Comment: Failing the high street

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The Competition Commission delivers its third report on supermarkets in seven years today. Its findings seem no more likely to meet the objections of environmentalists, small shops, farmers and those who want to sustain urban high streets than the previous reports. Its one recommendation with real bite is to tackle chains building up landbanks. This is the practice whereby a supermarket buys up potential sites to ensure that its competitors cannot build on them. It will now be far more difficult with the recommendation of the Commission that supermarkets be forced to sell land where it appears to be held for no better purpose than to forestall competitors.

The other main proposal is for an Ombudsman to protect suppliers in their one-sided relations with supermarkets. It remains to be seen whether it can protect farmers in particular from exploitation, including ruthless pricing and forcing suppliers to bear the costs of promoting goods in stores. The inequity of the relationship was clear a couple of years ago when supermarkets paid dairy farmers about 18p a litre, less than the cost of production, for milk sold for more than 50p. That unsustainable approach is less common now, partly because so many dairy farmers went out of business but chiefly because of increased consumer awareness of the problem.

The other endangered species is of course independent high-street retailers, and the Commission's relaxed approach to out-of-town shopping centres, will do nothing to help their problems. If town centres are to remain the hub of retail activity, then it is crucial that shoppers are not drawn to big shopping developments miles away, which are usually only accessible by car. The Commission's blithe acceptance of the overwhelming dominance of the supermarkets means it falls short of the hopes that were invested in it.