Torbay Council to invest £15million in new Amazon warehouse

Councillors raise concerns about impact on High street.

A special meeting of the full council voted in favour of buying the centre which is to be built near Exeter after hearing its advisers had already spent more than £100,000 working on the proposal.

The decision was made at a special urgent meeting of the full council held in private. 

Before the meeting, the leader of the council’s Conservative group had said the investment was unlikely to go ahead.

The statement from Dave Thomas followed concerns raised by Liberal Democrats about Amazon’s working practices, tax payment record and impact on town centres.

Sources revealed a proposal to back the deal was voted through with support from the Conservative group after councillors were told about the cost of work already done by its advisers the Torbay Development Agency.

Cllr Thomas was away and did not attend the meeting.

The TDA is a company owned by the council and its chief executive Steve Parrock is also chief executive of the council.

The deal was discussed in private to avoid disclosing confidential information at the “extraordinary urgent” council meeting called at short notice for last Wednesday, after the issue was referred on by the investment and regeneration committee the day before.

The Amazon investment had earlier been listed in a publicly available document as part of the council’s financial strategy discussed at a meeting the week before.

Liberal Democrat councillor Nick Pentney raised questions about the deal as he successfully objected to the mayor’s capital programme.

The councillor for Tormohun said: “As a town centre councillor, local business owners tell me how they are really struggling in the face of increased online shopping through the likes of Amazon.

“Many will wonder why, at a time when the council is failing to properly invest in our towns or deliver basic services, they are investing in warehouses that are leased out to Amazon?”

He added: “Having a working relationship with Amazon whilst our high streets are suffering is seriously questionable.”

Liberal Democrat Mandy Darling raised concerns about allegations of poor working conditions in Amazon centres and questioned the record of the business in paying corporate taxes.

Cllr Thomas said in a statement last Tuesday, the day before the special council meeting: “We are clear that if we do not invest, another investor will take our place and the Amazon scheme will still go ahead, however we are mindful of the views of our residents and feel that the council should not invest within a company that is currently causing so much damage to our high street and tax ethics that are still open to question.”

Torbay Council has a £200m commercial property investment strategy to raise extra income to offset funding cuts. 

The money is borrowed from the Government at low-cost rates and invested in commercial property to make a profit. It is expected to bring in £3.6m next year to help run services, but critics say it is high-risk and question whether councils should be involved in the sector.

The controversy over the Amazon deal follows concerns raised about the council’s recent £3m investment in a factory used to make Cornish pasties at Bodmin.

The new distribution centre is due to built in the Exeter Gateway area to the east of the city near the M5, alongside a Lidl distribution warehouse. Amazon has been linked to the site, but has refused to confirm it will be the tenant or comment on the criticisms from councillors.

The Conservative group is the largest on Torbay Council but does not have a majority or control decisions. The council is run by an elected mayor and an executive of independent councillors, but that will change to a leader and cabinet system after local elections in May.

Torbay has seen cuts of £76m in government funding over the last seven years, and is looking for £17m of savings and extra income over the next three years.

Torbay Council has declined to comment on the Amazon deal.