Agenda item

Councillor Jacobs presented the ‘Save Havers shops from closure’ petition on behalf of the petition organiser.

The Executive Member for Financial Sustainability responded to the petition.

I would like to thank residents for presenting this petition, and to all those that have signed it.

I would like to open by saying that I am in wholehearted agreement with the principal points of this petition, and I would hope all councillors within this chamber support it. Local shops are an invaluable local asset, providing local employment and services, a sense of community, and reduce the need for car journeys. The Havers shops are clearly very well located to serve the local community.

The title of the petition is ‘save Havers shops from closure’, and I am delighted to say that the Council has no plans to close the Havers shops. What has been decided is that the council is going to sell the property. We are currently working with our agent to agree marketing details, and the parade will be offered to the market within the next few weeks.

Since the decision to sell the property was announced, we have been approached by eight different parties who have expressed an interest in buying the parade. I understand that all eight of these potential buyers are seeking to purchase the parade as an investment, looking to retain the tenants and re-let the empty shops. None of the parties have indicated they would be looking to demolish the property and redevelop the site, although of course they may decide to do so later. However, the age and condition of the properties mean that some kind of refurbishment is probably needed soon, which may have an impact on the businesses.

The petition is also posing the question of whether the council can protect local businesses. Probably the best way to do this would be to retain ownership, thus retaining control of rental rates, but unfortunately, the weakening of local government is making this progressively more difficult. Parades such as this one were built post-war, along with the council houses they were designed to serve. Once the council houses around them were sold off, this led to councils owning retail properties scattered around the district. Whereas maintenance would previously be contracted for the entire property portfolio in an area, the loss of the houses significantly increased the cost of managing the shops, due to lack of economies of scale. In addition, as the properties aged, the maintenance requirements increased. The effect of this was that the council only carried out minimal maintenance and this led to the gradual degradation of the properties. Perhaps if the council had more funds, it could have done better than this, but as we know, since 2010 local government funding has been significantly reduced, and there is no sign of this changing in the foreseeable future. The effect of this national policy has been to force local councils to withdraw from providing certain non-essential services. This council is additionally hamstrung due to the particularly high level of debt that it has accumulated over the last 5 years or so, which makes asset sales attractive as they help reduce the debt.

In contrast to the council’s position, the private sector is well placed to manage commercial property. Private companies may have spare funds available, giving them easier access to new capital and much lower costs. In addition, companies who specialise in this business will have the knowledge and expertise to ensure the properties are maintained and tenanted. Their costs are likely to be also lower, because they may have economies of scale if they own other properties, and because they don’t carry the council costs associated with ensuring that public money is spent wisely.

The council must decide how to use its limited funds in the best interest of council taxpayers. In this case the sale of the parade will allow the council to reduce debt, which will help protect other essential services the council provides. The sale will mean the parade transfers to private ownership, but there is no reason to believe that this will harm the immediate prospects of the parade. There is a cost of course, and that is that private ownership brings uncertainty, and we are often afraid of uncertainty, but this fear will hopefully turn out to be unjustified.

The best way to preserve local businesses is to support them, and I am sure the council would consider promoting community initiatives supporting local shopping.

It is very reassuring that there are so many signatures to this petition, and I am hopeful that with the support of the local community the Havers Parade has a very bright future.