Belfast Telegraph

Friday 11 July 2014

Osborne's Autumn cash boost welcomed

Business organisations have welcomed Chancellor George Osborne's Autumn Statement, particularly the £130m in capital funds for the Executive and a Regional Growth regeneration fund to get £1bn in extra funding.

The Executive also received a windfall of £15m in additional funding.

Richard Ramsey, Ulster Bank chief economist, said the biggest positive is the additional capital investment for the beleaguered construction industry, which follows a raft of pro-construction measures unveiled in last week's Programme for Government.

It was also announced the Government will ask independent Pay Review Bodies to consider how public sector pay can be more responsive to local labour markets.

"This measure has added significance for Northern Ireland given that the current public-private wage differential is more marked in Northern Ireland than in any other UK region," Mr Ramsey said.

PricewaterhouseCooper chief economist Dr Esmond Birnie said that while Northern Ireland has been promised around £140m over the next three years, the Executive may not get all the cash.

"Under the Barnett Formula, Northern Ireland should get around £140m," he said.

"But the Executive has budgeted for public sector pay rising by 2% at the end of the current freeze.

"However the Chancellor also capped public sector wages at 1%, so as much as half might be clawed back by Westminster.

"Nevertheless, this is better than it might have been and gives the Assembly a clear message as to how challenging the next few years will be."

PwC tax partner Martin Fleetwood welcomed the decision to introduce improvements to the Research and Development tax relief regime from 2013 and said that would prove a real boost to the attractiveness of the region to inward investors.

And NI Retail Consortium director Jane Bevis said that using some of the additional funding to provide small businesses with the temporary rate relief is crucial.

Finance Minister Sammy Wilson said that the statement appears to be "positive news" for Northern Ireland.

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