Appearing at a hearing organised by the All-Party Small Shops Group, Tesco company secretary and corporate and legal affairs director Lucy Neville-Rolfe defended the grocer against charges that its dominance is leading to the demise of independent stores and should be restricted. She said that the convenience sector was a growing market and small retailers were benefiting.
She said that the challenge for all retailers was to 'make customers' lives easier'. Explaining Tesco's success, she said: 'In short, we deliver for customers. That route is open to other retailers, large or small.'
Neville-Rolfe dismissed claims that the opening of Tesco stores inevitably leads to the closure of local shops. She cited University of Southampton research - commissioned for the retailer - that showed otherwise. 'Opening an Express store makes local shopping more attractive, with more people walking and cycling to the shops,' she said. 'There's no negative effect on local retailers.'
Asked by chairman Jim Dowd MP what her reaction would be if it was recommended that Tesco divest stores or have its market share capped, Neville-Rolfe said: 'The public interest would have to be looked at in a proper manner. I hope that after speaking to us you would not think that was a good idea. I'd be uneasy about the wider economic effects.'
Appearing prior to Neville-Rolfe, Consumer Affairs and Competition Minister Gerry Sutcliffe said: 'The consumer will drive the marketplace of the future'. He made clear that the Government does not want to get involved in the nitty gritty of argument about supermarket power, which should be dealt with by the OFT and Competition Commission.
He said, however, that he would like to see a 'mixed domain' of big and small shops. He suggested that the decision of the OFT to reconsider its recent decision not to refer the supermarket sector to the Competition Commission again was linked to the recent change of leadership at the agency.
The All-Party Small Shops Group expects to release its conclusions on December 13.