Business rates blamed as data claims 1,100 fewer shops in Wales since 2010 – a drop of 9%

An exchange at First Ministers Questions has once again surfaced the issue of Business Rates, with the charge being described as ‘a contribution that businesses make to the services that allow those businesses to prosper’.

Welsh Conservatives Mohammad Asghar AM enquired of the First Minister “What action is the Welsh Government taking to support the retail sector?” citing data from the Welsh Retail Consortium showing that there were 1,100 fewer shops in Wales in 2018 than there were in 2010 – a drop of nearly 9 per cent.

First Minister Mark Drakeford said, “Retail is a foundation sector in our economic action plan. Over the past year, we have increased business rate relief for the high street, expanded the business improvement district programme as we work with the sector in what are, we recognise, undoubtedly challenging times.”

Mohammad Asghar AM noted that the Welsh Retail Consortium went on to say that business rates were partly to be blamed for these closures and that firms in Wales have recently faced the greatest rise in business rates in Britain, “First Minister, in view of the decreasing footfall to Welsh shopping destinations and with shop vacancy levels among the highest in the United Kingdom, what action will your Government take to reverse the decline in the Welsh retail sector?”

The First Minister said, “Let me begin by making it clear that business rates are charged for very good reasons, because businesses that operate on the high street get all the advantages that come with public services: the roads that people drive to are paid for by the public; the pavements that people walk on are paid for by the public; the education that is provided to their workers is paid for by the public; the health service that looks after their workers when they fall sick is paid for by the public.

“Business rates are a contribution that businesses make to the services that allow those businesses to prosper. Here in Wales we now invest more in business rate relief than at any time in the whole of devolution.

“More than three quarters of business rate payers in Wales benefit from the different forms of rate relief that are provided by the Welsh Government, and in this financial year, we are investing an extra £23.6 million specifically in high street rates relief.”

“That’s not to say for a moment that there aren’t real challenges that the high street faces. We know that out-of-town shopping and online shopping make a great difference on the high street. We know that there are changing patterns of consumer behaviour.

“10 years into austerity, wages have been held back to the point where there is a lack of effective demand out there in the economy to buy the goods that are supplied on the high street.

“So, the challenges are real. We work very closely with the British Retail Consortium and with its Welsh members to make sure that the assistance that the public purse provides to those businesses is as effective as we can make it.”