High street policy 'puts prices up'
The Town Centre First policy, introduced in the mid-1990s, is supposed to require planning authorities to encourage development within town centres before looking at out-of-town sites.
But Policy Exchange said it had decreased competition and damaged the social fabric of communities, particularly outside the South East, citing figures suggesting 68% of people visited out-of-town centres with other people, but that the majority of high street trips people made alone.
And it claimed that despite the policy, 15,000 smaller town centre stores closed between 2000 and 2009.
The report said the policy had pushed up costs by "discriminating" against out-of-town outlets in favour of high street stores, which have had to increase their prices to make up for a loss of productivity caused by restrictions on the size of shops, their configuration and location.
It proposed replacing Town Centre First with an Access First policy focusing on giving low income households access to social and retail hubs but not restricting where they were built.
It also recommended that well-run councils or high streets should be "left to their own devices" as they already catered for local demand, while those in charge of poorly run high streets which have the potential to flourish should have their powers transferred to management companies with retail experience.
High streets that are small, badly located or have little to no chance of competing with the internet and other retail destinations should be transformed into housing or office space, the think tank said.
The report's author, Alex Morton, stated: "Politicians can show they support hard working people struggling with rising living costs by abandoning policies that push up the cost of the weekly shop.
"It is understandable politicians sometimes feel the pull of nostalgia but a focus on trying to revive the high street by limiting out-of-town outlets isn't the answer.
"The results of this are boarded up high streets and higher prices.
"Some high streets are run by good local councils and are doing well.
"Others are not.
"High streets are struggling either due to poor council management, or simply because the high street is unable to meet the needs of 21st century shoppers.
"Poor performing councils should lose their powers over the high street.
"For those high streets unable to compete with other retail outlets, boarded up shops should be converted into housing and office space."
Local Growth Minister Mark Prisk said: "This report is further evidence that aggressive municipal parking policies are undermining local high streets.
"Town halls who encourage expensive parking are playing a key part in pushing up shopping costs for households.
"That is why we are tackling unpopular 'anti-car policies' and calling on local authorities to increase the number of parking spaces and offer incentives such as free parking to encourage shoppers into town centres.
"We make no apologies for having an explicit town centre first policy, which supports local high streets by cutting red tape and changing bureaucratic planning rules to make it easier for high street shops to adapt for the future."