UK shops had 'worst Christmas in a decade' as sales flatlined, says British Retail Consortium

Like-for-like sales fell 0.7 per cent from December 2017 as shoppers reined in spending

Heavy discounting could not save HMV which went into administration for a second time after a disappointing Christmas (EPA)

British retailers recorded zero sales growth in December - their worst Christmas trading for a decade - according to new data.

Not since the midst of the financial crisis in 2008 have UK high streets performed so poorly, the British Retail Consortium and KPMG found.

Like-for-like sales fell 0.7 per cent from December 2017 as shoppers reined in spending and shifted to budget retailers.

High street stalwarts Marks and Spencer and Debenhams both reported falling Christmas sales while John Lewis warned its staff their bonuses may be under threat.

It would be the first time since 1953 that the employee-owned partnership withheld the traditional payment.

BRC chief executive Helen Dickinson warned of further risks on the horizon for struggling retailers.

“The worst December sales performance in 10 years means a challenging start to 2019 for retailers, with business rates set to rise once again this year, and the threat of a no-deal Brexit looming ever larger.”

The retail landscape is “changing dramatically” in the UK, while the trading environment remains tough, she said.

“Retailers are facing up to this challenge but are having to wrestle with mounting costs from a succession of government policies - from the apprenticeship levy, to higher wage costs, to rising business rates.”

Paul Martin, UK head of retail at KPMG, said: “Retailers experienced little festive cheer this year, with total sales in December delivering zero growth on last year.

“This comes despite some retailers desperately attempting to generate sales through slashed pricing, which has seemingly not been enough to encourage shoppers."