In five countries IKEA operates stores that meet Ireland's existing retail planning limits - so why not here, asks Jim Goulding
Last week the Minister for the Environment, Dick Roche, announced wholesale changes to Ireland's retail planning guidelines. As reported extensively in the media, the change to this very important piece of legislation has taken place solely to meet the demands of IKEA, which insisted it would not enter the Irish market unless it could build a superstore five times the size of Croke Park.
Much of the past week's reporting, which spoke of increased consumer choice should IKEA enter the market, missed one salient point. The people stopping Irish consumers from shopping at IKEA were not Government officials protecting our planning laws but IKEA itself. In five other countries it operates stores that meet our existing retail cap - so why not here?
Many other international retailers have entered the market since the guidelines were introduced in 2001, happy to obey the laws of the Irish State. These include Harvey Norman, Aldi, Lidl, B&Q and Halfords.
The Irish Hardware and Building Materials Association (IHBMA), which represents more than 600 hardware and DIY merchants throughout Ireland, is not opposed to IKEA. Indeed, it welcomes competition in all its forms in the market. We do not however, believe that the existing retail planning guidelines, which are working well, should be altered simply to suit the shareholders of one company.
Five teams of independent experts, appointed by the Departments of Environment and Enterprise, Trade and Employment, devised our retail planning guidelines. They make up a very important piece of legislation that provides us with planning codes to promote best international practice on town planning, retail planning, traffic management and sustainable development.
Other European states are trying to take similar measures after a considerable amount of damage has been caused to their retail and urban environments by uncontrolled retail developments.
Indeed, last year a report from the New Economics Foundation in Britain highlighted the emergence of "ghost town" Britain, reporting on "the slow death of small and independent retailers in our local communities. The result - loss of local jobs, less support for local suppliers and less consumer choice - is squeezing the life out of local economies and undermining government initiatives to tackle poverty".
Make no mistake: the planning changes announced by Mr Roche are extensive and will result in a much altered landscape, not just in Dublin, but in each of the gateway areas outlined in the proposed changes to the planning guidelines. The debate should not be on how soon IKEA will enter the market but rather on whether we want to live in an environment dominated by large, out-of-town hyperstores with the resultant negative impact on our towns, roads and society.
So why did the Government allow itself to be bullied into changing the laws of our State for the benefit of foreign shareholders in a global corporation? Mr Roche made much of the 500 jobs that will be created in Ballymun by IKEA. Yet all of the evidence from countries where IKEA has established itself is to the contrary. The jobs created by IKEA solely replace those lost in existing businesses when IKEA squeezes competition out of the market. This is not scaremongering. One has only to visit Paisley in Scotland to see evidence of this.
The Competition Authority also welcomed the changes to the retail planning guidelines, claiming that the hardware and retail sectors in Ireland were anti-competitive and that changing our planning laws will result in greater competition. Nothing could be further from the truth.
Since October 2003, 26 new hardware/DIY outlets have been opened. In addition there are 55 proposed developments for retail warehouses and retail parks across the country.
Competition has never been stronger and this is reflected in the inflation figures issued by the Central Statistics Office each month. The inflation rate for hardware/DIY goods sold from retail warehouse outlets has been well below the headline rate of inflation on a consistent basis over the past 18 months
Consumers throughout the State are benefiting from enhanced choice, innovation and competition. At the same time, the State is also benefiting from the increased tax take and the creation of new jobs. Our sector is one of the largest employers in the country, with more than 25,000 people employed, and this will increase by more than 2,700 in the next 18 months. What further evidence is needed that the retail planning guidelines are working?
An IKEA superstore in Dublin at the scale proposed will also create enormous difficulties on the already congested M50, and will result in the generation of additional traffic journeys solely and specifically to the store.
Reports from the US, with its far superior road network to our own, regularly highlights the traffic jams resulting from IKEA's presence in an area. Our road network is improving but nowhere is it strong enough to support the traffic generated by large, out-of-town retail developments.
The decision to allow wholesale changes to the retail planning guidelines is a retrograde step. There is no competitive, economic or social justification. It is a mistake to allow an excellent piece of national legislation to be changed purely on the insistence of one or two vested interests.