Closure of pits in Yorkshire 'will cost pounds 255m'

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The Independent Online
SHUTTING the last pits in Barnsley will cost the Government pounds 255m in benefit payments and lost taxes by 2002, if closure of the Grimethorpe/Houghton Main colliery complex is confirmed, according to an independent report yesterday.

The Sheffield Business School analysis says that the 1,600 pit workers sustain more than 3,000 other jobs which would be lost as the effects of closing Grimethorpe were 'multiplied' through the local and national economies.

Those who lost their jobs would be worse off during the following 10 years by a net total of pounds 74.5m in disposable income. 'We put the discounted net cost to the nation of closure of the complex at pounds 330m at 1992 prices over 10 years,' the report, commissioned by Barnsley council, said.

Further damage to the local economy was likely, but difficult to calculate. New investment would be discouraged, many of the area's most able residents would migrate, and companies including a local glassworks would suffer if closure led to the loss of a railway line reliant on coal freight.

Previous research into the repercussions of colliery closures enabled the report to predict what will happen to the 1,600 mineworkers if the redundancies announced on 13 October go ahead. The largest proportion, one-third of the workforce at the two linked pits and the complex's coal-washing plant, will go into intermittent unskilled and mainly seasonal work, drawing benefit for an average of 39 weeks a year and working for 13 weeks. Like most former miners, they will earn substantially less than when employed at the pit.

A small number, about 1 per cent, will enter full-time further or higher education, claiming benefits for 32 weeks until courses start in the autumn of 1993.

Older miners suffering from industrial injuries will comprise 10 per cent of the redundant workforce, who will become long-term invalidity benefits claimants after 26 weeks on the dole.

About 5 per cent of the workforce will go into a training programme with a permanent job at the end, drawing benefits plus allowances for an average of 20 weeks. During the first six months after the pit closure, 20 per cent will find jobs without retraining; they will claim an average of 13 weeks of state benefits.

An estimated 10 per cent will retrain, but find work only after between six months and one year on the dole, claiming an average of 39 weeks of benefits.

After retraining, 20 per cent will find work only after long-term unemployment of between one and two years, claiming an average of 78 weeks of benefits.

A small proportion - about 3 per cent - will never work again, and live on benefit payments.

Two out of three men at the complex own their houses. An estimated 80 per cent will pay off their mortgages from redundancy payments. 'But a small proportion, 20 per cent, will deplete their redundancy nest eggs and still face a mortgage. They may, for instance, start a business that fails,' the report said. 'We estimate that, from 1994, one quarter of the unemployed mortgage holders will be in receipt of mortgage relief, and that the value of the mortgage will be pounds 20,000.'