The Prime Minister has signalled his willingness to consider a corporation tax cut in Northern Ireland, but warned the days of solving every economic problem by asking the Treasury for more money are over.

David Cameron insisted the local economy would benefit from nationwide stimulus measures already introduced by his Government, including a cross-UK drop in business tax rates, but acknowledged there was a need to take further recovery steps in the region.

Stormont's political leaders want the powers to set their own business tax rate and believe a more substantial reduction in the current UK rate of 26% would give their flagging economy a kickstart and enable it to compete more with the Republic of Ireland's, where the rate is 12.5%.

"As part of the UK, Northern Ireland will benefit from the measures to promote growth that we've already announced, such as cuts in business taxes," Mr Cameron told the Northern Ireland Assembly. "But I recognise that in Northern Ireland we need to go further."

He also repeated his belief that the public sector was too large in Northern Ireland and the region fared better in coalition Government's austerity measures than other parts of the UK.

"Northern Ireland continues to receive 25% more per head in public spending than England," he added. "But the days are over when the answer to every problem is simply to ask the Treasury for more money. That applies here as much as it does in other parts of the UK.

"So, like you, the Government is looking at new ways to revive the private sector and turning Northern Ireland into a dynamic, prosperous enterprise-led economy for the 21st century."

After the address to the chamber, First Minister Peter Robinson insisted Stormont wanted to be less reliant on the Treasury: "We are not seeking to have a begging bowl," he said. "The whole idea of having the devolution of corporation tax so we can set our own levels, is so that we can grow our economy so that we can increase jobs and we don't need to be as reliant or reliant at all on the Exchequer."

Emerging from an earlier meeting with the Prime Minister at Stormont Castle, Sinn Fein Deputy First Minister Martin McGuinness stressed the importance of corporation tax.

"Our view, and it is a collective view which all of the parties in government have signed up to, is that that (a tax cut) can dramatically change for the better the employment prospects, particularly for our young people, not just through foreign direct investment but also for support for our own indigenous businesses," he said.