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New analysis from the Adam Smith Institute shows that most English regions receive more in benefits than they generate in personal taxes. For instance, Birmingham receives £2.54 in welfare for every £1 its residents contribute in tax. Nationally, employees pay £213 billion in income tax and National Insurance compared to £266.1 billion spent on welfare, resulting in a £53 billion gap. Only London and the South East regions contribute more in personal taxes than they receive in benefits. The analysis highlights significant disparities between wealthier and poorer areas, with some affluent London constituencies contributing significantly more than they receive while others take out more than they put in.
Written locally by qwen2.5:14b on 2026-10-07,
using this article's own text rather than the other coverage of the
same event (that is the story summary below).
Story summary
New analysis reveals that almost every English region receives more in benefits handouts than it brings in through personal taxes, with Birmingham standing out as a major recipient. Birmingham takes £2.54 in welfare for every £1 its residents contribute in income tax and National Insurance, totaling over £6 billion annually across its ten constituencies. According to the Adam Smith Institute (ASI), London receives 78p in welfare per £1 of employee tax, creating a £10.8 billion tax surplus. Only two regions, London and the South East, contribute more in personal taxes than they receive in benefits. The North East is the worst-off region, receiving £2.19 in welfare for every pound contributed by workers, followed closely by Yorkshire and the Humber at £1.69. This imbalance has sparked criticism from Conservative politicians like Sir James Cleverly, who sees it as evidence of the government exploiting London's resources.
Written for “UK Benefit Tax Imbalance” on 2026-10-07,
grounded in this article and the 0 other(s) covering the same event.
Why this leaning score
The article's own words the score was based on. Each is quoted
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Leaning: leans strongly right for article 61568 (high confidence, 2 verified quotes) · logged 2026-10-07
Almost every English region now receives more in benefits handouts than it brings in in personal tax, new analysis reveals.
asserted
analysis → receive → tax
Birmingham, which is playing host to the Conservative Party's conference, takes £2.54 in welfare for every £1 its residents contribute in income tax and National Insurance.
asserted
residents → play → tax
Benefits spending across Birmingham's ten constituencies has gone over £6billion a year, and not a single one of the seats is a net contributor to the exchequer.
asserted
one → go → exchequer
According to the Adam Smith Institute (ASI) think-tank, Londoners receive a relatively modest 78p in welfare for every £1 of employee tax they contribute, providing Chancellor John Healey a tax surplus of £10.8billion.
uncertain
they → accord → 10.8billion
Just two regions in England receive less in welfare than they contribute in personal taxation – London and the South East.
asserted
they → receive → taxation
The North East of England is the worst region in the country, taking £2.19 for every pound its workers contribute in tax, followed by Yorkshire and the Humber at £1.69.
asserted
workers → take → 1.69
London itself is divided, with wealthy constituencies like Chelsea and Fulham paying £1.26billion more in tax than they receive in welfare, compared to the north London seat of Edmonton and Winchmore Hill taking out £397million more than it pays in.
asserted
it → divide → more
Across England, employees are paying £213billion in income tax and National Insurance, compared to £266.1billion of welfare spending – a gap of over £53billion.
asserted
employees → pay → 53billion
Almost every English region now receives more in benefits handouts than it brings in in personal tax, new analysis reveals
The ASI's chief of staff, Viggo Terling, told the Mail that the fresh figures provide yet more proof that the welfare system 'has failed'.
'
asserted
system → receive → proof
Even in the UK's most productive city, more than three quarters of what workers pay in income tax and National Insurance goes straight back out in welfare.
asserted
workers → pay → welfare
In Birmingham, every pound of employee tax is matched by two pounds fifty-four of welfare.
asserted
pound → match → welfare
Across England the bill outruns the revenue that pays for it by £53 billion, and only one region clearly covers its own costs.
asserted
region → outrun → costs
He demanded: 'Ministers need to get a grip on the welfare bill and restore a system that supports those in need without overwhelming the public finances.
'
asserted
that → demand → finances
That means reforming incentives so that work always pays, controlling costs, and ensuring the system is sustainable for the taxpayers funding it.'
asserted
system → mean → it
The figures also prompted backlash from top Tory Sir James Cleverly, who is running to be London mayor, as he said it was further proof that the Labour government is using the nation's capital as a 'cash cow'.
asserted
government → prompt → cow
Sir James said: 'When Labour look at London, they only see a cash cow, and their welfare addiction is bleeding Londoners dry.
asserted
addiction → say → Londoners
While the government refuses to tackle the ballooning welfare budget, London taxpayers will be left on the hook, and the capital will be left a poorer city for it.'
asserted
capital → refuse → it
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