This Autumn: corporation tax, power and people
In the wake of the Chancellor’s Autumn Statement regarding devolving corporation tax powers, the message across the board in Northern Ireland (well, almost across the board) is that those empowered by votes to serve us in the Northern Ireland Executive must grasp the mettle, step up to the plate and work together for the greater good of the electorate. We have the power within our grasp, but do we have the people to take and wield it?
In recognising Northern Ireland plc’s long held ambition to control the local rate of corporation tax, George Osborne said that such power could be devolved by legislation within this term (before May 2015) “provided the Northern Ireland Executive can show that it is able to manage the financial implications.” Osborne went on the say that the Executive’s ability to come to agreement in the most recent round of talks would be the proof of that. Emma Cowan from Northern Ireland Business Now provides a snapshot of reactions…
Institute of Directors
Linda Brown, Director of the Institute of Directors Northern Ireland said: “We would urge all parties currently involved in talks to show leadership in pursuit of a goal which already has cross-party support. The goal will herald a new dawn for the Northern Ireland economy, one of job creation, business expansion and the arrival of new international players to the local market.
“For many years the IoD has worked on behalf of its membership and with its partners in Grow NI, to present the case for the devolution of corporation tax varying powers. The devolution of corporation tax varying powers will greatly assist in rebalancing the economy and preparing the foundations from which we can flourish.”
Northern Ireland Chamber
Kevin Kingston, President of Northern Ireland Chamber of Commerce and Industry (NI Chamber) said: “NI Chamber welcomes today’s announcement on the devolution of Corporation Tax powers to the Northern Ireland Executive. The Prime Minister has listened to calls from the business community and all of Northern Ireland’s political parties for the devolution of powers, with the outcome now placed firmly on the Northern Ireland Executive’s willingness to cooperate on a number of issues which have challenged them.
“With the powers now sitting firmly in our hands, our politicians must grasp this opportunity whilst using the two years prior to the implementation of the new tax rate to ensure that we maximise the opportunity. Also, whilst agreeing the budget, the Northern Ireland Executive must ensure that resources are in place to support marketing, skills and infrastructure development.
“The crucial point when it comes to the Corporation Tax decision is that Corporation Tax is an investment in the private sector to grow new opportunities and to put new jobs on the ground for all of our communities. The price of doing nothing, of focusing solely on the past and ignoring the opportunity of the future is – for the business community – unthinkable.”
Adrian Doran, Head of Corporate Banking, Barclays Northern Ireland said: “The vast majority of business people in NI will welcome this announcement. This is a once in a lifetime chance for NI to make a step change to the growth of its private sector. It’s now up to our local politicians to seize the opportunity which has been given to them”.
RICS (Royal Institution of Chartered Surveyors) Northern Ireland Director, Ben Collins, commented: “Whilst we would have preferred movement now, we do welcome the Chancellor’s comments about his support for the devolution of powers over corporation tax to Northern Ireland. The onus is now on the NI Executive to demonstrate that it can make progress on key issues like welfare reform. It is also important that Northern Ireland continues to work in the meantime on some of the other foundation stones for attracting inward investment, such as enhancing our infrastructure, encouraging more Grade A office space, developing the skills of our workforce, and fostering a conductive social and political environment that is diverse, tolerant and outward looking.”
Tughans and CBI
In welcoming the announcement Ian Coulter, Managing Partner of Tughans and past CBI Chairman paid tribute to the late Sir George Quigley saying, “Sir George Quigley campaigned tirelessly for a lower rate of Corporation Tax and today we are indebted to him as we move ever closer to the finishing line. The NI Executive has within its grasp a unique opportunity to rebalance the Northern Ireland economy, drive down the annual deficit and build much needed profit centres. This is about improving people’s pay packets – our private sector average is £21,800, this could take us to £25K and beyond.
“Being able to set our own Corporation Tax is the most effective tool for us to do this. More companies, better salaries, better jobs. There is no doubt that the current budgetary crisis at Stormont is critical. Nonetheless this short term situation should not affect the long term discussion about how we get our economy generating better salaries in line with the rest of the UK and indeed the Republic of Ireland. Our politicians must now get a successful conclusion to the talks before Christmas. “
Political reaction to the Chancellor’s announcement has been predictable, with the DUP calling for common sense to prevail over the negotiating table, while a Sein Fein spokesperson said his party would not agree to ‘Tory’ policies. It is worth remembering that the Autumn Statement, whilst delivered by George Osborne, was delivered on behalf of a power-sharing coalition government, which is getting on with the task of governing and managing the country. The sticking issue for Sinn Fein is welfare reform and only this week Northern Ireland Business Now pointed to the importance of protecting the weak and vulnerable in our society as well as setting the stage for economic growth and prosperity. None of this can be achieved while our politicians persist with party and petty politics at the expense of progress. However we marked our cards in the ballot box, the reaction to Chancellor’s corporation tax carrot shows, very clearly, that we, the electorate, want our politicians to take charge of running the country in a professional, progressive and positive way. Devolution of corporation tax brings with it the knowledge that our allocation of funds for the national budget will be significantly reduced. We need a government in Stormont that is fit, able and prepared to take power. So, we could have the power, but do we have the people?