CHAPTER THIRTEEN

 

ECONOMICS AND TOURISM

 

 

In this chapter the Downland is viewed as a source of economic activity, a natural resource which can be exploited for economic advantage. The two principal economic activities considered are tourism, as defined in Chapter 4, and agriculture. By treating recreational tourism in this manner it enables an insight to be gained as to the role tourism plays in the regional economy. Agriculture has been the traditional principal economic activity on the Downland and this chapter also discusses ways of approaching the problems of a future reduction of agriculture in the marginal uplands of the Downs.

 

It has been shown in Chapter 11 that Downland tourism, conservation and the environment are inextricably linked. This chapter considers the possibility that these issues can have an economic value in a similar manner to farming on the Downland. In Chapter 6; Part 3, it was shown that Willis calculated a value for the landscape, based on a willingness to pay tax enquiry.[1] It was concluded that there was an annual economic value of the Downland landscape of œ80 million. The cost of maintaining the landscape was also identified by Willis as UK pounds 4.32m payments to farmers and UK pounds 1.94m public exchequer costs adjusted for EC contributions. The cost/benefit relationship is apparent and as a result, Willis argues that the nation gets good value for money.[2]

 

The findings of the Downland Visitor Survey discussed in Chapters 6 & 7 provide an alternative method of calculating the economic worth of the Downland derived from use for recreational tourism. It is estimated that 32.5 million visits are made to the Downland in a year.[3] From the Visitor Survey it is known that the average expenditure per visit is UK pounds 15.98.[4] From these two figures it can be argued that the Downland generates UK pounds 519.45 million in consumer expenditure in a year. This figure however is a substantial overstatement due to the nature of the questionnaire. Respondents were likely to be group or family leaders and expenditure figures reflected group expenditure rather than per capita. Chapter 6 suggests a median for group size of 3.27 persons.[5] Using this figure, per capita expenditure is:

                                 UK pounds 15.98      =    UK pounds 4.89
                                             3.27

This figure sits comfortably with the findings of the UK Day Visits Survey, undertaken by Survey Research Associates for a wide range of agencies with countryside interests. The Survey found that the average spend per visit to the countryside was UK pounds 7.50 but excludes individuals below the age of 15 years.[6] Group expenditure on the Downland calculates to UK pounds 13.74 for all day visitors; this gives a per capita expenditure of  UK pounds 4.20 with 3.27 persons per group including children. The Downland as a low price recreational resource, with a high incidence of local usage, understandably produces a lower per capita spend, although the notion that this is calculated from an assumed group expenditure suggests that the Downland figure is a minimum, safe estimate.

 

Given that there are 32.5m visits to the Downland, consumer expenditure per annum, generated by the Downland is:

                32,500,000 x UK pounds 4.89    =    UK pounds 158,925,000

ie. UK pounds 159 millions.[7]

 

 

To put some scale to this substantial figure, the carriageway widening on the M25 between junctions 10 and 11 in 1994 is costed at UK pounds 35 million [8]; Proctor and Gamble planned to spend UK pounds 130 million in 1994 on advertising [9]; the Health Education Authority costs UK pounds 56 million to run per annum[10] and the top ten UK travel advertisers spent UK pounds 97 million on advertising in 1993[11]. The Downland is therefore a substantial economic generator.

 

Only a small portion of the UK pounds 15.98 recreational tourism expenditure is being made within the Downland core study area, this is apparent from the breakdown of the total figure. The Visitor Survey data indicates that it is made up of UK pounds 5.38 on food and drink, UK pounds 4.56 on travel costs, UK pounds 3.47 on entry costs and UK pounds 2.57 on other costs. Table 13:1 illustrates the segmentation of the market by type of expenditure adjusted to a per capita basis as above. Even entry fees will largely have been made at locations not strictly within the core study area as shown in Table 4:2.

 

 

 

 

 

 

 

In Chapter 7 the principal user groups of the Downland were identified.[12] From this data it is now possible to consider the economic worth of each user group based on the expenditure that they each make. From the Visitor Survey it is possible to calculate expenditure per visit, by type of expenditure, by user group. This is given in Table 13:2.

 

 

 

 

Using the data from Table 7:2, an estimate of each user group's share of the total economic worth can be calculated. To achieve this the per capita expenditure of each user group is multiplied by the number of visits factor thereby using the group visits indexed against the total 32.5 million visits in a year. The "value" percentage share of each user group against the total can then be calculated. This complements the "volume" share of each user group given in Table 7:3.

 

Comparison between the volume shares estimated in Table 7:3 and the value shares estimated in Table 13:3 provides a measure of impact and economic worth of each user group. For example Dog walkers account for 6.1 percent of Downland use but only 3.7 percent of economic activity. By contrast wealthy tourists, although they account for 9.1 percent of Downland use, contribute 13.3 percent of economic activity.
 

 

 

 

The UK pounds 159 million of consumer expenditure per annum generated by the Downland in total, through direct taxation, represents a substantial revenue for the exchequer. Assuming all expenditure is subject to VAT at 17.5 percent, consumer expenditure gives central government a sum in excess of UK pounds 24 million gross in direct taxation before collection costs as a result of Downland recreation. This compares with the cost of the Downland as identified by Willis and detailed in Chapter 6, of UK pounds 6.26 million. Willis's view that the nation is getting extremely good value for money is an understatement. It also indicates that a sum in the order of UK pounds 135 million, excluding tax, is being spent into the economy on goods and services as a direct result of the Downland being available for recreation. Two provisos need to be stated in the application of these figures: a) that if the Downland were not available for recreation, expenditure would likely be made on other pursuits perhaps to a lesser extent and b) these figures are based on a number of assumptions which make them generally indicative rather than precise indicators. Further research would enable the data to be refined. In spite of the provisos, the data enables a considerable insight, not previously available, to be gained of Downland user expenditure.

 

This chapter now goes on to consider the role and utilisation of this expenditure in the economy. It has already been noted that much of this expenditure is made off the Downland. This introduces the concept of a geography of economic impact, which in the case of the Downland is clearly different from the geography of visitor impact. The Downland, although attracting 32.5 million visits in a year, provides limited opportunities for tourists to purchase goods or services. It is in the outer study zones, as determined in Chapter 2, that the economic benefits are most apparent. In this way the Downland is acting as an economic engine, powering the prosperity of the outer zones.

 

Not all of the economic benefits "leak" to the outer zones however. In the previous chapter, the social implications of increased visitor numbers in villages was considered and it was noted that there is a distinct social advantage when village services can be maintained as a result of increased visitor numbers providing demand, which then exceeds survival thresholds. It has been noted in the previous chapter that this effect can be enhanced with customised village activity aimed at attracting additional visitors.

 

The concept of the geography of tourism impact has already been discussed from a strategic planning viewpoint in Chapters 10 and 11. In these Chapters, the idea of creating specific zones is developed as an instrument of strategic planning. Careful orchestration of tourism's economic impact by zoning, similarly enables the environmental, conservation and social considerations to be managed to the maximum advantage. Is there however a danger that the main tourist product, in this case the core study area, is becoming an economic ghetto, as the benefits of tourist spending are actively dispersed into the outer zones?

 

According to Bowen; "The pretty faces of English villages often hide a blight of lost jobs and ageing populations". This sums up the now traditional view of rural needs and hardship. The suggestion is that all is not well in the rural environment. Bowen looks at the designation of part of East Sussex as a Rural Development Area.[14] Whilst the earlier proposals in this thesis suggest ways in which the village communities on the Downland can exploit tourism on a localised basis, is there an immediate need to pursue tourism development to bolster failing Downland rural economies? Tourism is often seen as a quick and easy solution as other aspects of the economy weaken.[15]

 

Recognising the possibility of such a requirement, the Sussex Downs Conservation Board in May 1993 established a Rural Panel to consider such issues in the Sussex AONB. The Board has a responsibility to promote sustainable forms of economic and social development, as outlined in its published objectives.[16] Following discussions, the report of the Rural Panel Rural Community Needs was published in January 1994.[17] This thesis draws on the content of the report in several places but in particular, this chapter considers the Local Economy debate in the context of tourism. In the conclusions, the report identifies a decline in village services, both economic and social.

 

The report concentrates on employment as an expression and measure of local economic circumstances. By doing so it, arguably, fails to reflect personal standards of living, which may benefit from historic wealth, either in the form of pensions or inherited wealth, from state disbursements of one form or another or from dividends and investment income.

 

From the data presented, it is noted that there is a continuing decline in numbers of people employed in agriculture. In the AONB this amounts to a 25 percent decline, 1981 - 1991. Forestry and fishing and manufacturing are also showing declines. Such declines are offset by major growth in employment in Banking and Finance, Transport and Public Administration and other services. A similar situation prevails in Sussex overall. (This restructuring of employment opportunities will be discussed later in this chapter.) The net outcome is that there is a general increase in numbers in employment of 4 percent over the 1981 - 1991 period in the AONB, with rural Sussex and Sussex overall showing a 16 percent gain. This would suggest that the AONB is not developing employment opportunities at the same rate as elsewhere, but why might this be so?

 

The lower figure of 4 percent for the AONB can be interpreted as indicative of a lack of available people to work, as shown by the maintenance of the proportion of the total populace as economically active. In 1991, between 57 and 58 percent of the population were economically active both in Sussex overall, and in the AONB. Unemployment in the AONB is less than elsewhere, 2.62 percent compared with 4.11 percent for Sussex overall.

 

Using employment as a measure of economic prosperity, it would appear that the AONB, which includes the Downland, fares better than elsewhere in Sussex. It may be therefore that the concerns of the Rural Development Panel are based on historic notions of rural deprivation, as expressed by authors such as Haynes [18] who, in the 1970s, bemoans the demise of public transport and small local facilities in rural areas but fails to take cognisance of the emerging, highly mobile and affluent lifestyles of the population at large, a reflection of the Downland rural populace in the mid 1990s. Such a conclusion is supported by other indirect measures of prosperity, for example car ownership. Only 14.5 percent of households in the AONB are without a car, this compares with 28.5 percent in Sussex overall. In addition, twice as many households in the AONB have three or more cars, compared with Sussex overall.

 

Blunden and Turner were able to identify this change in rural populace in their 1985 case study of Ditchling.[19] The demise of a community based on agricultural employment of the 1960s was replaced by a commuting, white collar populace by the 1980s. This brought not only increased affluence but also mobility. The agricultural cottage had become a stylish country home and the small village shops were replaced by centralised shopping elsewhere and new retail services not previously associated with a village community, for example the fishmongers had become an antique shop.

 

It would appear that economics are not the cause of rural deprivation on the AONB/Downland. Such deprivation and hardship as does exist, needs to be investigated in the context of other issues such as Christaller's Central Place Theory, modified by Key Settlement Policies Theory.[20] This is leading to a rationalising and consolidation of essential services in the urban rather than the rural. To the affluent mobile Downland resident this would be advantageous but it is with the residual, traditional, rural populace that such restructuring presents major problems. It may be that personal mobility is the real rural issue and this is considered in Chapter 15. The idea of a failing local rural economy on the Downland is, arguably, not sustainable and this in turn supports the approach that economic activity can be considered on a macro basis.

 

The continuing decline of employment in farming and allied fields has been highlighted earlier in this chapter. This is a manifestation of the restructuring of agriculture throughout the EC. Farmers, it is argued, have increasingly, since the War, pursued a policy of maximum yields. This has led to overproduction as efficiencies improve and a deterioration in the aesthetic qualities of the countryside. Agriculture became the uncontrolled monster of countryside destruction. The latter part of the 1980s saw the dinosaur roll over and start to die.[21] The legacy that the 1990s inherits is the evolution into a more streamlined farming industry, with up to 30 percent of earlier farmland being taken out of production and a decline in those actively employed in growing food.

 

From an economic standpoint therefore, there is a role for service industries such as tourism in replacing jobs lost in agriculture, an issue raised in the SDCB Rural Panel report.[22] Social change within society is also resulting in more women entering the employment market, and on the basis of equality with men. The tripartite balance between tourism, conservation and the environment can be readily deployed to meet the new needs of the ever-developing rural society in several ways. The market needs of the visitor provide considerable scope for job creation, either to directly service visitors or to provide support provision, particularly in the peripheral study area. Support provision particularly can include a wide variety of opportunities, including goods manufacture for onward sale, transport provision, financial and administrative services etc.

 

In addition, in the core study area itself, countryside management and environmental maintenance lead to an "agriculteur nouveau" directing traditional land management skills to providing a visitor landscape rather than a food manufactory. The deployment of resources, as proposed for example in the Heritage Coast Plan, illustrates the process in action. The SDCB staff are called upon to provide substantial support for the implementation of the Heritage Coast Management Plan, funded by a range of Government agencies.[23]  Money derived from taxation is channelled into conservation and visitor projects thereby returning wealth into the local economy and creating employment. This in turn, enables visitor opportunities to be improved, thereby increasing the overall economic worth of the Downland set out earlier in this chapter. Central government is able to more than recoup the finance through taxation, and economic progression ensues. A survey in the New Forest by the District Council in 1992 concluded that an expenditure of under œ1 million in commoning and forest maintenance produced a local income of UK pounds 76 million and created 2,930 full time equivalent jobs.[24]

 

Tourism can be seen as an important means whereby economic prosperity can be maintained either through direct or indirect employment means. Estimates of the value of Downland tourist expenditure have suggested a sum of about UK pounds 159 millions per annum, most of which will be dispersed in the peripheral study area. Estimates of tourism related employment in Sussex indicate the extent to which the visitors contribute to the south east economy.

 

In West Sussex it is estimated that there are approximately 23,000 jobs resulting from tourism, about 8 percent of all jobs. Many of these are at Gatwick Airport, which is outside the study region.[25]

 

In East Sussex the number employed in tourism is estimated to be about 7 percent of the working populace ie 21,600. Over half of these are concentrated in the Brighton and Eastbourne resort areas.[26]

 

Defining tourism-related employment is notoriously difficult and as difficult as defining tourism itself.[27]   "Tourism is apparently one of those industries that you can work in without knowing it" [28] Much of this nebula is due to the multiplier effect which will provide second generation employment for people servicing those employed in tourism and in supplying goods required in the tourism related industries. The power of the multiplier effect in enhancing the economic benefits of tourism prime spending is a subject which has engrossed academics for some years. Ryan [29] sees three key issues that determine the value of the multiplier:

 

a) The proportion of tourist expenditure remaining in the area after first round leakage.

 

b) The proportion of income that local people spend on local goods and services - a propensity to spend locally.

 

c) The proportion of expenditure of local people which accrues as local income.

The relationship between these factors is then expressed as follows:

 

                        TOURISM MULTIPLIER = (a) x (  _____1_____  ).
                                                                                       1-(b)(c)

 

Archer develops a more complex model to account for expenditure by type of outlet. Work carried out by Murphy, quoted in Ryan, observes that the multiplier reduces as the area under consideration decreases. One of the major problems with the multiplier calculation is the information requirements.[30] The calculation of the multiplier requires parameters to be placed on the data collection and then it becomes a comparative tool. For the purpose of this thesis it is important to appreciate the factors that enhance the multiplier effect rather than the detailed numbers. By adjusting the factors that enable the multiplier to increase, the economic benefits of tourism are enhanced within the local economy without an increase in overall visitor numbers.

 

To maximise the economic benefits of tourism, the retention of all primary and secondary expenditure opportunities within the overall study area is a key aspect. Such an endeavour should be incorporated into policy and management planning alongside any wish to increase visitor numbers overall for economic gain.

 

This then raises the question of what practical difficulties exist for the local communities in seeking greater economic benefits from tourism. In Chapter 12 it has been proposed that Downland villages could enhance local culture, improve social provision and gain economically from tourism by adopting themes as a means of encouraging visitors. This subject is debated by Chambers.[31]

 

From the viewpoint of ameliorating local economic needs Chambers makes a number of pertinent points. Often those in most need are those who are unable to be economically active. These are the less vocal and less able members of a community. A cursory inspection does not reveal the individual circumstances where problems exist and it is a variety of observers who see aspects of need, but no observer sees the full picture. For example, doctors will deal with sickness brought about by reduced financial circumstances but will not be aware of the complex individual circumstances that lead to such a plight which may include inadequate housing, poor diet, personal debt. etc. Chambers sees two cultures seeking to resolve matters, the academic social scientist who seeks to understand the world through analysis and debate, and the positive practitioner who engages in time bounded action with deadlines, budgets and results targets. Such a person makes an input and them moves on to pursue a career elsewhere. Although those in need are the subject of the enquiry, in the debate of who gains and who loses, it is often the inquirer who gains more than the enquiree.

 

The circumstances that bring this about are complex and locked into the fabric of our society. A deeper understanding enables management intentions to be implemented to greater effect. For example the poor have a small capital base. They are less resilient in times of hardship as a result, and actions will include the disposal of assets and the resorting to short term high interest loans. The more prosperous will buy the assets and lend the money. A hierarchy of capitalist exploitation ensues with the strong controlling the weak. Such control inevitably leads to the perpetuation and accentuation of the hierarchy. Plans, projects and controls are the bureaucratic response. The complexity and constraints often stifle the initiatives coming from the bottom up. Local initiatives are often triggered by grants and aid as part of the response to need by bureaucracy. These are seen as pump priming exercises. The outcome is that generally such assistance is scooped up by the active classes.

 

In the debate on the utilisation of the economic benefits of tourism the approach should perhaps be that the economically active classes are best suited to orchestrate commerce. Let those who have done it well in the past continue to do it well and those who cannot, do not expect them to change. In which case alternative mechanisms are required to underpin specific individual needs not resolved by the economic initiatives. This suggests a role for state disbursements derived from the benefits accrued through taxation of tourism expenditure rather than direct involvement in tourism related commercial activity. The transfer of wealth that such a policy implies could have a valuable side effect. The needy often have time available but no money. Realistic disbursements by the state would enable the economically less well-off to enjoy many of the facilities the wealthy take for granted. State assistance would enable those without reasonable income from economic activity to travel and enjoy the Downland resource, thereby ensuring that much of those disbursements are recirculated in the tourist economy.[32] This argument leads to a debate on the role of the State in ensuring quality of life for those not able to be economically active for whatever reasons. This thesis is not the place for such a debate other than to suggest that the economically inactive should be recognised for what they are and wealth made available to them through alternative mechanisms.

 

The role of District and County Councils and the SDCB now requires examination, given the reservations that Chambers expresses. Bacon and Le Pelley have considered this matter.[33]

 

"District Councils mastermind a complex operation of supply and demand for tourism facilities, backed by an administrative system which has to be flexible enough to recognise and foster the close link between tourism and community interests. Although many Councils run at a loss, their existence is an important catalyst in making the area attractive to tourists"

 

The scope of services provided by Councils ranges from Tourist Information Centres to Public Conveniences, Libraries and Museums to Refuse Collection, Countryside Conservation to Safety Standards etc. These form both direct and indirect interaction with tourism and no other agency is involved in such a wide ranging and pivotal role. As an employer, Councils outnumber any other in tourism-related industries. Table 4:4 details the extensive Local Authority expenditure on tourism in Sussex. The overlap with domestic service provision means that tourism benefits the community at large. As such, Councils cannot ignore tourism which is, as pointed out in Chapter 4, inseparable from all else around it.

 

Very few Council tourism activities are profit making. Notable exceptions are the Pump Rooms at Bath and like attractions. The role of the Councils is by and large one of a loss leader aiding the regional economic development. Expenditure in Downland conservation can be interpreted as a direct investment in tourism for the larger area. Any move to reduce such expenditure will have double ramifications, it will reduce conservation effort and will also impinge on the regional economics. Dramatic cut backs will threaten long term investment in the tourism industry as numbers drop and the multiplier effect goes into reverse as the industry contracts.

 

Experience has shown that where Councils invest in infrastructure requirements for tourism, this acts as pump priming and private capital quickly follows. Supporting such capital investment is the underpinning of the investment with marketing initiatives by local Council Tourism Departments. Whilst such approaches to tourism are traditionally associated with the tourism resorts such as Brighton, the approach can be modified to suit the environmental requirements of the Downland as has been demonstrated at Beachy Head recently. Although in Chapter 11 the Beachy Head Hotel was considered an inappropriate development for the Downland, an action programme initiated by Eastbourne District Council has resulted in considerable improvement in the area as eyesores are removed and new land management practices introduced. This has been supplemented by private capital which has resulted in the total refurbishment of the Hotel, rendering the external appearance more in harmony with the character of the Downland and the interior becoming a shrine and place of pilgrimage to enthusiasts of certain aspects of the Downland culture and heritage.

 

The difficulty with a region such as the study area, including the core and peripheral areas, is that of coordinating the endeavours of the various respective District and County Councils. The SDCB now demonstrates how this can be achieved for countryside management. For tourism a corporate business approach needs to be taken which would be coordinated through the Area Tourism Initiative as proposed in Chapter 10. Not only would it resolve much local conflict and competition for tourism benefits, it would also provide an integrated financial approach to tourism management giving common purpose to not only the provision of finance and services for local endeavour but in addition, to the securing of major aid from EC and other macro sources.

 

There is an important aspect of the Downland tourism infrastructure that lies outside many of the considerations voiced in this chapter on economic development, and that is agriculture. The Dartmoor case study has demonstrated the effective management of tourism and it should be noted that farming remains the backbone of the moorland economy and way of life.[34]

 

The underlying problems affecting farming have been outlined earlier[35]  and these are now manifesting themselves in a variety of ways. The reduced need for farm land is resulting in 15 percent of agricultural land being on set-aside at a subsidy cost to the Nation of UK pounds 316 p.a. per hectare.[36] In the core study area alone this represents an annual subsidy in excess of UK pounds 3.6 millions. This however is a temporary arrangement and does not take land out of permanent agricultural production. Reduced farm incomes mean that 65 percent of all farms generally, are run on a part time basis, the farmer having to seek income from elsewhere to support his standard of living. On the Downland, tourism is set to become the major rural industry if such trends continue. The current problems are the transition pains of metamorphism. Eighty percent of food production now comes from 20 percent of farmland.[37] This suggests that, in the longer term, land will be taken out of agricultural use permanently; inevitably it will be the more marginal producing land, such as the higher Downland, that will be particularly affected. Such a scenario is not limited to the UK. In France it is estimated that one farm goes out of business every three hours, breaking the backbone of the rural communities.[38] Medium term estimates suggest that as much as 30 percent of Britain's agricultural land stock will come out of production between 1989 and 1996.[39] The following debate in this thesis is based on the present 15 percent set-aside.

 

Farming as the principal land user on the Downland has sculptured the landscape and as agricultural output declines on the Downland, the same skills are required to maintain the landscape in a manner that the conservationists seek. Recognising the strong relationship between the rural welfare and agriculture, the Common Agricultural Policy is destined to become a Common Rural Policy in the 21st century according to many. This may well ease the dilemma of many land owning farmers who at the moment can be paid to look after the countryside in a certain way but are a long way off becoming parkland maintenance practitioners.

 

Diversification by farmers has resulted in a wide range of new uses for farmland and in Chapter 11 golf courses have been debated. Such diversification is often inappropriate for the core study region and the question therefore arises as to how the economic welfare of the agricultural community can be secured while new appropriate applications are found for the land. Tourism is able to offer a substantial and sound alternative which harmonises with the wishes of the community at large. The re-use of land for recreation provides a means of maintaining the surface area in a manner that is found environmentally acceptable. The cost of such maintenance is met as part of the public investment in economic development and funded by the increased value added taxation resulting from expanded recreational usage. The skills necessary for such maintenance are similar to the traditional farming skills and employment opportunities will ensue. The dilemma comes when considering the future of the farmer himself and the land which represents a major capital sum on which he expects an adequate return. There are possible solutions to this problem. These include the development of land holding for public recreation land, a theme which is discussed in the ensuing chapter.