Financial Times Austerity Audit

“Cuts in welfare payments will hit the local economies of northern towns and cities as much as five times as hard as the Conservative heartland southern countries, according to research commissioned by the Financial Times into the impact of austerity.”

The government’s ‘reform programme’ – its cuts in welfare benefits – will take £19 billion a year out of working age social security between now and 2015. The government says that ‘the welfare cuts will spur the private sector to greater dynamism on the back of an expanded labour force’. However, even the FT says that this research “underlines the potential risks to economic regeneration and private sector business prospects in poorer areas where the local population faces the loss of a large slice of purchasing power”.

Blackpool will lose on average £914 a year for every working age adult. Former industrial areas will be hit hard, one of the remaining legacies of the policies of Saint Margaret. However, the divide is not so simple as north/south, it’s a class divide which runs like Blackpool rock through the whole country. Swindon will lose on average £422 a year for every working age adult.

Mike Cherry, national policy chairman for the Federation of Small Businesses, said small independent shops already faced tough competition from supermarkets and out of town centres and had gone through a hard time during the recession.

“Taking more money out of already struggling local economies may well exacerbate the problem.”

The impact in Swindon is estimated at £422 per working age adult. It will have £58.6 million a year taken out of the economy, comprising

£11.09 million Incapacity Benefits

£4.26 million Disability Living Allowances

£4.60 million Local Housing Allowance

£12.67 million Tax Credits

£10.58 million Child Benefit

£0.99 million Non-dependent deduction

£1.80 million Council Tax Benefit

£0.52 million Household Benefit Cap

£1.08 million Under occupancy (bedroom tax)

Despite being in the ‘prosperous south’ Swindon has 15% of its neighbourhoods among the poorest 20% in Britain

You can visit the website at  http://ig.ft.com/austerity-audit/  and see the impact on you area.

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