Ministers urged to 'pause for thought'

Sluggish retail sales eased by Rio Games

Princes St retail shoppingScottish retail sales were “uninspiring” last month but the slowdown was eased by consumers buying more food to watch the Rio Olympics at home, according to new data.

Total sales fell 1.9% in August compared with the same period last year and by 0.3% when adjusted for deflation.

The grocery category recorded its best three-month average performance for more than two years.

However, non-food categories overall wilted further, with clothing and footwear faring poorly despite a fillip from ‘back to school’ purchases.

Only health and beauty products such as make-up and fragrances provided positive news in non-food.

David Lonsdale, director of the Scottish Retail Consortium, said: “This data should give our politicians pause for thought as they consider government’s tax and spending plans for the year ahead, with retailers looking to the Finance Secretary to do more than just twiddle the fiscal dials in the upcoming Scottish Budget.

“Ministers should be wary about adding to the pressure on household disposable incomes at a time when consumer confidence remains fragile, by keeping a firm grip on personal tax rates.

“They also need to look closely at the rising tax burden on Scottish retailers, with reversing last year’s regrettable doubling of the large business rates supplement an obvious place to start.” 

David McCorquodale, head of retail at KPMG, said: “Food sales in Scotland were the star performer in an otherwise disappointing month.

“Despite the deflationary environment causing further shrinking, the sector saw its best three-month average growth for more than two years.

“Staycations, coupled with the Rio Olympics, saw families gathering at home to watch Team GB, helping to drive increased volumes.”

> Separately,  new data from the government shows household disposable incomes in Scotland fell by 1% (once adjusted for inflation).

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