Tesco: superstores killing the community
by George Monbiot (25.09.98)
Tesco's announcement this week that it will be creating 10,000 new jobs was greeted with rapture by a workforce shivering at the prospect of global recession. The chain was extolled by the Guardian yesterday as a good employer, as it pays higher wages than most other shops. It has been praised by both the current government and its predecessor as a beacon of free enterprise. British shoppers honour it as their champion, battling on their behalf with Adidas and Calvin Klein. There are several words for people like us: suckers is perhaps the most polite.
For Tesco's business, in common with that of the other superstores, is the business not of generation, but of displacement. It doesn't create jobs, it destroys them. A report published by the National Retail Planning Forum shows that the opening of a superstore costs, on average, a net 276 local jobs, as independent grocers, village shops, newsagents, milk rounds and pharmacists are closed down in droves.
Tesco creates neither choice nor convenience, but merely concentrates them, laying waste to the diversity of social and economic life outside the store, shattering community, cluttering our streets with traffic. It relies for its expansion not upon nimble enterprise, but upon the ponderous might of political influence and regional control. Like a super-gravitational black hole, it sucks in and compacts the worlds that lie beyond it.
No commercial sector is better represented than the superstores. Lord Sainsbury is a minister at the Department of Trade and Industry (DTI), which sets the terms by which business in Britain is allowed to proceed. Archie Norman, the head of ASDA, is deputy chairman and chief executive of the Conservative Party. Ian McLaurin, Tesco's former chief executive, sits in the House of Lords. So too, if ever she dares to show her face, does the heiress to the chain, the disgraced former leader of Westminster Council, Dame Shirley Porter. Executives from Tesco inhabit no fewer than six government task forces, including, ominously, the DTI's Competitiveness Advisory Group.
The superstores enjoy a remarkable immunity from the laws by which we lesser mortals have to live. Over the past four years, they have been able first to ignore and then to remove the Sunday trading laws, the restrictions on opening hours, the Net Book Agreement and the chemists' Retail Price Maintenance. Two months ago, the superstores' lobbying prevented the Integrated Transport White Paper from proposing that their car parks be taxed.
Yesterday, the Office of Fair Trading, which is supervised by the DTI, published a report suggesting that no new laws were required to address the extraordinary control the superstores exert over their suppliers. Despite driving farmers and manufacturers out of business by forcing them into restrictive contracts and then paying less than the price of production for their goods, British superstores still manage to charge 40 per cent more to their customers than stores on the Continent, with the result that they make three times as much money. As control over their suppliers was to have been the main theme of the OFT's inquiry into the superstores' profits, it looks as if they will yet again be let off the hook. Two earlier "investigations" by the OFT and the Monopolies and Mergers Commission concluded that the superstores' market dominance, predatory pricing and uncompetitive practices, while wiping out small shops, mysteriously posed no threat either to healthy competition or to the wider public interest.
When John Gummer announced that there would be no more out-of-town superstores, it looked as if their power would at last be curbed. In truth, the ruling has achieved precisely the opposite, which was surely why it was allowed to happen. While Tesco, Sainsbury and the others had already lined up enough planning consents to keep expanding for years to come, the door was conveniently slammed shut on the continental warehouses trying to enter the market. Even so, the British superstores are managing to shrug off these restrictions as blithely as they have disposed of all the others. Now, as Tesco links up with Esso, and Safeway develops its relationship with BP, the superstores have discovered in the petrol stations a new and largely unregulated frontier of out-of-town development.
The end-game is already being played. Having crippled village shops, Sainsbury is now allowing them to stock its own products. Having helped create "food deserts" in Britain's poorest places, Tesco now has the government's blessing to move back into them, on its own terms. The superstores tell us that their expansion is all about choice. What choice would that be, exactly?