Half UK budget deficit 'is down to job destruction in older industrial areas'

Report finds that legacy of hollowing-out of manufacturing in 1980s is far more people claiming incapacity benefits

The enduring impact of closing factories and shutting coalmines in the 1980s has been revealed in new research showing that the drain on the exchequer from former industrial areas is responsible for up to half the government’s £55bn budget deficit.

In the first comprehensive analysis of the cost to the state of the de-industrialisation that began three decades ago, Sheffield Hallam University said the annual bill was at least £20bn and was perhaps as high as £30bn.
The report found that the cumulative legacy of the hollowing-out of manufacturing and the year-long miners’ strike of 1984-85 was a far heavier concentration of people claiming incapacity benefits than in the richer parts of Britain and a more widespread use of tax credits to top up the wages of those in low-paid jobs.
The report’s co-author, Prof Steve Fothergill, said: “The long-term effect of job destruction in older industrial Britain has been to park vast numbers out of the labour market on incapacity benefits, these days employment and support allowance (ESA). The cost to the Treasury is immense, especially if all the top-up benefits are included.
“Added to this, low wages in these weaker local economies have jacked up spending on in-work benefits such as tax credits and reduced income tax revenue. None of these impacts have diminished over the years, despite the recent upturn and efforts to cut claimant numbers.

“We estimate that the ongoing cost to the exchequer, in extra benefit spending and lost tax revenue, is at least £20bn a year, and possibly nearer £30bn. To put this another way, approaching half the current budget deficit is the result of job destruction in Britain’s older industrial areas.”
The report – Jobs, Welfare and Austerity – said there was a continuous thread linking what happened to British industry in the 1980s to the welfare cuts being borne by communities in the north, Scotland and Wales today.
The loss of manufacturing jobs fuelled spending on welfare benefits which in turn had added to the financial problems of successive governments and led to pressure for cuts.
“The welfare reforms implemented since 2010, and strengthened since the 2015 general election, hit the poorest places hardest,” the report said. “In effect, communities in older industrial Britain are being meted out punishment in the form of welfare cuts for the destruction wrought to their industrial base.”
The report comes as Theresa May’s government is coming under increasing pressure to delay cuts in disability benefits announced by the former chancellor, George Osborne, as part of his now abandoned plan to put the public finances back into the black by the end of the parliament.
May has raised expectations of action to help Britain’s manufacturing heartlands by stressing the need for the country to have an industrial strategy and by emphasising the difficulties faced by working-class families in the speech made in Downing Street on the day she became prime minister.
Last week Michael Fallon guaranteed 20 years of work for the BAE Systems shipyard on the Clyde when he announced that work on a new generation of warships would begin next summer.

But the Sheffield Hallam study found that Scotland, along with Wales and large areas of the north of England, still bore the scars of the period in the early 1980s when high interest rates and a strong pound led to the loss of 2 million jobs and a fifth of the UK’s manufacturing capacity.
Subsequent recessions in the early 1980s and the late 2000s have meant that the number of people working in industry has fallen from a peak of 8.9 million to 2.9 million over the past 50 years – a far bigger decline than in other advanced economies.
The report found that the increase from 750,000 to 2.5 million in the number of people on disability-related benefits reflected hidden unemployment and that 18 of the 20 districts with the highest incapacity rates were in older industrial Britain. In Blaenau Gwent and Neath Port Talbot in South Wales, and in Glasgow, the incapacity claimant rate was 11.9%.

In areas where the local economy was strong, there were much lower incapacity claimant rates. Only one London borough, Islington, featured in the top 100, with only four other districts in the south-east featuring, all of them seaside towns.
Fothergill and his co-author, Christina Beatty, said the UK spent £34bn a year on working-age incapacity benefits once housing benefits and tax credits were added to ESA. Of this, they said £10bn-£14bn was the cost of job destruction in older industrial Britain.
They added that higher claimant count unemployment in the old industrial areas was costing the exchequer a further £1bn-£1.5bn a year.
The study estimated that the government was also subsidising the poorly paid jobs that had replaced those lost in manufacturing in the older industrial areas to the tune of £10bn a year. Spending on tax credits exceeded £850 per head a year, double the level in southern Britain.
As a result, the poorer parts of Britain were vulnerable to the freezing of non-pensioner benefits, including tax credits, which Osborne announced for the duration of the current parliament. The study estimated that the average working age adult in the older industrial regions would lose £750 a year by 2020-21, whereas the average loss in Cambridge would be £340.
It added: “The Treasury has misdiagnosed high welfare spending as the result of inadequate work incentives and has too often blamed individuals for their own predicament, whereas in fact a large part of the bill is rooted in job destruction extending back decades.”

https://www.theguardian.com/business/2016/nov/06/half-of-uk-deficit-is-result-of-job-destruction-in-older-industrial-areas?CMP=share_btn_fb



The name Margaret Thatcher springs to mind.

OHN MAJOR triggered a round of damaging blood-letting among senior Tories last night over Margaret Thatcher's legacy.

In an unprecedented outburst against his predecessor, he blamed her for the "sleaze" and economic difficulties that dogged his premiership and accused her of doing "immense damage" to the party.

Mr Major abandoned any pretence of respect for Lady Thatcher by letting fly in an interview arranged to announce his endorsement of Kenneth Clarke in the Tory leadership contest.

He said she had incited Tory MPs to rebel against him over Europe and had bequeathed him high inflation, rising interest rates, unemployment and a Tory Party tarnished by allegations of sexual and financial wrongdoing.

He used his intervention to accuse Iain Duncan Smith of serial disloyalty during the Maastricht Treaty debates of the early 1990s

http://www.telegraph.co.uk/news/uknews/1338251/Major-scorns-the-Thatcher-legacy.html

John Major pretty much came to the same conclusion.

yep....

and I have pointed out times many a solution for it

and I note that when it had the power and opportunity to actually do something about it the labour party utterly failed to act......indulging in "sticking plaster" politics, rather than grabbing the problem by the horns .....

the tories are bastards to the working man
however
labour was a traitor.

 JUST like the tories...albeit for different reasons........ the labour party "loved" unemployment...it suited THEM as much as it did the tories....

Thank goodness we now have a leader who is prepared to stand up and be counted where zero hours, job losses, the vilifying of the sick etc are concerned and keeps on doing it no matter what lies and shit are thrown at him.

Lord Foul wrote:yep....

and I have pointed out times many a solution for it

and I note that when it had the power and opportunity to actually do something about it the labour party utterly failed to act......indulging in "sticking plaster" politics, rather than grabbing the problem by the horns .....

the tories are bastards to the working man
however
labour was a traitor  JUST like the tories...albeit for different reasons........ the labour party "loved" unemployment...it suited THEM as much as it did the tories....

Unemployment never ever reached the dizzy heights as it did under the Tories - over 3 million. But I take your point that on some of the other issues you raised.

Irn Bru wrote:

Lord Foul wrote:yep....

and I have pointed out times many a solution for it

and I note that when it had the power and opportunity to actually do something about it the labour party utterly failed to act......indulging in "sticking plaster" politics, rather than grabbing the problem by the horns .....

the tories are bastards to the working man
however
labour was a traitor  JUST like the tories...albeit for different reasons........ the labour party "loved" unemployment...it suited THEM as much as it did the tories....

Unemployment never ever reached the dizzy heights as it did under the Tories - over 3 million. But I take your point that on some of the other issues you raised.

agreed...BUT....they could have reduced it by much much more AND ensured proper wages and conditions....and got away from "working benefits" to a large degree by ensuring proper wages

but of course they were hampered by your precious E.U as well...lets not ignore ITS anti worker contribution

the OP is a bit ridculous
Ok so to work out why the UK is going so badly you just have to understand what is wrong with the OP

it assumes the UK's Problems are from Internal factors that only internal factors played a part or can be used to fix unemployment.

the UK unemployment went up because it is NOT AS COMPEDATIVE as many other nations in Low skill work like the Industrial jobs that left the UK int he 1980's
The is nothing the UK could do to keep them other than reduce wages to third world levels.

all the UK problems are pretty much down to it's Incapacity to see beyond it's shores.

broken record veya.....

round and round........

well glad i dont live in such a moronically insular nation

why not just take your sleves out of world affairs all together and cut all phone lines and interent so you can go back to pre WW2 then such thoughts as the expressed in the OP where only Half a century out of date.

Been 100 fukcing years since the economics used in the OP were even Slightly right, absolute Bullshit nonsense since globalisation of trade.

veya_victaous wrote:well glad i dont live in such a moronically insular nation

why not just take your sleves out of world affairs all together and cut all phone lines and interent so you can go back to pre WW2 then such thoughts as the expressed in the OP where only Half a century out of date.

Been 100 fukcing years since the economics used in the OP were even Slightly right, absolute Bullshit nonsense since globalisation of trade.

Lord Foul wrote:

Irn Bru wrote:

Lord Foul wrote:yep....

and I have pointed out times many a solution for it

and I note that when it had the power and opportunity to actually do something about it the labour party utterly failed to act......indulging in "sticking plaster" politics, rather than grabbing the problem by the horns .....

the tories are bastards to the working man
however
labour was a traitor  JUST like the tories...albeit for different reasons........ the labour party "loved" unemployment...it suited THEM as much as it did the tories....

Unemployment never ever reached the dizzy heights as it did under the Tories - over 3 million. But I take your point that on some of the other issues you raised.

agreed...BUT....they could have reduced it by much much more AND ensured proper wages and conditions....and got away from "working benefits" to a large degree by ensuring proper wages

but of course they were hampered by your precious E.U as well...lets not ignore ITS anti worker contribution

According to the governor of the Bank of England, Labour did just that

President and Congress

I want first to thank you for inviting me to address Congress. Members of your General Council have made a huge contribution to the Bank of England by serving on our board - the Bank's Court.

Carrying on that tradition today is Brendan Barber. By bringing a distinct and important perspective to our discussions, Brendan has helped us through some extremely turbulent times. I am grateful to him.

Recent times have indeed been turbulent. After a decade and a half of stability, with rising employment and living standards, came the crisis and recession - the biggest economic upheaval since the Great Depression. Before the crisis, steady growth with low inflation and high employment was in our grasp. We let it slip - we, that is, in the financial sector and as policy-makers - not your members nor the many businesses and organisations around the country which employ them. And although the causes of the crisis may have been rooted in the financial sector, the consequences are affecting everyone, and will continue to do so for years to come.

yes Victor they are words
Maybe if Brits listen to some words, other than Forunuz and Immgrantz there would be some hope for the nations.

but left is stuck in the past, staring at a mirror and ignoring the WHOLE FUCKING WORLD in favour of staring at it's belly button for the solution for it's economic woes.

and Right wing has the brains and education you'd expect to find in it some bark hut. the irony that those that are mentally scratching dirt still think they can call other primitive and accuse them of being dingle berry pickers, you wish you had dingle berries to pick cause you got nothign instead.

both are united in their backwards historical world outlook and dedication to rendering the UK a weak non-entity that will be consumed by another.

blah blah blah...ffs change the tune....

you are a biological marvel .....


the only person who's rectum has grown vocal cords

Fuck you wankers, Post shit about how dumb you are and expect people not to comment that you are just posting shit about how dumb you are.

OR is it that None of you dumb fucks can read past the Word Brit?

Come on then EXPALIN why your nation is so FUCKING USELESS without whining about lefties? cause it is not left and Right that has the issue is BRITS that have the issue!

Sick of your record Blaming lefties FOR YOUR NATIONS PATHETICNESS
Sick of Losers like Nicko just saying "it's Brit it's great"
It's fucking pathetic and I am Sick of reading the Pathetic losers posting the same Pathetic shit about how they suck but don't want to do anything about it.

Our nation isn't fucking useless... but has had too much immigration of fucking useless 3rd world scum bags come here and draining our country like leeches draining blood from the body of the host they are attached to...

Veya is supposed to be 33 years old, he posts like a child who's had his arse smacked by a BRIT, for being cheeky.

Well I thought I went a bit overboard
But I got a Green

 

Nicko you post like Parrot Trained to react to the word 'Brit'

Come on now, which of you will address the Post not the poster, come on do you agree with the OP posted by Sassy 

My dentist is a Muslim.

Ziz wrote:My dentist is a Muslim.

and???
mines a bloody sadist....

two of the guys in the failed bomb attack in scotland a while back were doctors
so ??

your point is??

the Point is for anyone with a brain
 
this is caused by the Tiger economies of Asia, it happened to ALL of the western nations, So looking into your own backyard is an exercise in Pointlessness cause YOU DIDN'T DO IT, it happened and the UK is simply not so great as insulated from Global economics.
 
Now I think we can all Agree the UK/EU is doing the Worst Currently (that’s just fact) so maybe if you looked at how other nations reacted to you could adapted a policy from that. You could even look at the tiger economies themselves (Japan, Korea and Singapore the most successful) and copy them.
 
But some Old geraniums would prefer to keep things British Even though that has failed. If you'd prefer thing to be British than to work and be successful than You are a waste of space and a detriment to your nation.

It is being in the eu that drags us back... and mass immigration...

Lord Foul wrote:

Ziz wrote:My dentist is a Muslim.

and???
mines a bloody sadist....

two of the guys in the failed bomb attack in scotland a while back were doctors
so ??

your point is??

Muslims are nice people.

really?

I wouldnt know

I have had dealings with 4 (business dealings) and all 4 scammed me...



generally I tend to just avoid/ignore them

i wouldnt wish them harm particularly but neither would I go out of my way to aid them

coldly neutral I suppose you could say

Lord Foul wrote:really?

I  wouldnt know

I have had dealings with 4 (business dealings) and all 4 scammed me...



generally I tend to just avoid/ignore them

i wouldnt wish them harm particularly but neither would I go out of my way to aid them

coldly neutral I suppose you could say

I speak as I find - my dentist is nice, my dentist is a Muslim.

mmmm...is your preposition reversible?

you say my dentist is nice, my dentist is a Muslim.
ergo Muslims are nice people

surely by the reverse of that logic anyone adversely affected by a Muslim terrorist atrocity can claim Muslims are NOT nice people??????

I'm sure that will only be permissable one way elmer...

it wouldnt surprise me daffy

Lord Foul wrote:mmmm...is your preposition reversible?

you say my dentist is nice, my dentist is a Muslim.
ergo Muslims are nice people

surely by the reverse of that logic anyone adversely affected by a Muslim terrorist atrocity can claim Muslims are NOT nice people??????

Of course - and the reverse of that logic is practised everyday on forums resulting in numerous ludicrous negative generalisations.

"Muslims are nice people" is an equally ludicrous generalisation following the same ridiculous logic.

How pleasant to see something positive for a change.

the difference is your preposition was queried politly and fairly
if someone dares to make the opposite preposition they are instantly visciously attacked by the rabid left
leading me to the conclusion suggested by

http://www.newsfixboard.com/t6820p700-the-picture-jokes-thread#351856

which is also why you will see me abused regularly by both the insane right ANd the equally insane left

I have little time for either POV.......

Lord Foul wrote:the difference is your preposition was queried politly and fairly
if someone dares to make the opposite preposition they are instantly visciously attacked by the rabid left
leading me to the conclusion suggested by

http://www.newsfixboard.com/t6820p700-the-picture-jokes-thread#351856

which is also why you will see me abused regularly by both the insane right ANd the equally insane left

I have little time for either POV.......

There is also a very real difference for the victims of these daily negative generalisations - your forum reputation is the least of their concerns.

Zarathustrians are wonderful.

The truth must be wrong if the truth is not politically correct...

Tommy Monk wrote:

The truth must be wrong if the truth is not politically correct...

Why must it?

Sorry, I thought that you were able to explain since it was you who made the assertion, oh well.

Ziz wrote:

Tommy Monk wrote:

The truth must be wrong if the truth is not politically correct...

Why must it?

Cause otherwise Tommy is Wrong

Oh WAIT That's the Obvious answer

veya_victaous wrote:

Ziz wrote:

Why must it?

Cause otherwise Tommy is Wrong

Oh WAIT That's the Obvious answer

Can a genius be wrong?

Ziz wrote:

Tommy Monk wrote:

The truth must be wrong if the truth is not politically correct...

Why must it?

It is the 'progressives' mantra... and it is wrong...!

Tommy Monk wrote:

Ziz wrote:

Why must it?

It is the 'progressives' mantra... and it is wrong...!

Have these "progressives" prevented you from speaking  - if so, what did you want to say?

Rigth Whingers in the UK be like

Yawn...