Labour government's budget boost for Northern Ireland 'will not even touch the sides' says MP while 'death tax' on farms remains in place
The extra money set aside for Northern Ireland in the Labour government’s autumn budget will do little to plug Stormont’s funding hole, said Robin Swann.
The Ulster Unionist MP was among those reacting to a raft of measures put forward by the government – including an extra £370m for the Province’s public finances, spread over three years.
But just days ago, Stormont’s finance minister John O’Dowd had warned that Northern Ireland is currently facing a £400m overspend (not including the colossal bill for the PSNI data breach).
Mr Swann and others also criticised the £16.6m which has been set aside for helping firms combat the effects of the Irish Sea border, indicating that it leaves the essential problem untouched.
He said: "While the £370m Barnet consequential is a welcome uplift, the finance minister has said he is £400m short this year alone, so this doesn't even touch the sides.”
He pointed to a raft of other “fundamental shortcomings” in the budget, saying: “This budget fails across so many sectors and levels...
“The freeze on tax thresholds for another two years will see more people and families now liable for tax when they hadn't been before.
“Farm families across the country and especially in Northern Ireland have been abandoned by this chancellor as there was no movement on the farm family inheritance tax, despite all their campaigning and engagements.
"Despite all the other U-turns, this is the one that the government unfortunately didn't perform.”
TUV MP Jim Allister said: “Today’s budget does little for Northern Ireland.
“The devastating death tax on farms remains.
“There is no money to deal with the PSNI’s special needs in terms of data breach costs and shortage of officers...
“There is no relief for our hard-pressed business community, just further increasing costs.
“This is a budget which while it increases the welfare bill, it will do nothing to strengthen our economy.”
Also reacting was Ulster University economist Esmond Birnie (a former UUP MLA).
He said: "Here in Northern Ireland where our regional government is, once again, heading for a position of overspend, even given the extra £370m from this budget (probably spread over the next three years), perhaps the key lesson to be learnt from the UK budget is the very one they will not be willing to hear: they should think about some revenue-raising.”
He also said: “The decision to increase the National Living Wage by 4.1% and the National Minimum Wage (the one applying to 18-20 year olds) by 8.5% is odd.
"Did the chancellor not learn from the way that last year’s National Insurance contributions increase led to a decrease in employment growth?
"Given that average wage levels are lower in Northern Ireland than Great Britain this move could have more of an adverse impact here.”
He concluded: “So, does it all add up? Probably not.
"Rather unwisely, the chancellor has taken on additional spending commitments.
"Most of these are up-front. Some of her larger tax increases will take time to kick in, some not until 2028.
"It does rather look as though she has prioritised political survival over economic prosperity.
"In the end these policies may fail to achieve either objective.”