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Oireachtas Committee on Jobs, Enterprise and Innovation hearings on town centres – 17 June 2014 Presentation by Retail Ireland

INTRODUCTIONS I would like to thank the Committee for the opportunity to speak to it today on this very important subject. My name is Stephen Lynam, I am the director of Retail Ireland and I am joined by Stephen Sealey, Managing Director of Brown Thomas, Bob Parker, Director of Operations at Clerys, and Leesa Kavanagh, Director of Retail at Arnotts. Retail Ireland is the representative body for the entire retail sector in Ireland and is affiliated to IBEC. Its members have 3,000 shops, including department stores, DIY, electrical retailers, fashion and footwear retailers, major supermarket groups, symbol groups and specialist retailers. We are a division

• f Ibec and through that connection, we have close links with the Small Firms

Association who represent a number of small and independent retailers. Some of our members operate in out-of-town stores. Some operate in towns and city centres. Many operate in both. These meetings are timely, as the recently established Retail Consultation Forum is due to discuss this matter in September, and I hope between these hearings and that Forum, real progress can be made. CURRENT RETAIL ENVIRONMENT It will not be news to any of you that retail has been on the sharp end of this

• recession. Sales are down by 25 per cent. 50,000 jobs have been lost.

Vacancies are up. But we are also a sector of huge potential. Our Strategy for Retail 2014-2016, copies of which we have brought with us today, tells two very important stories;

• Firstly, we are the biggest private sector employer in the country, bar

none, with a footprint in every town in the country, bar none. 75% of retail businesses are located outside Dublin and a similar number are SMEs.

• Secondly, we have forecast that if retail sales can in the first instance

stabilise, as seems to be happening, and then begin to grow by a modest 3 to 4 per cent from 2016, we have the potential to create 40,000 new jobs for this economy. Town centre rejuvenations is undoubtedly part of that growth strategy. RETAIL IRELAND APPROACH TO TOWN CENTRE REJUVENATION The issue of the need to rejuvenate town centres has been one at the centre of public debate for some years now. The recession, and the growing number of vacant outlets in or close to the centre of towns and cities, has led to heightened debate. A number of opinions have been expressed and industry representatives, politicians, economic operators and others have all made their views known. Central to Retail Ireland approach is recognition that out-of-town shopping is a reality in the Irish retail space that brings with it multiple benefits to retailer and consumer alike, and that town centre rejuvenation does not, as some might suggest, have to come at the expense of the shopping centre or out-of- town retail experience. We believe in a truly national policy. It is vital that all stakeholders concentrate not just on Dublin city centre, but our other major cities including Cork, Limerick, Waterford and Galway. Further, smaller towns should not be neglected in the effort to breathe new life into the heart of city centres. PROPOSALS Retail Ireland sees policy formulation in this area as falling into four broad themes from which individual policy recommendations may flow;  Measures focussed on making city and town centres better places to visit

 Measures to make town centres more attractive to consumers  Measures to tackle crime and improve safety  Measures to improve business conditions for retailers If these four areas can be properly addressed in a timely fashion, huge strides will be made in the rejuvenation of our town centres.

• 1. On the first point, measures focussed on making city and town centres

better places to visit, some of our proposals include the following; Town teams As recommended in the High Streets at the Heart of our Communities report, published in Britain in 2011, the Government here should identify pilot towns and cities where new partnerships involving retailers, landlords, local authorities, representative groups and so on can be formed to establish targets and achieve demonstrable improvements in town centre locations. BIDs Building on the success of the Dublin BID, other towns and cities should establish, where demand among retailers is present, their own Business Improvement District, to drive footfall. Indeed I would advise this committee to seek to hear from the Dublin BID at these hearings so they can share with you their experiences. Planning Specific measures should be taken in the planning process to make town and city centres attractive places to shop. This will, by necessity, involve a change in the location of certain services such as facilities for homeless people and drug treatment clinics. The importance of the provision of such services is not in doubt. However, instead of being centrally located, this service provision should be located closer to where those who are in receipt of such vital services live.

This will ensure a greater geographical spread of such services and allow for towns and city centres to once again become vibrant centres of commerce.  On making town centres more attractive to consumers, there are a number of things to consider. Car parking Public policy up to now has focussed on the need to encourage the use of public transport when travelling to city and town centres in order to reduce traffic congestion. This is a worthy aim, but discourages consumers from travelling in to city centres to make bulky purchases. It is obvious that a “free for all” parking system is not viable. However, consideration should be given to allow those travelling in to city and town centres for periods of two or three hours to park for free. The system may, for example, allow those who wish to park between the hours of 11am and 3pm to park for free for two hours, thus giving city centre retailers their custom while avoiding any contribution to rush hour traffic congestion. Cleanliness The Your Dublin, Your Voice survey, conducted some years ago by Dublin City Council, found that only 32% of respondents felt that the city was clean and

• tidy. Such a situation will not entice consumers to come into any city centre.

The Tidy Towns initiative has worked well for smaller towns and villages and helped instil local pride and respect for the surroundings in which people live- and shop. Consideration should be made of how to instil such pride and respect in larger urban environments.  Turning to measures to tackle crime and improve safety; Lighting and Garda presence The Your Dublin, Your Voice survey also found that less than one-in-three respondents felt safe in the city centre at night time. This must be improved upon.

To achieve greater feelings of safety at night, An Garda Siochana should prioritise guards on the beat during the hours of darkness and local authorities should ensure that streets are properly illuminated. Implementation of existing strategies Retail Ireland believes that much of the policy consideration to reduce crime in urban environments and the towns in which retailers operate has already been carried out and needs now to be implemented. To this end, we recommend the full implementation of the National Crime Council’s A Crime Prevention Strategy; Tackling the Concerns of Local Communities which advocates, among other things, an integrated crime prevention strategy involving all relevant Government departments, the development of community policing structures, a reduction in recidivism through work with ex-prisoners and greater investment in youth work at community level. We also fully supported the establishment of An Garda Siochana’s Theft from Shops Prevention Strategy and continue to play a role in its implementation.  Finally, measures to improving business conditions for retailers are crucial. Local Authority Rates The High Streets at the Heart of our Communities report highlights the importance of local authority rates and their interconnectedness with the viability of retailers’ businesses. Retail Ireland urges root and branch reform of local authority funding so that less of the burden for this funding falls on retailers. Rents The issue of rents and the huge difficulty upward-only rent reviews (UORRs) are causing retailers is well-documented. Notwithstanding the Constitutional difficulties encountered last year on this issue, action must be taken to ease

the burden on the retail sector to avoid store closures in areas of high rents, such as city and town centres. In particular, Retail Ireland joined with a number of other bodies in recently calling on the Government to allow Senator Feargal Quinn’s bill on the matter, which has been supported by the Seanad, to pass through the Dail so that the President can decide whether or not to refer it to the Supreme Court. Other costs of doing business Where rents are high and footfall is low, it is crucial that other costs are also

• addressed. In Ireland the costs for retailers for labour, water, gas, electricity

and professional services are far too high and must be addressed. In doing so, many town centre businesses will be saved and the opportunity for growth will present itself. Attracting tourists to retail outlets Shopping is an integral part of the tourism experience in cities around the

• world. Retail Ireland believes Failte Ireland and other bodies charged with

encouraging tourists to visit the country should concentrate more on this aspect of the tourist offering. Vacancies There is a particular issue around vacant retail units throughout Ireland. Research from CBRE shows that while retail activity has picked up a little, vacancy rates in key towns and cities remain high:  Athlone has a vacancy rate on its high street of 21.6% in Q1 of 2014, up from 18.2% in Q3 of last year.  The vacancy rate on Patrick St in Cork is up from 13% to 14.3%.  Sligo's high street vacancy rate stands at 12.5%, unchanged from last year.  Limerick's rate also remains unchanged at 16.3%.  Henry St in Dublin has a vacancy rate of 12.8%, up from 4.3%

There are improvements in parts of the country, with high profile areas like Grafton St showing reduced vacancies and Cork's Opera Lane development fully let. But the overall picture highlights the continued problems of the sector. A key problem is the high level of local authority charges, such as commercial

• rates. It is vital that we remember that a recovery in the retail sector will

reduce vacancy rates, increase the rates base and ultimately provide extra funding for local authority services. A key way to make that happen is to reduce rates for retailers and even offer rates holidays for retailers that take on a vacant unit. That way we can breathe new life into our towns and cities. Conclusion So, we need action on many fronts. We need to make town centres attractive, clean and safe places to do business. We need to encourage retailers to take up vacant units. We need an appropriate retail tourism strategy. We need to address anti-social behaviour. With a joined-up approach, we can start a new chapter for towns and cities around Ireland. I would now invite my colleagues here to speak. ENDS