Charity shops: Welsh government review into cutting aid

Experts have been asked to look further into the idea of cutting financial help for charity shops in Wales as the number on the high street booms.

A review for the Welsh government has recommended reducing business rate relief and tightening qualifying rules.

Business Minister Edwina Hart has asked a review group to discuss possibilities with businesses and charities.

But the Charity Retail Association, which represents the shops, warned the plans could put them out of business.

Wales now has more than 500 charity shops, a rise of about 60% since the start of the economic downturn in 2008.

On Wednesday Newport saw the opening of one of Wales' biggest charity shops in its city centre, opened by wealthy entrepreneur Sir Terry Matthews, owner of the nearby Celtic Manor Resort.

St Anne's Hospice took over the site of the former Next store, with 3,500sq ft (325sq m) of trading space for furniture, bridal ware, clothes and china.

Charity shops are currently eligible for 80% of business rate reduction but that could be cut to 50% under the recommendations.

Prof Brian Morgan, who led the review of business rates for the Welsh government, also proposed limiting the number of premises eligible for charitable relief in a town centres and introducing tighter qualifying rules.

Robert Robinson, clerk of Welshpool Town Council, where there are seven charity shops within a quarter of a mile, said something needed to be done to stop the "unfair advantage" charity shops have over independent traders.

Image caption There are claims that charity shops have an unfair advantage over independent traders

"I wouldn't support a reduction in the rates exemption for charity shops," he said.

"They do play a vital role in raising funds for the charitable sector, and the numbers of customers they attract in Welshpool would suggest that there's clearly a demand for them.

"However, I do think charity shops now have an unfair advantage over independent traders on the high street.

"The low level of business rates they pay means that they're able to offer more in rent, and so they're forcing up the cost of units for retailers who have to pay the full whack."

'Clinging on'

The Charity Retail Association estimated that its Welsh members raised £12m for good causes last year.

Its spokeswoman Wendy Mitchell argued that any attempt to punish charity shops for their success would simply be "shooting the messenger".

"The recession has accelerated an already existing process of driving trade away from town centres," she said.

"But it's hardly fair to blame charity shops because we're amongst the only traders who've managed to cling on."

She said charity shops were not taking shoppers away from other stores because people "aren't coming to town centres full stop".

"Before hitting charity shops with a stick, perhaps Wales ought to look at the planning and transport policies which have made high streets all over Britain unfavourable places to trade," she said.

'Vibrant town centres'

The plans have been put out for public consultation until December, when the Welsh government is due to take a decision on whether to adopt them as policy.

A Welsh government spokesman said there was a lot of interest in the Business Rates Review Group's recommendation on examining charity relief and the business minister had asked for more work, with the outcome due by the end of January.

Meanwhile, First Minister Carwyn Jones has predicted that Wales' town and city centres may look very different in the future with fewer shops and more offices, restaurants and cafes.

He spoke to the South Wales Argus on a visit to Newport on Tuesday amid concerns about the number of retail premises closing on high streets across the country.

He told the newspaper that any plan for Newport's city centre should be based on how it must look in the 21st Century - with "a greater mix of businesses, accepting there are some shop units that aren't going to be shops in the future".

"One of the things we want to look at here is to find a way of making it easier for local authorities to change the use of premises within a city centre to get a better mix of businesses in," said Mr Jones.

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