Matt Vickers: Conservatives must lead the way on revitalising our high streets

10 Aug

Matt Vickers is Conservative MP for Stockton South and Chair of the APPG on the Future of Retail

While Westminster has been firmly focused on the race to decide our next prime minister, many Conservative MPs – including myself – have been busy working hard in our constituencies. It is here that we get to hear what really matters to voters in the communities in which they live. Time and time again, people bring up the same thing: their local high street.

It is no secret that our high streets are struggling. We have seen the growth of out-of-town retail and online shopping, while the Covid-19 pandemic and the cost-of-living crisis have only made matters worse. In all parts of the UK, shuttered shops are a feature of our high streets. Data from the Local Data Company shows one in 20 high street units have sat empty for more than 3 years. This is particularly acute in the places where voters put their trust in the Conservatives in 2019 and that we need to win at the next election. My neck of the woods, the North East, is the region with the highest percentage of persistently vacant high streets properties in Britain.

High streets are central to people’s pride in place; that is why revitalising our high streets is a vital piece of the levelling up puzzle. When people think about levelling up they think about their local area, in particular their high street – 69 per cent of people worry about the decline of their high street and the effect on civic pride. We cannot, as a party and as a country, sit back and let this continue.

On a recent trip to Dumfries in Scotland, I saw part of the solution. I visited the brilliant Midsteeple Quarter along with business and community leaders and the local council, to look at how community ownership of assets can breathe new life into the high street. The benefits were clear walking through the town centre. Looking to my right I saw the sad sight of a now empty Burtons store, dating back to 1934. To my left, stood the vibrant fronts of the community-owned spaces that Midsteeple Quarter has taken control of to revitalise the high street.

We met in a meeting room above a bustling arts and crafts shop and spent some time in an impressive food photography studio – all in the same building owned by the local community. Clearly this isn’t about the death of retail – the mixed-use space where we held our meeting serves as a perfect example of how community-owned assets serve as ‘destination spaces’ that can drive footfall to other local businesses and boost retail.

These community-owned spaces also contribute more to the local economy, with 56p of every £1 they spend staying local, compared to just 40p for large private sector firms. Community-owned spaces can support new or emerging forms of economic activity, such as hybrid commercial and social business.

I was glad to see the government take some important steps to address high street decline in the Levelling Up and Regeneration Bill, which plans to introduce high street rental auctions for buildings that are vacant for longer than 12 months. But there is room for Conservatives to go further to demonstrate a commitment to revitalising our high streets and delivering on levelling up. One way we could do this is by establishing a High Street Buyout Fund that can compete with distant owners with little interest in the place, to purchase high street buildings on behalf of local communities and give them time to raise the capital to purchase it themselves.

Revitalising our high streets should be top of the pile on the list of issues that our next prime minister must deliver on, whoever they may be. Boosting community ownership on the high street is an innovative and cost-effective way of doing that. The public put their faith in us to level up, now is the time for us to deliver. We may not be forgiven if we do not.

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James Frayne: Will levelling-up survive Johnson’s exist?

2 Aug
James Frayne is Director of Public First and author of Meet the People, a guide to moving public opinion.

Will “levelling-up” survive Boris Johnson’s exit? While both Liz Truss and Rishi Sunak have pledged support for levelling-up, neither candidate has prioritised it in this contest. This might simply reflect the obvious reality of this election: the need to announce right-leaning policies for right-leaning voters. But it’s hard not to sense levelling-up will be gently de-prioritised regardless of who wins.

Three big reasons stand out.

Firstly, most importantly, because cost-of-living is now the dominant issue nationally. That is particularly the case amongst working-class voters in levelling-up areas. As I have written before, anger is growing at the Government’s perceived failure (unwillingness, even) to reduce costs. In this context, the new Prime Minister might conclude levelling-up has been overtaken by economic events and simply preventing working-class families drowning is all that matters; levelling-up could seem like an irrelevance or a luxury.

If anything, this might be underplaying the scale of the problem. For cost-of-living won’t be the only massive issue the new PM deals with. They will also wrestle with ongoing war in Ukraine, the prospect of serious energy shortages, more strikes, and continued backlogs in NHS care. It might be levelling-up is allowed to get washed away in the mess of Government. Only a PM truly committed to the project – obsessed about it, even – would make progress on it.

Secondly, because favourite Liz Truss is known to be much more committed to classical-liberal economics. While she has given in principle support for major new investment in rail links for the North of England (the Northern Powerhouse Rail), her levelling-up policies lean towards pure free market economics elsewhere: she has effectively indicated she’ll cut the pay of provincial civil servants by introducing regional pay boards; and her commitment to levelling-up in a recent debate came in the form of prioritising low-tax zones and better education. In short, it feels like levelling-up is more likely to derive from national policies that will “raise all boats”.

There’s certainly a prospective levelling-up strategy grounded in free-market economics (by far the best advocate of this is Ben Houchen). But this would unquestionably take levelling-up away from its current focus on improving the daily lives of people in less affluent areas through incremental but meaningful change.

To many of those working on levelling-up at the Department and in Number 10, there was a belief in using the policy to re-build high streets, reduce anti-social behaviour in town centres and on estates, help small businesses, and more. This requires Government intervention in a way that seems unlikely to follow if Truss wins. In other words, the only thing the Truss approach to levelling-up and Boris Johnson’s approach will have in common is the name.

Thirdly, because I believe Truss doesn’t have the same instinctive understanding of working-class voters as Johnson had – and indeed as those that campaigned for Leave developed. Johnson came to understand working-class voters and their values and attitudes on the campaign trail in 2016 – and his ability to move them propelled him into Downing Street with a massive majority. I confess I’m not sure about this, but Truss doesn’t seem to share this basic, fundamental understanding. She may gain this of course.

There’s an additional factor that might see levelling-up de-prioritised: so few Northern and Midlands businesses have joined in the debate. Whilst some have campaigned for more action to be taken, not enough people in government have heard that levelling-up is a priority from businesses in the areas it is designed to help. Truss might reasonably conclude that there are other areas she ought to focus on (corporation tax, “red tape”, and so on).

We will find out very quickly whether levelling-up remains a priority. If it is a priority, Truss or Sunak will re-appoint Michael Gove and Neil O’Brien to the department – or appoint two politicians of similar ability and standing (with those two hopefully given big, reforming jobs elsewhere). If it is a priority, the new PM will give a speech in the Midlands or North very early on giving their firm commitment to the project – putting their own stamp on it.

Levelling-up can only work if the Prime Minister takes it so seriously they’re prepared to see most policy areas – or at least a good number of them – through the prism of it. For example, thinking about boosting high streets when they think about economic policy, or thinking about anti-social behaviour in town centres when they think about crime, or thinking about protecting old historic buildings in our towns and cities when they think about planning. I doubt this will be the case.

 

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Neil O’Brien: How a new Bill will crack down on the car parking cowboys

7 Feb

Neil O’Brien is Chairman of the Conservative Party’s Policy Board, and is MP for Harborough.

The first thing you know you get an official-looking letter in the post. It says you owe a lot of money for a parking fine, though you never got a ticket. It threatens your that if you don’t pay up right now, you are going to get tangled up in a whole bunch of escalating legal trouble.

Ultimately it implies that the boys are going to come round if you don’t cough up.

You want to protest. Perhaps they just made an error and got your registration number wrong. Or you had paid and they made a mistake. Or the machine was out of order so you couldn’t pay.

Maybe there was no obvious sign that you couldn’t park there, or that you’d be charged for doing so.

Although you want to complain, even finding out how you can do that turns out to be a total maze, and you can only appeal to one of a number of bodies run by the parking industry themselves.

At that point a lot of people will give up and cough up, to avoid the hassle, even though they know they’ve been unfairly treated. Sadly, it’s a story that is familiar to millions of people.

Now, most people who run parking firms do the right thing, but there are too many cowboys and rogue operators out there – firms that make money not from the fair business of collecting normal parking charges, but from handing out tickets and then gouging people for additional costs.

And that’s not just unfair, but bad for our economy.

Helping our local high streets and town centres roar back into life after COVID means encouraging more people to shop local and support local businesses.

Yet, poll after poll – both before and during the pandemic – shows that a lack of cheap, easy parking is one of the greatest barriers to people visiting their local high street. Fear of being stung for parking ticket further puts people off driving into town.

And that fear is not entirely unfounded. Private firms issue roughly 22,000 parking tickets every day, often adopting a labyrinthine system of misleading and confusing signage, opaque appeals services, aggressive debt collection, and unreasonable fees designed to extort money from motorists.

Apart from their inherent unfairness, these practices damage our high-streets, our towns and our city centres.

So we’re determined to bring them to an end. That is why we threw our full support behind the Parking (Code of Practice) Act 2019 introduced by Sir Greg Knight, and backed by many Conservative MPs.

It set out a clear vision for the regulatory system with the interests of safe motorists at its heart.

The publication of the Private Parking Code of Practice today is a big step towards translating that bold vision into reality. It provides for clear and fair rules, and fair treatment.

First for clear signage, and clear surface markings, so that people don’t get stung because they didn’t even know the rules. It’s not good enough to have some tiny little rusty sign tucked away somewhere no one can see.

Second, for compulsory grace periods so that people parking to pick up a pint of milk from the corner shop can no longer be hit with a whacking great fine just for running a couple of minutes late.

Third, lower fines, down by about 50 per cent, and aligned with the system already used by local authorities. Fourth, an end to firms heaping unfair additional “collection charges” on top of the fines.

Fifth, the code also bans the use of aggressive and pseudo-legal language that we’ve all seen on those yellow parking slips doctored to look like official Penalty Charge Notices.

Loads of MPs have come to me with examples of constituents who feel bullied, intimidated and unfairly treated by cowboys. So finally, this new Code also allows drivers to challenge unfair fines through a new independent appeals service.

There will be no wriggle-room for rogue companies who continue to flout the rules. If they fail to follow this Code, they will effectively be banned from issuing parking charges indefinitely.

I’m confident that these measures will make it much simpler for people to park near their local shops and services without being unfairly fined. In doing so, it will deliver a shot in the arm for our high street businesses throughout our town and city centres, helping them to bounce back from the COVID pandemic stronger than ever before.

But it also restores basic fairness and common sense, and will reduce worry, hassle and unfair costs for millions of people.

James Frayne: Gove vs Nandy. Why civic pride will be at the centre of the battle for ownership of ‘levelling up’

7 Dec

James Frayne is Director of Public First and author of Meet the People, a guide to moving public opinion.

Lisa Nandy’s appointment to shadow levelling-up secretary suggests levelling-up will be one of the defining domestic policy battles of this Parliament.

Labour rightly views this policy area as a way back into relevance for the working-class voters they’ve lost over the last decade. If they can’t make progress with this group of voters, there’s no prospect of a majority.

In my last column, I looked at what all voters think about levelling-up; here I focus on the attitudes of working-class leavers who voted Conservative in 2019 – people who Nandy and Labour need to speak to urgently.

(For reference, the tables for the landscape poll I did on levelling-up are available here and the relevant cross-break for working-class, leave-voting Conservatives is on the right of every third page, marked “C2DE Leave Con”.)

They’re much more down about their local towns. Because civic pride is such an issue for these working-class voters, so in turn is the huge despondency at the state of their towns. This is one of the defining aspects of their political outlook.

While much more likely to say they personally define by the town they’re from than the national average, asked whether their town was a better or worse place to live than a decade ago, 44 per cent of working-class Conservatives say worse, compared to the national
average of 33 per cent – and compared to 28 per cent of AB professional voters.

Just 11 per cent of working-class Conservatives say their town is better. As for other voter groups, rising crime and anti-social behaviour is the main reason they say things have got worse. The Government has recently picked up on the importance of crime to the levelling-up agenda, thankfully.

The high street is an even bigger factor for working class Conservatives. While the decline of the high street is a big deal for most people, it’s a massive issue for these
working-class voters. By 65 per cent to eight per cent, they say their high street has got worse, compared to the national average of 50 per cent to 22 per cent.

They’re clearly not thinking narrowly about their shopping experience; when asked how their high street has got worse, many groups of voters say it’s the decline of small, independent shops; however, working class leavers say it’s the number of boarded-up shops, which is different. The point is the decline of the high street is aesthetic and cultural, rather than simply commercial. It comes right back to civic pride: bustling high streets reflect a town that is happy, prosperous and thriving.

With this in mind, given a list of general options the Government might take to level-up the country, working-class Conservatives are much more likely to say the Government should focus on the high street than other voters (although they too put the high street below retraining and encouraging business investment). And given a list of options to help the high street, the most popular for this group is cutting business rates.

They love apprenticeships and retraining. While apprenticeships are popular nationally, these working-class leavers are particularly keen. Given a list of options to improve local universities and training, working-class Conservatives put apprenticeships top by some distance – 17 points higher than the next option of funding work placements for young people.

Given a general list of options the Government might take to level-up the country, they put retraining top (in line with the national average). In any focus groups on levelling-up, these working-class voters invariably talk about the high street first; but just behind the high street come comments about the decline of the major industries their towns were built on – steel, cars, potteries, clothing – and the apprenticeships they provided for local people.

They talk about apprenticeships partly through the prism of the economy of their town, but also, again, through the prism of civic pride: having major employers who provided skilled jobs that people could be proud of was part of their identity (something David Skelton has previously written about).

They’re even more defensive of statues. Given a list of options on the future of statues and monuments in their local towns, 47 per cent of all voters across Britain think we should keep them all up, 33 per cent believe we should have plaques which explain historical context and nine per cent think we should actively remove those that commemorate people or events we now consider immoral.

On the Tory side, 69 per cent of working-class Conservatives think they should all be kept up and 21 per cent believe in what amounts to retain and explain; just one per cent
said they should be actively removed.

What is the relevance of this question to levelling-up? While this poll didn’t go into it, in my experience, the aesthetics of statues and monuments is often under-appreciated; in many towns, statues and monuments are seen to dramatically improve the “streetscape”.

(An interesting aside: just five years ago, the Newcastle Chronicle reported that the city’s Boer War memorial was set to be restored “to its former glory” without even a passing reference to imperial controversies which have been raging in the local and national media in recent months. This reflects a simple point: very often, statues
and monuments provide a backdrop to everyday life and have no relevance either politically or culturally for most people.)

They share the general lack of confidence in levelling-up. By 47 per cent to 21 per cent, working-class Conservatives lack confidence the Government will succeed in
levelling-up the country in the next decade. This is basically in line with the national average (48 per cent to 23 per cent).

What does this mean for the battle between Labour and the Conservatives on levelling-up amongst these voters?

While there are places where the Conservatives have a natural advantage on levelling-up – crime, most obviously, and certain aspects of culture – on most issues, Labour are perfectly competitive. There’s no reason they can’t come up with innovative new policies on the high street and apprenticeships, for example.

While it’s a double-edged sword, in that working-class voters have felt Labour have taken them for granted, it helps that Labour have been in power in many working-class towns across the country: activists and candidates know these towns inside out, which isn’t always true of their Conservative counterparts.Gove v Nandy will be a great battle to watch for the rest of this Parliament.

Harry Fone: Social distancing rules have pushed up the cost of council meetings

29 Jun

Harry Fone is the Grassroots Campaign Manager for the TaxPayers’ Alliance.

In recent weeks I’ve received a lot of correspondence from concerned taxpayers and councillors about the costs of holding covid compliant council meetings. During the pandemic, temporary legislation allowed local authorities to hold hybrid meetings – a mix of virtual and in-person meetings – in order for local government to function effectively.

Since May 7th, councils, by law, must hold meetings in person, despite the fact that social distancing guidelines are still in place. Many authorities lack the floor space to facilitate this and have effectively been forced to hire venues that do, at significant cost to the taxpayer.

Bournemouth, Christchurch and Poole council shelled out £6,000 to hold a recent meeting at a local exhibition venue. So too Sefton, Sheffield and Manchester, costing taxpayers £3,000, £10,000 and £7,000 respectively. Similarly, Portsmouth City Council bought £5,000 worth of AV equipment in order for its meeting to go ahead. Across England’s 330 plus councils, it’s very possible that the total bill to ensure meetings are covid compliant could be in excess of £1 million.

With many in the private sector adopting the financial and environmental benefits of video conferencing technology, it’s a massive shame that the temporary legislation couldn’t have been extended until social distancing restrictions are lifted. Councils aren’t to blame for this and many local leaders have called for hybrid meetings to continue. It’s not hard to see why – time and money could have been better utilised on frontline services.

A warm welcome?

Back in March, the government announced the Welcome Back Fund (WBF) “to help boost the look and feel of high streets and seaside towns”. £56 million has been allocated to local authorities in England to invest in everything from seating areas to parks.

I’m not a huge fan of the WBF. Yes, I want my town centre to look nice but there really isn’t a magic money tree. Given the devastating effects of covid we have to focus public cash on real priorities like adult social care and children’s services. Is this fund really a priority at a time like this? Put it another way, if you were struggling to pay your mortgage every month you wouldn’t splash out on fripperies would you?

Sheffield City Council was allocated some £520,216 from the fund and I have to question whether they’ve made the best decisions when it comes to spending taxpayers’ cash. The council has tendered two contracts, one to appoint a “media and PR agency” and the other a “creative agency” to promote the objectives of the WBF. The total value of these contracts is £135,000 – 26 per cent of allocated funding.

It begs the question, will taxpayers’ actually see any value from this? It seems quite ridiculous to me that such a large chunk of their budget will be splurged on ad men. Does the council really need two agencies to achieve its goals? Why not ask the public directly (for little to no cost) what they want by getting them to email their suggestions. Or why not go to businesses directly in the town centre and get their opinions?

Promising news from Croydon

At long last there’s a glimmer of hope for Croydon Council following the latest report from its Improvement and Assurance Panel. You may recall that the council ploughed £214 million into a housing company called Brick-by-Brick (BBB) which at last count had only built a handful of the homes it promised. This coupled with other serious failings led to Croydon Council declaring bankruptcy.

A brighter future is on the horizon though. The decision has been taken to continue with housing construction on some BBB sites but with the overarching goal to extract the company from all activities by October of this year. Additionally, a property developer is seeking to buy up BBB and a deal will hopefully be struck next month.

There are opportunities for further savings to be made too. The council has 313 external contracts worth around £200 million that are up for renewal this year. The Improvement and Assurance Panel described the council’s arrangements for ensuring that contracts deliver value as “poor.” So one would hope that in future negotiations they can both negotiate better deals and ensure that suppliers better fulfil their contractual obligations.

Croydon Council is by no means out of the woods. It’s only thanks to capital injections totalling £120 million from central government that there is a balanced budget this year. In all likelihood, residents will be paying for the council’s mistakes in the form of even higher council tax bills. Let’s hope Croydon residents get good value for money in future, especially since the newly appointed chief executive will be paid £192,000 a year.

Ryan Bourne: The tax hikes that could fall in the south. And tear the Tory coalition apart

22 Jun

Ryan Bourne is Chair in Public Understanding of Economics at the Cato Institute.

Who’s going to pay for all this? Andrew Neil’s GB News interview of Rishi Sunak has changed the fiscal conversation. The Chancellor deflected the question by saying he couldn’t discuss tax policy outside of Parliamentary “fiscal events.” Convenient. But many commentators are “rolling the pitch” for higher taxes to fund all this higher government spending already – often devoid of context of today’s true burden.

Much debate starts with the ahistorical view that the UK is a “low tax” economy. Yet revenues from taxes are already forecast to exceed 34 percent of GDP every year from 2023/24 onwards—a threshold not breached in consecutive years since Hugh Gaitskell and Rab Butler were Chancellors in the early 1950s. The world wars don’t bode well for the longer-term legacy of an acute borrowing shock either. Ten years’ after World War One, the tax burden was 12.5 per cent of GDP higher than pre-war; ten years’ after WW2, it was 11.4 percent higher again.

The pandemic is shorter and less destructive than mass mobilisation wars. We also don’t need a second welfare state. But we do have an aging population and slower growth. With those pressures, any government unwilling to reform age-related entitlements and committed to major new state investments will need revenues eventually.

Internationally, many Western European countries tax their populations more heavily than us. The UK was just below the OECD average as a share of GDP in 2019. But UK taxes are already higher than in English-speaking developed economies: Australia, New Zealand, Ireland and the United States. The rises that Sunak has pre-announced would take us close to the levels of pre-pandemic Spain and Poland. Go a bit further, and we will have gone Germanic.

That, sadly, appears where we are headed. ConHome’s Editor explained yesterday that  “levelling up” need not mean just more tax-and-spend, but might be centred on the supply-side. He should tell CCHQ. The “levelling up” member survey recently used that banner to ask for views on more NHS spending, the “lifetime skills guarantee,” catch-up schools funding, infrastructure investment, the Towns Fund, and money for high-street regeneration. The direction of travel is clear: levelling up means more redistribution—hence why a strange coalition of fiscal conservatives and certain level-uppers want to whack up taxes on the old Tory base to shower the new.

This is where the politics of tax becomes interesting though. For the “progressives of all the parties” have talked so far as if “someone else will pay” for any largesse. Polly Toynbee says that UK voters want a Scandivanian welfare state with US-style tax rates. But it’s the redistributionists that are selling the Red Wall something for nothing. How about “asking for more” from the top one per cent, big tech companies, wealthy homeowners, tax-avoiding multinationals or other bogeymen, they say? Ordinary hard-working families will be spared for all the goodies.

As a new Institute for Fiscal Studies tax tool shows, however, the difference between the UK and the big governments of Western Europe is not lower taxes on the rich. No, broad-based social security contributions are higher in Europe. The evidence there suggests a more generous welfare state or higher permanent spatial redistribution requires tax rises “larger for the median worker than for one near the top of the distribution”. Good luck selling to your new blue-collar voters.

And so, thus far, an unwillingness for broader hikes, coupled with an uncertainty about the wisdom of burning the old base, has meant that the “tax debate” has been all smoke and mirrors. Efforts to raise revenues have been stealthy. The headline Corporation Tax rate is being raised again, with Sunak stating that it was “fair and necessary to ask businesses to contribute.” Of course, research shows the ultimate burden of profit taxes falls on workers, as well as shareholders – not the message the Chancellor would be keen to promote.

Income tax thresholds have similarly been frozen until 2026, and the 45p rate threshold has been kept at £150,000 since 2010. This will slowly lure more and more upper middle income families into higher tax nets. The problem is that spiralling spending demands quickly use up the options which voters don’t notice. Eventually you need other big sources of revenue, and that’s when the discussion usually re-centres on taxing savings income or pensions more heavily, or indeed hiking property taxes—despite the fact that the UK has the highest overall property tax burden in the OECD already.

Let’s leave aside the economics here. What do these policies all have in common? Well, the highest earners, the more expensive properties, and those with the highest savings are more likely to reside in the South East. The only Conservatives making the running on the “who is going to pay for it?” question so far, then, are those level-uppers who want to whack the South East to keep the goodies for the north flowing.

Yet not all are convinced. This is a growing Conservative faultline among MPs and the party’s voters. The Brexit coalition incorporated relatively affluent home counties’ areas and a working class elderly base nationwide. For some Westminster types, it simply makes sense to deliver for the new voters by squeezing the south.

Others, though, think the older working class Northerners don’t want Labour-lite, and that the best way to deliver for both would be targeted hawkishness on spending. For what it’s worth, Dominic Cummings told me: “the gvt wastes so much I’d rather save and not put up taxes.” He usually understands what these voters truly want, but would Johnson’s government slay any meaningful spending projects without him?

Tax policy, I suspect, will really test this Tory coalition. Hot housing markets in the South East have widened regional wealth inequality in the past 15 years, but after-housing-cost incomes have risen slower in London as people rent or service large mortgages. So many people feel squeezed, even before new tax bills come in. And massive geographic redistribution occurs already: London and the South East generate large public sector surpluses—averaging net public surpluses of £4,350 and £2,380 per person.

Now I’m not going to go all Mary Riddell and suggest last week’s by-election result already reflected a middle-class tax revolt. But if the mood music is for higher and higher spending in the North, and the conversation about paying for it focuses on raising property taxes, raiding pension pots, taxing savings, alongside stealthy income tax squeezes for the middle-classes, would it be surprising if voters in traditional Tory heartlands reassessed their allegiances? In a world of ever-rising spending and an unwillingness for broadening tax bases, there’s only so long the Chancellor can obfuscate on who will really pay.

Sarah Ingham: Tech, tax – and out of this world wealth

12 Jun

Sarah Ingham is a writer and a Conservative Party member.

It’s been a good week for Chancellor of the Exchequer and a so-so seven days for the richest man on the planet, Jeff Bezos.

The agreement between G7 Finance Ministers to introduce a global minimum tax rate of 15 per cent on businesses was hailed as historic by Rishi Sunak. This should lead to “the largest multinational tech giants paying their fair share of tax in the UK”.

“About time too!” cries Britain, nodding in approval at this “seismic tax reform” – ©No 11 Downing Street.

The full consequences of the tech revolution we have been living through for the past two decades or so are, as yet, unknown. Dot dot dot com. The most tangible IRL effect can be seen in the nation’s high streets which have been hollowed out by the switch to online shopping and services such as banking.

In 2006 – tech world’s pre-iPhone Pleistocene epoch – online sales accounted for 2.8 per cent of total retail sales in Britain, according to the Office for National Statistics. By June 2019, this had risen to 18.3 per cent. In January this year, a whopping 36.3 per cent of all retail sales were online. Lockdown, the government’s chosen response to Covid-19, accelerated an existing trend.

In March, USDAW highlighted that many retailers and their employees were at ‘breaking point’, with 180,000 jobs lost and 16,000 store closures in 2020. Famous names went into administration, including Laura Ashley and Jaeger. While Debenhams and the Arcadia Group, which includes Topshop, live to fight another day as brands, the rescue package for both did not include the bricks-and-mortar stores, resulting in 25,000 job losses, 80 per cent of them women employees.

Months before the Covid virus decimated the travel industry, Thomas Cook collapsed, stranding 150,000 holidaymakers abroad. Founded in 1841, the travel agency toppled under the weight of old-fashioned debt as much as innovations in the sector. The firm’s slogan ‘Don’t just book it, Thomas Cook it’ became as redundant as its 560 town centre stores, because millions of us chose to cut out the middleman and book a trip ourselves. A few clicks on a smart device secured us a budget airline ticket to fly us to our Airbnb.

How concerned have we been about the advance of e-commerce? Online shopping can be seen a quicker, easier, twenty-first century version of mail order catalogues, which have been a huge social benefit ever since the mid nineteenth century.

‘Don’t Be Evil’ has now been removed from Google’s code of conduct. Turning Britain’s social fabric inside-out is not exactly evil, but has been far from an unalloyed public benefit. It is, however, too easy to blame the tech giants, rather than examining our own code of conduct as individual consumers: ‘Alexa, save my local bookshop.’ Communities are not built or sustained by us sitting on our backsides watching a movie on Netflix while we tuck into a Deliveroo.

‘As public finances are ever more strained due to Covid-19, the public’s tolerance for tax avoidance by multinational companies is nil,” declares the Organisation for Economic Cooperation and Development, in its Secretary-General Tax Report to G20 Finance Ministers and Central Bank Governors. Really? Tax evasion is illegal and tests public tolerance. Tax avoidance is about exploiting the loopholes caused by an unnecessarily complex taxation system overseen by finance ministers and central bank governors.

The OECD worked on the proposals to rewrite the global tax rules which are being advanced by Sunak and his G7 colleagues. In the days since the announcement confusion has arisen, not least about whether any changes will be agreed by the G20 and if Britain is seeking to get financial services excluded from the reforms.

Alexa, is the UK’s Digital Services Tax going to be scrapped in exchange for the global tech tax? Effective from April 2020, HMRC predicted it would raise £515 million by 2024/25. It seems that tech firms might actually pay less into the UK’s coffers if the reforms were adopted and digital sales tax abolished.

The tech titans themselves seemed none-too-bothered by this possible new assault on their finances. Apart from Netflix, the other four FAANGs – Facebook, Amazon, Apple and Google – have seen their share prices rise in the past week.

Just as possible changes to the international tax system have come onto the agenda, details of US billionaires’ tax returns have mysteriously found their way into the public domain. Tada!

Warren Buffett is among the Croesus-rich outed by investigative journalists at ProPublica as paying little or nothing in the way of income tax. Perhaps the OECD’s Tax Inspectors Without Borders team can explain to breathless hacks the difference between income and capital.

Amazon’s founder, Jeff Bezos, whose personal wealth has ping-ponged around the $200 billion mark since last August, apparently paid no income tax during 2007 and 2011, while Tesla’s Elon Musk, vying with Bezos for pole position in the global wealth stakes, paid none in 2018. Neither has done anything illegal. The public was probably far less tolerant of Amazon withholding tips to its delivery drivers, for which it was fined $62 million in February.

Perhaps their stratospheric wealth explains Bezos and Musk’s fascination with space exploration. It would be easy to write off the attitude of both as ‘only little earthlings pay taxes’, but the current taxation system, bound up as it is with national sovereignty, allows them to get away with it. If we had the money, and the money to afford the accountants, we’d probably all be into ‘tax planning’, which is fancy pants for haggling with HMRC.

Time for flat taxes, Chancellor. And, BTW, voters have a tolerance for keeping their own money rather than handing it over in taxes – even to you.

Rachel Wolf: Tests for the delivery of levelling up, and levers with which to deliver it

10 May

Rachel Wolf is a partner in Public First. She had co-charge of the 2019 Conservative Manifesto. She was an education and innovation adviser at Number 10 during David Cameron’s premiership and was founding director of the New Schools Network.

The Conservatives have won more stunning victories. Why?

First, the approach that drove the 2019 victory continues to deliver.  Second, vaccines and furlough have rewarded sitting governments: they have demonstrated competence, agility, and a willingness to spend.

The next great test won’t come for a while. Boris Johnson is Merrie England: he is the perfect leader for our summer of freedom. The economy will temporarily boom. Furlough won’t be withdrawn until September. Provided it stops raining, everyone should feel good.

But the Government will be acutely conscious that the next six months is also the last window for policies that can deliver by 2024. They will also know that, by Christmas, any lingering effects of what my partner and ConservativeHome columnist James calls ‘furlough morphine’ will have worn off. Some economic scarring is likely.

In other words, ‘levelling up’ now needs to get real. This is clearly the plan in the next few months, starting with the Queen’s Speech tomorrow, and then leading to the Levelling Up paper.

Truth be told, levelling up is a poor slogan. It has never done very well in our focus groups – people find it confusing and then, when it’s explained to them, mildly irritating. They don’t think they’re ‘levelled down’, they think they’re ignored. Equally, they find the idea that in four years they’re suddenly going to become London and the South East bizarre – it’s not what they want, and they don’t think it’s credible.

But the danger of ‘levelling up’ is not that it confuses voters, but that it confuses policy. Too many seem to equate it with transforming regional productivity, affecting every town in provincial England and Wales, within a Parliament. Obviously if that’s what voters wanted, they would be disappointed.

Of course regional productivity and innovation are vital, and longer term work should begin. But there are also shorter-term gains. Here are some important ones, some obvious levers, and ways to measure progress.

The high street test.

People care deeply about where they live. They ‘measure’ decline by their town or city centre. Here’s what you hear time and time again: shops boarded up; graffiti on the cenotaph; drug addicts; no monthly market; no decent playground.

In other words, it’s depressing to be in, feels mildly unsafe, and there’s nothing to do.

  • Levers: Business rates; soft infrastructure (local museums, libraries, playgrounds); events including markets and protecting green spaces; incentives for lower margin, often civic enterprises from soft play to youth clubs to sports. Decent bus services. Core public services in the town centre.

It is crucial that ‘economic investments’ (many of dubious effectiveness) do not trump these. Yes, it becomes easier to sustain this kind of infrastructure when people are wealthier. But it is worth remembering that many of these things existed when people were much, much poorer.

  • Tests: vacancy rates. Footfall. Number of events. And, of course, what people tell you about their town.

The safety test

Under-reporting of crime is a big problem, and there is reason to believe it disproportionately affects the Red Wall. Burglary, shoplifting and vandalism are particular problems.

Fraud, too, is a national problem with unequal consequences. Pensioners in Red Wall seats who may own their own homes but have very modest savings and no private income are particularly exposed to losing their life savings. Meanwhile, specific estates suffer from low police presence, and deprived coastal communities and small towns are the targets of County Lines.

In other words, crime is a particular issue in particular ways in these places.

  • Levers: the extra police will help. We also need to change the way in which Home Office funding is allocated and put more emphasis on localised funds like the Safer Streets Funds (which pays for things people want like CCTV). We need a massive, revived focus on fraud – it is getting insufficient airtime and attention.
  • Tests: the obvious source is surveyed crime, but the government also needs better ways to measure crime than annual face to face interviews,

The Opportunity Test 1: Skills and Jobs. 

Training and apprenticeships are a huge priority for working class people. They want local training opportunities – ideally leading to local jobs. We know there’s huge untapped demand for technical level skills in the labour market, and that many adults want to retrain. It remains one of the great challenges of our system.

  • Levers: the Queen’s Speech will create a proper lifetime learning entitlement. Now it needs more funding and less bureaucracy (which is already blighting other skills entitlements and apprenticeships).

On jobs, big changes will be long-term. As well as incentives for private sector investment, the public sector is an opportunity. People want trained people to stay or return home. A start – and one of the most popular things universities can support – would be incentivising public sector graduates (like teachers, nurses, and doctors) to stay in areas where recruitment is a challenge.

  • Tests: number of adults in retraining. Reduction in skills shortages in ‘technical’ roles. I’d include reduced reliance on foreign skilled labour in specific areas (such as parts of construction, who are presumably going to see investment, and therefore job opportunities through net zero and transport).

The Opportunity Test 2: Schools

Schools perform less well in many Conservative target areas. In the past, I would have said this was a moral imperative, but not an electoral one – school quality wasn’t a big vote winner. But I think there’s now greater desire from parents (and we’ll be publishing a report with the Centre for Policy Studies on this in the near future). They are more aware of how their children are doing, how far behind some of them are, and how differently schools responded to the pandemic.

  • Levers: incentives for teachers to go to underperforming areas. Renewed focus on academies and free schools. Ofsted inspections with a focus on standards. Continuing the drive on behaviour. There should also be new focus on the most gifted through programmes in schools and more academically selective sixth forms.
  • Test: Ofsted ratings (including number of failing schools); percentage getting five good GCSEs in core subjects (called the EBACC).

Finally, an overall measure: retention of people and inward migration – in other words, do people want to stay and move to the towns of England? It is implausible that this will transform in a few years, but you might start to see a little movement towards the end of the Parliament (and post-Covid home working will accelerate this effect if places are nice to live in).

You will no doubt have issue with many (if not all) of these levers and measures. There are some omissions (most obviously health). But my point is that it is possible to generate and measure progress within a few years. The job won’t be done, but people will see the path. That shouldn’t diminish the importance of the longer-term, even harder job of thinking through regional growth and productivity. But if you don’t get these areas right, Johnson and the Conservatives won’t be given permission to carry on.

Nick Fletcher: After the pandemic, large companies need to take more corporate responsibility

17 Apr

Nick Fletcher is MP for Don Valley.

Since the imposition of the first lockdown in March last year, our high streets have suffered enormously while online retail outlets such as Amazon have made huge profits.

I am in no way wholly against internet shopping, and I am pleased that the Housing Secretary also recognises that how we use our high streets will change over the coming years.

That said, polling data and my own experience with constituents demonstrate that the public wants to keep our high streets and believe that the companies who have been able to profit from the lack of competition now must give back more to the communities they serve.

In other words, such online business giants need to revisit what it means to be corporately responsible and how that can be best put into practice.

My feeling that this is more necessary than ever was sparked by the opening of the first Amazon shop in London in March. While some business commentators were eager to promote the concept, I am deeply concerned that the opening of this kind of store will have a negative impact on our society. The store that opened in London last month only requires a customer to pick up an item and leave. They are monitored by CCTV and charged for what they picked up accordingly.

While some may admire such a shopping experience’s supposed efficiency, this experience requires no interaction whatsoever. Is this what the public wants or needs, as we come out of over 12 months of lockdowns and isolation?

Stores such as these will exacerbate the decline of high street shops. The decline of the British high street has long been an issue but was made worse by the pandemic. Even more worryingly, the nature of the Amazon store will lower customer satisfaction and maintain the sense of social isolation that many have been feeling over the past twelve months.

As a Conservative, who believes in the necessity and utility of societal bonds, I firmly believe that we cannot allow huge corporations to create a dystopian environment where individuals speak to each other less and less, and are merely atoms within a system where everything is transacted on one’s phone.

The high street was in serious trouble before the pandemic. But Covid-19 has done a tremendous amount of damage. According to the Local Data Company (LDC), in 2020 more than 11,000 outlets permanently disappeared from UK streets. It is expected that this will continue, with 18,000 more shops, restaurants and leisure outlets potentially being vacated by the end of this year.

Yet if we are to turn the tide of this, and help rejuvenate our battered streets, these new Amazon stores, or similar ones like it, are not the way to go.

There are a couple of reasons for this. Firstly, a system that enables customers to come into a store and order anything they need will decimate the surrounding independent or more specialist stores within the vicinity. The rise of the Amazon store will do to our DIY stores and phone shops what the supermarkets did to our butchers, grocers and fishmongers. However, the scale of damage will be even more significant and will risk turning our high streets into nothing less than wind-swept, uninviting pickup centres.

While of course, I welcome that companies such as Amazon want to invest in our high streets, a far better approach would be for Amazon to open shops that showcased new products rather than selling ones in the store. This would still benefit the company, with consumers being able to try out or inspect new products, which if they liked, they could go home and order as usual. This approach would be the best of both worlds. It would enable Amazon to showcase its new products while also ensuring that its store did not suck up business from the smaller stores close by.

Some may argue that such an approach would be backward thinking and unattractive to consumers. However, rather than it being backwards, it is instead a reasonable compromise. Not least because data shows that consumers themselves are increasingly against any moves to increased automate of their shopping experience.

In a survey of 340 people by marketing agency iD, 70 per cent of respondents said that digital experiences do not compare with the ‘real thing’. Furthermore, the BBC’s research in 2017 was clear in its conclusion that most customers dislike self-checkouts and prefer proper, more traditional customer interactions. Limiting the amount of social interaction between shop staff and customers is therefore not wanted by consumers themselves. If we are to revive the high street in the pandemic, it would be nonsensical for the next breed of shops that emerge to be ones such as the new Amazon shop.

This brings me to my second reason for opposing the concept of the new Amazon store, and why I believe that further such stores of this nature are damaging. Not only will such stores accelerate the decline of the high street by making surrounding shops redundant and the shopping experience unpleasurable, but they shall also further exacerbate feelings of social isolation. This is something which large companies should avoid.

The shopping experience offered by the new Amazon store will no doubt further feelings of isolation, which are currently at dangerously high levels. According to a survey of over 4,000 adults by the Mental Health Foundation, the number of people in the UK experiencing feelings of loneliness has more than doubled since March last year, with a quarter of the 4,251 adults surveyed in February saying they felt lonely. This compared with only ten per cent in March 2020. Among young people, a staggering 48 per cent reported feeling alone, as lockdowns affected young people the hardest when it came to loneliness.

I am sure that most people will agree that these are troubling statistics, and we should not be encouraging large companies to employ business practices that make such figures even worse.

Instead, companies such as Amazon, who have done well out of the pandemic, should now be expected by Government and wider society not just to make a profit, but to think about how they can be corporately responsible as we come out of it. With the public concerned both about the future of the high street and increasing social atomisation, it is only right that we expect business giants such as Amazon to think more about the society and economy that they are building.

If we don’t push such companies to act responsibly, the consequences will be unfortunate, if not dire.

Alice Babington: Let’s make high streets the hubs in our rural towns

26 Mar

Alice Babington is a member of Conservative Young Women South West.

For generations, the high streets of our rural towns have been in decline. The increasing competition posed by online shopping, accelerated by the COVID-19 pandemic, has caused smaller high street shops to struggle. Before the pandemic, high streets had suffered a ten per cent decrease in footfall over the prior seven years. With the onset of the pandemic, the high street suffered an average 39.1 per cent decrease in footfall over the course of 2020.

The pandemic has also demonstrated how many jobs can be done remotely, with much of the population having worked from home for the past 12 months. Home working during the pandemic has highlighted the huge waste imposed by long commutes to cities. For workers, the commute is a waste of time and expense and damages their wellbeing. For businesses, home working has shown much of their office overheads to be an unnecessary expense that eats into profits. Furthermore, with the Conservative Party’s “Green Industrial Revolution” in sharp focus, millions of daily commutes only serve to harm the environment and frustrate attempts to tackle climate change.

It has thrown traditional routes to employment into question. No longer is university necessarily the preferred choice for school leavers and many would prefer to stay in their hometown and move straight into a job. Businesses based in small towns, devoid of job centres and links with local schools, struggle to recruit from the local population or convince suitable candidates to commute long distances from nearby cities.

Providing local, flexible, workspaces can help to solve these issues for workers, businesses, students, and the environment.

During a recent ‘Tell Number 10’ meeting hosted by Conservative Young Women South West, chaired by Jenny Rackham and attended by Alice Babington, Dan Brown and Samantha Dennis, the idea of developing “High Street Hubs” was proposed. These hubs could be implemented in rural towns to provide a community for agile workers, tackle environmental pollution associated with city commutes, incorporate an independent careers advice and mentorship service for local students, and boost failing high streets.

It will be interesting to see, in the rapidly approaching post-pandemic world, how many businesses encourage their employees to work from home, either partially or permanently. An increase in remote working will undoubtedly lead to demand for local hot-desking space, both from those who do not have room for a designated workspace at home, and for those who prefer to not mix work and home life so intimately.

The use of the proposed High Street Hubs could be incentivised by the provision of National Insurance/Working Tax Credits for employers and employees who make use of these hubs. For reference, it’s currently the case that an employee on a remote working contract pays five per cent less in national insurance contributions.

The presence of High Street Hubs would boost the everyday footfall on high streets, and focus consumer power in our regional towns, not just the largest cities. They would encourage businesses focused on services for workers to open nearby, providing the high streets of our rural towns a new lease of life.

In many areas of life, a return to the status quo is what we crave after this difficult pandemic period. But when it comes to the British high street, and the health of our regional towns, the status quo just won’t do. High Street Hubs could provide people with the chance to work in a thriving community environment; improved mental health and well-being; reduced environmental pollution and improved careers advice.

This is a collaborative article following a Tell No. Ten Policy Forum hosted by Conservative Young Women South West on 18th February 2021.