Tesco U-turn over Sunday hours

By JONATHAN PRYNN FOR MAILONLINE
Updated: 12:15 EST, 10 May 2006

TESCO today performed a U-turn on its bid for unregulated Sunday trading as it launched a fightback against its growing public image as a ruthless ' small-shop killer'.

It pulled out of a campaign for 'open all hours' trading on Sunday, saying it had found its customers did not want it.

Separately, its £3.2m-a-year chief executive Sir Terry Leahy will make a keynote speech saying the firm is committed to helping local communities.

The charm offensive comes the day after Tesco and other big supermarket groups were referred to the Competition Commission for an investigation into their domination of High Streets.

In his speech to an invited audience at the headquarters of the Work Foundation consultancy in central London, Sir Terry will stress the contribution Tesco already makes to communities, such as its Computers For Schools programme.

He will point to Tesco's efforts in promoting healthy eating, recycling and urban regeneration as well as its support for charities. He will also announce that Tesco has adopted 'community' as one of its core steering priorities, alongside customers, operations, finance and people.

The company will no longer support Deregulate, an industry campaign backed by Asda, Ikea and Next, which is calling for an end to all restrictions on Sunday trading. The supermarket said: 'Eighty% of customers we have talked to want more than six hours of shopping on Sunday - but less than 12% want more than 12 hours. So they don't want full deregulation.'

Sir Terry's speech will be the first in a series of initiatives to soften and 'green' Tesco's sometimes harsh image. Senior executives at the Cheshunt head office are known to be rattled by the hostility of recent coverage of Tesco's financial results and growth.

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Last month, Sir Terry revealed that Tesco has set up a £100m fund to help make its stores and operations more environmentally friendly. This will include heating and lighting supermarkets with sustainable energy sources such as wind turbines, solar panels and even gas from rotting food. Other small-scale measures under review include improving its delivery lorries so the suspensions are quieter.

The location of the speech is significant as the Work Foundation is headed by economics writer Will Hutton, one of the leading exponents of the idea that companies should Aim to work for all its ' stakeholders' and not just its shareholders.

However, the move has met a cynical response from environmental campaigners. Andrew Simms, policy director of the New Economics Foundation think tank - one of Tesco's harshest critics - said: 'If your idea of a good neighbour is someone who clogs the streets with their juggernauts, wakes you up at dawn with their delivery vehicles, puts your favourite small shops out of business, denies you real choice and turns your town into a clone town, then Tesco fits the bill.'

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MPs gave a cautious response to Tesco's Community programme. Danny Alexander, Liberal Democrat MP for Inverness, said to be the most 'Tescopolised' city in Britain, said: 'Of course it's a good thing if Tesco is looking to take its corporate social responsibility more seriously. I'm sure they'll support positive causes.'

The Evening Standard launched its Save Our Small Shops campaign in the face of the relentless growth of supermarket giants such as Tesco and the continuing decline of independent High Street shops.

Almost 20,000 shoppers and London retailers have responded to the campaign by signing petitions or putting up stickers. To get a Save Our Small Shops sticker, call 0901 030 1546.