Belfast Telegraph

Families can't take more cuts

By Boyd Black

The economy is recovering, but the feelgood factor is still to show in living standards and jobs. The danger is that, as well as more public spending cuts, the Executive is now threatening us with an additional race to the bottom.

A recent PWC report highlighted the fact that median real household incomes are 7% below levels seen in 2007 and will not reach that level again before 2019.

That is why we need to support the Labour campaign for a living wage to help restore living standards.

The worst-off have been hit even harder, with energy and food price inflation impacting harder on the poorest 10% of households.

Forty-two per cent of Northern Ireland families are in fuel poverty as a result of high energy prices.

New jobs are being created in sectors such as retail, hotels and catering to offset some of the job losses. But, they tend to be relatively low-paid. And there are not enough of them to provide jobs and apprenticeships for the large numbers of young unemployed.

We need a further boost to infrastructure spending, in particular house-building, to kickstart construction and speed up job creation.

As public spending is squeezed, the health service is close to meltdown, while teachers' unions complain of "under-resourcing and neglect" of the north's most vulnerable children in our schools.

Finance Minister Simon Hamilton tells us austerity will get worse, with an additional £300m in cuts to the public spending budget by 2015/16. Add to that the frightening cost to the economy of welfare reform.

But, in addition, the Executive wants control of corporation tax, so they can cut it. This will mean an additional self-inflicted reduction in the block grant. Simon says: "We need to engage in the very challenging discussion of how we pay for it." No need, Simon. You will just have to make even more cuts to public services.

Gordon Brown has entered the independence debate in Scotland. While supporting devolution, he ruled out moving corporation tax powers to Scotland. As he says, that would trigger a competitive race to the bottom.

Carry on cutting, Stormont.

* Boyd Black is secretary of the Labour Party in Northern Ireland

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