Campaigners fighting plans by Tesco to increase the amount of space it uses for non-grocery goods at its Shrewsbury “Extra” store today said a decision to refuse the application could be a landmark case.

A number of councillors, residents, organisations and retail groups have protested about the potential damage the supermarket giant is inflicting on small traders in the town centre.

And they say the firm stance taken by Shropshire Council’s central planning committee on Thursday could help to prevent other retailers breaching planning rules.

The campaigners, including Shop in the Loop and Shrewsbury Town Centre Residents’ Association claim the added space used by Tesco over the past three years has taken £3.5 million out of Shrewsbury’s small business economy.

Tesco’s retrospective plans to allow it to have 4,789 sq m of sales floorspace including 2,071 for non-grocery goods, were rejected by councillors on Thursday.

But the final say will lie with the council’s strategic planning committee.

Councillor Dr Maxwell Winchester, Shropshire Councillor for Quarry and Coton Hill ward, today warned that if the council did not uphold its own planning regulations it could “kill” the town centre and see other retailers take advantage.

He said: “I am relieved to see that members of the planning committee could see the potential damage approving this application could do to our local retailers based in the town centre.”

John Clayton, chairman of the board of Shropshire Enterprise Partnership, added: “The new Planning Policy Guidance is good news – it provides a clear framework within which investment can be attracted to town centres and where businesses can compete with out-of-town stores on more equal terms.”

But Tesco officials say the additional use of floorspace has not had a significant impact on town centre trade.

Tony Fletcher, for the firm, said they were “disappointed” by the committee’s decision and would await the decision of the strategic planning committee.

He said Tesco had not deliberately flouted planning laws.

By Russell Roberts