Confessions of a Shopaholic: Look to the Belgians to rescue our high streets.

By William Gould

If you take a walk down your local high street today, chances are that you'd be met with a ghost town of vacant units and derelict facades. Unfortunately, your high street isn't alone, as vacant units eat away at high streets across the country.  

 Even before the pandemic, data from the Office for National Statistics estimated there were 58,000 empty shops on Britain's high streets. And now, with rising inflation and the recent loss of large department stores, including British Home Stores and Debenhams, the future of our high streets has never looked so bleak. 

A wasted opportunity? 

This uncertainty has only grown with neither Rishi Sunak nor Liz Truss, the two candidates running to become Britain's next Prime Minister, seriously engaging in any debate on High Street Reform.   Truss has remained silent whilst Sunak vaguely engaged with the issue, promising that he would focus on turning empty shops into "thriving local assets", though not being too clear as to how he would achieve this. 

It's little surprise, then, that business leaders have expressed alarm. The Retail Jobs Alliance, whose members include Tesco, the Co-op, and Sainsbury's, recently issued a plea to both candidates, urging a permanent reduction in business rates for all retailers, regardless of their size.  

Now, of course, some addressing of business rates would help retailers. As the Retail Jobs Alliance suggest, a 20% cut in business rates across all retail properties would only cost £1.8 billion– just around a tenth of the cost of reversing the corporation tax rise and would benefit over 197,000 retail properties. 

But when considering the wider picture of high street reform, it's not enough to suggest that changes to business rates alone, however meaningful, can resolve the malaise of our worsening situation. 

Rather, to address the issue head-on and save our high streets, we must also consider wider reforms. One way to do this is by looking at Roeselare, a thriving city of 60,000 in Belgium. 

What Roeselare got right 

Around a decade ago, Roeselare was like most UK towns, struggling to save its floundering High Street. But perhaps unlike the trend of many local authorities here, the city chose to act. In 2013, city authorities implemented widescale reforms recommended by Londoner Bill Grimsey, a retail expert largely ignored at home. 

Many reforms centred on community first schemes, but one key reform targeted uncooperative landlords who controlled vacant units. Today in Roeselare, if a landlord leaves a unit empty for one month, they are issued 'empty shop tax' based on the unit's space; the longer the unit lies empty, the higher the tax rate, often doubling if left vacant year on year.  

This simple change has done wonders in motivating landlords to drop rents if they struggle to find an occupier. If units remain vacant for over six months, landlords can put their properties into a scheme called 'Roeselare Excites' to allow start-ups to rent retail space on a pop-up basis in the city on low fixed rent.  

Because of this scheme and other reforms driven by local government, including refunds on property tax for city centre shops and funding of up to €7,500 to help retailers open second units, between 30 and 40 new shops have opened. But most impressively, these reforms reduced Roeselare's average unit vacancy rate to 8.3%, which is even more impressive when compared to our national average of around 15.6%. 

Considering the wider picture 

Looking at Roeselare, it's clear that some intervention is needed in addition to any reforms on business rates. The good news is that local authorities already have some degree of autonomy.  

For one thing, they can make compulsory purchase orders to bring vacant buildings back into community use. But disappointingly, many authorities are unwilling to act on this, instead choosing to leave buildings empty. 

Fortunately, more changes are promised with the Government's Levelling Up and Regeneration Bill, which is currently being passed through Parliament. Under the Bill, local authorities will be granted new powers to compulsorily require landlords to put vacant high street units up for rental auction, especially those that have been continuously vacant for more than one year. 

As with any legislation, time will tell whether these proposals will have any positive effect. And it's little surprise that most within the landlord community prefer alternative strategies to drive back tenants.  

But as the city of Roeselare shows, local government can be a positive force if given more powers to intervene when required. Ultimately, if we want to deliver meaningful reform that'll meet the needs of our communities, then both intervention and business rate reforms will be required. 

This article was originally published in Advocacy Local’s Politics and Planning Newsletter. To receive our fortnightly newsletter straight to your inbox, subscribe here: http://eepurl.com/htOBCv