Why central London’s independent shops must be kept alive
April 29, 2016
Mark wrote the following piece for the Evening Standard on business rates and rents in London. The published article can be found here.
The fear that our Capital might one day become a clone city has long plagued the modern Londoner. Each time a bland or unsightly piece of architecture is proposed, a favourite independent shop or café closes down or a housing block is snapped up by non-resident owners, the cry goes out to defend London against the march of the generic. Londoners are fiercely protective of this city’s rich mix of buildings, culture, people, shops and food because it sets our Capital apart, making it one of the most wonderfully stimulating places on earth.
I am lucky enough to represent the constituency encapsulating the very heart of London. Yes, we have handy chain stores and eateries on Oxford Street and other key thoroughfares. But they are complemented by backstreets stuffed with quirky shops, concentrations of galleries and antique dealers, and specialist hubs stocking objects found nowhere else in the world. This fusion of the long-established and the up-and-coming makes for an independent retail and restaurant sector that combines the great traditions of London with a modernity that keeps the city fresh.
With London booming, however, a lazy assumption has grown up that these independent retailers have it far easier than those in other parts of the UK. For sure, their fate is not to struggle for survival on desolate provincial high streets, without the spending power of tourists and highly-paid residents to keep tills ringing. The Chancellor rightly acknowledged the needs of these latter kinds of enterprises by overhauling the business rates regime in the Budget. From 2017, a company occupying a property with a rateable value under £12 000 will pay zero business rates, with tapered relief given to those in the £12 000 to £15 000 bracket. By 2020, the inflation of rates will be calculated using CPI rather than RPI and councils will be able to set and retain the receipts of rates – a potential game-changer. This is all excellent news but unfortunately may not make much of an impact on businesses here in Central London where rateable values are so very high. Let me give a local example.
Cecil Court, just off Charing Cross Road, hosts the largest concentration of antiquarian book, map and print sellers in the West End. In trading such niche products, margins can be tight but the shopkeepers tend to be passionate enthusiasts and historians as much as traders, something I learned when helping them fight an ultimately unsuccessful campaign against business rate rises in 2009. At that time transitional rate relief had been removed alongside an almost doubling of business rates in London to fund decreases elsewhere. A lot of London’s independent booksellers have since gone under and the countrywide balance has tipped such that the Capital contributes nearly a third of the £24 billion raised in rates. This is placing a crushing burden on retailers in my Central London constituency.
The shopkeepers on Cecil Court are essentially excluded from the Chancellor’s assistance package as they occupy premises with rateable values over £12 000. One bookseller on the ancient alley told me that his rateable value is £21 250. Each metre of his bookshelves therefore effectively costs £300 per year – in rates alone! He is changing what he stocks, looking at more expensive items geared to the luxury market rather than the smaller, entry-level antique books that get new people interested in this esoteric, fascinating world. In many ways, however, the Cecil Courtiers are the luckier ones since they have in the Marquess of Salisbury a longstanding, sympathetic landlord who has kept rents low.
Other niche retailers in my constituency face the prospect of sky high rates and ballooning rents. Low availability of space on the main shopping streets has led to fashion retailers moving into areas where specialist shops have traditionally clustered, driving up rental costs. Westminster City Council has adopted specific planning policies to try to safeguard traditional businesses and is now in the final stages of creating new Special Policy Areas to help the tailors of Savile Row and the clusters of antique dealers and galleries in Mayfair and St James’s that complement nearby auction houses and public art institutions. Westminster rightly feels that these specialist hubs, in containing international leaders in their respective markets, are an integral part of London’s World City Status and create a vibrant, diverse economic base as well as an unparalleled concentration of skill, expertise and service.
It may seem sensible politics to get luxury, international retailers in London to subsidise struggling business in other parts of the country. But London’s independent retailers are in a fight for survival too. The Chancellor’s package to help businesses was a timely step forward, but London operates in a global context, not simply a national one – as with housing, taxation and transport policy, what works for the rest of the UK often has little impact here. We now need rate relief for London’s independent businesses commensurate with what is being proposed for the rest of the country. For bibliophiles, history wonks and London lovers alike, we must keep our specialist streets alive and get behind the Evening Standard’s Reform the Rates campaign.