ORDINARY RETAILERS are on the verge of collapse, with the loss of 40,000 jobs in the sector predicted in the first quarter of the year alone, an Oireachtas committee has been told.
David Fitzsimons, chief executive of Retail Excellence Ireland, said many of his 8,000 members were in a very grave position.
He knew of one company with 120 leases which had stopped paying the rent, while two national retailers were on the verge of examinership.
“Legislators will have to act soon to stem the tide,” he told the Joint Committee on Enterprise, Trade and Employment yesterday.
Mr Fitzsimons said that many of his members selling homeware and furniture were “scared” of the arrival of Ikea, the giant Swedish retailer which is opening its Dublin store in July.
Retailers in these sectors had already lost 60-70 per cent of their business and were suffering a perfect storm because of rising costs and declining business.
Mr Fitzsimons argued in favour of retaining the cap on large retail outlets because it was a “good thing” for retailers and consumers.
Removing the cap, as the Competition Authority has recommended, would “suck the heart out of the high street”.
RGdata, which represents grocers, said the existing retail planning guidelines were “an Irish success story” and the retail cap had benefited consumers and the environment by preventing the development of large out-of-town stores.
Chief executive Tara Buckley criticised as undemocratic the Competition Authority proposal to restrict access to third-party appeals in the planning system.
“That is not something that the authority, itself one of the least accountable bodies in the State, should seek to restrict,” she said.
Glen Roberts of the Northern Ireland Retail Trade Association said removing the cap would be “utter madness”.
Tesco Ireland managing director Tony Keohane said he didn’t consider the cap on retail size restrictive but argued against any further restriction on shop size or location which would inhibit job creation, consumer choice and lower prices.
Calling for speedier decision-making in planning, Mr Keohane said it could take up to seven years for Tesco to develop and open a store.
He said two-thirds of Tesco stores were located in town centres and the company would continue to locate stores in town centres where sites could be found and where it did not add to traffic congestion.
Londis commercial director Peter Foley said the removal of the cap on large retail stores would “suck the life-blood out of small-town Ireland”.
In the UK, “unfettered” planning had allowed the development of large stores and thereby created “ghost towns” with no local retailers.
The only retailer to seek an increase in the cap was German discounter Aldi.
It said the cap on discount stores should be increased marginally from 1,000-1,500sq m to 1,800sq m and this should not be interpreted by planners as a binding upper limit.
Property director Denzill Balfour criticised delays in the planning process and said An Bord Pleanála rarely made decisions on appeals within its target timeframe of 18 weeks.
The grounds for making “vexatious” third-party appeals should be limited, he said.
Aldi managing director Donald Markey said the company sourced more than 40 per cent of its products from Irish suppliers.