Page last updated at 20:17 GMT, Wednesday, 22 April 2009 21:17 UK

NI reaction to Darling's Budget

Alistair Darling
Alistair Darling revealed his Budget measures on Wednesday

Politicians and lobby groups in Northern Ireland give their reaction to the measures contained in Chancellor Alistair Darling's Budget.

The Northern Ireland Executive will have to find efficiency savings of £122m by 2011, although extra short-term funding of £116m has been promised to offset the longer term cuts.

SHAUN WOODWARD, NORTHERN IRELAND SECRETARY

"Northern Ireland will be nearly £50m better off as a result of today's announcement, in addition to further measures which will support businesses and households across the UK.

"Whilst the government has expected Northern Ireland like everywhere else in the UK to make savings by greater efficiency around £122m, the Chancellor announced increased provision of £116 million for the Executive to spend on its Budget.

"In addition, Northern Ireland will also receive £27 million which help fund measures including extra Winter Fuel Payment.

"And because I want to ensure we fully support the needs of the PSNI, I have secured from the Chancellor an additional £28.7m to support their work and this is particularly welcome. It will enable the chief constable to address current pressures arising from increased criminal activity from so called dissident republicans.

"This government has consistently recognised the needs of people in Northern Ireland which is why we have worked hard to ensure a settlement which is fair and which will continue to support political development in the run up to the devolution of policing and justice powers to the Assembly."

NIGEL DODDS, NI FINANCE MINISTER

"While it is disappointing that Northern Ireland has not been allowed to retain the savings from additional efficiencies, I note that the net impact is less than had been feared as a result of the £50.3m of additional funding for the Executive in the current financial year and £66.1m in 2010-11.

"Although the impact of the additional efficiency savings for Northern Ireland for 2011-12 and beyond will only become clear at the next UK Spending Review, the reality is that we are entering a period of lower growth public spending of 0.7% per annum at the UK level, which will require careful consideration of administrative structures and the public service delivery chain in Northern Ireland.

"However, for the short-term we must continue to prioritise frontline services and focus attention on maximising savings from back-office functions and potentially inefficient institutional structures.

"As we move into 2009-10 the Executive will need to have an even greater focus on ensuring that every pound spent on public services delivers maximum value for money so that we can continue to provide a better quality of life for all the people of Northern Ireland.

"The outworking of today's announcements in respect of the 2009-10 financial year will be incorporated into the Executive's decisions as regards the forthcoming June Monitoring Round in line with local needs and priorities."

DECLAN O'LOAN, SDLP FINANCE SPOKESMAN

"Northern Ireland needs its own Budget. The position of Peter Robinson and Nigel Dodds is untenable.

"Alistair Darling announced a new set of efficiency savings which cut the budget, cuts which will intensify for a number of years and are not offset by any increases.

"Nigel Dodds has said that he is disappointed by the cuts required. He needs to act.

"The SDLP has proposed £400m of new spending. It has the support of leading economists. The recession demands change.

"There are signs that Robinson and Dodds are giving in to the facts. Simon Hamilton today indicated that the Northern Ireland budget is not set in stone. It is time to announce a policy change."

GLYN ROBERTS, NI INDEPENDENT RETAIL TRADE ASSOCIATION

"On balance this is a disappointing Budget with very little for small businesses that are struggling with the recession.

"It is not just the independent retail sector which will suffer - the local economy as a whole will be adversely affected due to the extra efficiencies required.

"In the longer-term, the NI Executive risks taking its share of the £15bn efficiency savings.

"Cuts of this scale would take £450m out of our local budgets over the next few years and inevitably impact on the Programme for Government."

STEPHEN FARRY, ALLIANCE PARTY FINANCE SPOKESMAN

"Alliance is not convinced of the merits of the VAT cut. It amounts to a loss of £8bn, with little benefit in boosting investment for recovery. Northern Ireland's share of this is around £200m.

"Some of the spending commitments will be regionalised. We will be entitled to a proportionate share from new financial commitments to training and employment measures and financial support for renewable technologies.

"Northern Ireland will therefore get a short-term financial boost from Barnett consequentials, in the range of £30m to £50m. But the challenge now falls to our devolved Executive not to squander the opportunity, but to invest these resources in improving our society

"It is clear that a day of reckoning is approaching for Northern Ireland on public expenditure. It's vital that our Executive takes a responsible approach to its own finances."

JOANNE STUART, INSTITUTE OF DIRECTORS NI

"The growth in public spending will have to slow significantly over the next few years, and Northern Ireland, with its higher dependence on the public purse, will bear a disproportionate burden as a result.

"For business, the introduction of an enhanced first-year capital allowance of 40% for one year and some extra tax support for loss-making firms is positive news, particularly for small companies which dominate the local economy.

"But the benefit is spoiled by the rise in transport costs because of the Chancellor's need to raise funds through above-inflation rises in fuel duty and this will particularly affect our SME economy.

"With unemployment up again this month, assistance to get people back into work and provide them with the skills they need is welcome. We need to avoid a return to long-term unemployment which can blight a regional economy such as ours."

COLIN NEILL, FEDERATION OF THE RETAIL LICENSED TRADE

"As hundreds of pubs are shutting across the UK each month with thousands of jobs being shed it is beyond comprehension that the Chancellor should again raise the duty on alcohol, the third increase in the last year.

"For many the local pub is the hub of their community and not just somewhere to go for a drink.

"Previous research by the Northern Ireland Tourist Board showed that visiting a pub is the most popular activity amongst tourists visiting Northern Ireland.

"With this latest increase, the threat of closure is now a stark reality for our pubs and the impact on the tourism trade will be significant."

NIGEL SMYTH, CBI NORTHERN IRELAND

"There was little prospect of any major good news in this budget for Northern Ireland, and this has been proved correct.

The Chancellor has cut UK public expenditure growth to only 0.7% post 2011, which will equate under the Barnett formula to growth in public expenditure of less than 0.5% per annum in Northern Ireland.

The impact on Northern Ireland of efficiency savings in 2010/11 still remains unclear. The need for further public service reform and cultural change must be a top priority for the Executive to ensure public services are enhanced and not reduced.

"There are a number of welcome micro-measures which should help to stimulate investment and support struggling businesses.

"Increased investment allowances, a 'top-up' trade credit insurance scheme, a time-limited scrappage scheme for cars, a range of low-carbon initiatives and some support for housing will be welcomed by the business community, especially considering the Chancellor's tight fiscal constraints."

PHILIP MCDONAGH, PRICEWATERHOUSECOOPERS NI

"Northern Ireland may have escaped the doomsday forecasts of immediate and massive public expenditure cuts - but the dark shadow of the Chancellor's axe still hangs over Stormont.

"The Northern Ireland Executive will have to find its share of the £9bn efficiency savings, on top of its proportion of the £5bn in savings announced in November's Pre-Budget Report, although that sum still remains under negotiation between the Executive and Treasury.

"This could have been worse, but from next year, the executive will now have to review its spending priorities, as will Westminster departments and the other devolved regions.

GERRY MCELWEE, ULSTER CANCER FOUNDATION AND ASH NI

"Today's 2% inflation-only tax rise is a missed opportunity and will do little to reduce smoking rates amongst local people.

"UCF had urged the chancellor to re-introduce a real price escalator on tobacco tax of 3% above the rate of inflation and to strengthen the government's anti-smuggling strategy.

The government's strategy needs to be underpinned by tough new targets to reduce the amount of smuggled tobacco and must prevent the tobacco industry seducing our children to be their future customers."

"UCF had also called for an overhaul of the current tax system that allows tobacco companies to deduct marketing costs as legitimate business expenses, thus reducing their liability for corporation tax."

DANNY KENNEDY, ULSTER UNIONIST PARTY DEPUTY LEADER

"At this point the finance minister will have to get his head out of the sand and the Executive will have to urgently undertake a major revision of the priorities in the Programme for Government with job protection and job creation in mind.

"We in the Ulster Unionist Party have been calling for this for the past eight months only to be met with a refusal to move on the part of the finance minister, who appears to be in denial."

"The Ulster Unionist Party has been consistently warning that Gordon Brown's mismanagement of the UK economy would have dire consequences for Northern Ireland. Today's budget has painfully shown how true this is.

"The DUP must surely now get its head out of the sand; they have told the people of Northern Ireland all was fine with the public finances. Today has exposed that line as utterly false."

BRIAN GRAY, NORTHERN IRELAND MANUFACTURING

"While the Chancellor predicts a contraction this year, which we can all see happening around us, he has been bold in predicting a 1.25% growth next year.

"Let's hope that he has got it right, given the difficult times being experienced by our members across Northern Ireland.

We would welcome the measures which he has announced in relation to the construction industry, and we would be particularly keen to see the investment for emerging technologies, and green manufacturing coming on-stream as soon as possible.

"NIM is keen to work with government to develop a green technology strategy as we believe that our manufacturing sector is well placed to benefit from developments currently taking shape.

"At the end of the day, however, the most important thing is to see the banks start to re-engage with business, especially SMEs so that day to day running is made much less difficult."

BRIAN WILSON, GREEN PARTY MLA

"While we welcome the commitment to cut carbon emissions by 34% by 2020 and the extra £1bn support for low-carbon industries, we feel that the chancellor has missed an opportunity to create a low-carbon economy by putting significant investment into renewable energy and creating thousands of jobs.

"The car scrappage scheme will attract more foreign imports and will not create jobs within the UK economy, so from that point of view it seems wasteful.

However if the government encourages the production of energy efficient cars as part of this scheme it might just kick start a new, green, environmentally-friendly motoring era."

"I'm also very concerned about how the efficiency savings will impact on the Northern Ireland services."

GRAHAM FUREY, ULSTER FARMERS' UNION

"We will be urging the Northern Ireland Executive to ensure that if budget savings are to be found, government departments focus on ensuring that front-line services to the farming community are not affected.

"Unfortunately, the government has once again increased the duty on fuel. Approximately two-thirds of fuel costs are tax and the government should recognise that this ongoing taxation policy is having a damaging effect on our agri-food industry competitiveness.

"Farming families and rural dwellers tend to have limited or no access to public transport services and have longer travelling distances.

"Rising fuel costs are having a greater impact on these rural families and this is another issue which we will continue to highlight to the Treasury."

SEAMUS MCALEAVEY, NI COUNCIL FOR VOLUNTARY ACTION

Mr McAleavey chaired a panel of voluntary group representatives who gathered to watch Mr Darling deliver his Budget.

"The consensus was that this was an election budget and the Chancellor did the absolute best that he could in very grave economic circumstances.

"Reducing growth in public expenditure from 2011 to 0.7% will squeeze Northern Ireland significantly and the delivery of public services will be affected.

"The Chancellor has been optimistic in his assumptions and our fear remains that the next budget following a general election could see a further much more drastic correction take place."

ALAN BRIDLE, BANK OF IRELAND ECONOMIST

"As widely expected, this budget is the harbinger of a harsher public expenditure climate particularly from April 2011 onwards. While details have yet to be revealed, the projected 0.7% increase in real terms (revised down from +1.1% in the Pre-Budget Report) could read across to a near zero rate of growth for this region.

"The Executive could have a little more cash but above-inflation allocations in some departments will have to be offset by significant cuts elsewhere.

"Furthermore, it is not clear immediately the extent to which this region will be expected to share the pain of efficiency savings before 2011.

"The pre-announced hikes in income tax, changes to allowances and squeeze on pension contribution relief will have limited impact on Northern Ireland given the skew in the local earnings distribution but look quite punitive nonetheless and a potential blow to enterprise.

"Local businesses will welcome the temporary increased capital allowance for new investment to 40% and the proposed top-up credit insurance scheme and some other smaller measures but overall I would say that the very modest expectations have been met."

JENNIFER MCCANN, SINN FÉIN FINANCE COMMITTEE MEMBER

"As predicted by Sinn Féin, the British Chancellor has reneged on previous British Government assurances that the executive could retain and reinvest efficiency savings in frontline services and infrastructural projects.

"What Alistair Darling has announced today runs contrary to earlier commitments by the British government with respect to efficiency savings in the absence of a Peace Dividend.

"While some parties seem to believe that the extra money announced in the budget today for the north goes some way to compensating for the additional £123m extra efficiency savings now being imposed for years 2010/2011, they are overlooking the fact that this is in effect a cut of £123m in the Block grant that will not be recovered in subsequent years.

"In light of this typical slight of hand by the British Treasury today, I would appeal to those parties who opposed the Sinn Féin motion for the acquisition of more fiscal powers for the Assembly to rethink their position."



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