The case for cheap food...

The map above (you can view a bigger version here) shows the proportion of household income spent on food and the incidence of malnutrition in those countries. As a visual guide to the politics and economics of food it's pretty telling - simply put, places with the highest proportion of income spent on food are the places with the highest incidence of malnutrition.

The other stand out feature is just how little the UK and USA spend on food - less than 10% of household income (the difference between the UK and Scandinavia, however, can probably be explained by the latter countries taxing food). This is one of the greatest achievements of the past hundred years - from a situation where a third or more of income was spent putting food on the table to one where it costs less than a tenth of income. From a time when the diseases of malnutrition were commonplace to one where they are very rare.

There are two central features to this achievement. The most important is that we are, by every measure, significantly better off. The richest tenth of 100 years ago would be blown away by the wonders that are available to the poorest tenth today - things that we so take for granted we consider them essentials. This is what capitalism and free markets have brought - not just higher incomes but a bewildering variety of goods and services on which to spend those incomes. So when high-income left-wing writers attack neo-liberalism or 'market fundamentalism' they wish that future generations won't see progress and improvement. Worse George Monbiot and his sort would condemn billions living in those purple and brown circles above to a life of poverty with no prospect of escape. The choice for me is simple, you have free markets or you have permanent poverty for the mass of people.

The second feature behind us only spending a tenth of our income on food is the industry that makes and distributes the food. Those same high income left-wing writers will quickly condemn high volume food processing and sophisticated distribution for the terrible sin of bringing cheap food to people with less income. For that is what this industry does and it does it efficiently and effectively. When we look at nations with price fixing, over-regulated food retail and nationalised distribution we see people spending more of their income on food and many there being unable to get enough to stave off malnutrition. Think of India with its high skill industries, its space programme and it nuclear bombs, plus over 40% of its population suffering from malnutrition in some form. While levels of income partly explain this, the sclerotic and over-regulated retail distribution sector also drives up food prices for the poorest.

Perhaps in the UK we can afford food snobbery and the indulgence of expensive food but for much of the world the mass production of protein dense cheap food is essential. And this means a system of free markets and trade. The approach preferred by development organisations (and too many governments) of using subsidy to sustain subsistence farmers just above starvation is morally indefensible. Indeed, Oxfam and other development NGOs should be at the forefront of calling for more open trade, more free markets and less regulation. That these organisations aren't champions of neoliberalism represents a complete failure to meet their mission of alleviating poverty.

We do not get cheap food by digging wells for subsistence farmers, we get it by opening up markets to a sophisticated industry able to grow, process and distribute high quality food at a fraction of the cost the local, controlled and officious systems that dominate the sector across the parts of the world with the highest proportion of income spent on food. If you want less starvation, less poverty and healthier people everywhere then you want cheap food - and cheap food comes from free markets.

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Taxing supermarkets won't save the high street...but it will stop the high street saving itself

The 'supermarket levy' campaign has been around for a while and, thanks to the thoughtlessness of local politicians in assorted places, has now reached the national media:

BBC News has learned that Derby City Council has called for the right to bring in a levy as a "modest" effort to ensure supermarket spending "re-circulates" in local communities.

Some 19 other local authorities back a so-called "Tesco tax" on big retailers, which could raise up to £400m a year.

The premise for this is that supermarkets and other out-of-town retailers are to blame for the decline of town centres and, when we're asked, we all say town centres are really important. Except that we don't do very much of our shopping there any more. And the reason we don't shop there is because town centre shopping - at least for every day purposes - is inconvenient, inconsistent and often expensive. We have to get into town, park (often at considerable cost) and then lug our tired bodies round assorted shots that may or may not have the things on our list.

The 'supermarket levy' is promoted by an organisation calling itself 'Local Works'. Here's something about it:

Local Works was the coalition campaign for the Sustainable Communities Bill, originally set up by the new economics foundation. The campaign was successful when the Bill became law - the Sustainable Communities Act - in October 2007. Since then Local Works, as a part of Unlock Democracy, has been promoting the Act and urging people to get involved and government to implement it properly.

What nef did was to cobble together this coalition on the manifesto of 'localism' and the Sustainable Communities Act was sold to us on the basis of positive proposals to improve town centres and local communities. It is pretty sad that the usual green left wibble about the malign affect of supermarkets has been allowed to dominate the campaign's agenda. A fine idea that local initiatives shared can prompt national action has become just a campaign for a tax on food retailing, a campaign that won't save the high street, won't make people use independent shops but will impact on food prices in the places where most people - and especially less well off people - shop.

Seeking to rescue the traditional town centre by this route merely replaces trade with subsidy. The independent retailers and town centres become dependent on the money that flows from the levy. This doesn't really make those businesses and those centres viable, it merely acts to ossify a failed model. The future for high streets - as I have said many times before - doesn't lie with mere shopping but with being places of leisure and pleasure. This probably means fewer shops and smaller centres but it also means a different approach starting from what people want - not defined by opinion polling but rather by what people actually consume.

In the widest meaning of these words, the successful town centre is about the event, about theatre and about occasion. Some of the events are grand, some might be political or campaigning or even smaller and localised. But most of the events and occasions are personal and private - Susan's 40th birthday, the end-of-season night out for the football team, a reunion of old university friends or perhaps just a walk round town with mum and dad. The best town centres are the ones that provide for these events and occasions and not the ones harking back to a time before most people had cars and fridge freezers, a time when shopping was daily and a real chore.

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Sir Terry Leahy is right about supermarkets...

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About supermarkets:

Asked if seeing boarded-up shops made him sad, Leahy said: "It does, but it is part of progress. People are not made to shop in supermarkets, they choose to shop there.

"High streets– some of them are medieval and the way that we live our lives now is very different, so what you have to do is make sure the benefits do outweigh the costs, and I think that they do."

It pains me to agree with Sir Terry since I like those independent shops. But he's right - there is no doubt that, on balance, society has gained from the success of supermarkets like Sir Terry's beloved Tesco. Just as we no longer have to pound away washing clothes by hand, bash at carpets with a big stick or get on our knees to scrub the hearth, we no longer have to spend hours each week traipsing from small shop to small shop merely to get the things we need.

Instead we can read, we can sing, we can enjoy a bit of leisure - make the most of all the good things progress (and I mean real progress here, the fruits of capitalism, not the fake progress socialists offer) has brought us. Television, computers, games, foreign holidays, thousands of songs on one little pod.

Our lives are richer than they've ever been and the supermarket has played a big part in creating those riches. Rather than a limited selection at the shop on the corner, we've access to thousands of different products under one roof. We don't have to walk round in the rain, snow and sleet but can make our choices in the warmth and light of indoors - choosing vegetables and fruit throughout the year, flown in from Peru, Kenya and Sri Lanka. We can experiment with odd foreign grains, with twenty types of rice and a hundred different teas and coffees.

All this isn't just available to the elite. Everyone has this choice on the doorstep. And it enriches our lives in a hundred ways. Yes, Sir Terry, supermarkets are great!

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Transition Towns - or how to be less resilient and exclude the poor

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Maybe I've been asleep - I don't usually miss left-wing, green wibble - but 'transition towns' were a new one on me. Apparently there's a whole movement of them:

Transition Initiatives, community by community, are actively and cooperatively creating happier, fairer and stronger communities, places that work for the people living in them and are far better suited to dealing with the shocks that'll accompany our economic and energy challenges and a climate in chaos.

The point about these 'transition initiatives' is that they involve the capture of a local agenda - and policy-setting within a specific community - by a small group of committed, green extremists. The point and purpose of these groups is to ensure that all the focus within the particular community is on "resilience". We are told the problem is - without evidence or the proffering of choice - with things such as 'runaway' climate change, peak oil and that:

Industrial society has lost the resilience to be able to cope with energy shocks.

The chosen methods for these activists are to stress those parts of the local agenda that are open to criticism on 'environmental' grounds - it might be anything from local concerns about proposals for a coffee shop or a supermarket to campaigns against housing development or new transport infrastructure.

These campaigns give the green extremists the crack into which to ram their anti-development, anti-industrial wedge. At the heart of this extremism is the seemingly benign idea of 'resiliance' - making communities more resistant to shocks such as "fluctuations in energy prices" and "anticipated changes in climate". And this resilience is all about excluding the regional, national and international - thus the lower prices and distribution resilience of the large supermarket is denied in favour of local growing initiatives, jolly little town currencies and campaigns to defend independent shops. All of which, of course, make it more difficult and more expensive for the less well off.

And cutting yourself off from wider distribution systems does not make you more resilient. You only need to look at the aftermath of the recent Hurricane Sandy to see that national retailers were far more able to respond to the crisis than were local independents. Why? Because their national distribution networks, dispersed warehouses and truck fleets allowed them to quickly redirect stocks to places affected by the hurricane.

The truth is that the last and best protection - that resilience - comes from well-managed private business rather than from government. The Transition Towns idea deliberately sets out to exlcude these systems claiming they damage the environment or actually threaten local resilience. Worse still Transition Towns seek to create local systems that are more expensive to manage, less robust and excluding of the poor - they are not just twee little groups 'doing good' but organisations actively damaging communities.

Most depressingly these Transition Towns do not seem that way. Clever and articulate people promote them, the same naive churchy types as were suckered by 'fair trade' get involved and none of these people realise that the losers in all this are the poor. The one's who'd rather like a nice supermarket or a Costa coffee. The one's who would benefit most from connection to the international network of trade. The one's who'd like their sons and daughters to have a fighting chance of affording to carry on living in the smart little market town. The people who benefit from that "industrial society" our Transition Town advocates disdain.

Transition Towns really are less resilient and exclude the poor.

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Rotherham Council gives local supermarket £80,000 - or so they don't say

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Well that's what it looks like to me:

Carl Battersby, director of environment and development services at Rotherham Council, told the BBC the idea to arrange the loan came after suggestions from its welfare reform steering group.

"We're trying to do the best for our local people," said Mr Battersby.

"Clearly we're not quite sure what the demand and take-up will be but we think it's the right thing to do to help some of the most vulnerable people."

He added: "People are struggling to meet the cost of basic items, food being one of them. As a council we wanted to do something positive."

The vouchers can only be redeemed at Pak supermarket in Rotherham until 11 January and exclude cigarettes and alcohol.

For sure all the campaigners against evil loans sharks and other such demons will see this as the action of a wonderful caring council. Indeed that's how the BBC reports it:

Struggling families in South Yorkshire are being offered help with their food bills through Christmas in a bid to stop people borrowing from loan sharks

But why just the one supermarket - and not even one anyone has heard of? Why not just give cash loans? It wouldn't be that cigarettes and alcohol bit would it!

Put simply this is an atrocious use of public money - bordering on malfeasance.

And 'the-man-who-would-be-MP' seems to get on well with this supermarket!

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Doctor know everything...

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Including about marketing and pricing strategies:

...citing an article from a medical journal in 2009 by a leading liver specialist which suggested supermarkets were overcharging for food to pay for cheap drink.

This is the Prime Minister - yet again revelling in his ignorance of business. Or rather his minions at No 10 digging him out from the latest hole into which he'd dived. It seems that the PM believes that offers on beer are "subsidised" by more expensive food.

This is nonsense on sticks. For two reasons - firstly we don't go to supermarkets, in the main, to buy drink we go there to buy food and other household necessities. And secondly, the price of X isn't subsidised by the margins on Y - supermarket pricing strategies just don't work like that.

More importantly however, what qualification does a "leading liver specialist" have to talk about the pricing strategies of supermarkets? None whatsoever - I'll take his advice on my liver, maybe on some other doctoring stuff but not in an area where (despite not being a specialist) I know more than he does.

But then 'Doctor know everything', he is mighty god and great know-all.

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"I don't approve of you drinking" - Cameron's message to the English

The softening up process - the drip drip of judgemental leakage that typifies Cameronism - continues as we're warned about the new "Alcohol Strategy":

The plans, being driven by David Cameron, have raised fears that middle-class households will bear the brunt of measures supposedly aimed at troublemaking youths and other anti-social drinkers. 

Now when this all started it was driven by the recycling of old photographs in the Daily Mail. You know the ones I mean - attractive girl, drunk, draped over a bench. All accompanied by the dire description of our town centres as ridden with drunken violence. So minimum pricing was born - not to make us healthy but to get rid of the unsightly tramp, to discourage the baseball-cap wearing youth from quaffing cheap cider at the park gates and to end "pre-loading" thereby making town centres civilised places where people promenade between tea shops rather than stagger from bar to bar.

But it's not about that now. It's about you and me sitting at home, not bothering anyone and enjoying a glass of wine while watching the X-Factor:

“People shouldn’t think this is just about yobs getting drunk in parks and kids preloading before going out — this is going to affect respectable middle-class people popping into Waitrose for a couple of bottles of sauvignon blanc at the weekend.” 

So from a (misguided and misplaced) policy aimed at those buying cheap booze - by definition these folk don't shop at Waitrose let alone Booth's - we now have policies targeted at the myth of increasing alcohol consumption. It seems we will get a consultation - but it won't be about whether these proposals are a good or bad idea or even whether they will actually achieve what they claim.

Mr Cameron this year backed a 40p minimum unit price, but it is understood that the Home Office will next week seek views on a range of options for a minimum price for a unit of alcohol.

The policy is confused, won't achieve its stated aims, is illiberal, will promote rather than reduce crime and will close down a load of corner shops. And it will annoy people - not much but enough to flake a few more off the Tory branch. These people won't take to the streets in protest. They won't fill the pages of the Guardian or the BBC's bit of the airwaves with their voice.

But they will give both barrels of their opinion to the next Tory canvasser. And I don't blame them.


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Crying foul at supermarkets won't save the High Street. Getting the offer right just might...

Skipton High Street - success in a small town with three supermarkets

In an article containing a vaguely linked set of slightly left-wing presumptions, John Harris in the Guardian explains how the High Street is “under attack”.

Now, dear reader, set aside images of tripod-like Martian war machines stomping into Cheam and Cheltenham or perhaps sinister masked ninja figures rolling grenades into Marks & Spencer and turning over benches or plant pots in the Arndale. No we’re talking here about those besuited plutocrats that the Guardian so hates (bejeaned, Tuscany-dwelling plutocrats are, of course, fine).

The truth is that big business has failed us, twice. First, while distant high street landlords endlessly put up rents, the boom years saw the accelerated replacement of independent shops with the chains whose names – Game, Peacocks, JJB Sports – denoted the stereotypical clone town. Soon enough, the same firms became bywords for the aftershocks of the crash – and left behind the retail equivalent of scorched earth.

Sadly for Mr Harris, the truth is a great deal more prosaic that this – the High Street is dying because people prefer to shop elsewhere. And where they don’t prefer to shop elsewhere, High Streets – or more to the point, town centres – are not dying.

Perhaps Mr Harris should take a trip to Keighley (I know John, it’s in the North) and walk around this pretty ordinary town counting the empty shops. Sadly for Mr Harris’s thesis he won’t find very many. Indeed, if he walks down Cavendish Street, he’ll see an eclectic mix of shops. For sure, there’s a ‘cash converter’ sort of place and a couple of charity shops. But in amongst there’s an old-fashioned cobbler, an independent toy shop, a gift shop or two, a hairdresser and – wonder of wonders – a hardware store run by a man who actually mends things!

All this in a town with three supermarkets (five if you include Aldi and Iceland, six if you include the wonderful Shaan’s Asian supermarket) – it seems that, if you get the environment right and the offer right, town centres can succeed. And that having supermarkets isn’t the death knell for the High Street either.

Mr Harris spends a deal of time championing negative campaign groups such as Tescopoly rather than asking what might be done to improve and develop – even save – the town centre. We should bear in mind that the fastest growing retail sectors are on-line and factory outlets. Even further from the town centre than the terrible Tesco or the sinister Sainsbury. Places that – despite Mr Harris’s worst fears haven’t killed his “adopted” home of Frome.

Frome has seven – yes folks, seven – supermarkets (Sainsbury, Tesco, ASDA, Somerfield, Iceland, Lidl and Co-op) as well as:

...a town centre that has the rare luxury of scores of independent shops.

The truth in all this is that not only is the negative impact of supermarkets overstated (there is a negative impact but it’s on jobs and secondary grocery outlets, the corner shop, rather than town centre comparison shopping) but this is yesterday’s battle. Today we should be thinking about the role of town centres where comparison shopping has moved on-line.

A while ago I wrote about how our view of town centres has to change:

The driver to the success of Main Street isn’t the shop – although to hear us talk about town centres you would think that – it is the relationship we have with that place and the space it provides for the events and activities of our lives. In Bradford, when Pakistan win at cricket, hundreds of fans head for the local centres. Not to shop but to share their happiness at victory.

Yet we distrust such a use for the spaces of our town centres. Many of us grumble about public drinking, about young people gathering together, about hen parties and stag dos. And we certainly dislike political campaigns and religious promotion (unless of course it’s an official and state-sanctioned occasion) – to the point of complaining about these activities.

To make town centres work we need to start thinking about them differently:

1. places of performance – planned or otherwise
2. centres of culture not temples to shopping
3. a locus for excitement and discovery rather than the workaday
4. as venues for communal celebration, sharing and festivity

In the end, town centres have to be wanted. Not because campaigners have driven away choice but because people want to go there – to shop, to eat, to promenade, to listen, to watch, to sing. The negative attitude of John Harris and his sort won’t change a thing. What will change the town centre is making them places that people – old, young, rich, poor – want to visit. Places of leisure and pleasure - centres of delight, the focus of fun.

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I wonder what's in Bradford Council's rather secretive "markets review"?

Solly's Fruit & Veg - from John Street Market but here on tour in Haworth

Way back in May 2000 I became Bradford’s Portfolio Holder for Regeneration succeeded the current leader of council in that role. At the time there was a great long wish list of projects – it seemed that hardly a community in the City hadn’t been promised some miraculous regenerative cure.

Amongst all these promises were records of a series of discussions with a large Bradford-based supermarket chain. Some of these discussions related to the relocation of Morrison’s headquarters from Thornton Road to Gain Lane at Thornbury (the land there was in Council ownership). However, some of the remaining discussions related to the “regeneration” of Bradford’s markets – the John Street Market in the City centre and Keighley Market in the centre of that town.

Keighley folk may recall the debate about the possible relocation of the market so as to give Morrison’s a frontage on Low Street (right opposite the shopping centre where the market entrance is located). What Bradford folk don’t appreciate is that the Council had been in a similar conversation regarding John Street Market. And bear in mind that Cllr Green had already presided over the demolition of Rawson Market, Yorkshire’s last specialist municipal fresh food market – ostensibly for reasons of “health and safety”.

By 2000 it was too late to save most of the fishmongers, many of the butchers and most of the greengrocers decamped from the knocked down Rawson and James Street Markets – dozens of long established businesses sacrificed on the altar of “regeneration”. But we could – and did - put a stop to the idea of tucking the markets away behind a supermarket. And we did rebuild John Street market (I remain unsure about the rebranding as the Oastler Centre although this was done for good reasons and with positive intent).

I’m saying all this because I fear that we may be back defending the District’s markets. It has already been reported that the Shipley outdoor market is threatened with relocation – away from the car park, away from the centre of the town. What we don’t know is the full detail and content of the “markets review” ordered by the Council’s regeneration chiefs.

I fear – and I know some traders do too – that the Council fancies the chance to close down John Street Market (they’ll call it consolidation or merger with Kirkgate Market). After all the advocates of shiny regeneration that dominate our local agenda have never liked markets. Untidy places filled with cheap stuff, immigrants and poor people – not the sort of folk we aspire to in our wonderful city centre! A supermarket would be altogether neater and think of the capital receipt from selling the John Street site!

The markets review is being driven by the desire for savings – yet the markets generate a healthy surplus after all their costs are accounted for. The wonder of these places is ignored. The chance to invest, to grow and to improve is not taken. And the fact that markets make a place far better than shopping centres, public art or supermarkets is simply dismissed.

I may be proven wrong about the markets review – although the Council’s leadership is remarkably coy about the very existence of the review, let alone its content. But if Councillor Green returns to his 1990s habits of trying to knock down successful markets, it will make the Odeon debacle seem like a walk in the City Park.

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A hearty meal

We took a trip to Shan's who call themselves the premier multicultural halal supermarket. They're in Keighley - another premier multicultural halal place - and are well worth a visit. The shop is tidy, stacks of spices, rices and flours line the shelves and it's great to wander through the fruit and veg section going "what on earth is that?" or "I wonder how you cook that?". I love the yard long beans and the strange knobbly roots but have yet to pluck up the excuse to buy some and see how they taste. Maybe next time.

At the back of the shop is a long butcher's counter - chicken, lamb, mutton. Both off and on the bone, butchered Asian style. And plenty of offal from tripe (best avoided I think) through to sweetbreads. Amongst this was a pile of lamb's hearts something I hadn't eaten since my childhood. We bought them and took them home for a hearty meal!

I stuffed the hearts with shallots, chestnut mushrooms and puy lentils and since I had way more stuffing than needed I poured the rest over the top of the hearts before covering and baking slowly for (if I recall right) about two and a half hours at 150 degrees. For the last half hour I took the foil off and added some red peppers - more for colour than for additional flavour.

Very nice it was too (as you can see)!

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More evidence that planning stifles economic growth...

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Now this isn't to say that we shouldn't have planning but is to observe that, if we do have planning, then we must appreciate the costs that society faces from having that planning. And the main cost is in economic growth - fewer jobs, fewer businesses and more expensive goods in the shops:

Using the quasi-natural experiment of the variation in planning policies between England and other UK countries and a difference-in-difference approach, we isolate the impact of Town Centre First (TCF) policies. We find that space contributes directly to the productivity of stores and planning policies in England directly reduce output both by reducing store sizes and forcing stores onto less productive sites. Our results suggest that since the late 1980s planning policies have imposed a loss of total output of at least 18.3 to 24.9%. This is equivalent to more than a ‘lost decade’ of output growth in a major sector generated directly by government policy.

Maybe we were right to have TCF policies but, in having them, we must also accept that loss of output growth and that lower productivity. Plus of course the negative impact on the UK economy of that lost output and lower productivity. We may be socially richer from having a "vibrant" high street but we are economically poorer.

So next time some planning expert tries to tell you it supports the economy - laugh in his face.

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The Groceries Code Adjudicator Bill or how to raise food prices without helping suppliers

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The Queen’s Speech setting out the government’s proposed legislative programme is, as these things always are, something of a curate’s egg. There’s some pretty sensible stuff – pension reforms, some regulatory reform, scrapping (I thought we already had though) the Audit Commission and some reform to the electoral register that will make cheating a little harder.

But there are some bad bits – the blogs will be crammed with comment, even rage, about the surveillance bill so I’ll leave commenting on that to others. However there is another dreadful proposal - an unholy stitch up between metropolitan foodies and the National Farmers Union. It has the quite innocuous title of the “Groceries Code Adjudicator Bill”. It is a bill to put up food prices.

It’s not portrayed in that way of course but rather as a benign measure aimed at stopping the big grocers – let’s be blunt here, the big supermarket chains plus the Co-op – from wielding their market power with suppliers. But no-one asks about what wielding that market power actually means to the British public.

So let me explain. When supermarkets screw suppliers – large and small – down to the floor they do so in their own interests. And in the interests of consumers. That’s right, you and I benefit from the evil supermarkets buying stuff as cheaply as possible and on the most flexible of terms. Not only that but the consumers who gain the most from the evil business practices of the supermarkets are the consumers who need that gain most – the poor. Whatever I may think of supermarkets – and I’m no particular fan – there is no doubt that delivering on their promise of cheap food has been the single biggest contribution to alleviating poverty in the last fifty years.

However much the supply chain likes the proposed Bill and however much the competition (the Association of Convenience Stores are big fans) want it to happen, nothing should cover up the fact that the proposals will result in higher food prices. Maybe not by much but rest assured prices of staple foods – eggs, butter, flour, cheese, bread and so forth – will be higher. Which is why the ACS likes the Bill – it removes, at a stroke of the pen, some of the supermarkets’ competitive advantage thereby making a direct contribution to those stores’ bottom line.

The saddest thing is that – faced with higher prices from UK suppliers – the big supermarkets will look overseas. Rather than having some clipboard wielding jobsworth determining prices, the buyers will head to Poland, to Serbia and to Bulgaria where they’ll by milk, meat and flour to sell in their shops. Far from protecting the livelihoods of hill farmers, these proposals are just as likely to accelerate that vocation’s decline.

The Grocery Code Adjudicator Bill will raise food prices. And there’s no evidence at all that it will make life any better for suppliers.

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Tim Farron - Communist

Supermarkets are evil, they are driving down the prices for suppliers forcing poor farmers to go out of business. This must be stopped!

But just a minute – how do we do this? After all those farmers already receive a subsidy from the Common Agricultural Programme to produce their sheep, beef or milk so the taxpayer is already (in theory) subsiding the price of these goods.

Apparently we need a regulator! Who – according to Tim Farron, President of the Liberal Democrats -  would:

Totally agree! A strong regulator would make sure consumers don't pay more & that farmers get a better price

So we create a system where the price to the supplier is fixed (or subject to controls to guarantee a minimum price which amounts to the same hill of beans) but the supermarket can’t pass that on to the consumer.

We would have a subsidised, loss-making farming business with state determined minimum prices and a grocery sector with state determined maximum prices. If that’s not a recipe for disaster, I don’t know what is!

Rather reminds me of the Soviet Union!

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Too few people using The People's Supermarket it seems!

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There was a flurry of right-on, luvvie commentary about the People's Supermarket a while back:

Arthur Potts Dawson, the mastermind behind The People's Supermarket, is certainly full of what one might loosely define as organic missionary zeal. A tall, youthful and reasonably optimistic chap who set up the London eco-restaurant Acorn House, (and is vaguely related to Mick Jagger, inter alia), Potts Dawson hopes that once his baby takes off, the likes of Tesco and Asda will be as a bad dream. We will all put in our community service and revel in 1970s-style food bills, while the big boys founder.

This is because in return for washing walls at TPS, you will be eligible for a 10 per cent shopping discount, and the ability to buy about 20 special "People's" foodstuffs at artificially low prices. Ordinary shoppers will be able to use the store, but not access the cheaper prices. Only we cleaners qualify for that. 

Eighteen months later it doesn't seem to be working out for them:

Due to financial difficulties, The People's Supermarket has struggled to keep up with the payment of business rates to Camden Council. The People's Supermarket is a Co-operative and Community Benefit Society and operates for the benefit of its members and the community, not in pursuit of profit. For that reason, we ask that Camden Council continue to support us by allowing for the renegotiation of rate payments. In the absence of such support, The People's Supermarket will become insolvent by March 1st.

So when we're getting all excited about different business models, frothing about mutuals, co-ops, co-production and other such wonders, let's not forget the basic truth about the market! If you don't have enough custom, you don't make enough income and you can't pay your bills. With the result that the cap is waved under the council's nose saying "help us out - we're really good even though we're losing money!"

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Dear Res Publica, taxing the shopping habits of the poor to subsidise the preferences of the wealthy is immoral and stupid

I wasn’t planning to comment at length on Adam Schoenborn’s Res Publica report, The Right to Retail – indeed Guido’s comments might have sufficed:

Food price inflation is bad enough as it is without Blond trying to undermine the competitiveness of the supermarkets, who will inevitably just pass on increased costs to consumers. Blond and Zac are a danger to the affordability of basic needs to consumers with their attempts to foist a Tory form of autarky on us all. If Blond wants to open a grocery store good luck to him, no need to hobble the supermarkets in the process.

However, I made the mistake of starting to read the report and to consider what it says:

The finding of the Competition Commission in 2008 – that the grocery market represents a “good deal for consumers” – has exposed the limitations of our national competition framework. We participate in our economy not just as consumers but as employees, community-members, investors and crucially as owners. As such, competition law must go beyond price-based consideration of consumer interest. It must create and sustain markets and a model of growth that can sustain small owners alongside the big. If instead we continue to be indifferent to ownership, we will continue to be a society without assets, practicing capitalism without capitalists.

The obvious question that springs from this comment is why? Why do we need to “sustain small owners” – surely in a free market small owners will succeed if they make a good enough offer, buy well and are properly managed. And I know this because I wrote a Masters Dissertation on street markets and farmers markets. Unlike the author of this report, I took the trouble to read the wide academic literature, to look at the experience of the USA, Canada and Europe and to consider how you can see small traders succeed alongside the supermarket. And yes, there is a movement out there, growing and expanding – filling a niche of local, high-quality food.

• FARMA, the farmers’ market, farm shop and pick-your-own organisation now boasts over 700 members trading through 800 markets and retail outlets across the country.
• Ocado, set out in 2002 to provide high quality food online and is now a listed company – demonstrating again how new entrants to the grocery market can succeed
• And Abel & Cole lead the field in the provision of veg boxes – regular deliveries of fresh, seasonal fruit and veg to the consumer’s home

Moreover if you visit inner-cities you’ll see other grocery phenomena – thriving municipal markets stuffed with Asian, African and East European stalls, corner shops that, in response to demand, have suddenly become the Polish shop and in places like Bradford great supermarkets like Pakeezah and Haq. All these businesses are successfully trading in competition to the big supermarket chains. I even saw fruit and veg van sales in Bradford last week – something I’ve not seen since I was a child!

What saddens me about Schoenborn’s report isn’t just that it completely ignores all this exciting new retailing but that there is absolutely no reference to the extensive literature about the drivers for supermarket success, the long term decline of town centres as locations for convenience and bulky goods shopping and the different strategies available to rejuvenate town centres. The only theory in the report relates to economics – there is nothing from the wider field of urban studies, from town and country planning (despite the proposal for a whole raft of new planning regulations and controls), from sociology or from geography.

And the prescription set out here – to introduce a further tax on out-of-town retail – won’t work. It may provide some extra cash for town centres but are we really suggesting that a tax on one business should be used to subsidise another business – selected through some unspecified process of ‘designation’? Is that not a recipe for state control, corruption and market distortion?

More importantly, at a time when food inflation is well in excess of 5%, such a tax would act merely to raise prices. And it would be the less well off – the folk who shop and Morrisons, Tesco and ASDA – who will pay those prices. What Schoenborn proposes is a tax on the shopping habits of the relatively poor so as to subsidise the shopping preferences of the relatively rich.

A while ago I wrote – referring to a study by US sociologists Susie Pryor and Sanford Grossbart (“The Ethnography of an American Main Street”, International Journal of Retail & Distribution Management 2005):

Main Street is not simply a place of commerce – a shopping centre. Nor is it (as if in some Soviet dream) just a place for formal events and celebrations. It is a place of engagement and co-operation between merchants, consumers and “ancillary actors”. It is alive.

The driver to the success of Main Street isn’t the shop – although to hear us talk about town centres you would think that – it is the relationship we have with that place and the space it provides for the events and activities of our lives. In Bradford, when Pakistan wins at cricket, hundreds of fans head for the local centres. Not to shop but to share their happiness at victory.

Yet we distrust such a use for the spaces of our town centres. Many of us grumble about public drinking, about young people gathering together, about hen parties and stag dos. And we certainly dislike political campaigns and religious promotion (unless of course it’s an official and state-sanctioned occasion) – to the point of complaining about these activities.

To make town centres work we need to start thinking about them differently:

1. Places of performance – planned or otherwise
2. Centres of culture not temples to shopping
3. A locus for excitement and discovery rather than the workaday
4. As venues for communal celebration, sharing and festivity

So rather than beating down the door of John Lewis, Selfridges or some other “iconic” store should we not be finding impresarios to programme and create the framework on which the community's events and occasions – large and small – might be hung? After all we won’t go to Tesco to celebrate when West Ham win the world cup again!

Simply using the blunt instrument of tax and planning controls to give preference to selected small high street shops (not street markets, farmers markets, van sales, veg boxes, farm shops or other innovative retail businesses) is both wrong and misguided. To make town centres work you have to animate them, to put on events, to make them party friendly and to make the centre accessible by car – so cheap or free parking and plenty off it, please.

And, when you undertake some research, it’s good practice to actually refer to the literature lovingly written by academics across the world who specialise in that field rather than simply revisit one report (in this case from the UK’s Competition Commission) the conclusions of which you – without any substantiation or theoretical basis – choose to disagree with.

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