Struggling retailers pour scorn on ONS's upbeat high street sales data

BRC says incomes are down and consumers are cutting back

A dispute over the state of the high street broke out yesterday as the British Retail Consortium accused the Office for National Statistics of producing sales figures that "paint an overly rosy picture" of shopping in the UK.

The ONS initially caused considerable pre-Christmas cheer yesterday, as its latest data indicated that the value of UK sales grew by 0.7 per cent in October, from September, and by an inflation-busting 5.4 per cent from the year before.

The Government's official statistics office put the surprise sales rise down to "pre-Christmas sales and in-store promotions", with supermarket wars helping push prices down by 0.4 per cent in October.

However, the British Retail Consortium dismissed the figures, arguing that they underestimated the extreme difficulties retailers are experiencing on the high street. To make matters worse, they implied conditions were improving, when they are actually deteriorating, said the BRC, which has a history of disputing ONS figures.

Stephen Robertson, the BRC's director general, said: "Most retailers won't recognise the overly positive picture being painted by these ONS results. The reality is disposable incomes are down on a year ago and customers are cutting back."

The BRC said its figures for October show that the value of sales grew by just 1.5 per cent, compared with the year before, "meaning customers are actually buying less when the impact of inflation is factored in".

Furthermore, yesterday's ONS figure represent an improvement on the 3.7 per cent year-on-year rise it recorded in September. But the BRC figures have gone the other way, with its October figure representing a decline on September's 2.5 per cent increase.

A BRC spokesman said: "We've had little spats with the ONS over figures before when they were similarly over-rosy. They have in the past been the target of scepticism and forced to justify their figures."

ONS declined to address BRC's attack, although a spokesman insisted the group stood by its figures.

Many in the industry were surprised, if not sceptical, by the ONS data, especially as it came just a day after the latest survey of consumer sentiment by Nationwide building society found confidence to the lowest level last month since the series started in 2004.

"The retail sales data certainly bodes well for fourth-quarter personal spending. However, we would not read too much out of the data as they clearly diverge from the overall picture," said an analyst at Newedge Strategy.

" Indeed the general outlook is set to remain sluggish," the analyst added.

Samuel Tombs, an analyst at Capital Economics, said: "October's official retail sales figures suggested that the intensity of the fiscal and inflation squeezes on consumers has not kept them away from the high street. But we doubt that the figures signal that the double-dip in overall consumer spending is drawing to a close." The BRC's Mr Robertston, took the opportunity yesterday to call on the Chancellor "to support households and businesses by holding back the costs he's responsible for".

He added: "He should scrap the increases in fuel duty planned for next year and reduce the threatened 5.6 per cent business rates rise. At a time when youth unemployment has passed the 1 million mark, promoting growth in a sector where under 25s make up a third of the workforce should be a priority for the Government."

More trouble in stores at high-street giants

Mothercare and French Connection appeared to throw down the gauntlet to the ONS yesterday, as they became the latest members of the high street to report extreme difficulties.

On the day that the ONS reported that Britain's high-street sales increased by 0.7 per last month, Mothercare and French Connection disappointed their investors so much that their shares dived by 18 per cent and 15.5 per cent, respectively.

For its part, Mothercare unveiled an £82m loss for the first half and slashed its dividend by more than two-thirds, as the retailer's performance in Britain dragged the wider group down.

Alan Parker, Mothercare's executive chairman, said: "The Mothercare group has had a difficult first half. Whilst the international business continues to perform strongly, our performance in the UK illustrates the extent of the challenges facing the business in a weak economic and consumer environment."

French Connection issued a profits warning, saying weak sales meant it was "unlikely" that full-year profits would meet its "original expectations". The group revealed revenues had fallen 10 per cent in the past three months on poor sales of its winter ranges.

A spokesman said: "The UK fashion shopper continues to act very cautiously and, in addition, the unseasonably warm weather has had a negative impact on sales of our winter ranges."

Shareholders were particularly disappointed by French Connection's announcement since it came just two months after Stephen Marks, the group's chairman, said the chain was "firmly back on a growth path", making it well placed to grow its business overseas.

French Connection said it was hopeful revenues in December and January would be better than a year ago, but admitted it was now too far behind to catch up for the year.

In a further sign of the difficulties on the high street, John Lewis's latest sales figures show revenues down by 0.8 per cent year on year in the first half of this trading week.

Tom Bawden

News
Susan Sarandon described David Bowie as
peopleSusan Sarandon reveals more on her David Bowie romance
Sport
Lewis Hamilton walks back to the pit lane with his Mercedes burning in the background
Formula 1
Arts and Entertainment
The new characters were announced yesterday at San Diego Comic Con
comic-con 2014
Sport
Arsenal supporters gather for a recent ‘fan party’ in New Jersey
football
PROMOTED VIDEO
News
i100
News
Bryan had a bracelet given to him by his late father stolen during the raid
people
News
A rub on the tummy sprang Casey back to life
video
Sport
sportDidier Drogba returns to Chelsea on one-year deal
Arts and Entertainment
The Secret Cinema performance of Back to the Future has been cancelled again
film
Life and Style
Balmain's autumn/winter 2014 campaign, shot by Mario Sorrenti and featuring Binx Walton, Cara Delevingne, Jourdan Dunn, Ysaunny Brito, Issa Lish and Kayla Scott
fashionHow Olivier Rousteing is revitalising the house of Balmain
News
i100
Arts and Entertainment
Christian Grey cradles Ana in the Fifty Shades of Grey film
filmFifty Shades of Grey trailer provokes moral outrage in US
News
people
News
BBC broadcaster and presenter Evan Davis, who will be taking over from Jeremy Paxman on Newsnight
peopleForget Paxman - what will Evan Davis be like on Newsnight?
Life and Style
fashionCustomer complained about the visibly protruding ribs
News
ebookA unique anthology of reporting and analysis of a crucial period of history
News
newsComedy club forced to apologise as maggots eating a dead pigeon fall out of air-conditioning
Arts and Entertainment
Jo Brand says she's mellowed a lot
tvJo Brand says shows encourage people to laugh at the vulnerable
Life and Style
People may feel that they're procrastinating by watching TV in the evening
life
News
Tovey says of homeless charity the Pillion Trust : 'If it weren't for them and the park attendant I wouldn't be here today.'
people
Sport
Rhys Williams
commonwealth games
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs Money & Business

Senior Risk Manager - Banking - London - £650

£600 - £650 per day: Orgtel: Conduct Risk Liaison Manager - Banking - London -...

The benefits of being in Recruitment at SThree...

£18000 - £23000 per annum + Comission: SThree: SThree, International Recruitme...

Test Analyst - UAT - Credit Risk

£280 - £300 per day + competitive: Orgtel: Test Analyst, Edinburgh, Credit Ris...

Trainee Recruitment Consultants - Banking & Finance

£20000 - £25000 per annum + OTE £40,000: SThree: SThree Group have been well e...

Day In a Page

Evan Davis: The BBC’s wolf in sheep’s clothing to take over at Newsnight

The BBC’s wolf in sheep’s clothing

What will Evan Davis be like on Newsnight?
Finding the names for America’s shame: What happens to the immigrants crossing the US-Mexico border without documents who never make it past the Arizona desert?

Finding the names for America’s shame

The immigrants crossing the US-Mexico border without documents who never make it past the Arizona desert
Inside a church for Born Again Christians: Speaking to God in a Manchester multiplex

Inside a church for Born Again Christians

As Britain's Anglican church struggles to establish its modern identity, one branch of Christianity is booming
Rihanna, Kim Kardashian and me: How Olivier Rousteing is revitalising the house of Balmain

Olivier Rousteing is revitalising the house of Balmain

Parisian couturier Pierre Balmain made his name dressing the mid-century jet set. Today, Olivier Rousteing – heir to the house Pierre built – is celebrating their 21st-century equivalents. The result? Nothing short of Balmania
Cancer, cardiac arrest, HIV and homelessness - and he's only 39

Incredible survival story of David Tovey

Tovey went from cooking for the Queen to rifling through bins for his supper. His is a startling story of endurance against the odds – and of a social safety net failing at every turn
Backhanders, bribery and abuses of power have soared in China as economy surges

Bribery and abuses of power soar in China

The bribery is fuelled by the surge in China's economy but the rules of corruption are subtle and unspoken, finds Evan Osnos, as he learns the dark arts from a master
Commonwealth Games 2014: Highland terriers stole the show at the opening ceremony

Highland terriers steal the show at opening ceremony

Gillian Orr explores why a dog loved by film stars and presidents is finally having its day
German art world rocked as artists use renowned fat sculpture to distil schnapps

Brewing the fat from artwork angers widow of sculptor

Part of Joseph Beuys' 1982 sculpture 'Fettecke' used to distil schnapps
BBC's The Secret History of Our Streets reveals a fascinating window into Britain's past

BBC takes viewers back down memory lane

The Secret History of Our Streets, which returns with three films looking at Scottish streets, is the inverse of Benefits Street - delivering warmth instead of cynicism
Joe, film review: Nicolas Cage delivers an astonishing performance in low budget drama

Nicolas Cage shines in low-budget drama Joe

Cage plays an ex-con in David Gordon Green's independent drama, which has been adapted from a novel by Larry Brown
How to make your own gourmet ice lollies, granitas, slushy cocktails and frozen yoghurt

Make your own ice lollies and frozen yoghurt

Think outside the cool box for this summer's tempting frozen treats
Ford Fiesta is UK's most popular car of all-time, with sales topping 4.1 million since 1976

Fiesta is UK's most popular car of all-time

Sales have topped 4.1 million since 1976. To celebrate this milestone, four Independent writers recall their Fiestas with pride
10 best reed diffusers

Heaven scent: 10 best reed diffusers

Keep your rooms smelling summery and fresh with one of these subtle but distinctive home fragrances that’ll last you months
Commonwealth Games 2014: Female boxers set to compete for first time

Female boxers set to compete at Commonwealth Games for first time

There’s no favourites and with no headguards anything could happen
Five things we’ve learned so far about Manchester United under Louis van Gaal

Five things we’ve learned so far about United under Van Gaal

It’s impossible to avoid the impression that the Dutch manager is playing to the gallery a little