The Guardian published an article yesterday which named Torbay as the local authority with by far the highest number of households in the UK at the risk of falling into poverty if the economic situation falls into further decline. The figures don’t take into account those already deemed to be living in poverty, or those in receipt of out of work benefits.
The research highlights some major issues which Torbay faces. Firstly, due to its tourism focus, Torbay has a low wage, seasonal economy which means a significant number of Torbay residents are only in employment for a portion of the year, and having to rely on savings or benefits for the rest. This creates a perpetual stagnation for a proportion of the workforce. For Torbay to be able to grow its economy, its future must lie in a diverse economy which does not rely on tourism as its dominant market. Unless permanent, quality jobs can be created in the Bay, low wage residents face an uphill struggle to pull themselves away from the poverty line.
The South Devon Link Road should start to make a difference to this. Earlier in the week, Torbay Councillors rejected a Tesco planning application for land at Edginswell, where the new link road will join the existing road network at the ‘gateway’ to Torquay. One of the arguments given was that the link road will encourage higher wage professions to Torbay, and that this land was ideally suited, alongside the existing business park, to house just this type of employment. The link road is not due to be completed until Autumn 2015 however, so the benefits from the road may well still be a few years off.
Secondly, the cost of housing in Torbay is a real issue, as house prices has not kept in line with the low wage economy. A severe lack of social housing in the area has raised prices significantly in the private renting market, as Housing Benefit recipients move more and more into private accommodation and low wage earners find it difficult to get onto the property ladder. The maximum rent permitted under Housing Benefit can be higher than the price level low wage earners in Torbay can comfortably afford to pay. Landlords can raise their prices to match Housing Benefit prices, confident of filling their properties due to lack of availability, which then has a knock-on effect to the wage-earning rental market.
Until significant inroads are made in addressing the social housing shortage in Torbay, it is difficult to see a way out of this problem. Hopefully the Government will be announcing plans shortly on the financing of building new social housing.
But for the moment, what is clear is that the issues of a perilously low wage, seasonal economy and significant lack of housing are creating a perfect storm in Torbay. These are both issues which have been present in the area for as long as I can remember. Without significant investment and direction from political leaders, it is difficult to see how Torbay can push its way up and away from the risk of large-scale poverty.