19 October 2010

Current levels of unemployment in the Highlands could be costing around £31 million a year.

In July there were 3,652 people in the Highland council area claiming unemployment-related benefits such as Job Seekers Allowance.

These break down into areas as follows :

Badenoch and Strathspey 111

Caithness 603

Inverness 1238

Lochaber 206

Nairn 157

Ross and Cromarty 841

Skye and Lochalsh 160

Sutherland 336

Research from Bristol University suggests that the cost of unemployment per person is approximately between £8,000 and £9,000 a year.

This costing breaks down as follows :
£3-4,000 in adult benefits such as Job Seekers Allowance
£1,750 in housing benefits/council tax benefit
£1,500 in child benefits including free school meals
£2,000 in lost income tax payments and National Insurance
contributions and lower VAT receipts

Highlands and Islands Labour MSP David Stewart said : "People contribute to benefits through taxation and national insurance payments.

"The best way to tackle the deficit is to encourage growth by investing in jobs and not by cutting public expenditure too fast and too deep.

"This will produce increased tax revenues and so reduce spending on benefits.

" However, the UK Government’s measures of large cuts and the looming rise in VAT have severely hit demand in the private sector and threaten the recovery.

"Sustainable growth in the economy depends upon public investment.

"The TUC estimate that for every £1 spent on public services to create jobs or to purchase supplies and services generates a further 64p for the local economy."

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