The report argues that the decline of traditional high street shopping is inevitable, meaning ministers should focus less on slowing that decline than on supporting new and more beneficial uses for town-centre sites.

The think-tank has calculated that a major programme of converting retail units for residential use could allow 800,000 new homes to be built across the UK.

SMF has said that the majority of those homes should be built by local councils and other public bodies in a major expansion of social housing. The organisation has also said that the UK Government should write off tens of billions of pounds of local councils’ debt to support that programme.

The SMF report, entitled A New Life for the High Street, argues that the coronavirus crisis will accelerate pre-existing trends including a shift away from shopping in urban centres. As more and more workers spend at least some of their working week working at home, footfall in town centres will decline and more retailers will collapse.

Instead of trying to arrest the inevitable decline of high-street retailers with promises to “save the high street”, the SMF’s research director Scott Corfe said that national and local politicians should deploy radical new measures to stimulate new life in urban centres and support unemployed retail staff.

To save urban centres, Scott Corfe suggests:

1. A nationwide program of repurposing city and town centres should be introduced. This would see vacant retail space converted into residential property. Replacing commercial space with residential property could, under cautious assumptions, create 800,000 additional homes under our calculations.
2. A write off of the £80bn in local government debt sitting on the Public Works Loan Board’s loan book, to stimulate new investment in community assets in town and city centres. This would essentially transfer local government debt into the hands of central government, which is better-placed to service the debt. A debt write-off would liberate local authorities to invest in urban renewal projects – including the creation of new schools, parks, and sports facilities.
3. Designating areas at risk of urban decline due to loss of retail and office space as Economic Growth Areas (EGAs). Modelled on France’s Zones Franches Urbaines, these EGAs would offer tax incentives for firms moving into these areas, with tax incentives contingent on the hiring of local workers – particularly those that have lost work as a result of economic change accelerated by the coronavirus crisis.

Mr Corfe added: “Politicians pledging to save the high street are promising voters the impossible. Instead of claiming they can turn back the clock, leaders should aim to make inevitable change work better for urban centres and populations.

“Trying to prop up high street retailers facing long-term decline is not an act of kindness to workers or towns. It just postpones the inevitable and wastes opportunities to develop new policies to help workers and towns embrace the future.

“Nothing can stop the demise of traditional high street shopping so it would be better for politicians to support the next chapter in the story of the high street, with hundreds of thousands of new homes that bring new life to our urban centres.”