Tax raising powers could make Stormont even more populist than it already is

The question of how Stormont’s expenditure should be funded is a thorny one.

At present the subsidies almost entirely come from London, which helps to foster a political culture of entitlement and even at times resentment.

Many voters might think that the perpetual, cross-party demands for Northern Ireland to get even more money are quite reasonable — the UK is a wealthy nation and this Province is right to get as much financial support as it can.

But there are two problems with that approach.

The first is that it risks alienating politicians and members of the public in Great Britain, who then dismiss NI as needy and ungrateful. Republicans would love that outcome.

The second is that it delays — and perhaps even makes impossible — fiscal competence among those who govern us.

MLAs are swift to support various calls for subsidy but rarely say that too much is being spent in one sphere or another. Few politicians on the Hill seem to have the confidence to say, for example, that a particular special interest group might in fact be making an unreasonable financial request, or already have sufficient support. They are all the more loath to do this if the public has a benign view about the said group.

In a range of core areas of public life, money is not well managed. In health, for example, experts have for two decades recommended that NI has a smaller number of world-class hospitals because it will lead to more efficient NHS expenditure. The refusal of weak politicians to act on this advice exacerbates chronic problems such as waiting lists.

The chief secretary of the Treasury was obviously right to say that “the Executive has not yet been able to demonstrate that its finances are on a sustainable footing”.

However, if Stormont gets revenue raising powers, such as over income tax, it could lurch further in a populist direction, such as pandering to ill informed prejudices by jacking up taxes against disliked groups, but causing more economic harm to Northern Ireland than financial good.

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