MPs joined forces on Wednesday to debate crucial issues the retail sector is facing and call on Government to acknowledge the sector’s value.
Conservative party vice-chairman Richard Harrington, who called the meeting, said the retail sector contributes more added value to the economy than the manufacturing sector, which the Government is encouraging to grow.
Harrington said that although he accepts that “retail is not the total answer to our economic problems”, he added: “We must accept what it does for employment, infrastructure and areas where the rest of the private sector and public sector have failed completely.
“It is a significant and serious business, and its problems must be considered by the Government.”
Harrington highlighted that the retail sector currently contributes 5% to the UK’s GDP.
He urged the Government to switch the way business rates are calculated from the Retail Price Index to Consumer Price Index.
Within the debate it emerged that the select committee for Business, Innovation and Skills has agreed to launch an inquiry into the changes taking place in the sector.
Business and enterprise minister Michael Fallon, who has responsibility for retail, said the Government is continuing to review the relationship between RPI and CPI.
Through the Fair Rates for Retail Campaign, Retail Week and the BRC have been lobbying Government to switch the rates calculation to CPI.
The campaign also aims to freeze business rates this year as retailers will face an additional rates bill of £175m when the 2.6% increase hits in April, following two consecutive years of big increases.
Fallon said the Government has supported the retail sector through the Portas Review of the high streets, extending the business rates relief for small businesses and a priority in the Red Tape Challenge to reduce regulation.
Fallon added: “Retail is an important barometer of our economic and cultural well-being. It is going through a period of rapid change, but Britain has the companies, the brands and the entrepreneurial spirit to ensure that we will always have successful retailers.”