The Chancellor must not miss the opportunity presented by the Budget to help London’s beleaguered retail sector, writes Ros Morgan
Confirmation that the UK slipped into a recession towards the end of 2023 came as little surprise to most of us. While activity has started to return, there’s no escaping the fact that 2023 was a tough trading year for most.
Whilst we’ve seen spectacular new theatre productions and red-carpet premiers drawing crowds back to the West End, the stark reality is we are still recovering from the pandemic. Footfall remains lower than pre-pandemic levels and 2023 was 16 per cent slower than 2022.
The traditional strengths of this iconic part of the capital remain stoic, with our world-leading cultural institutions and international traders nestled amongst first class hospitality and retail. But stoicism can only get us so far. Now it’s time for government to invest in our national assets and set forward a coherent plan to address the seismic pressures facing the economy. Let’s hope Wednesday’s Budget does that before the election mayhem takes over everything for the rest of the year.
The single biggest opportunity to help the economy is through the reform of business rates. It beggars belief that such an enormous issue has been allowed to be kicked into the long grass for so long. Many of the world’s greatest minds have reported on why the UK’s business rates system is broken, and better still, how to fix it. And yet here we are, over three decades later, using the same maligned approach. Isn’t the definition of insanity doing the same thing repeatedly and expecting a different result? But, if it’s still too soon for this government, perhaps the next one will finally transform a centralised system into a responsive and fair one that rewards local economic growth.
Ironically, a previous Budget concluded it was time to fix a system that was never broken in the first place, by removing tax-free shopping for international visitors. Independent research by the Office for Budget Responsibility has since confirmed what we knew: that the Exchequer is losing billions in revenue as a consequence. A reinstatement would be a quick and easy win for the country, and we have actively campaigned for this to be put right this Budget.
London is a leading global destination for tourism, investment, education and trade, but the competition is tough so we can’t be complacent. HOLBA partners with London and Partners, who do an exceptional job of promoting London across the world. The quality and impact of the work is only the more impressive when you realise just how poorly their budget pales into comparison with that of our international competitors. Once again, the business cavalry steps up to financially support this critical work of national significance – because when the capital does well, so too does the nation. Perhaps, the Chancellor will remember this tomorrow.
On policing and enforcement, the safety, security and wellbeing of visitors to the capital must be of paramount importance. Over recent years, the West End has seen a worrying rise in thefts, shoplifting and violence. Many of these crimes are opportunistic and could be deterred by regular police and enforcement patrols, in conjunction with other tools and interventions. However, the statutory provision of these services continues to evaporate in step with eroding budgets. As such, businesses, who already pay the highest business rates in the country find themselves paying for private security teams to keep people safe across the West End. Whether this is seen as right or wrong is a moot point – because right now, the alternative is dire.
In addition to the unique challenge of policing in central London, there are challenges with delivering appropriate funding for the capital’s transport network, which is integral to economic success. It is vital that it receives appropriate investment to retain and enhance transport services, ensuring that they are affordable, reliable and accessible, and to respond to the environmental challenge.
There were over 10,000 rough sleepers on London’s streets in the 12 months to March 2023. Across England, London and the South-East accounts for almost half of the rise of rough sleepers in 2022, with the greatest number in the Westminster City Council area. We fund specialist outreach workers to help rough sleepers find the right support and a route of the streets into safety, but there are issues such as people smuggling and modern slavery, which are exacerbating the issue. The Kerslake Commission has said that the government will not meet its target of ending rough sleeping this year. The Chancellor should set out what he will do to mitigate this failure.
The Budget is an opportunity to support businesses and people in every part of the country, and further elevate London against its international peers. The Chancellor must ensure that it’s not a missed opportunity.