Welfare reforms to cost Sheffield residents £173m

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SHEFFIELD residents could lose around £173m a year as the effect of welfare reforms starts to bite, new research has shown.

The study reveals an estimated loss of £173m per working year – or a financial loss of £471 for each working adult – in Sheffield.

The research also shows the number of people affected by a cut in housing benefit – dubbed the ‘bedroom tax’ – totals 11,200 in Sheffield, with an estimated loss of £7.6 million.

Another 34,200 people will see a cut in their council tax benefit and 63,300 households will suffer a loss in child benefit.

Britain’s older industrial areas, some seaside towns and London boroughs are hit hardest while much of the south and east of England escapes ‘lightly’.

Professor Steve Fothergill, who led the study from Sheffield Hallam University’s centre for regional economic and social research, said: “A key effect of the welfare reforms will be to widen the gaps in prosperity between the best and worst local economies across Britain..

In Doncaster the estimated financial loss per year is £110m while in Barnsley it is £93 million and in Rotherham £91 million.

The biggest losers include places such as Middlesbrough, Liverpool, Glasgow, Blackpool and Merthyr Tydfil. Wealthier areas such as Cambridge, Surrey and the Cotswolds will not see incomes squeezed as much.

The Government says welfare reforms are necessary as the cost of benefits has spiralled in recent years. It says it is helping the poorest with a cut in income tax.