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Mayor calls for ‘free trade zones’ in town centres

The directly-elected mayor of the West Midlands has called for town centres to be turned into ‘free trade zones’ to help struggling high street shops.

Speaking in front of the treasury parliamentary select committee earlier this week, Andy Street, who is also the former managing director of John Lewis said the current business rate system must be overhauled in order to help town centres.

In particular, Mr Street called for reduced rates for new and expanding businesses, as well as a 100% relief for public sector organisations who bring their services into high street units.

‘If we are genuinely determined to change our town centres, and not just to protect retail—retailers are part of the component—is that we need to be moving to a more wholesale, structural piece, something like a free trade or enterprise zone in the town centres,’ he told MPs.

‘You could exempt public services from paying business rates in town centres,’ he explained.

‘You would be able to give special planning powers for town centres. We have done them in enterprise zones, but we are not prepared to do them in town centres in the same way.’

Mr Street added that the government has been very keen to develop enterprise zones, and ‘they have been very successful in some locations’.

‘If you have driven along the M54, you will have seen the Jaguar Land Rover site north of Wolverhampton, which is on the i54 enterprise zone. It is a brilliant example of the model working,’ he added.

‘We are quite happy to give huge reliefs there, but then you would go into the city centre, not far away, and we have not given a structural relief. Again, you just get to that point of inconsistency.’

The select committee hearing also touched on the subject of local authorities investing in commercial properties and shopping centres in order to make up for declining central government grants.

Earlier this month, New Start reported that South Somerset District Council has bought an office block in Milton Keynes for £2.92m.

Last month, Mid Sussex District Council bought two retail units in a deal worth £5m to generate income for the local authority.

Appearing in front of the committee, the leader of the London borough of Islington, Cllr Richard Watts admitted ‘local authorities are in a difficult position’, because ‘we have been told to be entrepreneurial and then we get criticised for being entrepreneurial’.

‘I cannot account for every individual local authority’s decision to buy shopping centres in other bits of the country and stuff like that,’ said Cllr Watts.

‘We have taken a particular decision that we are not going to do that, largely because we don’t have the reserves to do that,’ he added.

‘Where we do think we are going to spend some money on acquiring property, we are going to do it in our own borough for wider economic development purposes, rather than because we particularly see the value of commercial investment in shopping centres in Bolton or whatever it is.’

Mr Street responded by mentioning the West Midlands Combined Authority’s town centres programme, where ‘we actively intervene and buy those properties’.

‘Of course there is a risk in any property transaction like that, but I think it is a very appropriate use of a public fund to do that, provided we are not building up too much risk on the balance sheet, which has always got to be assessed,’ added the mayor.

Photo supplied by West Midlands Combined Authority

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