Dáil Éireann Debate, Thursday - 16 December 2004
3 Mr. Eamon Ryan asked the Minister for Enterprise, Trade and Employment if he has carried out an analysis of the implications of lifting the cap on retail size with regard to employment and competition within the retail sector here; and if he will make a statement on the matter. [34046/04]
Amharc ar fhreagraI have received the views of the Competition Authority on the floor size cap contained in the retail planning guidelines. The authority is opposed to a cap on the grounds that it restricts competition in the market and lessens consumer choice.
The consumer strategy group was set up earlier this year to examine a wide range of consumer issues. While the retail planning guidelines were not specifically referred to in the group's terms of reference, the floor space cap may be under consideration by the group in view of its impact on consumers. I expect to receive the group's report after Christmas.
I thank the Minister for responding and for telling me the Competition Authority's views. I was particularly interested to hear the Minister's views. It is interesting that he says he expects to receive a report after Christmas. I thought the Minister for the Environment, Heritage and Local Government planned to make a decision before Christmas. Does the Minister for Enterprise, Trade and Employment hope to use the analysis that has been carried out under the auspices of his Department to influence the decision by the Minister for the Environment, Heritage and Local Government or has he a view on the matter?
Clearly I would favour a relaxation of the retail planning guidelines. My Department has consistently supported the Competition Authority in this regard on the grounds that it would facilitate greater competition and greater entry into the market, and that it would be beneficial to consumers.
And destroy the urban heartlands, the towns.
In the context of the report I referred to, a relaxation will come anyway through the work of the consumer. The consumer strategy group is looking at the matter, particularly from the viewpoint of the consumer.
When the Government introduced the planning guidelines, a study was undertaken by the then Minister for the Environment and Local Government. The issue is how to balance the maintenance and sustenance of economic activity within city and town centres, and on the other hand try to facilitate competition. There are arguments on both sides. Looking around at what has happened over the past few years, even since the introduction of the capping guidelines, the proliferation of major shopping centres on the outskirts of towns and cities has not been halted.
The degree to which one can regulate the marketplace is questionable. One can consider the size issue. My personal observation in recent years is of changing patterns in cities and towns in terms of services and economic activities, compared to ten or 15 years ago. Likewise, on the outskirts of cities, close to the link roads and motorways, we are witnessing the development of major retail stores. Again, the issue is one of convenience and of facilitating the shopper and the consumer in terms of where they want to do their major retail shopping. They might want to go to the city centre to do different things.
This matter has been considered by the Government following the submission by the Minister for the Environment, Heritage and Local Government. He will shortly make an announcement and that is a matter for him. He is talking of a modest relaxation of the guidelines but I prefer to defer to the Minister concerned as it is in his domain in terms of any announcement or ultimate decision in the area.
The Minister is implying that we cannot do anything, that shopping centres such as the Liffey Valley Centre, and the Mahon Centre in his own constituency, simply arrive, that the market allows them despite Government regulation, and that we should therefore go along with that policy. Is the Minister concerned that there is a possible further development of that type of concentration which would lead to perhaps four or five major centres around the country servicing all of Ireland as main retail centres? Under such circumstances there would be less employment created and less competition, where one might have one major centre effectively serving the whole of Munster, another serving all of Leinster and so on? That is the international experience. We are relatively small and could easily have four major shopping centres for the whole country. We would then have less competition and less employment. Does the Minister see that as a possibility?
Obviously, any monopolising that might occur would have to be dealt with in the context of enforcement, competition law and so on. The Government is not about to remove all the existing guidelines. What has been submitted to the Government is the suggestion for a modest relaxation.
We must also be mindful of global trends. We cannot ignore what is happening around us. Having talked to colleagues more seasoned than I, it is clear that the arguments put forward by the Deputy were also put forward when supermarkets came to the fore. Calamity was predicted and it was thought the world would collapse. That did not quite happen. In many respects we have seen the alternative emergence of small effective shopping centres too, notwithstanding the development of major ones. There are high levels of quality and standards in many of these with good delivery services and good responsiveness to the consumer. They developed their own niches. One can look at the Spar group, the Centra and Musgrave groups and so on. Many of those have grown. They provide an interesting illustration of what has happened over time. One can look at the island economy and at what happens around the world. We need to be careful that we do not always try to withstand the forces out there in terms of a changing society and a changing way of doing things. We often overstate the degree to which we feel we can control matters.
