Belfast Telegraph

Friday 26 December 2014

Unions call for greater spending to aid growth

Trade union leaders have urged the next UK Government to ramp up public spending to boost economic growth after the General Election rather than taking an axe to Northern Ireland’s budget.

Launching its ‘Jobs and Services’ campaign today, the Irish Congress of Trade Unions said workers should not be made to pay for the “flagrant” excesses of bank bosses as it outlined measures it believes will protect jobs and services.

ICTU strongly rejected the “false dogma” of private sector growth at the expense of the public sector, and said that working people should not have to bear the burden of the recovery because are not responsible for the causes of recession.

“If the next UK Government does not accept the advice of respected economists to increase public spending to stimulate economic growth, but opts instead for more public expenditure cuts, the consequences for jobs and services in Northern Ireland could be catastrophic,” the policy paper said.

Conservative leader David Cameron sparked outrage when he singled out Northern Ireland as one of the regions with too large a public sector, prompting fears a Tory government would target the province for public spending cutbacks — something he then strongly denied.

Northern Ireland’s public sector accounts for almost a third of jobs, compared to the UK average of nearer 20%, and the issue of stimulating a more vibrant private sector has become a key election issue. Union chiefs believe there are other viable alternatives to public sector cuts.

They said: “The UK Government could give priority to tackling the tax gap now estimated to stand at over £120bn a year. This includes illegal tax evasion, tax avoided by those seeking to minimise bills and uncollected taxes due to be collected.

“Tax evaded and avoided by individuals and large companies could be reinvested into public services. Taking concerted action and allocating the resources to close the massive tax gap could therefore go a long way to aiding economic recovery.

“But instead HM Revenue Customs is cutting 25,000 posts and closing offices.”

The policy document blames pressure on public finances on the Government’s multi-billion pound bailout of the banks, noting that the Stormont Executive is already facing £370m of expenditure cuts and that there are projections another £1bn could be cut from funding over the next three years.

Among the 29 measures put forward by the trade unions are:

  • Making public subsidies to the private sector conditional on employment, with a focus on developing local enterprises not foreign direct investment projects
  • Making sure contracts awarded under public procurement include provisions for apprentices and assisting the unemployed
  • Scrapping policies of privatisation and outsourcing of public services
  • Forcing public-owned banks to provide credit for SMEs and start up |companies
  • Ending the freeze on domestic rate increases and the rates cap
  • Resisting the introduction of |separate household water charges.

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