Strabane Weekly News - News - Nearly three quarters of the district could be hit by budget cuts

News

Nearly three quarters of the district could be hit by budget cuts

Thursday, 1 July 2010

Nearly three quarters of the population in the Strabane district may be affected by cutbacks to the social welfare system announced in last week's budget, the Strabane Weekly News can reveal.
Deemed as the harshest budget in a generation, it brings with it new medical assessments for people claiming disability living allowance and incapacity benefit. Child benefit will not increase for the next three years, while payments to those claiming working tax credits and housing benefit will be capped or reduced.
Of the 38,248 people who live in the district, just over 25,600 people (67 per cent) claim one or more of these benefits.
Announcing the details last Tuesday, the Chancellor, George Osborne, referred to the measures as "tough but fair", adding that "years of debt and spending" made the measures "unavoidable".
Criticism
Fending off criticism that the benefits system was being undermined, he instead blamed recent financial recklessness, and, echoing the words of the late Charlie Haughey, stressed that austerity was vital for recovery.
The gaping absence of levies on bankers bonuses has galled many however. As those claiming benefits await their fate, it has emerged that a £2 billion bank levy does not touch bankers' wallets. The tax loophole also remains for the privileged 250,000 people UK-wide who pay capital gains tax, while corporation tax is still the lowest in the western world.
Osborne's pledge in Westminster last Tuesday to create "work incentives" will ring hollow 620 miles away in Strabane - a district where 6.9 per cent of the population is unemployed and job opportunities are few and far between. At the town's local job centre this week, there is just one job vacancy located in the town being advertised. The temporary machinist position offers "competitive wage rates".
Michael Lyttle, a local debt advisor from Debt NI, says people in the district will be hit primarily by changes to child benefit and working tax credits. According to the most recent statistics, there are 5,485 families in the district claiming child benefit, and just over 12,200 claiming it across West Tyrone - all of whom will have to wait three years before their payments next rise, at a time when social need is at its highest. Nearly 5,100 families in the district claim working tax credits. Revenue and Customs says it cannot confirm how many of these families earn £40,000 or more a year - the threshold where families will see their payments ducked - but it is reasonable to predict that a sizeable portion will be affected by reductions to their payments.
“For people who rely on all that it is going to really hurt," Mr Lyttle said on Monday.
“With the cuts to the baby element [of benefits], that was paying £545 a year approximately, so for a family or a single parent that is a big amount. And the Sure Start grants, for your first child you will get a grant and thereafter there are going to be no grants. Say you had a child and you get the grant and then you find yourself pregnant again and you need things all over again, what do you do?"
Strict assessment
Meanwhile, nearly 9,000 people claiming disability living allowance (DLA) and/or incapacity benefit locally will face a strict new medical assessment, in a bid to "reduce dependency and promote work". Debt advisors such as Mr Lyttle say it is hard to predict the future effects of this until the new criteria is announced, but it is thought that many current claimants could lose out under the more stringent system.
Time will also tell what effect caps on housing benefit will have in the Strabane area. More than 6,000 people locally claim housing benefit, and the Housing Executive has confirmed that 413 (or 3 per cent) more of its tenants are claiming housing benefit than last year.
These people will see their weekly payments capped at £280 for a one-bedroom property, or £400 a week for a house with four bedrooms or more. In an area where rents are still below this threshold, the measure is not immediately alarming. The average weekly rent for a three-bedroom semi-detached house in Strabane is £110, or £90 for a former council house.