Ministerial Response - Environment Minister - Retail in Jersey - 28 January 2019

Findings

Comments

1

Since 2006, various policies and strategies on the retail sector have been developed by the Department. Whilst these may have served a purpose at the time, it has been difficult to determine which ones are still in use and which ones are redundant. The last policy was published in 2010 and the last strategy was an interim measure developed in 2014.

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2

The retail sector in Jersey is broad and wide-ranging. The main retail area in St. Helier , which offers a mix of local and non-local produce, is a major source of attraction for tourists and Islanders. There are a number of secondary retail areas outside of

St. Helier which offer different retail experiences for local communities and tourists.

The  Minister  welcomes  the  Panel's  recognition  and understanding of the hierarchy of retail provision in the Island, which is protected and promoted in the Island Plan.

Successive  Island  Plans  have  sought  to  uphold  and support the role of St. Helier as the primary focus for shopping in Jersey, whilst recognising the role of other local centres, particularly in meeting local convenience shopping needs.

Findings

Comments

3

There are several groups which exist to develop, improve and regenerate parts of St. Helier . The Parish of St. Helier has the greatest overall understanding of the needs of the Town Centre, and in this regard, the Panel has suggested that discussions take place between the Parish and the Department for Infrastructure to determine whether responsibility for some functions, which are currently held within the Department, could be transferred to the Parish.

The development and management of urban centres is a complex  task,  involving  many  different  interests, reflecting the range of uses and functions that happen within them: St. Helier is no exception, and changes within it have significance both for the town and the parish, but also for the whole Island.

Because of this, the Minister is of the view that work to improve and regenerate the town needs to be carried out within a strategic framework and an overall plan for the town, which sits within, and is integrated with, a plan for the Island. The role of planning in this process is supported by research: the role of statutory land use planning  in  creating  a  resilient  future  for  the  high street remains a legitimate and democratic space for providing a leadership role, collating and prioritising the evidence base, and articulating options and joint strategies for change'[1].

On this basis, those agencies with a strategic oversight and responsibility for planning and transport are best placed to lead and to facilitate change, including that which  might  affect  the  town  centre  and   St. Helier 's retail function.

Any  such  work  is  best  carried  out  with  those stakeholders  affected  by  change  and,  in  the  town centre, the Parish of St. Helier is an integral player, both in terms of its insight and ability to act.

Whilst there currently exists a range of groups with a specific interest in –

• a  particular part of the town – for example; the States Regeneration Steering Group and the States of Jersey Development Company are focussed on the development of States assets; or

• a  theme  of activity  within  it –  for  example,  the Safer   St. Helier  Group  is  focussed  on  reducing crime and anti-social behaviour;

the overall regeneration and improvement of the town requires  collaboration  and  partnership  working  with relevant agencies within a strategic framework.

The  Council  of  Ministers  recognises  this,  and  has identified the revitalisation of the town as a key theme in its Common Strategic Policy.

Work  is  underway  to  establish  governance arrangements to take this work forward, including the involvement of the Parish of St. Helier .

Findings

Comments

4

The retail sector is one of the biggest industries in Jersey and involves a vast amount of people and businesses in the production, distribution and selling of goods and services. It also has a major impact on the local economy. In 2017, the retail sector generated approximately £38 million in GST and is estimated to deliver almost £6 million in retail tax in 2019.

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5

Although tourists generated £800,000 of GST revenue in 2017, this is a relatively small amount of GST balanced against the figure generated by the sector as a whole (£38 million).

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6

Although the retail offering in the town centre is wide-ranging, it lacks a specific offering dedicated to attracting consumer tourists'. Jersey may be able to attract consumer tourists by encouraging the development of a section of the town that is focused on enhancing the local tourist economy.

The  Minister  notes  the  substance  of  this recommendation,  which  is  also  reflected  in  work arising from Visit Jersey's Product Audit and Action Plan.

The development of town quarters around a specific retail offer would be supported by the existing planning policy regime that is provided by the current Island Plan,  where  any  such  activity  is  located  within  the defined Core Retail Area (see Island Plan Policy ER2).

7

Physical stores offer a distinctly different retail experience to online shopping. The possibility of social interaction between shoppers and retailers gives local shops the opportunity to compete and win business by offering excellent personal service.

The  Minister  welcomes  the  Panel's  recognition  that social interaction is an important aspect of why people might travel to a town centre, or local shopping centre, to shop.

The provision of good customer service is clearly an important aspect of local retail service, but the Minister is also of the view that the development of a good quality  public  realm  throughout   St. Helier  in particular – including streets and spaces where people have the opportunity to meet, socialise and spend time together –  is  an  important  aspect  of  a  good  urban environment, and can enhance the experience of living, working, shopping or visiting the town.

8

Out of town retail areas, such as

St. John 's Village and Gorey, are vital, particularly for parishioners who may find travelling to St. Helier difficult. Although shops in these areas may not be people's main source of shopping, they offer convenience and play an important community role.

The  Minister  welcomes  the  Panel's  recognition  and understanding of the hierarchy of retail provision in the Island, which is protected and promoted in the Island Plan.

Successive  Island  Plans  have  sought  to  uphold  and support the role of St. Helier , as the primary focus for shopping in Jersey, whilst recognising the role of other local centres, particularly in meeting local convenience shopping needs.

Findings

Comments

9

The current de minimis level is not in line with the tax policy principle of fairness and creates a disadvantage for local retailers.

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10

Before the retail tax was introduced, there was a lack of consultation with retailers and other key stakeholders, creating a lack of fairness in its implementation.

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11

The retail tax only applies to companies if 60% of their trading turnover is from retail sales. Therefore there are some larger companies who supply goods wholesale as well as retail, but who are not liable to pay the tax because 60% of their turnover is not from retail sales.

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12

The Sustainable Transport Policy 2010 recommended that the amount of short- stay (shopper) parking was increased. Since the policy was approved, however, the amount of parking spaces has decreased rather than increased, with the removal of 390 public and

230 private parking spaces at Gas Place to enable construction of the Millennium Town Park in 2011. Although this has not resulted in increased usage of other town car parks, it may have added to people having to "hunt" for available spaces.

One of the key objectives of the Sustainable Transport Policy, which was adopted by the States, was to reduce peak hour traffic to and from St. Helier by at least 15% by 2015, whilst seeking to encourage a shift to more  sustainable  modes  of  transport  at  all  times throughout the day.

The reduction of private, non-residential, long-stay car parking spaces – principally used by commuters – is a stated  policy  objective  of  both  the  Sustainable Transport Policy and the Island Plan: the loss of private spaces at Gas Place is, therefore, entirely consistent with adopted policy objectives.

Reducing the level of this type of car parking provision requires commuters to consider alternative modes of transport,  thus  potentially  reducing  peak-hour congestion;  and  can  encourage  the  better  use  of valuable town centre land for other, more beneficial uses. This is a key objective for the regeneration of St. Helier .

The  Sustainable  Transport  Policy  acknowledges  the economic importance of short-stay (shopper) parking for the viability and vitality of the town centre, and seeks to maintain and increase the quantity of shopping parking that is available at all times. This is monitored and managed by Growth, Housing and Environment: their  evidence  shows  that  town  shopper  car  parks generally  have  spare  capacity  and  operate  on  an occupancy rate of approximately 70%, Minden Place being the exception to this.

Findings

Comments

13

The Sustainable Transport Policy 2010 aimed to persuade people out of their cars, reducing the demand for both public and private parking spaces. The Panel questions whether the policy has been successful as 70% of respondents to the consumer survey use their own cars whilst shopping in Jersey.

It is important to recognise and acknowledge that use of cars for shopping, as tested by the consumer survey, did  not  differentiate  between  food  and  non-food shopping. In this respect, the same survey showed that 97% of food and  groceries bought in the  preceding month  were  from  supermarkets.  The  distribution  of supermarkets in Jersey occurs throughout the Island, and  they  are,  therefore,  not  exclusively  located  in St. Helier  and  are  generally  required  to  provide dedicated private car parking for shoppers.

The  survey  did report  that  32% of respondents  had used St. Helier 's Central Markets for food shopping, and  it  is  clearly  important  that  these  remain  easily accessible to shoppers, albeit that the pattern of their use – involving the purchase of fresh produce – may happen more regularly than a visit to a supermarket and involve journeys by foot.

14

The high level of rents is creating challenges for retailers and may put off new entrants to the market.

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15

Unlike parts of the UK, Jersey does not have a general problem with empty retail shops. As of July 2018, just over 2% of the available shops in St. Helier were vacant.

The Minister notes and welcomes the Panel's findings that   St. Helier  has  not  witnessed  the  level  of  retail vacancies experienced elsewhere which may, in part, reflect the success of the Island's planning policies in resisting  major  out-of-town  retail  development  and supporting  the  hierarchy  of  existing  retail  centres, particularly the primacy of St. Helier .

16

Rating assessments were fixed in 2003, based on rental values at that time. Therefore, it is highly likely that the retail sector is currently paying a higher proportion of the rates burden than they would if there were a revaluation process.

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17

Although retailers are experiencing significant challenges, particularly with the growth of online shopping, it is evident that consumers are also feeling the strain as household incomes have increased by less than inflation. This could be a contributory factor as to why, in the recent consumer survey commissioned by the Economic Development Department, 88% of consumers said cost was one of the main reasons why they shopped online instead of in Jersey.

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Findings

Comments

18

It is unclear what impact Brexit will have on the retail industry, and it will remain an unsettled time for both retailers and consumers. The main challenges will likely be the potential disruption of supply lines and the possible weakness of sterling, which will raise prices.

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19

Data collection in the retail sector is poor and as a result we do not have a clear view of the industry. Robust data on the value of retail to the Jersey economy will be beneficial and should enable the Economic Development Department to identify weaknesses and problems in advance, as well as providing an insight for potential investors in the Island's retail economy.

The Minister would wish to ensure that comprehensive information  about  the  capacity  and  health  of  the Island's retail sector is available in order to inform the development of planning policy which seeks to support the vitality and viability of the Island's retail centres.

20

Footfall cameras measure the number of people walking in the street. By counting footfall, retailers and the Town Centre Manager are able to identify trends in consumer behaviour. Currently there is only one footfall camera in town whereas previously there were three.

There are  many factors which  have the  potential to influence the health of the high street, and the Minister would  welcome  and  support  the  collection  and maintenance  of  data  upon  the  following  range  of factors –

• pedestrian footfall
• diversity of uses and change
• recent and proposed investment
• accessibility
• attitudes and perceptions
• retailer representation and demand
• commercial yields and retail rents
• vacancy rates
• cultural and social events
• leisure and cultural facilities
• town centre residential population
• employment in the town centre
• street safety
• sense of place.

21

The Jersey Retail Association (JRA) was established in 2016 and is pivotal in giving retailers across the Island a voice. The JRA was given a two year start up fund of £100,000 by the Economic Development Department.

The Minister welcomes the establishment of the JRA in order that it might collectively represent this important sector of the Island's economy and help to facilitate and maintain dialogue with government.

Findings

Comments

22

Events such as the Christmas lights switch-on, Sunday markets and street theatre play an important role in animating the town centre. Such events are highly anticipated by Islanders and are vital for supporting retailers.

The Minister acknowledges the significance of events in animating the town centre and helping to ensure that it remains vibrant.

The development and maintenance of a good quality public realm throughout St. Helier , including the town centre, is important in helping to facilitate events and social interaction, in whatever form that might take – whether  formal  street  theatre  or  just  informal socialising and people watching'. This an important aspect of a good urban environment which can enhance the experience of living, working, shopping or visiting the town.

23

Although retailers are experiencing challenging times, particularly with the increase of internet shopping, the future outlook is promising if retailers remain open to new ideas, technologies and innovation, and focus on exceeding customers' expectations.

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24

In recent times the retail sector has seen the emergence of sustainability-focused shops. Sustainability can be a key differentiator if Jersey's retail sector is to rejuvenate itself, for example, aligning practices with plastic-free Jersey. Research from elsewhere shows that consumers want to associate themselves with brands that have a sense of purpose and represent their views, beliefs and values.

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25

Retail Theatre improves the consumer experience and is a key differentiator for physical versus online retail. Retail Theatre, through the organisation of events, particularly at peak times of the year, adds to the vitality of the town centre and attracts Islanders and tourists alike.

The Minister acknowledges the significance of events in animating the town centre and helping to ensure that it remains vibrant.

The development and maintenance of a good quality public realm throughout St. Helier , including the town centre, is important in helping to facilitate events and social interaction, in whatever form that might take – whether  formal  street  theatre  or  just  informal socialising and people watching'. This an important aspect of a good urban environment which can enhance the experience of living, working, shopping or visiting the town.

Findings

Comments

26

The impact of online shopping has been felt acutely by the traditional retail sector. Therefore, it is important, now more than ever, that retail staff have the necessary skills to improve the quality of their customer service and so encourage customers to choose to shop on-Island rather than online.

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27

It is likely that the Minister for Economic Development will propose the deregulation of Sunday trading in 2019.

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28

Current Regulations mean that most shops can already open on a Sunday. The Panel is generally supportive of the principle that the decision to open on a Sunday should be made by the retailer. By giving larger shops the opportunity to open on a Sunday, it is believed that an overall uplift in footfall on Sundays, will be experienced. This is likely to particularly benefit the tourism industry by ensuring St. Helier remains an interesting destination for weekend visitors.

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29

In a sector that has very little data available to it, the consumer survey provides very useful insights and information about consumer attitudes to shopping in Jersey.

The Minister welcomes the consumer survey and the insight it provides.

Recommendations

To

1

Although certain functions, particularly regarding roads, are the legislative responsibility of the Minister for Infrastructure, potential benefits could be realised by transferring some responsibilities to the Parish of St. Helier . The Panel recommends that the Parish and the Department work together to  determine  whether  there  is  any  advantage  to  be  had  through  the delegation or transfer of certain responsibilities to the Parish. This work should be undertaken in 2019 and any outcomes should be reported to the Panel.

Minister for Infrastructure

2

The  concept  of  consumer  tourism  should  feature  in  the  new  Retail Development Strategy. The Department should consult with experts in this field in order to explore ways to incentivise the mass market and increase the selection of luxury brands in Jersey.

Minister for Economic Development, Tourism, Sport and Culture

3

The Treasury Department should consider levelling the playing field to ensure that the Retail Tax is fair and introduce these measures in the Budget 2020.

Minister for Treasury and Resources

4

The Department for Infrastructure should investigate new measures for improving the convenience and cost of short-term parking in town. These could include revisiting free parking pilot schemes for limited periods and increasing  the  availability  of  on-street  parking.  These  should  be undertaken before the end of the second quarter of 2019.

Minister for Infrastructure

5

The Economic Development Department should collect the data necessary to monitor rent levels on a quarterly basis.

Minister for Economic Development, Tourism, Sport and Culture

6

The  Economic  Development  Department  should  explore  whether  the current practice of increase-only rent reviews is appropriate.

Minister for Economic Development, Tourism, Sport and Culture

7

In  order  to  balance  the  rates  system,  the  Minister  for  Treasury  and Resources and the Comité des Connétable s should commission a Rates Assessor to undertake a revaluation.  Such revaluations should then be undertaken every 10 years to ensure fairness in the rates system.

Minister for Treasury and Resources

8

The Economic Development Department, Treasury and External Relations must work together in order to seek clarity around Brexit negotiations and the impact it could have on shoppers, retailers and most importantly the security of food supplies. This should be incorporated into the new Retail Development Strategy with input from both the Ministers for Treasury and Resources, and External Relations.

Ministers for –

Economic Development, Tourism, Sport and Culture

Treasury and Resources

External Relations

Recommendations

To

9

Statistics Jersey previously undertook a Retail Sales survey which sampled businesses (including food and non-food) operating in the retail trade in Jersey. Statistics Jersey had to stop collecting data in 2015 because of a lack of funding. The Minister for Economic Development should work with Statistics Jersey to restart the collection of retail data. This work should be completed and funding identified before the end of June 2019.

Minister for Economic Development, Tourism, Sport and Culture

10

In order to gain a true understanding of consumer behaviour, the Minister for  Economic  Development  should invest in  more  footfall  cameras  in St. Helier .  Additional  footfall  cameras  should  be  installed  before  the second quarter of 2019.

Minister for Economic Development, Tourism, Sport and Culture

11

The future of the Jersey Retail Association should not remain uncertain and a long-term funding strategy should be identified in the new Retail Development Strategy.

Minister for Economic Development, Tourism, Sport and Culture

12

The Economic Development Department should work with the Parish of St. Helier and the Town Centre Manager to ensure funding is available for the provision of a year-round schedule of events. This should feature in the new Retail Development Strategy.

Minister for Economic Development, Tourism, Sport and Culture

13

In order to guarantee a minimum level of customer service throughout the Island's retail sector, the Minister for Economic Development should work with the Jersey Retail Association to create and deliver a customer service course that is required as part of the training of new members of staff. This should be rolled out before the end of 2019.

Minister for Economic Development, Tourism, Sport and Culture

14

When the Minister for Economic Development brings forward proposals to deregulate Sunday trading, appropriate protections for staff in terms of religious beliefs and adequate days in lieu should be included. The effects on out of town convenience stores, should also be monitored.

Minister for Economic Development, Tourism, Sport and Culture

15

The Department for Economic Development should repeat the consumer survey every 2 years.

Minister for Economic Development, Tourism, Sport and Culture