Supermarket giants are preparing to build hundreds of new stores in Britain as a key restriction limiting their growth looks set to be lifted. The report by Kate Barker
into the planning system last week recommended the abandoning of the so-called 'needs test'. This permits the building of major shopping schemes only if an area's population is deemed to have insufficient retail space. Asda Wal-Mart has long lobbied for abandoning the needs test in order to allow the free market to decide how many supermarkets there should be.But MPs and green campaigners say it could spell disaster for small shops and run counter to efforts to stem climate change. It has been likened to bringing back Thatcherite out-of-town development policies that killed off urban centres. 'Getting rid of the needs test means that hundreds of new supermarkets will open,' said James Lowman of the Association of Convenience Stores. 'This will mean oversupply and smaller, less powerful businesses going under.' A former aide to John Prescott, who until last May was in charge of the planning system, said that the Deputy Prime Minister had spent most of his four years in that role resisting Treasury moves to allow pure economic interests to hold sway over planning matters. This, he said, was now being undone. Ruth Kelly, the communities and local government secretary and a former Treasury minister, is now considering whether to include the measure in a planning white paper due this spring.
Andrew Simms, influential policy director at the New Economics Foundation, said: 'This takes us back to the Eighties and would be armageddon for town centres and small shops.' 'There's a danger this could be a charter for carpeting the country with supermarkets,' said Gideon Amos, chief executive of the Town and Country Planning Association. A senior Whitehall insider said: 'I think there's a lot of good in the Barker report but this is the one item she has got wrong because it's almost impossible for a local authority to insist development should go in town centres without the needs test. It won't be quite the free for all of the Ridley era under Margaret Thatcher but it will lead without question to a significant amount of out-of-town development. It also cuts across the environmental agenda. It runs contrary to what we're trying to do.' LibDem shadow communities and local government secretary Andrew Stunell said: 'The needs test is there for a good reason because town centres in the Eighties declined terribly. Lifting this would be a body blow.'
A government spokesman said that there would remain a town centre impact assessment that local councils could use to turn down developments but critics say this is insufficient to deter new stores.