Business secretary Vince Cable has dismissed criticism levelled at the Government in the past week that more needs to be done to help support the retail sector following a series of collapses.
Speaking to the business, innovation and skills committee in the House of Commons today, Cable said his department for business, innovation and skills only has a “modest” role to play in supporting the retail sector, outlining the work done by the Government with the Portas Pilots to try and boost struggling high streets.
When questioned about the support given to the banks and industrial sectors, Cable said he does not think it “appropriate” to provide financial support to the retail sector.
Cable said: “The reason why the last Government and others before it have been right to prevent the collapse of the banks is to stop the financial system from collapsing. I don’t think that could be used as a precedent in saying we should be intervening in Government support in all other sectors.
“We do have that for industrial strategy, aerospace sector and life science but it is not appropriate in retail.”
Hisviews conflict with Labour shadow business secretary Chuka Umunna, who last week called for a “sector-specific industrial strategy to grow retail”.
He said he believes the closure of big name retailers HMV, Jessops and Comet in recent weeks did not represent a “crisis”, despite thousands of jobs being lost.
Cable said: “What’s happening in the retail sector is partly a result of not a lot of economic growth and that is pressure to bear.
“The main reason we’ve had a spate of companies going into administration is primarily because of changes in consumer habit. There has been a very rapid switch to downloads in music and film and online shopping.”
Defending the Government’s passive stance to those retailer’s that have recently hit the wall, Cable said: “The Government role isn’t just to be a bystander.
“We feel we do have a role but don’t believe we can say, ‘this particular brand, that for some reason people decided not to spend money on, should be preserved for the nation’.”
Retail Week and the BRC are lobbying the Government in the joint Fair Rates for Retail campaign to freeze business rates. The planned rise in April will add £175m to the £500m rates increase retailers have paid over the past two years.
HMV receives 'substantial' interest from retailers for store estate
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Business secretary Vince Cable denies retail sector is in crisis despite recent administrations