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Last Updated: Saturday, 16 September 2006, 09:02 GMT 10:02 UK
Is rates issue a carrot or stick?

By Mark Devenport
Political editor, BBC Northern Ireland

Former SDLP leader John Hume was fond of saying "you can't eat a flag".

The new rating system could make it harder to get on the property ladder

Now his party colleague Carmel Hanna is trying to coin a new slogan "You can't pay at a shop with a brick".

Still trying to work it out? Well the famous Hume adage was intended to illustrate the limits of nationalist politics, whilst the Hanna motto is an attempt to sum up the plight of householders in places like South Belfast and North Down who are facing huge bills under the new rates system.

The new rates will be introduced in April next year.

They are being assessed on the basis of the market value of a ratepayer's home.

In contrast to the council tax in England there is no cap which means that some people are facing bills of 6,000 or more.

Luxury living

People living in luxury homes will probably get little sympathy from those in more deprived areas.

But the campaigners who have come to the fore in recent weeks argue that the new rates will have a devastating impact on pensioners living in large houses with negligible income.

As Carmel Hanna would say, they can't eat their bricks or pay for goods with them in the shop, but they are still being asked to fork out for big rates bills.

So exercised was the UK Unionist MLA Bob McCartney on this score that, attending a public meeting, he declared that he would go to jail rather than pay up.

He believes people should pay their current rates plus 10% and withhold the rest.

That threat prompted a dusty response from the Finance Minister David Hanson who said he was surprised that a leading QC would advocate an "uncivilised" form of action.

Minister Hanson insists that the proposed system is fair and that any hardship cases can be dealt with by relief schemes which will run alongside.

The finance department claims that introducing an English style cap would benefit only 3,000 householders living in less than 1% of homes.

If a cap is added, Mr Hanson argues, the majority of ratepayers will have to pick up the bill.


However, there is more than economics driving David Hanson's obduracy.

In an echo of the delay to the ban on academic selection, the minister has overtly linked opposition to the new rates to the government's attempts to restore devolution.

"If people have a problem with any aspect of the legislation", he argues, "there is one way, and only one way, in which they can influence change.

"They can put pressure on their MLAs to do a deal by 24 November and take responsibility for decisions on important issues like rates reform.

"I believe the new system is fair and I will not change it whilst I have the responsibility to govern in the absence of MLAs doing their jobs and taking that responsibility."

With the government piling on the pressure, the parties have been arguing amongst themselves about who is to blame.

Rates could work as a pressure point, but some politicians might also see them as a reason to delay taking power

Alliance says all the parties in the old Executive share responsibility because they set off down the capital value route.

But interviewed for Inside Politics, the former finance minister and SDLP leader Mark Durkan argued that Alliance's favoured alternative, a local income tax, wasn't an option because the Executive had been precluded from levying taxes which replicated those already collected by the Treasury.

Mr Durkan says that if he was finance minister he would introduce a cap as a matter of fairness, perhaps by stipulating that no one should pay over a certain percentage of their income in rates.

But given the current impasse that suggestion remains hypothetical.

The government clearly hopes the current furore over rates will add to the pressure on local politicians.

However, it depends where you live - one MP told me that many of his constituents were telling him they didn't think the new rates demands were that bad.

Rates could work as a pressure point, but some politicians might also see them as a reason to delay taking power.

Will the future finance minister want one of their first responsibilities to be the collection of an onerous new tax?

Or might they want a direct ruler to take the blame, then come to office with a peace dividend under their arms which allows them to ease the pain?

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