I thank the Chairman and the committee for the opportunity to outline, for their information, the objectives and operation of retail planning guidelines in Ireland and the scope for the forthcoming review of the guidelines later this year.
Guidelines for planning authorities on retail planning came into effect in 2001 following a lengthy consultation process. The objectives of the guidelines are as follows: to assist local authorities in planning for retail development in development plans; to assist local authorities in assessing planning applications for retail development; to guide retailers and developers in formulating development proposals; to facilitate a competitive and healthy environment for the retail industry; to promote forms of development which are easily accessible — particularly by public transport in locations which encourage multi-purpose shopping, business and leisure trips on the same journey; to support the continuing role of town and district centres as centres of social and business interaction in the community; and to set clear parameters for large retail centres, located adjacent or close to existing, new or planned national roads or motorways.
In January 2005, the retail planning guidelines were amended to provide that the floor space cap of 6,000 sq. m on retail warehouses for the sale of bulky, durable goods would no longer apply in areas which were subject to integrated area plans, within the functional areas of the four Dublin local authorities and in the other NSS-designated gateway cities and towns. This cap was reviewed, taking account of the need to promote effective competition in the retail sector while ensuring that emerging retail developments and formats continued to underpin proper planning and sustainable development.
The 6,000 sq. m cap on the floorspace of retail warehouses continues to apply in all other areas. The amended guidelines, which restated the 2001 objectives and principles, were published under section 28 of the Planning and Development Act 2000 which requires planning authorities and An Bord Pleanála to have regard to them in the performance of their functions.
As the committee will gather, the guidelines attempt to balance the need for healthy retail competition with the need to support the vibrancy of town centres and the need for customer access. However, at the heart of the guidelines is the belief that retail development needs to be plan-led, not developer-led. Hence the emphasis on sustainable development through clear development plan policy-setting.
I will briefly address the committee on the issue of retail planning and competition. The guidelines are very clear in stating that the planning system should not inhibit competition, should not preserve existing commercial interests nor prevent innovation and that local authorities should avoid taking actions which would adversely affect competition in the retail market. Last year, the Competition Authority published a grocery retail planning report based on an examination of competition issues relating to the planning system through the planning experience of the seven largest grocery retailers in the State between 2001 and 2007. Regrettably, no planning authorities nor my Department were consulted in researching or preparing this report. While the report confirmed that the guidelines were still valid in their analysis and policies, based on the experience of the seven largest grocery retailers, it stated that the planning system acts as a barrier to competition in grocery retailing by restricting the size of a grocery retail outlet, by restricting where a grocery retail outlet can locate and by increasing the cost and timescales of new outlets opening because of uncertainties regarding planning permission.
However, the report acknowledges the significant growth in the size and number of retail outlets in Ireland since 2001 and the fact that there were no more than a handful of cases where the cap on the size of retail outlets was an issue. Shortly after the publication of the Competition Authority report, MacCabe, Durney and Barnes Consulting published a report commissioned by RGDATA, the representative body for the independent retail grocery sector in Ireland which the committee has consulted in the course of its own work, on the effectiveness of the retail planning guidelines. Its findings broadly supported the guidelines, with some recommendations to strengthen some of the measures. Among its main conclusions were that, with a 275% increase in shopping centre floorspace in Ireland between 2001 and 2007, the guidelines are not inhibiting growth and the caps on the size of retail outlets have not restricted new entrants nor expansion of floorspace overall. The European experience has been that out-of-town retailing with large store formats have had negative effects on existing town centres and planning controls on retail location are required to protect town centre vitality.
As the committee can see, these two reports were published at approximately the same time, with different conclusions. It reinforces for me, as Minister, the need for a balanced approach to retail planning policy. It also reinforces my belief that the two main recurring issues are the size and location of retail development.
I announced last autumn that I intended to review the retail guidelines in 2009. My principal motivation for announcing the review was that, since the guidelines came into force in 2001, Ireland has undergone considerable change in terms of economic and social development, particularly in population expansion and settlement patterns. However, we are now in a period of economic contraction, with consequential social implications. I want to ensure that forward planning for retail is robust and realistic.
The principles that will guide the review are as follows. Competition to the benefit of the consumer should be maintained and enhanced. Existing retail development-type definitions, such as discount food stores and district centres, and relevant floor space limits will be assessed to determine whether they remain appropriate or whether they need to be amended. Preferred locations for retail development should continue to be guided by considerations of sustainable land use, including access by public transport. In particular, new retail development should be encouraged to contribute to the vitality and vibrancy of town and village centres, to ensure that they retain retailing as a core function. Realistic, forward-looking strategies for plan-led retail development should be adopted and planning authorities, developers and shop owners should be given clear guidance in formulating development or expansion proposals.
I intend to issue a draft of the revised guidelines for public consultation later this year which will allow planning authorities, retailers, representative bodies, developers and all interested parties and individuals, including members of this committee, to make submissions that will be fully considered before their finalisation.