Spending on public services in the Isle of Man is to go up by ?8.5 million or 1.6%, below the current inflation rate of 2.5% and a real-terms cut.

Delivering his 2013 - 14 budget to Tynwald, Treasury Minister Eddie Teare announced net spending by government, the sum funded by direct and indirect taxation, will total ?547.9 million next year.

That equates to just under ?11,000 on every man, woman and child in the population.

Included in that, more than ?3,000 per head on benefits, ?2,000 on health and ?1100 on education. At the other end of the scale ?102 is spent per citizen on public transport and heritage railways, ?73 on sport, arts and entertainment and ?67 on running the airport. Funding government employees' pensions costs each citizen ?714.

Spending on the health service will rise next year by more than 12% partly due to the transfer of mental health services from the social care department.

The elderly will see their state pensions go up by 2.5% but rises in a range of other benefits including Jobseekers Allowance and Income support are pegged at one per cent.

Child Benefit is to be frozen and withdrawn from higher earners from April 2014 under a means-test scheme the details of which are yet to be announced.

Treasury Minister Eddie Teare also unveiled a new initiative to reduce the number of long-term unemployed by half to 100 over the next two years: