High streets and town centres in 2030 Contents

Summary

The six months over which our inquiry took place appeared to be the most turbulent for the high street so far. Barely a week went by without headlines pronouncing the ‘death of the high street’ or a major retailer announcing a restructuring or a fall in profits.

An enormous change has taken place in retail in recent years. The traditional pattern of making purchases in physical stores, both in and out-of-town, has been profoundly disrupted by the growth of online shopping. The impact of this on our high streets and town centres in the form of store closures, persistently empty shops and declining footfall is clear for all to see.

Against this concerning backdrop, we make a set of recommendations to Government, local government, local communities, retailers and landlords to be acted on now. Unless this urgent action is taken, we fear that further deterioration, loss of visitors and dereliction may lead to some high streets and town centres disappearing altogether.

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An intervention leading to large-scale structural change

We believe that high streets and town centres can survive, and thrive, by 2030 if they adapt. Our vision is for activity-based community gathering places where retail is a smaller part of a wider range of uses and activities and where green space, leisure, arts and culture and health and social care services combine with housing to create a space based on social and community interactions.

But the Future High Streets Fund is only one part of the solution. Local intervention, while essential, needs to be accompanied by further action by central government and at local level, as well as by retailers and landlords, to create the conditions for high streets and town centres to flourish in the future.

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Central government action

High street retailers are paying more than their fair share of tax, while online retailers are not contributing enough: we heard that Amazon UK’s business rates amounted to approximately 0.7% of their UK turnover,1 while high street retailers are paying considerably more, with business rates as a proportion of turnover ranging from 1.5% to 6.5%. The Government has announced the introduction of a Digital Services Tax in April 2020 to address issues related to historic avoidance of corporation tax. However, this does not address the imbalance between online and high street retailers. The Government needs to go further and move faster to level the playing field between online and high street retailers.

Planning is crucial to high street and town centre transformation. Given this, the Government should ensure that planning powers are fit-for-purpose, sufficiently responsive and up-to-date and undertake a comprehensive review of planning as it pertains to the high street. In particular, we believe that permitted development rights (PDRs) risk undermining the strategic vision that a community has developed for its high street or town centre.

The Government has announced that the Future High Streets Fund will be accompanied by the creation of a Future High Streets Task Force, which the Minister described as a “national re-source” and “a central knowledge base”. The Task Force should be much more than a ‘talking shop’ and, in combination with the Fund, must provide real and tangible support directly to local areas. Among other things, we recommend that it should:

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Local action

We recommend that action is taken at local level to create visionary strategies for high streets and town centres which have the backing of the local community, to support local traders, to facilitate parking and to develop the role of place partnerships.

Retailers

With online shopping only set to grow in the future, we heard that, to compete and be successful, high street retail needs to carve out a separate role, focusing on providing “experience” and “convenience”.

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Landlords

Landlords are often the least visible stakeholders in high streets and town centres but are among the most important. We heard that disparate property ownership and lack of landlord engagement are key barriers to high street and town centre transformation and that high rents are affecting retailers’ profitability.

Conclusion

We firmly believe that our high streets and town centres can have a better and more balanced future ahead of them if our recommendation are followed. This will require a shift from the retail focused activities of high streets and town centres today to new uses and purposes which foster greater social interaction, community spirit and local identity and characteristics. With a properly planned strategic intervention led by the local authority, with the backing of local stakeholders and the wider community, we can redefine our high streets and town centres and ensure their long-term sustainability for future generations to come.


1 This is an approximate figure based on the 2017 total revenue figure and 2018 business rates figure given to us by Amazon UK.




Published: 21 February 2019