No sale

12 May 2022

No Sale

by J.R.Thomas

It is becoming a very dangerous activity to read the Sunday newspapers.  Given that All Fools Day comes but once a year, and then rarely on a Sunday, the only logical explanation for the bizarre contents of the rag that thumps onto the front door mat is that either the reader is becoming insane, or the editor of the chosen Sunday is.  But hopefully none of our readers have problems with sanity, and given that all newspapers report much the same news, it seems unlikely that the senior ranks of Fleet Street could all have flipped at the same time.  But equally, the upset to the croissant and coffee must have some explanation.  Which, alas, is simple: our politicians have gone collectively mad.

We are not venturing into Sir Keir’s memory failures, or the forgetfulness of Ms Rayner, or the mysteries of when curry is for work and when it is for pleasure.  In the end, none of it matters a jot to the troubled times we live in.  But what does matter is that the Conservative Party seems to have lost even the most basic understanding of economics and trade.

 Sir Alec Douglas Home, the 14th Earl of Home, as Harold Wilson insisted on calling him (at least until Alec pointed out that Harold was certainly the 14th Mr Wilson), said when Prime Minister that he had to do economics on his fingers.  Well, many of us do find that the best approach as it keeps things simple and in touch with reality.  But Mr Gove, now Secretary of State for Levelling Up, the most absurd title ever given to a cabinet minister, has foresworn his fingers, his toes, and his common sense. The SoSfLU says that landlords with empty shops must be forced to let them.  “Eh, what?” the Earl of Home would have said.  He could have told Mr Gove that there is nothing the average shop owner would like more that to find tenants for his empty shops, preferably ones that could oblige with rental payments every three months or so.  The 14th Mr Wilson, even in the recessions to which his governments were slightly prone, did not think landlords needed encouragement to find tenants, knowing that tenants = income = tax yield (Sir Alec could do that on three fingers). Nor did Messrs Callaghan or Heath, and certainly not Mrs T, the daughter of a corner shop owner and operator.

Mr Gove is said to be one of the brightest stars in our present government.  One quakes at the notion that this might be true, but sure enough, his boss, currently watching Sir K thrash about in the biryani, has given this new strategy his full support.  It was trailed across the Sundays last weekend; then the Queen’s Speech at the opening of Parliament on Tuesday afternoon contained a promise of legislation to force landlords whose shops had been empty for more that twelve months to submit to a rental auction and let their premises to the highest bidder.  What happens if bidders did not appear or were persons of straw or turned out to be dream weavers as to their abilities in retail commerce was not clear, and as the bill was not laid out in any detail we are not yet the wiser.  But we remain convinced that if a landlord has failed to let his premises it will generally not have been for the want of trying.  The Speech was full of promised bills for the next session – 31 of them, several of them seeming more than a little eccentric, but this was the oddest.

If anything underscores Mr Rees-Mogg’s urgent efforts to get civil servants back to their offices, it must be the pushing forward of this wholly daft idea.  We have a strong suspicion that some junior oik in the Dept of Lev Up wiled away last Wednesday morning sitting on the end of his bed in Clapham South on his laptop creating an elaborate joke, sent it to his three best mates, who, roaring with laughter, sent it to each of their three best mates, and so on until it reached the Senior Permanent Secretary, who, roaring with laughter, sent it to Mr Gove. Twenty minutes later back came the Minister’s email marked “ACTION THIS DAY”.  They aren’t laughing now, those civil servants.

It is in theory at least not difficult to make money in commercial property.  Take your savings, buy a vacant shop or two (offices and warehouses will also work), let them to a tenant. The tenant pays rent which gives an income on your investment, and, whoopee, the value of your shop increases because you can sell it to other landlords who will pay for you having done the hard work of letting it.  The smarter the tenant, the longer the lease, the more the value will have gone up.  Sell the shop, buy another vacant one, and repeat.  Spend the rest of your day wondering what colour Ferrari you should order (red).  Be warned, it is possible to reverse the whole process (buy tenanted shop, tenant trades badly and goes bust, lose your investment, return Ferrari to dealer).

As you can see, there is a very strong incentive on landlords to keep their shops let.  Mr Gove though, in his myriad responsibilities and cares of high office, seemingly has not considered my simple worked example; his objective is to keep the High Street bustling, especially in Rochdale and Penistone and Alsager, where he wants those northern Tory voters to understand he cares about them. Or about their votes at least.  “Damn me,” he thinks “these landlords are blowing my strategy to bits by deliberately keeping their shops empty, leading to abandoned High Streets, tumbleweed infesting empty car parks, and local youth acting out A Clockwork Orange in the underpass”. Then this brilliant idea was emailed to him by his SPS, having been peer reviewed by almost the entire staff of DOLU.  That’s the answer, make ‘em let ‘em.  Problem solved. Next.

A lesser minister might have contemplated record high commercial taxes, rising interest rates, costs of parking for retail shoppers, congested roads, perceived street crime, increasing costs of employing retail staff especially at the junior level where customers appreciate them, bureaucracy on imports and indeed bureaucracy on everything, the tax advantages of on-line traders, and the general convenience of having deliveries to front doors compared with the difficulties flung in the face of even a determined shopper proceeding to town.  And indeed, the relentless abstraction by governmental hands of the contents of pay-packets. Then he might have wondered if there were solutions to the crisis on the High Street other than penalising landlords for failing to do the impossible in the face of what Whitehall has itself created.

He might also consider some of the ancient principles of Toryism and indeed Liberalism, that people are usually the best placed to make their own decisions, run their own lives and businesses, and generally thrive if just left alone, while the government can help best by keeping out of their way.  And Minister, read something by Burke or John Stuart Mill or Friedman or Hayek, that will help you understand how to be a modern Conservative.  Easily available from your local bookshop.  

Oh, your local bookshop has closed down. Oh dear, oh dear.  I wonder why that was.

tile photo: Ben Garratt on Unsplash

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