Chris Martin, chief executive of the €4.6bn Musgrave Group, has branded a report by the Irish Competition Authority calling for a radical revision of the Republic’s retail planning guidelines “a flawed analysis”.

The report recommends the current cap on store size be lifted and the ban on out-of-town retail developments be relaxed, in a bid to encourage new entrants to the market and increase competition. But Martin claimed that allowing large out-of-town stores would destroy urban centres and result in increased unemployment. “A lot of people in Britain lost their jobs when hypermarkets started opening, and town centres were decimated by some of the developments,” he said.

Martin, whose company owns the SuperValu and Centra franchises, also criticised the “limited research” behind the report. He claimed its evaluation of the grocery sector was based on the seven largest retailers and took no account of the choice provided by smaller shops, which represented almost a third of the market. But the present planning system restricted entry by new retailers, said the Competition Authority chairman Bill Prasifka.

“Existing retailers are happy at the moment because they have their market share,” he said. “Our job is to promote competition and pave the way for new entrants.”