RUTH SUNDERLAND: Chancellor in enterprise fee betrayal

This is meant to be the golden time of the year for retailers. But festive spirit is in dangerously short supply. To invoke Scrooge comes nowhere near doing justice to the effect Rachel Reeves’ Budget is having on High Streets around the country.

The Chancellor has piled on the misery for shops and restaurants that have already battled to survive the pandemic, the rise of online retail and a business rate system that has been grotesquely unfair for years.

Rather than anger petering out after the Budget as Reeves will have hoped, rage is rising to boiling point as the implications of her triple whammy become clear.

Shops and other venues are faced with higher minimum wage costs, a hike in employers’ National Insurance plus an abject failure by the Government to deliver on its promise to reform business rates.

Reeves’ budget is also a betrayal of her own sex: she is letting down the millions of women who work in these sectors, often for low pay.

The row over National Insurance has taken precedence but there is simmering unrest over business rates.

In its manifesto, Labour pledged to reform the system.

Reeves talked about ‘first steps’ at the Budget, with a plan to introduce permanently lower rates for High Street businesses operating out of less valuable properties. This is to be funded by a higher rate on bigger premises, which Labour paints as capturing the warehouses used by online giants. It will, however, also hit larger bricks-and-mortar retailers such as supermarkets.

This may be reasonable enough in itself – but it is a case of jam tomorrow, if ever.

The ‘intention’ – a weasel word if ever there was one – is for these changes to come in from the tax year April 2026/27. In the meantime, smaller High Street businesses will see their rate relief slashed from 75 per cent to 40 per cent in 2025/26 with a cap of £110,000, so will have to pay significantly more.

Labour is cynically pretending this latter move is a benefit by claiming the Tories would have scrapped the relief entirely.

Silly point-scoring won’t help small shopkeepers, who will have to find thousands of pounds extra regardless. Business rates raise £26billion of much needed cash for local economies so reform does need to be sustainable.

But the Mail and Mail on Sunday have been campaigning for fairer business rates for years.

The Government had plenty of time in opposition to formulate its plans. It should not need to delay for at least another year.

That will be too late for many, including long-standing family businesses, which will pull up the shutters before the wondrous new regime arrives.

The UK has already lost 6,000 shops in the last five years: in two-thirds of these closures, business rates were a factor in the decision, according to the British Retail Consortium.

Without action, the BRC estimates another 17,300 shops could close over the next decade.

Those that remain open are likely to cut staff, scale back on hiring and push up prices, fuelling inflation.

Reeves seems obsessed with molly-coddling public sector workers so it may have escaped her notice that retail is the biggest private sector employer, offering work to millions, most of them women.

One bitter irony is that this country’s first female Chancellor – who wants to be seen as a role model for young girls in their careers – risks being responsible for putting large numbers of other women out of work.