Posted on Monday 25 March 2019 by Ulster Business
Northern Ireland retailers are increasingly frustrated that a lack of government means key areas of reform aren’t being looked at. John Mulgrew speaks to retail experts about the challenges of the high street
If there’s one thing Northern Ireland is good at, it’s kicking the can down the road. Again. And while the ongoing political flux at home is being trumped by Brexit, crucial areas of business reform, especially in regards to the ever-evolving retail landscape, aren’t being addressed.
And even since the fundamental review and reform of the business rates system was last discussed On the Hill, Northern Ireland and the wider retail landscape has changed further still – with national retailers going to the wall, or narrowly avoiding going bust.
“In 2019 our retail sector is in for its fastest ever period of change and reinvention,” Glyn Roberts, chief executive of Retail NI says. “This is equally the case for our high streets and town centres.
“This change will not all be good, as we will see some more significant large retail casualties in 2019. However, we will also see the creation of more confident and dynamic independent retailers, who will be at the forefront of a new retail sector, leading toward 21st century town high streets.”
As for the big names facing tough times, HMV called in the administrators once again, while House of Fraser was bought out of administration by Sports Direct’s Mike Ashley – a recent fresh lease with the owners of Belfast’s Victoria Square shopping centre securing the only Northern Ireland outlet’s future for the foreseeable future.
“It is nothing less than disgraceful that we start a second New Year with no Government in place in Northern Ireland, with not even a date set for all-party talks,” Glyn says.
“This is hugely disruptive for the economy and Northern Ireland is in danger of becoming an international laughing stock.
“With much-needed decisions not being made on reform of business rates, infrastructure investment, addressing an ever-growing skills gap and modernisation of our town centres, Northern Ireland is not just lagging behind the rest of the UK and Ireland, it is in real danger of being left behind internationally.”
Aodhan Connolly, director of the Northern Ireland Retail Consortium, says there needs to be a fundamental review of the business rates system.
“Retail is 12% of the economy but pays almost a quarter of rates – that is not tenable,” he says. “The structural change in retail is not reflected in the business rates system and we need to widen the tax base.
“Stormont being down is a problem, as it affects decisions on business rates and apprenticeship levy, plus the changing face of retail, and a lack of legislation to protect shop workers from abuse and violence.”
Meanwhile, Northern Ireland’s councils are raising business rates, from the smallest rise in Antrim and Newtownabbey Borough Council, at 0.99%, to the inflation-busting hike of 3.46% from Derry & Strabane District Council.
“There is the very real possibility that they will only find out what the regional rate — and their total rates liability — will be the week before those business rates bills hit their doormats,” Aodhan says.
Hospitality Ulster’s Colin Neill says the lack of a Government in Northern Ireland is costing the sector millions and damaging the potential for future growth — sighting the lack of progress to modernise liquor licensing as one of its major contributors to the losses.
A Liquor Licensing Bill was one of the few pieces of legislation the Assembly had introduced at that time, but the collapse of Stormont killed the Bill, which set out to address the laws.
Overall figures point to a mixed bag for the high streets in general. For example Northern Ireland shops in January defied a UK trend slump to rise by almost 4%, but shop vacancy rates have crept up to 14%. >
Belfast itself is still recovering from its high street disaster, following the firm at Primark’s Bank Buildings. That led to a city centre drop in footfall of more than a third, while businesses in and around the cordon felt a more considerable drop.
“Consumer behaviour is rapidly changing, and people want something different from their high streets and I believe that smaller, more agile and tech-savvy retailers who can adapt to this tidal wave of change, will be the ones who will not just survive, but thrive,” Glyn Roberts says.
“Government also needs to reboot its policy agenda for the retail sector and for our town centres to meet the challenges ahead.
“While devolution remains in limbo, our eleven councils have been doing their level best to fill the gap and provide leadership, despite not having the full ranges of powers to make the real economic changes within their communities.
“Retail NI is an organisation working across all 11 councils, contributing to each of their consultations on local development plans and assisting our members with planning and town centre regeneration.
“Local government elections take place in May and Retail NI has already hit the ground running with the publication of our detailed report, ‘Regeneration NI’, which sets out a comprehensive plan to create 21st century town and city centres.
“The regeneration of our town and city centres needs to be the top priority of our local councils and we will be engaging with them and the political parties ahead of the elections.
“The Belfast Region and Derry city deals offer huge opportunities for economic, social and infrastructural regeneration for our two main cities and many of our local towns. It is hoped the Belfast Region City Deal will create up to 20,000 new and better jobs, alongside delivering a 10-year programme of inclusive economic growth – including an increase of £470m Gross Value Added (GVA).”
“2019 will truly be the year of retail reinvention that will see Northern Ireland’s largest sector of industry, perhaps being slightly smaller but more agile, nevertheless a sector, which is vital to the future of our local economy’.