Belfast Telegraph

Politicians must demonstrate their financial acumen

Editor's Viewpoint

A number of English Tories have become jittery about the Ukip election victories in Rochester and elsewhere, and they are also questioning the amount of public funding being given to Northern Ireland from Westminster.

This funding is largely determined by the complex Barnett Formula which determines that nearly £11,000 is spent per person here each year. This is 28% more than the amount given to people living in parts of England. Some Conservative MPs believe that a fairer distribution of wealth across the UK has been long overdue, and a Commons motion in favour of a review of the Barnett Formula has been backed by 70 Tory MPs.

This is in line with the policy of Ukip, which has already vowed to review Barnett, and it is not difficult to understand the Tory desire not to be outflanked by these brash political newcomers.

However, the Prime Minister David Cameron has made it abundantly clear that there will not be a review of the Barnett Formula in the near future, so this is unlikely to take place until after the general election next year. Meanwhile, it is likely that Northern Ireland will soon have the power to set a lower rate of corporation tax and this financial concession - as well as greater public funding per capita - might attract some English companies to relocate. There is no way that this would appeal to English Tories.

A lower rate of corporation tax in Northern Ireland would give us a golden opportunity to rebalance our economy and to become less of a burden on the Treasury. If Northern Ireland is to maintain the claim for special funding, our politicians will continually need to demonstrate that they can manage our financial affairs to the greatest mutual advantage of everyone, to cut out wasteful spending, and to make sure that they are not handing out benefits here that do not apply to the rest of the UK.

It is also imperative that if special benefits are being given here, they are not being handed over without good reasons for doing so.

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