Retail body asks Holyrood to call out budget measures to help sector ‘weather the economic storm’

The trade body sent its budget submission – titled Weathering the storm: tackling the cost crisis – to John Swinney, Scottish Deputy First Minister and Acting Finance Secretary, covering Kate Forbes who is on maternity leave. In the document, the SRC says retailers are working hard to reduce the cost of living for customers while battling rising spending in the face of weak demand.

The organization says retail is Scotland’s largest private sector employer, providing 233,000 jobs, but added that recent data shows retail sales have stagnated in real terms, footfall in customers are “weakening” and remain below pre-pandemic levels, while vacancies in stores are still high.

Its 12-page submission comes ahead of the expected publication of the findings of the devolved government’s emergency budget review and the unveiling in the fall of its fiscal and spending plans for 2023-24.

The SRC says it is essential that ministers succeed in their plans outlined in the Scottish Spending Review to cut the cost of government, ‘otherwise taxes could rise and the economy be stunted’.

The trade body’s suggestions for Holyrood include protecting less wealthy workers by ruling out increases in Scottish income tax rates; consider introducing a Scotland-wide shoppers stimulus modeled on the Glasgow Voucher Initiative; and exclude any increase in the activity rate next spring, “which is already at a 23-year high”.

Also on the SRC’s list of recommendations, accelerating ‘restoring a level playing field with England’ on higher housing activity; suspend workplace parking charges for the next 18 months; and reduce the amount of decentralized regulation implemented or contemplated.

SRC director David Lonsdale stressed that retail is once again ‘in the eye of the storm’, adding: ‘To help Scottish shoppers and traders weather this storm, we suggest concerted action to restore consumer confidence and reduce the cost of doing business.

“It is imperative that the next Scottish budget is used to support shops and shoppers ahead of the economic storm. In particular, the focus should be on protecting less well-off workers from income tax hikes and on protecting retailers against a further rise in the rate of activity.”

This followed the organization last month revealing how the overall vacancy rate on high streets in Scotland stood at 15.7% in the second quarter. Mr Lonsdale said at the time that Scotland’s vacancy rate remained higher than the rest of the UK as a whole and “well above” pre-pandemic levels, with attendance falling and continuous hybrid work making it more difficult to recover rates.