Sheffield Hallam University is a well established and widely respected educational institution. It recently published a report entitled ‘Hitting the poorest places hardest”, which was concerned with the impact of the welfare reforms being implemented by the coalition government which will continue until 2017. The Sheffield Hallam study quotes the widely reported figure that the welfare reforms will take nearly £19 billion out of the economy (or generate savings to the welfare budget, depending on how your political point of view). This equates to around £470 per annum for every adult of working age in the country.
There are significant regional variations in the impact of the welfare changes and this is reflected in the report findings. The 50 worst affected local authority areas includes many formerly industrial towns though is headed by Blackpool with a loss per annum per working age adult of £910. The equivalent figure for Waverley which lies in the 20 least affected local authorities areas is £280. It is also worth noting that Guildford, Hart, Surrey Heath and Mole Valley also feature in this same group of 20.
This evidence leads the authors of the report to conclude that in relation to the welfare reforms
Britain’s older industrial areas, a number of seaside towns and some London boroughs are hit hardest. Much of the south and east of England outside London escapes comparatively lightly.
So, the affluent south east will suffer the effects of cuts in benefit less than places which lie in what were once largely industrial areas of the country. This is perhaps unsurprising given that more benefits are claimed in these areas. Are there any other conclusions which can be drawn (without jumping) regarding the difficulties faced by households with balancing their budgets in different parts of the country?
According to the Office of National Statistics the population of the Blackpool Unitary Authority area in 2011 was 140,000. The Waverley District Council Area population was 119,000 – 85% of the Blackpool figure. CAB experience suggests that faced with cuts in their income, most households try and absorb the impact in the first instance until they find they are getting deeper into debt and realise they need help, which is when they come to their CAB.
During the period April to June 2013, 134 clients with an average debt of £14,700 sought advice from Blackpool CAB while 120 clients (90% of the number of Blackpool clients) with an average debt of slightly less than £15,200 visited or called CA Waverley. Most of the debt in both locations is unsecured and contains a large proportion of credit card debt. As a proportion of the population, the number of clients requiring debt advice in each location is the same to within 5%. These figures reflect data collected during a single quarterly period and only provide a snapshot. They do however offer a slightly different view of the economic realities of living in the advisedly affluent south east and suggest that although cuts in benefits will affect fewer people in the south east the impact on individual households can be just as severe regardless of where they are located or the number of people claiming benefits in that area.