The Chancellor’s announcement last week that another £15 billion will be made available to help families cope with the cost of living crisis is of course welcome.
But despite that further huge injection of money from our National Government we will still face a number of significant challenges in the economy over the coming months.
Whilst people understandably look to their local or national government for support, the reality is that current geopolitical events continue to a have a significant impact on the world’s economy. The conflict in Ukraine and associated economic sanctions on Russia, coupled with China’s continuing lockdown policy is not only causing disruption to supply chains, but is also increasing costs of commodities and energy. This means it costs more to heat our homes, fuel our cars, feed our families or build new houses. UK inflation rates currently sit at a 40-year high, with the immediate impact being sharply felt by households, businesses, the public sector and the wider economy.
At a local government level we will inevitably see huge pressures on public expenditure as energy costs across the NICS estate rise, public sector workers seek pay reviews and the cost of capital projects increase significantly.
There are no easy answers, and we need to plan for the medium and long term every bit as much as provide immediate help for those who desperately need it. That means using public money wisely. It means investing in our future. It means being strategic.
Last year, an ambitious new vision for the NI economy was launched. The overarching aim of the ‘10X Economic Vision’ will be to deliver an economy which is ten times more innovative, more inclusive and more sustainable for the benefit of everyone. We will do this by focusing on what makes NI unique, what sets us apart from the crowd and where our areas of strengths lie. The 10X Vision has identified those enabling technologies and priority clusters where we already show strength and have real potential to be competitive on the world stage, such as fintech, cyber security and advanced manufacturing.
In parallel to the Vision, in March I launched ‘Skills for a 10X Economy’, which will seek to invest in the skill and talent of our workforce to unlock future economic prosperity for everyone.
The Skills Strategy will focus on innovation by increasing further education qualifications in technical and professional skills and rebalancing higher education towards Science, Technology, Engineering and Maths (STEM). The strategy will also tackle inequality by supporting people with low or no qualifications to overcome barriers to employment and making the most of their capabilities.
Significant increases and ongoing volatility in international wholesale fuel prices witnessed across the globe have continued to impact negatively on our electricity and gas markets. The conflict in Ukraine and the subsequent rise and increased volatility in fossil fuel costs clearly illustrates the need to accelerate the roadmap to energy decarbonisation and self-sufficiency.
Our ambitious Energy Strategy – ‘The Path to Net Zero Energy’ – sets out a vision to deliver self-sufficiency in affordable renewable energy for NI. The pathway to energy decarbonisation has the potential to transform our local economy. We will grow the skills base for the low carbon economy providing opportunities for our younger people to be the engine room for our growth. We are developing a suite of new initiatives including a £10m green innovation fund, a hydrogen centre of excellence and one-stop shop for energy advice.
Tourism was a billion-pound sector for NI prior to Covid. My Tourism Recovery Action Plan sets out how we will reach, and surpass, that level once again. We have supported increased marketing in GB by Tourism Ireland and in the RoI by Tourism NI and we can hopefully look forward to a prosperous summer season for our local tourism and hospitality sector.
Acting as a catalyst for all areas of our economy is Project Stratum. Funded under the DUP/Conservative Confidence and Supply Deal, this key measure represents a total investment of almost £200m and is transforming the broadband connectivity of 85,000 premises in rural areas of NI, providing access to gigabit-capable full-fibre broadband. 27,000 premises have been connected to date and the project will be completed by 2025.
Continued investment in skills, innovation and sustainability remains the right course of action both now and for the long term. The strategies we have in place will help build resilience for NI in the face of these global challenges and others we may face in the time ahead.