THE events of the past week regarding the MG Rover group have been disastrous.

With 6,000 jobs hit at Longbridge and the possibility that many of those affected could be facing a long term period of unemployment, especially the older workers who may remain out of work till retirement age, I thought the following elementary calculations may be of interest.

Assuming the majority of those affected are married or have partners, the average unemployment benefit or income support payable is likely to average something in the region of £80 per week, representing a total bill of £24m per year.

Housing benefit at an average of £70 per week represents an additional sum of £21m pounds per year, whilst Council Tax benefit at an average of £100 per month works out at £7.2m per year.

Add to those figures the loss to the Exchequer of income tax and national insurance payments of 6,000 workers, coupled with the loss to the national economy of MG Rover export sales and the additional cost of imports to replace lost domestic sales, and the requested loan of £100m to keep the company afloat it didn't seem to be that bad a deal.

The above calculations do not take account of the effect of additional jobs which will be lost in ancillary industries, or the effect of the loss of spending power on the local economy.

There are also increased child tax credit implications for those workers with children.

QED

Catshill