British Retail Consortium urges Chancellor to cut public spending and avoid tax hikes in a bid to help retailers recover from the recession.


Ahead of next month's expected Budget, the BRC's submission to the Chancellor states that any move to deal with the budget deficit should prioritise a cut in non-essential public spending over tax rise, or risk a return to recession.

BRC director general Stephen Robertson said: "The size of the country's deficit means action must be taken. To nurture our fledgling recovery, the main tool for dealing with the deficit has to be cutting non-vital public sector spending.

"Some tax rises may be inevitable, but no Government should rely on tax hikes to reduce borrowing. The increases would have to be so large that customers' ability to spend would be wrecked - risking a double dip recession."

The BRC also feels that retailers' ability to maintain and create jobs runs the risk of being undermined by further increases in employment costs. Retailing is one of the UK's biggest employers, with nearly three million people working in the sector.

The trade association is calling for the planned 1% increase in National Insurance to be scrapped, as it believes this will cost retailers an extra £220m. It is also asking that this year's National Minimum Wage increase be no higher than 1%.

The BRC has joined forces with the British Chambers of Commerce, CBI and other leading business groups to create an online petition opposed to the 2011 National Insurance rise. A dediated website has been set up at www.no-nics-rise.co.uk

Property cost rises are another hindrance for retailers, says the BRC. Retail companies already pay a quarter of the £23bn in business rates in England - more than any other sector. This April, retailers across the UK face hefty increases, as a result of the five-year revaluation.

The BRC is calling for affordable increases in business rates and that businesses affected by the Business Rate Supplement (BRS), which was introduced in London to pay for Crossrail, to have a legal right to vote down any BRS that they do not believe will deliver enough local economic benefits.

Mr Robertson concluded: "Retailers are vital to jobs. Retailing is the UK's largest private sector employer. We'll be leading the UK into recovery. It's crucial this budget gives us the support we need to maintain and create jobs and doesn't pile on damaging new costs."

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