Campaigning to curb supermarket power


In the 1970s and 1980s, planning laws were relaxed and allowed a large amount of out-of-town supermarket development. By the 1990s, it was clear that massive superstores relying on car-use and bulk buying were killing the High Street and were not socially or environmentally sustainable.

National Planning Policy: 2005 - 2012

2005 - The Government first introduced planning guidance to protect town centres in 1997, which was renewed as Planning Policy Statement 6 (PPS6) in 2005. Under PPS6, local authorities had to promote retail development in town centres first, and out-of-town stores were only be allowed if there was a clear need for them and their impact will be limited. PPS6 helped stem the tide of out-of-town retail and has played an important role in protecting and rejuvenating town and city centres.

2006 - In December 2006, the Barker review, commissioned by the Treasury, recommended deregulation of the planning system and the removal of the needs test in PPS6. The needs test requires supermarkets to justify a new out-of-town store by demonstrating a need for additional retail floor space in the area.

2007 -  Recommendations from the Barker Review were included in a Planning White Paper. See a briefing paper by Friends of the Earth, ACS, CPRE, Food Access Networks UK and the Womens Institute published in 2007. Please see PDF town_centre_first at end of this page.

2008 - The Department for Communities and Local Government released a consultation document on proposed changes to PPS6, including a replacement of the needs test with an “impact test”.

Research by Friends of the Earth showed the importance of the need test. 96% of planning officers surveyed said they believed that the need test is important and 81 per cent believed that the absence of a need test would make it harder to focus new development in town centres. The research also showed that supermarket chains already have a significant impact on the planning system, by putting pressure on local authorities, getting involved in regeneration schemes and sports and housing projects, and the use of “section 106” agreements which offer resources to local authorities together with a planning application. Please see the Friends of the Earth reports Shopping the Bullies and Calling the Shots which look at some of the ways supermarkets can make sure they get their way in planning decisions. The reports are in PDFs at the bottom of this page.

The Competition Commission  (CC) recommended to the Department of Communities and Local Government that they introduce a competition test in planning decisions on larger grocery stores. The competition test would prevent retailers with a very strong local presence in an area from building new supermarkets or making large extensions to existing stores.

2009 - A summary of the responses to the consultation, was released in February. On the 29th December 2009, the Government published the new Planning Policy Statement 4: Planning for Sustainable Economic Growth which replaced PPS6 and a number of other Planning Policy Statements.

2010 -  The Government didn't formally respond to the recommendation for a competition test. The current Government's coalition agreement included a commitment to change planning policy so as to enable Councils to take into account competition issues when drawing up their local plans.

25th July 2011 - Government published the Draft National Planning Policy Framework.

27th March 2012 - Government released the final version of the National Planning Policy Framework.  Read reactions to the new Policy in this Guardian article.

Promoting alternatives in local plans
Local authorities should develop positive initiatives to encourage more sustainable forms of retail and protect independent shops. Islington’s Local Plan, for example, encouraged initiatives such as co-operatives and street trading and providing support for small shops. Policies encouraging alternative forms of retail across London are collected in a paper by Sustain, the Food Commission and the London Development Agency, How London’s planners can improve access to healthy and affordable food. Crucially, local authorities are currently preparing new planning documents called Local Development Frameworks. For more information please see a Friends of the Earth briefing -Retail Policy and Local Development Frameworks, May 2010 (ref 3.5 Retail Planning final doc).

Tesco’s land bank
One issue that the CC considered in their inquiry is the practice by the largest retail chains of holding on to a massive land bank of properties. This can act as a barrier for smaller chains entering the market. The CC's final report recommended combating this practice, and particularly the practice of retailers placing restrictive covenants on land to stop a competitor moving in. However, retailers would not be forced to sell undeveloped land that they own.  In August 2010 the Competition Commission introduced legislation that came into effect in April 2011, which gives supermarket chains a deadline to lift exclusivity arrangements. Under the exclusivity arrangements, landowners agreed with supermarkets to either stop other grocery retailers from opening on the same site or limit the sale of groceries by rivals there. 

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