Retail Industry Leadership Group meeting minutes: March 2024

Attendees and apologies

ILG members attending in person

• Joe FitzPatrick, Minister for Local Government Empowerment and Planning and Ministerial ILG Co-Chair (Minister)
• Polly Jones, Head of Corporate Affairs for Scotland, Asda and Industry ILG Co-Chair (PJ)
• Laura Mitchell, Head of Retail, Greggs
• Tracy Gilbert, Regional Secretary, USDAW
• Karen Stewart, Centre Manager, Livingston Designer Outlet
• Colin Smith, Chief Executive, Scottish Wholesale Association

Attending via MS Teams

• Debbie Harding, Chief Corporate Officer, Dobbies Garden Centres
• Kyron Keogh, Co-founder and Managing Director, ROX - Diamonds and Thrills
• Lucy Brown, Central Operations Director, John Lewis Partnership
• Mo Razzaq, National (UK) Deputy Vice President, National Federation of Independent Retailers

Guests

• Siobhian Brown, Minister for Victims and Community Safety
• Detective Superintendent Andrew Patrick, Police Scotland

Apologies

• Meryl Halls, CEO, Booksellers Association of the UK/Eire
• Sonya Harper, Central Operations Director, CJ Lang and Son
• David Lonsdale, Director, Scottish Retail Consortium
• Dr Pete Cheema OBE, Chief Executive, Scottish Grocers’ Federation
• Reuben Chesters, Project Manager, Locavore
• Robert Deavy, Scotland Organiser, GMB
• Andrew McRae, Policy Chair, Federation of Small Business (FSB)
• Tony McElroy, Head of Communications and Devolved Government Relations, Tesco

Scottish Government

• Tom Lowry, Policy Officer, Retail Policy, Scottish Government
• Allan Clifford, Senior Retail Policy Advisor, Scottish Government
• Sandra Reid, Non-Domestic Rates Policy Manager, Scottish Government (SR)
• Cheryl McNulty, Restricting Promotions Team Leader, Scottish Government
• Stuart Lewis, Head of Strategy and Collaboration, Police Powers, Scottish Government

Secretariat

• Tom Lowry, Policy Officer, Retail Policy, Scottish Government

Items and actions

Items and Actions

Welcome and opening remarks

• The Minister welcomed attendees to the sixth meeting of the Retail Industry Leadership Group (ILG) and thanked members participating in this ILG for the time and commitment being given.
• The Minister noted that attendance at this meeting was lower than usual due to clashes with other meetings taking place today.
• Polly thanked new ILG members Karen Stewart, Centre Manager of the Livingston Designer Outlet, Kyron Keogh, Co-founder and Managing Director of ROX – Diamonds and Thrills, and Laura Mitchell Head of Retail at Greggs for joining the group and welcomed them to their first meeting.

Update on the actions from the previous meeting

• Letter from the ILG sent to the Chief Constable, Police Scotland, asking for retail crime to be considered in the Policing Plan. Response received which will consider the ask. This is a positive step by the ILG and a good example of where we have joint priorities.
• Progress from the Fair Work Working Group – Allan Clifford will provide an additional Scottish Government resource to support the group.
• Allan is also working on the Skills Audit and Action Plan alongside Skills Development Scotland (SDS), this work is progressing.
• At the last ILG meeting we agreed that SDS would attend today to present the Draft Final Retail Skills Audit and Action Plan. As this work is still ongoing we have decided to postpone this until the next ILG meeting.

Hot Topics

Points raised in discussion

Tax free shopping

• Appreciate this is a UK-wide issue, but should be raised nonetheless.
• The chancellor had an opportunity to reinstate tax free shopping but this didn’t happen despite 500 business leaders across the country campaigning for it.
• Has a major impact on retail but also on tourism, therefore has a wider impact on the economy as a whole.
• International tourists are choosing other European destinations due to the attractiveness of discounts on shopping. The UK are losing out to this market.
• It is also having an impact on domestic demand. Domestic shoppers are taking weekend breaks to European cities as the savings on goods cover the costs of the trip.
• (Minister) Not a matter for Scottish Government but happy to feed into UK Government the views of Scottish businesses.

Public Health Supplement (PHS)

• Businesses are really disappointed by the Scottish Budget announcement to explore the reintroduction of a non-domestic rates Public Health Supplement for large retailers in advance of the next Budget.
• Encouraged by the New Deal for Business and appreciate the collaborative approach on policy development, therefore this announcement was surprising and feels contrary to the principles of New Deal for Business and this ILG.
• Unintended consequences need to be considered in terms of costs and the knock on effect to jobs, low income families and increased child poverty.
• The Minister commented that the way the PHS has been done is an example of the Scottish Government responding to the New Deal for Business because government have made an announcement of the intention before deciding what that will look like. Rather than committing to this in the budget Ministers are open to exploratory, evidence based discussions with businesses.
• No options have been discounted at this moment in time, and Ministers are at an evidence-gathering stage and meeting with stakeholders including in the retail sector.
• (PJ) Policy must be proportionate and evidence based, this would be a substantial amount of money for the businesses involved, at a time when rates are already increasing by nearly 7% and we are trying to keep prices down for customers, and without any evidence-base to justify it.

Non-Domestic Rates (NDR) – Update from Scottish Government official (SR)

• The Budget continues to support businesses and communities with a competitive non-domestic rates relief package worth an estimated £685 million.
• We are maintaining the Small Business Bonus Scheme (SBBS) which remains the most generous scheme of its kind in the UK.
• We estimate around half of the properties in the Retail, Hospitality and Leisure sectors will be eligible for 100% SBBS relief in 2024-25.
• These are extremely challenging financial times and we have had to consider how best to target support within limited finances.

Regulation

• The collective ongoing regulatory burden includes; the vaping and tobacco action plan, alcohol marketing and advertising restrictions, high fat salt and sugar (HFSS), heat in buildings, the circular economy bill and single use cup charge, deposit return scheme (DRS), as well as local council restrictions such as low emission zones (ULEZ), parking restrictions, tourist tax and short term lets.
• (Minister) Need to make sure the regulations around our policy intentions achieve what we want to deliver. Need to feed into the regulatory review group to make sure we are not creating regulations unnecessarily.

High Fat Salt and Sugar (HFSS) consultation

• Another example of collaborative working to develop something meaningful.
• If the proposal is going to become more complex, as is currently being proposed in the consultation, this will be more difficult to deliver in the timeframe set.
• Due to market sensitivity and complexity it would be better to be done in primary legislation rather than secondary legislation.
• What the Scottish Government is proposing, in going beyond England and straying into very complex and market sensitive areas, would be a significant additional burden on businesses which would appear to be disproportionate.
• The Scottish Government want to listen to businesses and respond to consultations.

Cost pressures

• A Scottish Wholesale Association members survey shows a lack of confidence in the coming year. It shows little appetite for investment including in net zero which shows business’ fatigue starting to come through.
• Issues include the rise in the minimum wage, and although employers are not against pay rises it does have an impact on margins in the sector.
• Businesses are feeling the effects of inflationary pressures which are expected to increase further due to a rise in shipping costs.
• 90% of the wholesale sector are small to medium-sized enterprises (SMEs). These businesses are now questioning whether or not they can remain in business due to additional operating costs.
• Jobs are being lost with retailers going out of business due to additional costs. Retail is one of the main employers for under-represented groups, evidence shows youth unemployment is increasing.

Recruitment, skills development and skills retention

• Proving difficult for some businesses to encourage people to relocate to Scotland given the differential in income due to income tax.
• Recruitment and retention remains a challenge for everybody in a salary bracket of £40k and above.
• At junior levels also finding a dearth of digital skills in Scotland so online business is being resourced from England.
• Businesses are attracting talent from out with Scotland. It is important to recognise the need to develop and retain our talent in Scotland.
• (Minister) Scottish Government Ministers are mindful of tax policies and the budget takes account of that, but also levels in £1.5b extra public spending.
• (Minister) overall evidence shows that net migration within the UK is still moving to Scotland, people are looking at the whole range of benefits in terms of social contract and making a decision on balance to come to Scotland.

Car parking charges

• Glasgow City Council 8am-10pm car parking charges gives no consideration to retail and hospitality businesses.
• This is having a detrimental impact on city centre high streets.

Planning

• Businesses trying to grow and expand are finding difficulties with Glasgow City Council planning. Planning applications are rejected without compromise. No issues in other major cities, Glasgow much harder to operate in.
• Local issues can be feed into COSLA. May be useful to invite someone from COSLA to a future ILG meeting.

Retail Crime

Siobhian Brown, Minister for Victims and Community Safety introduction

• Portfolio responsibility includes anti-social behaviour, recent work has reflected current issues regarding anti-social behaviour on public transport and in schools.
• Really concerned about reports of emerging anti-social behaviour across many portfolios. Interested to hear about the anti-social behaviour ongoing in retail and very keen to work collaboratively and listen to members on how we can work together to resolve these issues.
• Aware that local authorities are working together on anti-social behaviour especially with young people. There are some great initiatives happening in various areas which Ministers would like to see replicated throughout Scotland.
• Government shares concerns of the increase in retail crime and violence towards shop workers and fully understands the serious challenges the sector is facing.
• Those working in our retail sector should be lauded for the important work they are continuing to do during such challenging economic circumstances. They, like anybody, should be able to work without fear of abuse.

Detective Superintendent Andrew Patrick, Police Scotland, update on Retail Crime

• Detective Superintendent Andrew Patrick works in Fife where he is responsible for local crime in that area, but also has portfolio responsibility for national acquisitive crime. He is the tactical lead for Police Scotland.
• Acquisitive crime includes retail crime, housebreaking, vehicle crime as well as other things.
• Retail crime is rising, crimes against retail workers are increasing, Police have been detecting a lot of these crimes, significantly it is the age of the perpetrators which stands out with people aged 13-15 being the biggest group responsible.
• Police focus is on threat, risk and harm, focusing on organised crime and the assaults on retail workers.
• In a better position than England and Wales due to the Protection of Retail Workers Act.
• Every two months police hold a national acquisitive crime meeting with partners.
• Police Scotland are acutely aware that they are struggling to respond to the demand retailers have.
• Looking to develop a pilot system in Fife to commence at the beginning of next month on direct reporting which should allow staff on the shop floor to report crimes directly, which will streamline the reporting process taking demand away from phone calls and back and forth with police. The pilot will run for 6 months.
• This will reduce demand and increase capacity for the police, but equally increase confidence for retailers. Anticipates a rise in reporting from a retail perspective.
• This isn’t for all crimes, where a perpetrator is still on the premises or where a retail worker has been assaulted police assistance will still be required immediately.
• Differences between how to service large and small stores, recognise different things are available.
• Police are working closely with the business crime prevention officer around prevention and education.

Points raised in discussion

• Retail crime is part of a wider societal problem. Organised gangs, chaotic lifestyles involving substance abuse and addiction issues, as well as young people with nothing else to do all plays a part, this needs a concerted effort from across the community spectrum to deal with it.
• Anti-social behaviour amongst young people is quite new, it has escalated dramatically over the last couple of years.
• Needs a multi-agency approach but cannot be led by retail as a coordinating group.
• Minister for Victims and Community Safety shared examples of multi-agency groups led by local authorities in Inverclyde and also West Lothian which includes police, fire rescue, ambulance service, health, housing, schools, social services etc. Feels retail should be involved in these discussions. Would like to see this approach in all areas moving forward.
• The Minister will raise the issue with COSLA through their Community Safety spokesperson.
• Recent USDAW survey results released on 11 March 2024 show 70% of retail workers have been verbally abused, 46% have been threatened and assaults on retail workers has gone up from 5% last year to 18% this year.
• Retailers are investing a huge amount of resource to protect retail workers and protect their stores, bigger retailers are better resourced to do that as opposed to smaller businesses.
• More lone working in smaller retailers which make them easier to target.
• Further stats can be provided on patterns of anti-social behaviour in shopping centres. Shopping centres are seeing anti-social behaviour occurring between 2pm - 9pm daily. Instances happening after school time are heightened.
• Free bus travel for young people is creating an issue with perpetrators coming from various different areas and grouping together. Crime and anti-social behaviour has escalated since the introduction of free bus passes, and since COVID.
• Additionally, the Scottish Grocers Federation (SGF) crime survey was published today which shows the impact crime is having on convenience stores.
• Would be useful to gather stats from the SGF crime survey and share with members.
• When campaigning for the Protection of Retail Workers Act USDAW had requested a high profile TV advertising campaign to help change behaviours.
• Scottish Government advertising budgets are tight, but can take away to consider.
• Also important to acknowledge that retail is a good place to work.

Actions

• Officials to gather stats on retail crime and share with ILG members.
• Scottish Government to consider TV advertising campaign.
• To ensure retail representation within multi-agency groups, led by local authorities, the Minister for Victims and Community Safety will raise the issue with COSLA through their Community Safety spokesperson.

ILG Survey Results

• Polly thanked members who took the time to complete the survey. We got a really high response rate and we really appreciate all members contributions.
• The survey considered the Group’s format and progress to evaluate effectiveness and determine if any improvements can be made.
• This is an excellent opportunity to make positive change, members feedback is extremely valuable and will contribute greatly to the success of the Group.
• This is a chance to decide if the objectives of the group are still relevant or if we need to review them.
• The priority objectives as it currently stands are; the Fair Work Charter, the Skills Audit and Action Plan and the Just Transition to Net Zero plan for retail.

Points raised in discussion

• The Chair of the Fair Work Working Group (FWWG) thanked members for their participation in the group.
• At this stage the FWWG need support from businesses within the ILG to provide examples of best practice in order to develop a document which is both meaningful and impactful.
• Just transition can provide opportunities for job creation.
• There is a role for large businesses to work with small businesses in the just transition to net zero by sharing best practice and providing toolkits.
• The food and drink supply chain are already doing a lot of work on sustainability from producer/manufacturer through to wholesale/retail. Case studies can provide examples of what can be done.
• Landscape scanning on just transition will benefit businesses. The British Retail Consortium are also undertaking work which could be shared with the group.
• ILG members agreed that the objectives of the group do need to be reviewed to make them more current and ensure the group is delivering for the industry. The easing of the regulatory burden on the retail sector was highlighted as a possible idea to consider.

Actions

Group members to think about priorities, what would be useful to come out of the group? For discussion at the next meeting.

Planning and preparation for future meetings

• John Lewis have offered their premises to hold the next meeting, this could include a store walkthrough.
• 27 June has been suggested for the next meeting date, but this isn’t suitable due to annual leave, school holidays etc.
• Co-Chairs agreed that once a date has been set for the next meeting a diary hold will be issued as opposed to a ‘save the date’ email.

Action

Secretariat will issue a doodle poll to members seeking a preferable date for the next meeting.