Belfast Telegraph

Theresa Villiers unlikely to back move on Northern Ireland corporation tax

Northern Ireland’s new Secretary of State is unlikely to throw her support behind the devolution of corporation tax at the Tory conference today, sources have said.

In a potential double blow for the economy, the Prime Minister has voiced support for the idea of regional pay for civil servants — something that would hit Northern Ireland particularly hard, as it has a large public sector.

In her first major speech on Northern Ireland, Theresa Villiers will tell the Tory Party she can see the arguments in favour of devolving the power to Stormont.

But she is unlikely to publicly back the move, and will also stress the obstacles that remain, ahead of a final crunch meeting of the ministerial working group.

The former Transport Minister — shifted to Northern Ireland in last month’s reshuffle — will defend the Government's record on the economy. It follows attacks by Labour last week, claiming that cutting the deficit and measures on bank lending will help the people of Northern Ireland. Labour's Vernon Coaker accused Ms Villiers of “dithering” over corporation tax.

She will also offer to work closely with the Executive, and stress her commitment to the union.

Today is day two of the conference in Birmingham, and as it began yesterday, Prime Minister David Cameron was grilled about plans to set up local, or regional rates of public sector pay.

Northern Ireland’s public service unions have waged a campaign against any changes, saying pay would be held down in areas where the private sector is deemed to be lagging behind.

Mr Cameron told journalists: “I think we do need to make sure that institutions increasingly have a greater ability to have some pay flexibility. It's nothing to do with regions — it's a general point about should you try and encourage institutions throughout the public sector to have greater flexibility about pay locally and I think you should.”

He also defended pressing on with the review of constituency boundaries that would reduce the number of Northern Ireland MPs from 18 to 16.

But public money is still being spent on the scheme, and last month the Belfast Telegraph revealed the doomed process in Northern Ireland would end up costing taxpayers more than £8m.

Mr Cameron said: “This vote is going to come before the Commons and the Lords. The work is being done. The legislation has been passed. All that remains is these last two votes.

\[Shane Donaghey\]”And when they come forward I will urge MPs of all parties — Labour, Liberals, DUP, SDLP, Plaid Cymru — anyone that believes. Go and ask your constituents I would say.

“Do you want a smaller House of Commons, that cost less money, that all seats should be the same size with the same number of voters in. If they can fund me an argument of different numbers of voters in I would be very interested to hear it.”

what next?

Theresa Villiers’ predecessor as Northern Ireland Secretary, Owen Paterson, was an enthusiastic fan of devolving corporation tax powers from Westminster. Ms Villiers has been less vocally supportive. Talks between the Treasury and Executive are in the balance. But the Tories could deliver a hammer blow to our public sector, if the Prime Minister introduces regional pay scales for civil servants.

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