I welcome the representatives of RGDATA: Ms Tara Buckley, director general; Mr. Jerry Barnes, consultant town planner; and Mr. Terry Durney, consultant town planner, and thank them for their attendance. As we have a very busy schedule, I ask them to be as brief as possible in summarising their submission. We have allowed each party five minutes for its summary which will be followed by a discussion with members of the committee. We have had a fruitful morning and want to continue on those lines. I draw attention to the fact that while members of the committee have absolute privilege, the same privilege does not apply to witnesses appearing before the committee. Members are reminded of the long-standing parliamentary practice to the effect that they should not comment on, criticise or make charges against a person outside the Houses or an official by name or in such a way as to make him or her identifiable.
RGDATA.
Ms Tara Buckley
RGDATA is the representative body for independent retail grocers in Ireland. Formed in 1942, its members operate over 4,000 family-owned grocery shops in the State. Our main aim is to provide representation and support for independent grocers. Our members trade in every city, town and village. Their hallmark is that their supermarkets, convenience and forecourt stores are locally owned and run, employ local staff and source as many goods as possible from local markets. Some of them are affiliated to symbol groups, while others are non-aligned. They employ approximately 80,000 people. We hold about 40% of the retail grocery market. Each day about 3.2 million customer transactions take place in shops affiliated to RGDATA. Our members are strong supporters of their local communities and have a key stake in the creation and maintenance of vibrant local communities.
Retail planning is a very important issue for RGDATA. Independent retailers believe our villages, towns and cities should be developed in a way that benefits the people who live and work in them, not property developers or global retailers. Sustainable strategic retail development is about supporting and renewing urban communities, not just for this generation but for our children and grandchildren also. Strategic planning ensures people who live in a community have easy access to shops, services and amenities, which can dramatically enhance the quality of their lives. We believe in vibrant, diversified and localised retail development. We want to reverse the decline of town centres and encourage investment in traditional shopping areas, high streets and town centres. We want small villages and rural communities to have access to a local shop. As such, RGDATA is a strong supporter of the retail planning guidelines. We believe that, by and large, the guidelines introduced in 2000 and revised in 2005 have ensured we have a sustainable and vibrant retail planning system which encourages development but in a sustainable and planned way.
We have gone into the background to the retail planning guidelines in our written submission, on which I will not dwell now. We believe the guidelines have been central to ensuring Ireland has a plan led approach to retailing. They have facilitated a significant amount of retail development, including the development of some large-scale stores. Most importantly, we believe they have not hindered competition, reduced choice or damaged consumer interest.
Last year RGDATA commissioned McCabe Durney and Barnes Consulting to assess the retail planning guidelines and determine their impact. A summary of its findings is included in the written submission and I would like to highlight four points. First, it found that shopping centre accommodation had more than trebled in the past five years; that retail warehouse accommodation had increased by over 400%; that current planning permissions for stores would see a further 40% increase in retail space if they were to go ahead, given local economic conditions; that there were a significant number of new stores, new formats and new retailers since the introduction of the guidelines. It also found — we think this is very important — that An Bord Pleanála had never refused permission for retail development on the basis of the likely impact of the proposed development on existing retailers. It also noted that An Bord Pleanála had never taken a decision to refuse permission for a store on the grounds of competitive impacts. Instead applications had been refused on planning grounds such as non-compliance with county and local development plans, traffic impact, zoning, distance from the town centre and design.
We believe the retail planning guidelines have made a positive contribution to planning in Ireland but that there are some areas that may need to be addressed. There is a need for a consistent approach to town centre and edge of and out-of-town planning. There is evidence that the approach taken by local authorities to town centre parking charges penalises both shops and shoppers. This issue should be addressed.
There is a need for greater information on the extent of retail provision in Ireland and for a proper national database on shops and shopping. We are often criticised for a failure to implement best practices and constantly playing catch-up with developments in business. We believe in retail planning — this is something about which we can be justifiably proud — that as a country we have properly provided for an appropriate planning regime that takes account of all stakeholders' interests.
I refer to the Competition Authority's study which has made some recommendations about changes to the retail planning guidelines. However, the authority does not appear to understand the planning system and has failed to comprehend a basic premise of planning, that it is about controlling activity for the common good. Some of the recommendation made by it are incorrect and should not form the basis of a serious consideration of policy. For example, it has claimed the retail planning guidelines limit competition, but it fails to deal adequately with the extensive growth in the number, format and identity of retailers operating since 2001. It states the planning system limits competition between grocery retailers. A planning system of its nature involves restrictions on development; the question is: when are the restrictions reasonable and necessary and when do they support the common good?
The Competition Authority claims the retail planning guidelines discriminate against discount retailers. Given the rapid growth of discounters in the market since 2000, it is hard to see how this contention can be upheld. It is also important to note that no application for a discounter has ever been rejected by a local authority or An Bord Pleanála on the basis of scale. The authority states decisions on scale should be made by local authorities without reference to national guidelines. All of the evidence in the period prior to the introduction of the retail planning guidelines and in relation to development since 2000 suggests local authorities which frequently compete for rates and development require national guidelines to ensure the scale of development encouraged or facilitated is not disproportionate to the impact it will have on adjoining counties and local boundaries.
The Competition Authority also claims local and consumer interests are not taken into account in the planning regime. RGDATA believes this is an appalling slur on the hundreds of councils which give serious and detailed consideration to the retail strategies and development plans for their area. The authority also wants to restrict access to third party appeals in the planning system. This is an undemocratic suggestion and should be resisted. It is suggested local business people do not have a right to make their views known or have an input of their perspectives to decisions that affect the environment in which they operate. They have as much right and entitlement to make their views known to their local authority, An Bord Pleanála or the Competition Authority as any other stakeholder in the community. It is up to the local authority or An Bord Pleanála to balance these views and reach a decision in the common good. That is not something the authority, one of the least accountable bodies in the State, should seek to restrict.
The retail planning regime has been a success. It has ensured large-scale development but on a sustainable basis. It has ensured consumer choice and facilitated the development of a diverse market for consumers who do have a choice from a selection of retailers. In this context, it is important that the views of the Competition Authority are taken into account but they should not be the determining factor in assessing the effectiveness of the guidelines. The planning system involves the control of development. It is a question for the Government and the Houses to determine whether that control is in the common interest. As far as the retail planning guidelines are concerned, RGDATA believes they do deliver the right level of control with resulting benefits for consumers generally. This is an Irish success story which we should be prepared to applaud.
Are there discrepancies in the approach taken by local authorities in granting planning permission for retail premises in town centres and neighbourhood community developments?
Ms Tara Buckley
We have noted during the years that there are different approaches. Our concerns centre on local authorities competing with each other for new retail developments because they are keen on securing a rates gain. Some decisions were not in the best interests of the retail environment or local communities but were taken more out of a concern for a rates gain for the local authority. Our other concern which my colleague, Mr. Terry Durney, will address is the difference in attitude towards and the conditions for out-of-town greenfield sites and town centres which discriminates against town centre redevelopment.
Would RGDATA prefer if retail planning was a matter for overall guidelines rather than leaving a decision to individual local authorities?
Ms Tara Buckley
It is very important that there is an overriding national plan because decisions need to be taken based on the needs of the country as a whole in order that we have sustainable and strategic development.
On that specific point, RGDATA comments on the Competition Authority slurring individual councillors. Surely individual councillors have a better idea of what is needed in their area? National guidelines may be completely irrelevant in specific areas.
Ms Tara Buckley
No. We need national guidelines to ensure sustainable development across the country. If it were left to local areas, unfortunately, we could end up with disjointed development. Therefore, we need to ensure local authorities have national guidelines to ensure we end up with sustainable development that is environmentally friendly, with good transport links, and which is good for the consumers who live in the communities affected.
I agree that there must be a national plan because some councils are impoverished and in their need to attract rates could allow a large-scale development. They know it could go to another county. It is evident that people in towns in the South close to the Border would rather see increased caps on building and instead do business in the North. There is an issue in this regard and a national plan with local input is needed. If local authorities wish to make a case for something at variance with the national plan, they should be able to approach the Minister with a detailed explanation. This should be allowed under well specified conditions. On the same issue, should we consider a sliding scale guideline? Certain towns with certain populations could see an increase in the cap with others experiencing a decrease. Are the delegates happy with this the way it is?
Regarding town centre developments, it is evident that many consumers are happier to visit out-of-town retail units; it may be quicker and more efficient. A great effort is needed to encourage people to stay in town centres and support local business. Which two or three key areas need improvement? The delegates identified parking, particularly surface parking, as an issue. Do consumers dislike using multi-storey car parks or is surface parking easier? Should parking charges be imposed on parking spaces in out-of-town retail units belonging to the large multiples? Should we have a national plan on the funding of local authorities for the provision of new car parking spaces in towns and villages? Many town councils do not have the funding to tackle the car parking issue and the issue falls to businesses in the form of rates. Should there be a national system that uses tax breaks?
The report mentions Enniscorthy and Sligo and I visited both towns on reading it. The delegates are correct that they exemplify how retail can be conducted properly and how town centre developments can be sustained. However, there have been delays in Sligo due to appeals in the planning process and so on. We must learn to fast-track the process to help deliver for consumers.
Ms Tara Buckley
From our perspective, we can accept that developers and retailers trying to develop in a town centre will usually face a more complicated situation than on a greenfield site. We should be honest about the fact that they will opt for the greenfield site if they get the opportunity. We agree on the point about the need for investment in town centres and their regeneration to make them attractive. A vibrant town centre will give many diverse retailers the opportunity to run shops and consumers will be able to shop around, as Ministers are keen to advise them to do. This creates competition and diversity and gives consumers choice and the opportunity to trade with different retailers. We do not favour having no cap on large out-of-town retail units because we consider this approach would be detrimental. Other countries have seen that such developments suck the life out of towns and villages and leave small villages without local shops. Countries that took this route, including France, and the United Kingdom, are now questioning the approach, as it has been disastrous for consumers, towns and villages and locally owned businesses. RGDATA contends that at times like this locally owned businesses, run by people living in the community, will get us through. We should not discriminate against them; they should have a level playing field and be allowed to compete with the biggest players in the world. All they want is a level playing field.
We agree that the issue of parking must be addressed, as free parking at retail units outside town is too attractive. We would support an initiative to examine the issue of town centre parking. We accept that some consumers dislike multi-storey car parks but believe towns that have taken that route find that people eventually use such facilities. They want parking adjacent to the retail zone in order that they can do their shopping and return to their cars. At the same time, it is very important that people without access to a car have shopping facilities. In terms of environmental sustainability and transport initiatives, it is important that we provide people with an alternative to using a car for shopping. People on bicycles and those who wish to walk should also be able to access shops with ease.
We have seen a number of reports from official bodies such as Forfás that favour lifting the cap, or at least extending it substantially. Is RGDATA merely making arguments in favour of the cap simply to prolong the lives of its members? Nobody thought I was a free marketeer before today and my reputation has been destroyed.
The Deputy is playing devil's advocate.
We are seeking to achieve the best for communities in the range and price of products and services available.
Ms Buckley alluded to competition between local authorities that may ensue without unified State-wide control. When I was a member of the local authority in County Louth, I faced a wagging finger on the issue of a substantial retail outlet outside Dundalk that would move North if we did not accept it. Would the best outcome be aligned regulation across the island, implemented separately in the North and here? This would at least end the cross-Border competition mentioned. I appreciate that the committee does not yet have jurisdiction in the North but I have an interest in this issue, as do my party colleagues.
Those were searching questions.
Ms Tara Buckley
I am glad to hear the Deputy is a free marketeer.
I would not bet on it.
Ms Tara Buckley
With regard to the cap on the size of stores in Dublin and outside, when the original research was done for the retail planning guidelines and various experts, including planners, environmentalists, economists, global retailers and local players, gave their views, it emerged that there were certain economies of scale and that once a store exceeded a given size economies of scale decreased. The argument relating to bigger stores does not make sense because stores of existing size are large enough to provide consumers with the choice they want. We believe making the cap on store sizes bigger would work against consumers. In reality, there is a large dispersed population; only Dublin and a couple of other urban centres have large populations. People are dispersed throughout towns and villages and need shops that are easy to access. They do not need very large shops a long distance away that must be reached by car. The cap, as it stands, benefits people, as it aids sustainable retail development.
On whether we should all have the same regulations, my colleagues from the Northern Ireland Independent Retail Trade Association, NIIRTA, who will speak after me say Northern Ireland needs good planning guidelines similar to ours. Representatives from other countries would say the same. In this instance we are ahead of the pack; therefore, we should encourage them to join us, rather than dilute our guidelines.
On competition between local councils, it is in our interest that there be competition but we must continue to examine what is in the overall best interest of communities. The existing guidelines provide for what is in the best interests of the people. The consultants' report shows very clearly that our guidelines have not hindered competition or new entrants to the market. They have not hindered new formats in the market or price-driven formats. They are working very effectively and do not require drastic changes.
I have a brief supplementary question. Ms. Buckley said economies of scale faded at a certain threshold. Does RGDATA have evidence to stand this up?
Mr. Jerry Barnes
Goodbody economic consultants undertook a study of this issue in 2000 which was presented to the Department of the Environment, Heritage and Local Government at the time. We can forward it to the Deputy.
I thank Mr. Barnes.
This is the fourth submission this morning, following those of Aldi, Londis and Retail Excellence Ireland. None has called for the lifting of the cap which the Competition Authority has suggested is a barrier to competition. RGDATA has criticised the study as ill-informed and lacking in understanding of planning. Why does it think the Competition Authority got it so badly wrong? Did it consult RGDATA during preparation of the report?
Ms Tara Buckley
It consulted some independent retailers. We think it got it wrong because it looked at the issue within a box and only from an economic perspective. Planning is not something at which one should look from just one perspective. People sit in traffic jams every morning, stressed as they collect their children from crèches or try to get into work on time and this is because of bad planning. The best policy is one that is strategic, well planned and well thought out and our guidelines assist us in ensuring this. Our study has shown that we do not hinder competition. In the United Kingdom discounters found it very hard to get a foothold in the market. Because of our planning regime discounters were able to come and have a large number of stores built in a short period to get a foothold in the market. The system has facilitated competition and a diversity of shops. Countries without these guidelines have very large formats outside towns. I am sure members agree that policy has been a dismal failure, for consumers, competition and the economy. The system encourages the vibrancy of our town centres, giving consumers the opportunity to shop around. Therefore, any serious adjustment would be a mistake.
I apologise for being late — I was stuck in the snow. As a retailer who spent most of her adult life on the high street, in an academic institution or a town centre, my thoughts lean towards preserving the fabric of our towns and villages. I am not talking about storybook idylls but working towns and villages in which people can make money and the butcher, the baker and the candlestick maker can thrive. My own town of Borris, County Carlow is still a candle-producing town.
Does RGDATA believe retailers who locate out of town have a duty to contribute to the prevention of urban sprawl and community initiatives put forward by the towns from which they have sucked out all economic life?
Ms Tara Buckley
The consultants who accompany me today made proposals concerning out-of-town developments, taking into account what they did to town centres and the contribution they should make to the regeneration of town centres. A number of developers want to build outside or at the edge of towns, many of which have large vacant sites such as where the mart used to be. They are difficult and complex sites to develop but their regeneration would make a huge difference to our towns and villages. Everybody would have easy access to these developments and it would be good for competition and diversity. We agree that we should encourage new retail zones to locate in vacant sites in town centres to help revitalise them.
In the United Kingdom, when councils have insisted a development take place in a town and that it respect the architectural heritage of a town, some of the biggest players in the world have responded by putting up beautiful buildings which add to the attractiveness of the town and around which people are proud to walk. We would be in favour of initiatives to support this approach.
I wish to follow up on a point made about parking by Deputy English. Dublin city centre is a bad example but local authorities use revenues raised from parking to invest in the regeneration of town centres. How does RGDATA suggest we achieve the right balance in that regard?
Mr. Terry Durney
It is a question of having a level playing field. There are opportunities to raise levies to fund car parks but people do not have to pay for out-of-town parking. Everybody should pay the same.
I thank RGDATA for its presentation and Ms Buckley, whom I have known for a long time. When I was Chairman of the committee, I interacted on many occasions with RGDATA and always found its submissions to be correct and based on sound information.
The delegates said there was evidence that local authorities were inconsistent in their approach. I agree. Can RGDATA forward the evidence to me at a later stage? I concur with the points they made about the Competition Authority's claims about the retail planning guidelines and they are worthy of further consideration.
Ms Buckley said there was a change in the debate in France and the United Kingdom. Is that coming from consumers or retailers? The report also cited Sligo as an example of great planning. Two years ago there was huge controversy in Sligo because a number of multiples were refused planning permission for developments in the town. One subsequently obtained permission and went ahead with the development. What does RGDATA state to the consumers of Sligo? They were very angry that they were being deprived of choice and value. The development by Treasury Holdings has since received the go-ahead but that is a completely separate matter.
Ms Tara Buckley
The towns which have adhered to the retail planning guidelines have some of the best retail offerings in the country. They have the best diversity of shops, some of the best prices and the most competitive environment. It can be painful to take difficult decisions and some councils pay any price to get a retailer to come to a town. However, towns that have allowed new retailers to build outside the existing retail zone end up with vacancies and dereliction on their main streets. The retail experience moves out of town and the town centre loses its heart and vibrancy. That is not in the best interests of a town. Smaller, locally-owned businesses on the high street are forced to close down as all their business moves out of town. These developments are usually owned and controlled by one retailer and competition is diminished.
Athlone is an example of a good development. It took some time to put together but it was right in the middle of the town centre and accessible to everybody. It has not sucked the life out of Athlone, although there are plenty of other examples where large developments have been allowed at a distance from the town centre and the latter has suffered as a result. We would not be in favour of changing the guidelines to allow for that type of development. We would say to consumers that when it is done properly they will enjoy it most and will derive most benefit from it and the town will thrive and survive as a result.
I thank Ms Buckley. Senator Callely and Deputy Calleary raised particular issues. If there is any further information Ms Buckley wishes to furnish to the committee on the queries they raised I ask her to do so as quickly as possible to ensure it is taken into account in our overall deliberations. I thank the delegation for appearing before the committee and for an interesting exchange of views. I did not ask any question because my wife and I are involved in one of those small shops. Some of what Ms Buckley said is happening in reality.
We have had a useful exchange. I thank the delegation for its assistance in our deliberations. It is important that we hear all sides of this debate. We will prepare a report and will furnish the delegation with a copy in due course. Is the delegation coming back tomorrow?
Ms Tara Buckley
Yes.
We look forward to the company of the delegation again tomorrow. I thank the delegation for its promptness and for adhering to the guidelines. We accept they are pretty onerous in terms of time.
Ms Tara Buckley
I thank the Chairman and members of the committee. We will furnish any additional information.