Diolch, Gadeirydd. I’m pleased to move the motion before you today. Before I entered politics, I was a small business owner, operating businesses on the high street in Bridgend and Porthcawl, and I experienced at first hand the challenges facing businesses on our high streets. The motion tabled by my colleagues and me seeks to mitigate some of these challenges. We are calling for the Welsh Government to take action on business rates as a longer-term solution and to introduce better rate relief for small businesses in the short term. This will inject much-needed support for small independent retailers who are struggling, particularly those operating on our high streets.

As the Federation of Small Businesses state in their 2017 manifesto, small independent retailers make a unique and irreplaceable contribution to the character of our streets in our cities, towns and villages. They are vital to local economies throughout the country. A much higher proportion of revenue is recycled into the local community through small businesses than through their local counterparts. Without small independent retailers, our high streets are at risk of becoming either empty shells or smaller versions of out-of-town retail parks. If we want to retain the character of our high streets, from Bridgend to Bangor, from Connah’s Quay to Cowbridge, then we have to act now.

One in every eight retail units are currently empty, and with the Welsh economy lagging behind the other UK nations the outlook for the high street isn’t great. High-street retailers are struggling with increasing rents and business rates, at the same time as facing increasing competition from online and out-of-town retailers who have much lower costs. We have to create a level playing field, and the majority of small businesses and small independent retailers want to see action taken on business rates.

Business rates, as currently constituted, are inherently inequitable as they bear no relation to the profitability of a business. They are a charge based upon the rent of the property, and, as many small high-street retailers have found to their detriment, do not reflect the turnover or profits of the business. Retailers who wish to remain on the high street have no choice but to absorb the additional cost. They can simply move on, as some Ministers have suggested in the past. It is therefore vital to the very survival of our high streets that we replace the current business rates system with a more equitable tax based upon the ability to pay.

This is supported by both the FSB and the Welsh retail consortium. The FSB state that the non-domestic rates system, as it stands, is an unfair and regressive tax that takes no account of a firm’s ability to pay. A business must pay £1 in business rates before it earns £1 in turnover, let alone £1 in profit. This system is no longer fit for purpose and is unable to take account of the changing nature of doing business. A property-based tax, by its nature, unfairly targets businesses in prime locations such as high streets. Infrequent revaluations merely store up trouble, exacerbating a property tax that already lags behind the economic cycle. We agree.

According to the Welsh retail consortium, Welsh retailers want to see fundamental reform of business rates for all, whether that be small, medium or larger-sized business. What is abundantly clear is that the current system is not fit for purpose. It’s deterring investment and leading to shop closures and job losses. We understand that this cannot happen overnight. This is why we are proposing an interim system of rate relief that will see businesses with a rateable value below £15,000 taken out of business rates altogether, and a reduction of 20 per cent for those businesses that fall within the £15,000 to £20,000.

Although business rates are the biggest barrier to the survivability of high-street businesses, they aren’t the only one. Our high streets are facing stiffer competition from online and out-of-town retailers. I believe in a free market but here we don’t have a level playing field, and therefore the odds are stacked against high-street businesses in more than one way. Out-of-town developments benefit from free car parking and those car parks are not included in the business rate valuation. In order to even up the playing field, we are proposing that an offer of at least one hour of parking in town and city centre car parks should be available. We believe this will encourage local trade.

It’s not just the Welsh Government who are to take action to save our high streets. The UK Government also have a role to play. They have to create the economic stability we need for the high street to survive. They also need to look at business taxation. I would like the UK Government to review value added tax when Brexit does materialise. The VAT threshold needs to be raised from the £85,000 it currently is, and a more graduated system introduced. But above all, the Welsh public also have a role to play. We should all prioritise small independent retailers—whenever we can—who offer goods and services at top value very often. To paraphrase the Labour leader’s conference speech, it’s a case of use it or lose it. If the Welsh public value the high street, they have to use the high street. In just under eight weeks, it will be Small Business Saturday, and the Federation of Small Businesses have once again launched the £10 pledge, in which they’re encouraging as many people as possible to pledge that they will spend at least £10 with a local business, a small business, on Saturday 2 December. I have accepted that pledge, as I did last year and the years before it, and I will be supporting Small Business Saturday and I urge everyone here to do likewise.

I urge everyone watching this debate to accept the pledge. Supporting our small high-street businesses ensures that we have a diverse and vibrant local economy. By reducing the threshold on VAT, we can then employ more people and then the economy grows further. I ask you to show your support for the Welsh high street by supporting the motion before you. Diolch yn fawr.