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Grimsey Review slammed over levies and red tape

The Grimsey Review’s call for more red tape and a levy on major retailers has drawn criticism from industry experts, although his vision of a “networked” high street won initial applause.

Well-trodden areas for campaign, such as business rate reform and parking fee freezes, were welcomed but some argued the interventionist nature of the review went too far.

Neil Saunders, managing director of retail consultancy Conlumino, told Drapers the review had “definitely got teeth” but highlighted key stumbling blocks, particularly the 0.25% one-off levy the review asks major retailers to pay on 2014 sales.

“It’s ludicrous because it doesn’t reflect the success of the underlying business,” he said. “A group like Sainsbury’s would end up paying less than Dixons, even though it is substantially bigger. Retailers are already paying enough tax as it is.”

The British Retail Consortium welcomed a focus on business rates reform, car parking fees and long-term town planning, but it also voiced concerns over the levies.

Director-general Helen Dickinson said she “firmly opposed” the idea.

“Any new approach must be fair for all, not a selective attempt to penalise one particular part of the retail sector,” she said.

The Confederation of British Industry also slammed Grimsey’s one-off “money grab”, saying it would “undermine investment and job creation”, but said it supported other proposals.

Other experts criticised Grimsey’s call to make malls give over a proportion of space to local traders.

One said: “It’s the developer’s responsibility to make the mall work, so it should be their decision.”

Saunders also criticised Grimsey for working against demand. “The bottom line is these things need to be sorted out by the market. In some ways one has to let the high street evolve and get on with it.”

The Portas Review, he noted, had been more about encouraging shoppers into towns than legislating to bring them in.

But Don McCarthy, chairman of House of Fraser, said neither review addressed the complexity of the problem: “There are so manyfactors to consider, there is no one answer and no quick fix. The problem is we’re overshopped – there are too many stores – and there’s a change in customer habits so this is a natural contraction.

“There is a problem here, but everyone is just skirting on the top of it.”

Not everyone was critical, however. Digital experts backed Grimsey’s vision for a networked future where retailers are able to offer tailored deals to consumers as they walk past their shops.

The British Property Federation (BPF) also said it backed the review, particularly its research highlighting how the UK pays the highest business rates in Europe.

BPF chief executive Liz Peace said: “We’re pleased to see that Bill Grimsey recognises the damaging impact this has had on UK high streets, and we would urge the

Government to commit to a root and branch review of the current business rates system and the distortions it creates.”

Readers' comments (1)

  • I have to agree with Don McCarthy, he hits the nail on the head.

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