Charity shop tax benefits have come under fire from a Tory in MP in a backbencher debate about the future of the British high street.
Mark Menzies, the Conservative MP for Fylde, said that while charity shops have an important role to play in raising money for charity, the time has come to review the “considerable benefits that are given to them”.
“Landlords often prefer to sign a lease with Oxfam than to take the risk with an independent retailer. The security of Oxfam versus the uncertainty of a start-up independent can distort the local market,” he said during a backbench business committee debate on the future of the high street on Tuesday this week.
As an example of charity shop dominance, Menzies chose well. Oxfam charity shops have indeed been performing strongly. The charity reported an 11 per cent year-on-year increase in sales over the Christmas period - a Christmas period which saw many for-profit high street retailers struggle and forced into early discounting to stimulate sales. The longer-term trend has generally been positive for charities which have retail presence; the Charity Finance Charity Shop Survey 2011 found an increase in charity shop income of 12 per cent across the board. Charity shop income has been increasing year-on-year for the best part of this century, and many large retailers, like British Heart Foundation, have been expanding their empires.
The Tory MP said that charity shops have a structural advantage over other retailers: “Charity shops do not have the bigger costs that many retailers face. The biggest cost for any retailer is the one that walks through the door on two legs—namely, the staff. Charity shops often trade on the generous support that they receive from volunteers. Given that backdrop, I do not think that it would be wrong to put the support that we give to charity shops on to the table for a timely review, to see whether we need to move past that.”
Menzies went on to complain that not all the items for sale are donated, second-hand stock but rather that some are “brand spanking new”.
“Oxfam has more shops selling books than Waterstones, and that imbalance needs to be addressed,” he said.
The debate this week followed the release of the report on the future of the high street by Mary Portas, commissioned by David Cameron. In the review Portas criticised the rate discounts offered to charity shops, which she said “builds disadvantage into the system”. Portas called for such rates to be offered to independent shops also. The government has not yet responded to the recommendations in the Portas report.
MP blames chuggers for decline in high street
In the same debate fellow Tory MP Paul Uppal blamed face-to-face fundraisers for the number of empty shops in his electorate of Wolverhampton.
“I conducted a survey of small shops and businesses in the city centre to find out why people do not shop there. I was surprised by the number one reason - chuggers: people who fundraise, perhaps aggressively. Again and again, shoppers said that the aggressive tactics used by some street fundraisers leave them feeling harassed and intimidated. I was disappointed to learn that people were being discouraged from visiting Wolverhampton city centre and I called for action to address the problem,” he told parliament.
Uppal praised Manchester for having worked out a site management agreement with the Public Fundraising Regulatory Association. “They have found a balance between fundraising and leaving people in peace to shop. It is important that that fine line is drawn,” he said.
