A manifesto to make NI flourish: end corporation tax, restore rail and invest

Over the past few weeks and months, the News Letter and other media have focussed a great deal on the Northern Ireland Brexit Protocol and its impact on the province.

By Ben Habib & Kate Hoey
Thursday, 5th August 2021, 7:17 am
Ben Habib and Kate Hoey
Ben Habib and Kate Hoey

Less attention has been paid, however, to the equally serious problems in Northern Ireland which still need to be solved.

It is an uncomfortable truth, but the problem with Northern Ireland is largely in Westminster. The institutionalised neglect over the past few decades from both Labour and Conservative governments has brought the region to where it is now.

How do you know Northern Ireland has been neglected? Easy. Look up the time it takes to travel between just about any town in the province to Belfast by public transport.

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The results will shock you. It is quicker to get from Belfast to London than it is to Londonderry. The 70-mile trip across the province takes a whopping two hours and twenty minutes.

That is an average speed of 30 miles an hour. Travel in Victorian England was faster. It is this kind of neglect which has caused Northern Ireland to become the biggest ‘deficit’ economy in the United Kingdom. But it really does not need to be this way.

Northern Ireland is a classic example of why the levelling up about which the prime minister speaks so frequently and fondly needs urgent application here.

There are a few simple things the prime minister could do. First and foremost, Boris Johnson needs to make sure taxes on businesses are cut.

The chancellor is wrong to increase corporation tax. Doing so will hit Northern Ireland particularly hard and is economically illiterate.

There is already a massive gap in the tax rates between Ireland and Northern Ireland. No businessman would open a business in Belfast where the corporation tax rate is 19 per cent and rising, if it could operate equally well in Dublin where it is 12.5 per cent, with breaks to take that rate even lower.

The island of Ireland has complete freedom of movement. Unless there is a pressing need to be in Belfast most would choose Dublin every day of the week.

The government has sat idly by and watched as businesses flocked to Dublin. Imagine the difference in Northern Ireland’s fortunes if Apple had chosen to reside in Belfast instead.

The corporation tax rate in Northern Ireland should be slashed – ideally to nil.

Taxes on consumption and workers should be slashed too. The most obvious taxes to reduce would be VAT, stamp duty, taxes on fuel and National Insurance contributions for those on lower wages.

Consumers need a helping hand as well. Putting these two tax policies together would be a powerful cocktail for growth.

There should be a ready supply of capital to facilitate the investment a favourable tax regime would engender. Special funding schemes for banks in the province should be launched, with the promotion of unsecured lending to businesses for investment.

Alongside fiscal reform and the boost in money supply should be a reduction in bureaucracy. Red tape should be cut. Make it easier to get planning permission on brown field sites to build housing and to employ people.

Crucially the Province desperately needs a proper rail network, which also would take many cars off our roads. Rural areas need better digital connectivity. An economy cannot move forward without the ability to travel easily and to communicate.

Finally, invest in Belfast. Make it a first class, interconnected, fun city in which to live and work. For

Northern Ireland to succeed, Belfast must do so.

Northern Ireland should have at least one world class university. Queen’s University is good but it could be world-beating.

This would attract the dynamic, aspirational young people businesses require and ensure more of our brightest young people stayed in Northern Ireland.

The task is really quite simple but government has to grasp the opportunities and the Northern Ireland office must start pushing radical policies rather than always just wanting to keep everything low key.

With the debilitating effects of the Northern Ireland Protocol playing out, it is doubly important government stops seeing the province as an economically troublesome burden and starts laying plans to make it a tiger economy. Nothing would strengthen our union more than a vibrant economically successful Northern Ireland.

Sadly, the above is, at least at the moment, a dream. Sadly this government like past ones seem to care little for Northern Ireland.

It is not even prepared to take the safeguarding measure of invoking Article 16 of the Protocol – allowing the UK unilaterally to take action against the agreement – in the face of the admitted societal and economic damage caused by the protocol.

If it will not move to protect the people of Northern Ireland, it certainly will not move to elevate them.

So, Lord Frost, let’s start with baby steps – invoke Article 16.

l Ben Habib is a former Brexit Party MEP and Kate Hoey is a former Labour MP

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