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impact of welfare rights advice
The University of Salford recently conducted some research in Kirklees on the impact of welfare rights advice on the increased disposable income of claimants and the positive multiplier effects on the local economy. It may be useful in putting forward the case for funding welfare rights advice.
The research report is available from the NAWRA website @ http://www.nawra.org.uk/index.php/resources/newresources/
This piece is interesting (although government has previously dismissed such modelling when passing the legal aid bill).
In total we estimate that financial inclusion interventions in Kirklees generate an increase in disposable income among its users of £27.5 million per year at a cost of £5.3 million. The financial inclusion service providers achieve this mainly by providing access to affordable credit and increasing benefit up-take.
In turn, using the Family Resources Survey, we estimate that £24.5 million is spent in the economy of Kirklees. Based on input-output for the Yorkshire and Humber region, we estimate that this, in turn, has a cumulative impact on the regional economy of £30 million. This cumulative impact is generated as the firms providing goods and services to the financial inclusion service users, purchase goods and services from other firms in the region.
If we take into account the increase in disposable income of users as a result of the intervention and the effect this has on local businesses and industry, this means that for every £1 spent on delivering financial inclusion services in Kirklees, £3.5 is generated for the regional economy.
The impact on the local economy of Kirklees is likely to be smaller than that of Yorkshire and Humber because smaller economies tend to rely more on imports. However, in absence of data on the proportion of inputs imported by local industry from outside the local economy, it is difficult to know for certain the exact impact on the local economy. Using inward commuting as a proxy for leakage, we estimate the impact on the local economy to be in the region of £24.5 million. This means that for every £1 spent on delivering financial inclusion services, £4.6 is generated for the local economy.