Five ways the Scottish Government can help the country's hard-pressed shops
From soaring cases of shoplifting to high Scottish business rates, the retail sector does not have its troubles to seek
With the ballots tallied, it’s time for our newly elected MSPs to move from the poetry of idealistic campaigning to the pragmatic prose of governing. After an election campaign with lots of promises but few details, the First Minister will have to get to grips with the reality of a daunting fiscal situation and immense pressure on public services.
The economic backdrop is inauspicious following five years of insipid growth due to the fallout from Covid, an ongoing costs crunch propelled by conflicts in Ukraine and Iran, and colossal increases in statutory costs. Retail has been hit as hard as any sector, with stalwart brands leaving the high street and retail sales growth this past year of a listless 0.9 per cent.
That’s a worry as retail is vital to Scotland’s socio-economic fabric, providing over 200,000 jobs with thousands more in the supply chain. Shops can be found at the heart of most communities, driving footfall to our town centres, and supporting local charities and good causes.
No meddling with shop prices
So what do retailers want from the new Scottish Government? Firstly, a coherent approach which relentlessly focuses on growth and recognises the cumulative impact of decisions. If retailers expend effort on grappling with red tape and extra costs, it means fewer resources are available to grow their business and keep down prices for customers.
There should be no statutory cap on food prices. Ministerial meddling to set shop prices isn’t necessary as retailers are already incentivised to keep down prices or they risk losing custom. A statutory cap would have administrative implications for tills and for staff in shops. Being compelled to sell some products at a loss may mean higher prices for other items. The impacts will resonate across the supply chain at a time when international pressures are acute.
The increasing cost of food is due to the increasing cost of food production. Instead of a legal cap, the devolved administration should work with us to identify costs and regulations that could be reduced or deferred, and lobby UK ministers to mitigate some of the energy bills that the food supply chain faces.
Secondly, public spending restraint should be the order of the day. Public spending has outgrown the capability of the private sector to fund it and Scotland has more quangos than MSPs. There should be no new levies on retail which would simply hold back investment. Instead, let’s celebrate retail and help it to grow.
Good politics
Thirdly, we need more ambition to reduce business costs. The new retail, hospitality, and leisure business rates relief recognises these sectors pay a disproportionate amount compared to others. However, larger Scottish stores still pay £54 million more than their English counterparts. That needs rectified otherwise investment – which keeps stores attractive and minimises empty units on high streets – could be lost.
Fourthly, shoplifting has soared and incidents of abuse towards shopworkers are all too common. We need sustained funding for the Retail Crime Taskforce and the prioritisation of retail crime across the criminal justice system.
Finally, ministers must champion retail. Supporting ‘everyday economy’ sectors isn’t just good policy, it’s good politics. The new government should work in partnership with the sector to make Scotland the best place in the UK to grow a retail business.
David Lonsdale is director of the Scottish Retail Consortium
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