Northern Ireland incomes down by £375 per year, says study


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Average household incomes in Northern Ireland have been reduced by £375 a year, research has suggested.

The drop is due to tax and benefit changes implemented by Westminster's Conservative/Liberal Democrat coalition.

The Institute for Fiscal Studies (IFS) has analysed all the changes.

It calculates that, on average, UK household incomes will be £1,127 lower in 2015 than they would have been if no changes had been made.

Households in London have lost most, on average, partially because high rents mean that households there are particularly affected by cuts to housing benefit.

The analysis for Northern Ireland suggests that reductions in direct taxes gave an average gain of £425.

However, that was offset by increased indirect taxes of £264 and reduced benefits of £537.

Only households in London saw a bigger fall in benefits and the calculation does not include benefit changes which are yet to be implemented in Northern Ireland.

Low-income households

The only region to see a bigger gain through reduction in direct taxation was the East Midlands where the gain was £446.

Overall the research finds that poorer households with children and the very richest households lost the most as a percentage of income.

By contrast, middle to higher income working age households have escaped "remarkably unscathed" on average.

Middle to higher income household without children have gained from the changes.

James Browne, a senior research economist at IFS and a co-author of the report said: "Whichever way you cut it, low-income households with children and the very richest households have lost out significantly from the changes as a percentage of their incomes.

"Increases in the tax free personal allowance have played an important role in protecting middle-income working-age households."

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