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'60,000 in Wales set to be moved off incapacity benefits'

Media centre home > News > '60,000 in Wales set to be moved off incapacity benefits'

Issued:05/07/11

Some 60,000 people in Wales will be thrown off incapacity benefits as a result of the coalition government’s welfare reforms, according to a new report by Sheffield Hallam University.

Some of these men and women will end up on unemployment benefits instead but the report estimates that when the reforms come to full fruition as many as 30,000 will be pushed out of the benefits system altogether.

Some 60,000 people in Wales will be thrown off incapacity benefits as a result of the coalition government’s welfare reforms, according to a new report by Sheffield Hallam University.

Some of these men and women will end up on unemployment benefits instead but the report estimates that when the reforms come to full fruition as many as 30,000 will be pushed out of the benefits system altogether.

The report was commissioned by the Industrial Communities Alliance, which represents councils in some of the most deprived areas in Wales.

It provides a comprehensive review of the scale of people out of work and on benefits in different parts of Wales, and highlights the acute problem, particularly in the Valleys, where Merthyr Tydfil and Blaenau Gwent share the distinction of having the highest working age benefit claimant rate in the whole of Britain.

The report argues that in most of Wales the high incidence of worklessness is rooted in a shortage of jobs. 

Welfare reform is therefore unlikely to move people into work without a commensurate increase in job opportunities.

Sheffield Hallam researchers calculate that to bring the employment rate in Wales up to the average already found in more prosperous parts of Britain would require 170,000 more residents in work.  In the Valleys alone, 70,000 more jobs would be needed.

The authors also cast doubt on the ability of continued job growth in Cardiff to make a big dent in worklessness in the Valleys.

There is a strong case for the Welsh Government to initiate a job creation programme targeted at the large numbers of incapacity claimants who will lose entitlement to benefit, says the report.

Professor Steve Fothergill, who led the research, said “The Coalition government’s welfare reforms are based on the assumption that there are plenty of jobs for people to go to.  In most of Wales this seems wide of the mark.

Steve Fothergill

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"The startling numbers that we estimate will be denied benefits in future are based on experience in pilot areas elsewhere in Britain and on the Westminster government’s own assumptions about the impact of extensions to means-testing.

"Welfare reform will begin to take effect in the next few months, as existing incapacity claimants start to be called in for the new, tougher medical test.  The consequence is likely to be widespread distress and, in many cases, additional financial hardship.”

Peter Slater, Director of the Industrial Communities Alliance in Wales, said: “The long-term solution to worklessness in places like the Valleys is a revival in the local economy, and in particular a rebalancing of the economy in favour of manufacturing and services in Wales.  But delivering this takes time, even with the right policies in place.

"The new report shows that in the short-run Wales faces a crisis arising from the impact of welfare reform.  Job creation needs to be at the top of the new Welsh Government’s list of priorities.”

The research, carried out by Sheffield Hallam's Centre for Regional, Economic and Social Research,  is being launched today at a conference in Merthyr.

For press information: contact Laurie Harvey in the Sheffield Hallam press office on 0114 225 2621.