Changes to the welfare system will drain at least £63.5 million a year from the economies of Tayside and Fife with the worst-hit people losing up to a third of their income.
The economy of Fife alone will lose between £33m and £40m from the benefits cuts and caps introduced by Chancellor George Osborne, the council has claimed.
Fife Council has carried out an economic impact assessment looking at the loss to benefits claimants and the knock-on effects to small businesses, service providers and others.
Dundee City Council estimates the direct loss of benefits will leave its residents £17.5m to £21.2m a year worse off. Angus Council has calculated benefits claimants in its area will lose £13m.
Perth and Kinross Council was unable to project losses, only saying that a team of officers were looking at the issue.
The overall impact on the economy of Tayside and Fife is likely to be well over £100m.
Below-inflation rises in benefits and an under-occupancy tax for tenants are among measures brought in by the coalition Government to tackle the cost of the welfare state.
Councillor David Ross, deputy leader of Fife Council, said: “Cuts in benefits have a knock-on effect. Local services, shops and other businesses also suffer. People with disabilities will also be badly affected.”
For more from Day Two of our special investigation of the benefits system, see Wednesday’s Courier or try our new digital edition.