Maybe I would not go as far as that but in terms of having some restrictions it does not help facilitate that flow of competition that is so important. I am certainly going to go away and have a look at that. I have a meeting with London councils this week where I will mention it but it certainly has not come across my desk as a major cause of concern in the past.

  Q308  David Wright: Perhaps it has not come across your desk because people clearly do not know where to go. The evidence we have just heard is that there is not a coherent voice for markets within government. You heard one of the previous witnesses say how different that was in France and how that process could potentially reduce bureaucracy and aid liaison for example with the EU. Why are we not doing that here?

  Mr Wright: If I can answer that by mentioning one of the other themes which seems to be emerging from this inquiry, which is whether we should have a Minister for Markets or a champion in Whitehall, whether at ministerial or official level, my answer to that is slightly mixed. I think traditional retail markets and wider town centre management span such a wide range of Whitehall departments. They cover my Department in terms of planning and urban policy and the interaction with local government. I think Defra has a role to play in the food standards and maybe farmers' markets. I think the Department of Health has an important role to play as well. We have mentioned how BERR could be the favoured department of choice and we obviously have a Minister for Small Businesses. We have a wide span of different interests that we all bring to the table within different government departments. I await with interest what the Committee concludes but, rather than having it with BERR, important though that economic stimulus is, markets are much more than just economic developments. Within CLG something like that could sit. 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.

  Q309  David Wright: Do you have any examples where regional development agencies have supported markets or where national government has put direct help in to support specific activity, not necessarily on its own? Maybe it has prompted local authorities to do it. Is there any strategic evidence that you have of central or regional government doing anything proactive to help markets?

  Mr Wright: In terms of the big regeneration schemes of the past decade or so—things like New Deal for communities, something like £2 billion over 10 years; neighbourhood renewal funding which has been about £3 million in the 88 the most deprived areas—there has been a range of those. 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. I think that is the right approach to take. Local authorities can determine best what is needed in their own particular patch. Having said that, you mentioned regional development agencies. I would also mention the Homes and Communities Agency, which is tasked with facilitating the regeneration of communities in England. I think there is a huge opportunity there. I would also mention the big schemes in terms of housing market renewal. I used to work for One North East, which is the north east development agency. There was a specific grant allocated by One North East for market towns to help stimulate economic development, making sure that they are attractive, helping to stimulate tourism. I do think there are specific examples. Certainly in my own direct experience in my working career, I have seen evidence of that.

  Q310  Dr Pugh: Looking at regional development agencies as a whole, they do tend to favour, do they not, the large infrastructure projects that you can see? Clearly, market development ticks a number of good economic development boxes: local produce is used; local employment is generated; people are attracted to an area and so on, but it is fairly small scale stuff, is it not? It does not change things in the dramatic way that sometimes regional development agencies like to change things. Are you aware outside the north east of any behaviour by regional development agencies that does positively stimulate and support markets?

  Mr Wright: Specifically in terms of retail led regeneration, particularly in town centres, it has been a key feature of the past decade. When regional development agencies have been involved in that, the relocation of markets has been an important consideration. Sometimes that has worked. One of the considerations of the Committee has been the siting, location and place of markets. That is absolutely crucial. In direct answer to your question, what I would suggest is that the relationship between regional development agencies and local authorities and the interchange and conflict between them is the right approach to take in terms of how markets and town centres fit in with the regional development agencies.

  Q311  Dr Pugh: The onus would be on the local authority to talk to the local traders and so on and then put the proposition to the regional development agency rather than expecting the regional development agency to adopt a hands on approach, dealing with each individual market trader in a market?

  Mr Wright: In terms of best practice, 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. In terms of trying to determine that vision, it is working in consultation and in conjunction with RDAs, with the Homes and Communities Agency and with other bodies to ensure that that vision can be realised.

  Q312  David Wright: Is that phrase "key element of strategy" going to be in the government's future strategic documents published by RDAs? It strikes me at the moment that we all think markets are great—a bit motherhood and apple pie—but nobody ever says it in a strategic document at a regional level. Nobody ever really talks about it at that level.

  Mr Wright: I think regional spatial strategies sometimes mention it but I would certainly mention PPS6 again and that key paragraph—paragraph 2.27 I think it is—where local authorities have a role to play in retaining and enhancing markets as part of their town centre offer. I think that is absolutely crucial. I personally think that is very strong wording for a planning policy statement that is welcome and to be encouraged and local authorities need to act upon that.

  Q313  Chair: David has said that it is all motherhood and apple pie. Are we relying on individual local authorities to realise that their market is an asset, not something they are just lumbered with? Is the Government's role simply to facilitate it or should the Government be a bit more directive?

  Mr Wright: I think that is a fundamental policy issue, not just focusing on markets and town centres. You have talked about public lavatories in a similar way. I am very conscious as a Minister within Communities and Local Government that we are trying to have a policy of devolving power and responsibility down to local level. Ann Coffey, in her evidence to you, said that central government does not have a role to compel or dictate with regard to that. I think that is the right approach to take. We can facilitate. We can provide strong, robust planning and policy frameworks. We can provide guidance. We can provide encouragement. We can provide funding to some extent through local authorities, through RDAs and through the Homes and Communities Agency but, in terms of where we sit, you must have a market. I do not think that is the role of central government. I think local authorities should determine what is necessary in their area to produce their vision.

  Q314  Sir Paul Beresford: Those who want a champion, a minister whose portfolio includes this, want somebody who can pull it together. You described a dog's breakfast of legislation in all the government departments. No one pulls it together and what markets are saying to us is that if a tiny corner of your role or BERR's role was that every time anything linked to the markets came across a desk it also came across that minister's desk and people in the local government and the markets had a problem with a new piece of legislation coming through, they could come to a minister who understands.

  Mr Wright: I would still reiterate that in terms of anything to do with planning or the relationship with local government, CLG is well placed to try and deal with that. Different departments bring different agendas for a whole variety of reasons and that is to be welcomed.

  Q315  Sir Paul Beresford: I have been a minister. I know that you can still have anything involving markets come across your desk and the markets that are having trouble with a particular department could come to you as a champion or somebody else.

  Mr Wright: I think there is certainly consideration to be given to the idea of some sort of champion within Whitehall. I think that is to be encouraged because, as I said, I can see that sitting within CLG. People will have different matters with regard to whether it should be BERR or not, but in terms of that wider sense of community with local government and that link in with urban policy I think there is a role to play in there. As I said, Chair, I am very interested in the Committee's conclusions with regard to this but I think we do have a strong and robust framework in Whitehall at the moment. Different departments bring different things with regard to their interests in markets.

  Q316  Anne Main: You have partly answered my question but stallholders are happily saying to us that the trouble is that it is almost a brief that nobody wants and it also just seems a money-collecting exercise, yet they, as small businesses, might contribute a lot to the community; they might contribute all sorts of social and other welfare benefits to a community in terms of cohesion and integration, but they have no-one that they can go to to access anything in terms of business advice, in terms of being involved in decision-making about how the business as a whole operates within their own city. I think it would be important if the Government actually made that conscious decision that they suddenly pull all those strands together, because the trouble with it falling to everybody's little patch means that everybody says it is not their responsibility and they push it to somewhere else. If I were a market stallholder where would I be expected to go? If I were a small business I would know where to go, but they are small businesses of a specific sort.

  Mr Wright: I would suggest the local authority needs to be in the driving seat here. Again, one of the things I have been struck by when reading the oral hearings for the inquiry is that good, positive, proactive management, both of markets and the wider town centres, means that markets can thrive.

  Q317  Anne Main: Are you aware that in local authorities the person with the responsibility for markets may well be having the responsibility for, say, parks and gardens, which I think was one of the ones we were told may well have town centre management, may well have a different brief entirely, may be the planning department. Because in government there is no central vision of this there is often not at a local level either. As Government surely you should set a lead with perhaps good guidance and good practice to local authorities and maybe even a bit of help with funding to perhaps ensure that there is training available for people who are going to manage markets. Do you believe there should be any expertise or expert help available to local authorities?

  Mr Wright: I would suggest that, with respect to good practice in terms of how you manage markets and the wider point about town centres, central government has provided guidance. We provided guidance in 2005. That was updated in 2007. We have provided a toolkit for local authorities.

  Q318  Anne Main: Specifically with markets in mind?

  Mr Wright: As I said, important though markets are in terms of the wider retail offer, I also think it is absolutely crucial that in order for markets to thrive they need to be seen in the wider context of town centre strategies and good, positive, proactive town centre management where there is an emphasis upon increased competition in terms of a good diversity of what is on offer in terms of that retail offer and in terms of other things like culture and recreation. I think that is very important and I do think that local authorities have a key role to play in that.

  Q319  Anne Main: Some towns see their market as a bit of a messy area that they would not mind if it withered on the vine and went. I am not saying that is very true in many areas, and in fact it is probably not true of how the public see it, but if you were perhaps to consider offering a lead in this and better guidance to local authorities, they might start taking markets seriously because, in terms of all the benefits you are talking about, how much of that do you say to local authorities? Do you actually say, "Deliver all these benefits", which is why markets suddenly start becoming a special case, because I do not think W H Smith, for example, sees itself as delivering all those other benefits that you have just outlined?

  Mr Wright: No, but, as I said, I do reiterate the point about that wider, proactive town centre strategy, and we have provided guidance. We provided a good practice toolkit in October 2008 with regard to that.

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