Waitrose has thrown its support behind the Competition Commission’s inquiry into the grocery market, but has warned that the proposal to abolish the so-called needs test could damage town centres.

Managing director Mark Price told Retail Week that the proposed inclusion of a fascia test into the planning system, the abolition of restrictive covenants and the proposal to force grocers to sell undeveloped sites would all help encourage competition.

“We think it’s a very good report and if the proposals are implemented it will mean customers will get a choice,” he said.

However, he warned that abolishing the needs test, which exists to establish whether a town needs a new retail development before giving planning permission, could lead to excessive development and harm town centres.

“If you allow stores to be built irrespective of need, you get the scale of out-of-town development that has taken place in the US,” he warned.

The Competition Commission published its provisional findings on the grocery sector at the end of last month. It is now discussing its proposed remedies with retailers and other parties with a view to publishing its final report before May 8.

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