Review of the Year (part two)

One of the fun if slightly surreal parts of my job is responding to members and others asking me to forecast what’s going to happen next in politics.  Such forecasts are always a bit of guesswork, and the best anyone can really do is analyse the factors at play and come up with some sort of rationale for what might happen next.  I also have a rule that if you want to know what’s likely to happen in an election, listen to the person least connected with the Westminster village where rumours and granular message crafting and media spin cloud the fundamentals of how people in the country at large are feeling and thinking. 

If anyone tells you they confidently forecast Brexit, Trump, the 2015 general election and the 2017 general election, they’re either liars or they should be enjoying early retirement right now with the winnings from bets they placed on these outcomes.  Politics is astonishingly uncertain at the moment, and the usual rules about turnout, regional bias, why people vote how they do, and how election campaigns are run have all gone out of the window. 

Take all this into account when I talk about what’s most likely to happen in 2018 (with recent history telling us that the exact opposite may well occur).  Starting with the identity of the prime minister and the colour(s) of the government, it would require a particular series of events to result in a general election next year, with either the government losing a vote of no confidence, or two-thirds of the House of Commons voting for an early election.  Both of these are possible if Brexit talks collapse, if there are unforeseen catastrophes for either main party leaderships, or if scandal or tragedy sweeps away the majority currently held by the Conservatives and the DUP.  Nonetheless, expect Theresa May to be prime minister, and expect the Conservatives to govern on a similar basis to now.

I’m more confident in saying that the issue that will dominate the Government’s time will be Brexit.  The problem – or the blessing – for the government is that media commentators and politicians have positioned themselves so clearly in the Brexit debate that very few will change their mind and adopt a different view.  How many people have you met who have said: “I voted Remain, but now I think the country made the right decision in leaving the EU” or vice versa?  People are doubling down on their view of Brexit, so don’t expect any real change in the coverage of the deal the government strikes with the EU, or parliamentary debate about it.  Your view on Brexit is likely to be about the same this time next year as it is now.

So what does all this mean for the policy agenda relevant to local shops?  We know there won’t be that much new legislation and no Queen’s Speech between now and March 2019, and we know that the fragile coalitions (as much with the Conservative party as between the Conservatives and the DUP) in parliament will mean ministers pick their battles very carefully.  One area where lots of groundwork has been put in is on environmental policy.  Michael Gove is leading debate on animal welfare, marine plastics and food production all through a green lens.  That means something will be done on plastics recycling, and this may include a deposit return scheme or some other intervention which might have implications for our sector. 

Look out also for changes on business rates.  The wheel is turning slowly here, with concessions on how rates are set and calculated, and a growing consensus that business rates aren’t fit for purpose in the modern economy.  The problem is, business rates are also very hard to evade or avoid compared to some other taxes, so any government will be loathe to move away from this reliable (and unfair and outdated) method of securing revenue.

Keep a close eye out for the debate on the National Living Wage.  We’re set on a path for this to be 60% of median earnings by 2020, but how tempting it is for politicians to buy votes with businesses’ money, and to massage productivity figures, by promising further increases.  That’s not the end of the debate on employment either.  As well as the pay rates for staff, there’s a debate about the security and quality of these jobs that we can expect to run in 2018.

Finally, what about the products we sell?  The sugary drinks levy coms in in April, and the reaction to this will be instructive.  Will consumers push back against higher costs, or will government see this as a template for other interventions?

Last week I wrote about retailers needing to focus on their business and their community in the face of changes in our industry.  The same goes for the political changes around us.  Your political world is the community around your store.  Engage with ACS and help us to influence what happens on the national policies that impact you, and you deliver what you do best for your customers every day in 2018.

This entry was posted by Chloe on Fri, 29/12/2017 - 08:00