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Welfare system cannot be relied on to keep local economy afloat

September 17, 2014 5:25 PM

A report published today from Sheffield Hallam University claims that changes to the welfare system could strip around £430m a year out of the South Wales Valleys and bring and endanger 3,000 local jobs

The report states: "The big loss of benefit income can be expected to have knock-on consequences for consumer spending. Over time, some 3,000 jobs in consumer services might be expected to be lost in the Valleys as a result of the reforms."

In short, some people on benefits will receive less money and so will have less to spend locally.

Welsh Liberal Democrat Parliamentary candidate for Pontypridd Mike Powell is quoted in the local press saying:

"The problem here has come about as a result of years of economic neglect of the South Wales Valleys. Whilst many still hark back to the closure of the mines as being the death knell for the area, they forget that it is the total lack of investment since that has brought us to this position.

"After thirteen years of Labour Government in Westminster and fifteen years under Labour in Wales nothing has been done to lift this area out of poverty and bring employment.

"The issue is not that welfare reforms will mean there is less money available to spend in the locality, it is that far too many people have been forced to rely on benefits in the first place."

The report was commissioned by the Industrial Communities Alliance (Wales). The committee is chaired by RCT Labour Councillor Jane Ward. She said:

"There are already too many empty shops and offices in our towns. We wouldn't have so many people on benefit in the Valleys if it was easier to find a job, especially a decently-paid job."

Mike Powell says she has "hit the nail on the head" but that it is her party that is to blame.

"The Labour party have failed the people of RCT and indeed Wales as a whole. Cllr Ward is spot on when she says we wouldn't have so many people on benefit if there were more jobs, but what are they doing about it?"

RCT Welsh Liberal Democrat Campaign Manager Karen Roberts say that the report is little more than political spin.

"The Benefits system is there as a safeguard. It is to help those who need it - people who are unable to find work or who are maybe too ill to work, the frail and the elderly.

"It is, however, becoming an accepted way of life for far too many in the area. The system needs changing, it cannot be acceptable for generation after generation to rely on a benefits culture, just as it cannot be acceptable that so many of those who want to work cannot find employment.

"Is it right that an area should rely on income from benefits in order to survive? I certainly don't think so, but the conclusion of this report seems to be that we shouldn't cut back on the benefits system at all as claimants will have less to spend. What we should be doing is creating more jobs so that fewer people have to rely on state help whilst at the same time making sure the benefits system is adequately funded to support those who need it."