The bell tolls for August… but not yet for May

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Last modified on 25/08/2017

Only a few months on from the June election (it has indeed only been a few months) the holidays are nearly over. The political void of summer is coming to an end and attention will turn back from the silenced chimes of Big Ben to the business of serious government.

The General Election created more uncertainty than it put to rest. A mixed outcome if ever there was one. Number 10 hamstrung itself by blowing its majority, a resurgent Labour Party still only managed second place. Voting patterns were distinctly regional; unionist Tories taking seats in Scotland, Labour taking ‘remain’ seats in London. Ukip collapsing everywhere. Even the Lib Dems showed an unlikely, albeit small, comeback.  

The Queen’s Speech launched a rare two-year parliamentary session to deal with the lengthy debate and scrutiny needed to get European Union withdrawal through the chamber, a move last seen in the aftermath of the financial crisis by the Conservative-Lib Dem coalition government. The knock on effect for our industry was the squeeze on parliamentary time available for domestic bills which failed to get through the House before the snap election and have yet to return. Domestic legislation which would have as much (or greater) impact on the acute challenges facing retail and real estate than our supranational divorce - local government finance and business rates reform for example.

So what’s next?

 

State of the Rates

In Scotland, the Barclay Review into business rates has now reported - interestingly it did not

mention moving indexation from RPI to CPI, as recommended in England. HM Treasury confirmed the move for 2020 following a concerted campaign from Revo and industry partners. RPI is now widely discredited as a measure and CPI should translate into creating a fairer business rates system. 

The Review did recommend more frequent revaluations (3 yearly), and HM Treasury have now invited key stakeholders to discuss revaluation in England & Wales on the same matter, including ourselves on your behalf. 

Revo will represent industry views to ensure we do not face the predictable calamity caused by the Government’s seven year delay and consequential cliff-edge faced by many businesses who already face challenges presenting by a difficult economic trading environment and uncertainty over the future. 

Reforms would also alleviate the immediate downward pressure on high street retailers at a time when the Future High Streets Forum has effectively stalled over its future objectives. Again a new minister is in post - Jake Berry MP - however we look to engage and build a positive working relationship with new faces across critical government departments.

 

Euro-vision

In the months since the election there have been various rounds of UK-EU negotiations -depending on which paper one reads we are either wildly unprepared or bluffing like poker champions who secretly had a royal flush all along. Nothing has yet been agreed. The cost of divorce still unconfirmed. 

In the first instance, currency fluctuations have already had a degree of impact on investment capital as well as consumer spend. The Government has now started to circulate a new wave of papers outlining the UK’s negotiating strategy on key issues related to Britain’s future relationship with the EU, starting with continuity in the availability of goods on the market and the confidentiality of documents.

Another primary concern is in the availability of skills. The eligibility of EU workers now and in the future will impact retail from the ground up. Young, educated, flexible workers will be all the harder to source notwithstanding the need for positive immigration outcomes in the face of an ageing population. Skills and talent is a longer game which will need to be addressed. Our Retail Matters campaign in October will further fuel this critical conversation.  

Working with partners through the Property Industry Alliance, we will continue to push for the best possible deal for our industry.

 

Looking forwards 

For now, the Conservatives remain in government and May still holds on to Downing Street.Butshe has yet to pass any contentious legislation on the floor of the House. Key markers to watch include the Trade Bill due in Autumn 2017, an associated Customs White Paper, and the Immigration White Paper due late 2017.

These will begin to formalise the government’s position and allow the scrutiny process to begin whilst offering a window into the real impact withdrawal will have on business. This will also be the first test for both the opposition, and opponents of Brexit, to challenge or derail the minority government. 

However, before that the major parties must navigate party conference season. Will the knives already be out? Will it be all change at the top of the ticket or much ado about nothing? 

Revo will be on the ground in Brighton and Manchester to make sure retail property and placemaking is firmly on the political agenda, and important areas of domestic policy including housing, planning, tax and infrastructure are not forgotten in the emotionally charged melee of EU separation.

Tags: Economy, Tax & Legal, Government Relations

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