John Denham, Labour MP for Southampton Itchen and Shadow Business Secretary, has called for the Conservative-led Government to help families and businesses in Southampton by cutting VAT.
Mr Denham is responding to retail figures which show high street shops are continuing to struggle while the Government stands by and does nothing. This also follows yesterday’s disappointing figures for growth, which show the economy is slowing down, with GDP only increasing by 0.2%.
Slow retail sales and the recent wave of high street failures have been exacerbated by the Government’s VAT hike and its failure to back Labour’s plan to give local people a real say over the future of their high street. Too many shops in Southampton stand empty, while retail sales remain sluggish with a monthly increase in volume of 0.7% in June following a 1.4% fall in May. According to the Office of National Statistics this week, “the underlying pattern in the monthly retail sales growth rate was flat.”
VAT has also hit families hard. With prices rising, families have been sharing their concerns with Mr Denham in the last few months about how much the VAT rise has affected them.
That’s why Mr Denham and his Shadow Business Team have launched a campaign to cut VAT to help families and to save high streets from suffering. Mr Denham’s four point plan is:
1. Cut VAT – introduce a temporary cut in VAT from 20% to 17.5%, to give struggling retailers a boost and put £450 back into each family’s pocket.
2. Give local people the power to put the heart back into the high street. By amending the Localism Bill, Labour would give communities a real say in developing a plan for their local shops.
3. Repeat Labour’s empty shops initiative, enabling councils to pursue innovative uses for empty shops and reinvigorate high-streets, such as using vacant units for cultural, community or learning services, rather than leaving them empty. We would fund a £5 million programme as part of the £200 million allocated to regional growth from a repeat of the bank bonus tax.
4. Promote a fair playing field on the High Street by putting a competition test into the planning system.
Mr Denham said: “I want the Government to take action so families have a bit of extra cash in their pocket and so we don’t see more businesses closing in the next year.
“The Tory-led Government has opposed Labour’s plan to cut VAT to help families in these tough times. They’ve failed to back Labour’s call to give local people a greater say over their high street. Families and businesses urgently need help now.
“The figures for economic growth are very worrying indeed. It’s bad news for retail owners in Southampton and that’s why I want to do all I can to help local businesses in these tough times.
Jack Dromey MP, Shadow Local Government Minister, said: “The Tories opposed Labour’s plan to give local people a real say over the future of their High Street.
“John Denham is right to campaign for greater say over the future of the high street to local residents in Southampton Itchen”
Chuka Umunna MP, Shadow Minister for Small Business and Enterprise, said: “We are now seeing the true cost of the Tory led government’s VAT hike with the wave of retailers going into administration, hurting consumers and jobs by choking off growth.
“The Tory-led Government should enact Labour’s VAT cut now and repeat Labour’s empty shop initiative to put confidence back into the high street and money into consumers’ pockets. The Tory-led government’s VAT hike is costing the average family £450 a year.”Other news from Southampton Labour