Business and consumers are looking to the Chancellor’s upcoming Budget for action to support consumer spending and help encourage private sector investment.
In a submission entitled Helping Shoppers Budget, sent to the Chancellor last week, the British Retail Consortium (BRC) proposes a series of targeted measures to support the retail industry in maximising its future contribution to the UK’s success and playing its part in supporting the country through a period of profound change and uncertainty.
Retail is one of the world’s most innovative industries, the UK’s largest private sector employer and an industry which is finding efficiencies at a faster rate than many others – which in Government speak means it’s outpacing average productivity growth in the UK. It is also an industry undergoing profound structural change, being driven by the ever increasing demands of customers and the technology revolution.
The BRC points to the risk of an opportunity missed. A backdrop of rising labour and property costs is altering the attractiveness of investment options, as the cost of technology falls and digital capability improves. This has profound implications for much needed investments in local communities, new and refurbished shops, and of course jobs.The implications of this are that it’s the most vulnerable communities that will suffer the negative consequences most acutely.
Specifically, the BRC is recommending that the UK Government:
Freezes the business rates multiplier in April 2018 which otherwise will increase the bill of every rate payer in the country and simultaneously divert £270m of retail investment from delivering for consumers and away from local investment.
Keeps the cost of living down for consumers by not increasing income tax rates for the majority of taxpayers and considers accelerating increases in the personal allowance if the squeeze on consumers persists.
Gives itself the best chance of ensuring its flagship apprenticeship policy is successful by providing additional flexibility in how apprenticeship levy funds can be spent.
Works in partnership with retail to enhance the basic digital literacy skills of the large parts of the workforce being left behind by the technology revolution and to increase the amount of UK manufacturing of textiles and clothing.
Ensures business does not face double regulatory charges or new financial burdens from the Withdrawal Bill and makes the necessary investment in infrastructure at ports and border control points to ensure an orderly exit from the EU.
Helen Dickinson OBE, Chief Executive of the BRC said:
“At a time of uncertainty for both the economy and the country, it’s important we set ourselves up for success.
“The cumulative burden of Government imposed costs has become acute. Indeed, September’s inflation figures mean retailers are faced with a £270 million leap in their business rate tax bills alone next Spring. With retailers’ margins being squeezed to their limit, this is money that could be better spent investing in keeping prices low for consumers, in local communities up and down the country and in developing a workforce which is fit for the future.
“Without the Chancellor’s intervention, the consequences for town centres and jobs will be even more keenly felt in the most vulnerable communities. For consumers, the squeeze on household incomes will be compounded as the pound in their pocket buys them even less at the checkout.
“Retailers want to help build the confidence of their customers, us all as shoppers, not damage it. But to do this they need the support of Government policy that keeps down the cost of living, not exacerbates it. That encourages, rather than deters the retail investment necessary to meet constantly evolving customer expectations. And finally, policy action that enables retailers to maximise their vital contribution to the Government’s productivity aspirations.”