Belfast Telegraph

Corporation tax cut not the answer

By Boyd Black

The likely catastrophic impact of the collective desire of the parties in the Executive for a cut in corporation tax is now clear.

According to a leaked DUP paper, the £300m-£400m cost of such a cut will be paid for by many thousands (perhaps 10,000) of additional public sector redundancies in Northern Ireland. We need an alternative strategy.

The DUP has declared itself ideologically committed long-term to matching the outcome of Tory-led austerity cuts in Britain.

These massive additional cuts in public expenditure and public employment would take effect from day one of a corporation tax cut, as the block grant is immediately cut to match the loss in revenue to the Treasury.

The advocates of a corporation tax cut believe it will attract additional private sector jobs. However, there is no guarantee that even one new job will be created.

It is an illusion to think we can match the past success of the Republic, which happened in unique historical circumstances.

The Executive's copycat tax-cutting strategy is lauded as a potential "game-changer". A more convincing strategy would be to use what money we can spare to prioritise investment in our own workforce infrastructure, rather than in increasing the retained profits of large corporations.

We should be upgrading the skills of our workforce so that people will be capable of earning more than just a living wage.

This should start with childcare and early years' education and continue through expanded apprenticeship schemes.

We also need an expansion of locally provided university places to prevent the forced emigration of our brightest young people.

This strategy of workforce upskilling to provide work-ready employees would benefit the local SME private sector and offer a real attraction to large investors.

The Executive parties and their business and professional advisory supporters share an ideological consensus on the corporation tax-cutting approach.

Sinn Fein is now protesting that, if it involves public sector job cuts, it is not so sure. How else is it going to finance it?

We can only hope the public and the trade union movement will present a united alternative

Boyd Black is secretary of the Labour Party in Northern Ireland

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