Parliament & Politics: Planning - Blair `gave no assurances to US retailer'

TONY BLAIR did not give any assurances to Wal-Mart that planning restrictions on out-of-town superstores would be relaxed if the US giant entered Britain, ministers insisted last night.

Richard Caborn, the planning minister, stressed that the Prime Minister did not discuss planning issues during a meeting in March with executives of the US supermarket giant.

Liberal Democrats and Tories claimed during a debate on the issue that Wal-Mart would not have launched its pounds 6.7bn bid for Asda without indications that it would be able to expand in the south of England.

But Mr Caborn said that the Government was determined to promote competitive and vibrant town centres where retailers competed on a level playing field.

"I want to reaffirm that is still our policy. The Prime Minister has put on the record that he has given no assurances to Wal-Mart about relaxing planning policy. Indeed planning issues were not discussed."

Developers, including Asda and Wal-Mart, would have to demonstrate that there was a "need" for their plan, and a gap in the market was not sufficient justification, he said.

Mr Caborn's reassurance came as Asda made it clear in a statement that it would maintain its policy to adapt its store-development plans to "meet the intention and spirit" of planning regulations.

"As far as Asda is concerned, rumours to the effect that there has been any understanding, formal or informal, with the Government on relaxation of planning requirements are complete nonsense."

But Lib Dem MP Matthew Taylor, opening the debate, said that newspapers had been given off-the-record briefings by sources at the Department of Trade and Industry and the Treasury to the effect that curbs on greenbelt developments were to be relaxed.

"We know that Wal-Mart's acquisition of Asda only makes commercial sense if they are allowed to [develop on greenbelt sites]" he said.

In one of the fiercest personal attacks on Mr Blair this parliamentary session, Mr Taylor told MPs that Wal-Mart made its bid for Asda after its chief took sherry with the Prime Minister at No 10.

He said that Wal-Mart's stated aims were to operate stores large enough to accommodate a large range of food and other goods at prices low enough to take market share away from competitors.

"There is no question at all what Asda want; there is no question at all what Wal-Mart must want - the real question is: why was it after a meeting with the Prime Minister that they felt able to come in?

John Redwood, the shadow Environment Secretary, has already tabled a series of parliamentary questions about the Government's contact with Wal-Mart. He claimed that ministers were determined to bring down supermarket prices by allowing large out-of-town developments.