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Executive can’t reap gains without taking some pain

The rest of the UK doesn’t owe us a living. Sammy Wilson realises this, but does Peter Robinson, asks Owen Polley

When he was Chancellor of the Exchequer, the antipathy between Gordon Brown and Prime Minister Tony Blair was legendary. Is a similar rivalry developing in the Executive between Sammy Wilson, the DUP Finance Minister, and Peter Robinson, Wilson's party leader?

Brown often acted like an internal opposition, blocking Blair's plans for reform by refusing to fund the Prime Minister's pet projects. Wilson, in contrast, is tasked with balancing the books in Northern Ireland.

But it is beginning to look like he will be frustrated by the First Minister and the rest of the Executive, who are reluctant to jettison populist policies, despite their cost.

For some time our politicians have realised that separate water charges are unavoidable. With the budget tightening, it would be folly to defer them any longer.

To Wilson's credit, he has argued the case for an immediate introduction. It is the type of unpopular decision which must be made in the interests of good government.

When the Finance Minister authored a paper, working on the assumption that charges would be introduced for the 2011-12 financial year, however, he was rebuffed by his colleague in the First Minister's office

Robinson rejected the document, describing it as "unwise", and rubbished the notion that the Executive is to implement a 'tap tax'.

It is not the first time that the two DUP men have clashed over economic policy. Previously, Wilson declared his scepticism about a cut in corporation tax for Northern Ireland, arguing that it would inevitably be accompanied by a reduction in the block grant. Robinson, meanwhile, has made positive noises about lower business taxes.

The First Minister probably has the stronger case on that issue. But at least Wilson shows awareness that there are two sides to the public finance ledger.

Too often, populism rather than common sense guides decisions at Executive level. The most recent First Trust quarterly economic review blasts Northern Ireland's politicians for avoiding "financial reality", by continuing to defer water charges. It accuses ministers of expecting a 'free ride', subsidised by taxpayers in Great Britain.

In truth, water charges are merely the tip of the iceberg. Since the devolved institutions were restored in 2007, expensive gimmicks have been offered to convince people that power-sharing is working.

The Assembly had barely re-convened when one-off payments were made to householders in Belfast for flood damage which insurance policies should have covered.

Health Minister Michael McGimpsey then phased in free prescriptions, which were already means tested, at a cost exceeding £16m each year.

And the Executive hasn't proved willing to gather revenues to pay for its largesse. The UK Treasury keeps Northern Ireland afloat by pouring £7.3bn into the province each year, to bridge the gap between our tax take and our outgoings. The size of that subvention is not sustainable, given the extent of the national deficit.

Yet the Executive is missing opportunities to show leadership. The problem with devolution is it hands regional administrations power without requiring fiscal responsibility. It is too easy to take credit for popular policies and blame Westminster for unpopular ones.

The phenomenon was exacerbated by the fawning attention which we became accustomed to from prime ministers. The 'peace process' inculcated a sense of overweening entitlement. But the rest of the UK doesn't owe us a living. Tough decisions can't be avoided.

With the 2011 Assembly elections looming, the Executive might be tempted to delay the pain a little longer. This would be irresponsible. I suspect Sammy Wilson has accepted this. He still needs to persuade Peter Robinson.

Owen Polley is a unionist blogger and commentator

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