Frasers warns of more closures amid anger at business rates delay
Frasers Group has said it will review the viability of a number of stores in its portfolio after slamming the Government’s decision to delay the next business rates valuation until 2023.
“How many more businesses on the high street have to disappear and jobs be lost before the Government takes this issue seriously?,” the retail group asked in a statement reacting to the announcement.
Mike Ashley’s business has closed seven House of Fraser stores since acquiring the department store chain in 2018. In December, the chief executive warned that more stores could go this year, saying that some branches are still losing money despite paying nearly zero rent.
Apart from House of Fraser and Sports Direct, the group also owns designer fashion retailer Flannels, clothing brand Jack Wills and cycle specialist Evans Cycles.
Frasers Group has long petitioned the Government to change the business rates system alongside a host of retail experts and trade bodies.
The two-year delay means that the next revaluation will take effect in April 2023, with many complaining that the property valuations retailers' payments are based on will continue to be “wildly out of date” for another few years as they are currently based on values from a more buoyant 2015.
Frasers said: “With the high street already in meltdown, Covid-19, the lockdown, and its after-effects are now pulverising what remains. Yet the Government stands aside and has buried its head in the sand on the critical business rates issue, raising unfair and uneconomic revenue sums from already distressed businesses.
“Not only has it kicked the can down the road; it has also kicked businesses when they are clearly down. We expect that the Government's inaction will drive further stores and businesses on our high streets into closure, in the process costing many people their jobs and livelihoods.”
The British Retail Consortium echoed the company’s concerns, with business and regulation director Tom Ironside saying: “Business rates are a huge burden for retailers even in normal circumstances, and the current system has contributed to store closures and job losses across the country.”
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