Did you know that Gareth Thomas has just taken on ministerial responsibility for the retail sector at the Department for Business Enterprise and Regulatory Reform?
Did you know that the stores industry even featured in any minister’s portfolio? It would be no surprise if not. Thomas’ predecessor, Ian Pearson, kept a profile lower than the Dead Sea as far as retail is concerned. And in the eyes of many store chiefs, that has been typical of the Government and parliamentarians.
While other industries, such as car manufacturing and most notoriously the banks, have received the full focus of top Government figures, retail sometimes appears to be a business Cinderella.
Retailers’ concerns about problems such as availability of credit insurance or the detrimental effect of an imminent business rates rise seem much lower priority, despite the growing list of business failures and the sector’s importance to GDP and jobs.
In recent weeks retail bosses seem to have spent as much energy lobbying as selling. Focus chief Bill Grimsey wrote to Lord Mandelson about trade insurers, while Sir Philip Green, Rob Templeman and Terry Duddy are among those that went on the warpath about rates and associated business costs.
And it is not just the Government that presents problems. Despite the past involvement of many prominent retailers in the Conservative party, some store chiefs despair at an apparent lack of interest in the industry by the Tories. The only comment most can remember from Tory leader David Cameron, for instance, is his criticism of WHSmith for promoting sweets at its tills.
So the fear is that the retail industry does not have the ear of MPs in the way that some other sectors do. Is that true? And if so, what can be done about it?
Labour MP Austin Mitchell, who identified the problem that withdrawal of credit insurance would pose for retailers such as Woolworths ahead of the variety store group’s collapse, and wrote to Financial Services Secretary Lord Myners about the issue, thinks retailers could do better.
He says: “Credit insurance was a big issue with considerable ramifications. The Government didn’t seem to know about it and the big insurance companies were effectively strangling Woolworths and other chains. I thought that was extraordinary.”
Mitchell thinks that retailers collectively, and trade body the British Retail Consortium, have done a good job of making a case on broad issues such as interest rates, but not on specific matters such as credit insurance. Retailers, he says, have been “too dignified” and need to inject greater urgency into their communication with Government and parliamentarians.
He argues: “They need to put more information directly. It comes through too slowly and we’re playing catch up. A lot of it goes through big organisations, such as chambers of commerce, which slows everything down. There’s a cushion between the Government and the industry.”
BRC director-general Stephen Robertson rejects that perspective. “I don’t see it like that at all,” he says. “We have very good contacts at a formal and informal level – not just with politicians but with civil servants.”
He also points out that the BRC’s political efforts are directed not just at Westminster, but at Brussels – from where much legislation emanates – and the devolved assemblies in Wales and Scotland. The need for representation in Edinburgh was abundantly clear on Monday, when the Scottish parliament revealed proposals to end cut-price alcohol offers and enforce pricing per unit.
He says it is not the job of the BRC to get involved in “megaphone diplomacy” and that what politicians – whether Government or opposition – value about the BRC is that it provides evidence in support of its arguments.
Many believe that the efforts of the BRC are strengthened, however, if retailers also stand up individually and speak out on matters of concern, as Kingfisher chief executive Ian Cheshire and others have done on the proposed rates rise.
James Gurling, director of public affairs consultancy Hanover and a former BRC parliamentary officer, says: “It’s a good thing, provided they’re not saying different things.” He believes the personalisation to politicians of retail companies and the people who lead them gives the sector a greater purchase.
One of the difficulties that can sometimes affect retailers’ ability to influence political opinion is the enormous diversity of the industry – a characteristic that is easily missed.
Gurling says: “The problem is and always has been the extent to which you have an industry dominated by four very large players. If you say ‘retailer’ to any MP or legislator they immediately think of supermarkets.”
The challenge for retail, says Gurling, is to better educate politicians about the industry and communicate “common messages that can be understood by legislators. The BRC has a massively important role in co-ordinating the positions”.
Philip Dunne, the former chairman of bookseller Ottakar’s and now Conservative MP for Ludlow, says retail is a critical economic sector and thinks its message is starting to be heard more clearly.
He says: “Much work is done by individual retailers, especially food retailers. Other sectors are less engaged. But I would say the BRC is stepping up a gear and has been quite effective in beginning to get the message across to government.”
Dunne is running a retail crime commission for the Conservatives, which is expected to report at the beginning of the next parliamentary session. Retail crime was identified by Dunne as “an area of Government inaction” but one which deserved greater parliamentary attention.
Similarly, there are signs that MPs more widely might take a greater interest in the health of retail than they have in the past.
Parliament’s All-Party Retail Group (APRG), which has had a low profile in recent years, is poised to kick-start its activities following the appointment of Labour MP Christine Russell as chair last autumn.
Unlike some industries, such as cars, retail is not typically linked to MPs geographically through particular constituencies, which has probably resulted in looser political connections than exist in certain business sectors.
And there has traditionally been more than one retail group in parliament, which has tended to filter the industry’s interests through a particular lens – such as convenience stores, for instance. But Russell says: “It’s important, particularly in a time of economic downturn, that parliamentarians hear from the whole range of retailers.”
Despite the headlines about the collapse of retailers such as Woolworths, Russell thinks retail’s employment demographic has affected media coverage and wider interest in the sector. She says: “The people who are suffering [in retail] tend to be part-time, fairly low paid women workers who don’t get the same banner headlines as a car plant or steelworks closing.”
APRG has traditionally drawn much of its membership from the House of Lords but Russell is keen to get more members of the Commons to join.
Dunne also hopes APRG will enjoy a resurgence. He says: “It’s a suitable forum for people from the industry to come and make their case known to politicians of all parties, provided it’s got the right leadership.”
A revitalisation of APRG – which receives secretarial support from the BRC – should be welcomed by retailers, if only in helping ensure the industry’s future fortunes rather than helping them through this downturn.
Retailers are unlikely to win all the political arguments they enter during the recession for the simple reason that they have not sufficiently cultivated political support on issues that are now taking a toll.
Dunne says: “Lobbying should have been done a couple of years ago, so MPs had a proper understanding about loading up businesses with burdens when they’re least equipped to cope.”
So it is vital for the sector’s future health that the politicians are kept up to date with developments in the industry and its preoccupations. As BRC chairman Sir Geoff Mulcahy says: “It’s important for us to get more political traction.” The role of retailers in job creation and keeping up the country’s economic momentum needs to be better understood, he says.
One encouraging sign is that Gareth Thomas is scheduled to address APRG next Wednesday. The message from politicians seems to be that they are interested in retail. It is now up to retailers to engage and develop that interest.
The politics of retail: Some key players
Secretary of State, BERR
Preoccupied with the row over Royal Mail at present, but Mandelson has been an ally of the industry. Regarded as pro-retailer while a European Commissioner. His office intervened during Woolworths’ collapse.
Minister for Trade, Development and Consumer Affairs, BERR
Has just added retail to his portfolio, which also includes competition issues and trade policy. Is expected to attend a meeting of Parliament’s All-Party Retail Group next Wednesday.
Labour MP for Chester
Parliamentary private secretary to Beverley Hughes, Minister for Children, Young People and Families. Chair of Parliament’s All-Party Retail Group.
Conservative MP for Ludlow
Former chairman of bookseller Ottakar’s. Chairman of the retail and consumer goods group of Conservative Business Relations. Chairman of the Conservatives’ retail crime commission.