| 24.4°C Belfast

Republic 'using loan to snatch investment'

The Republic of Ireland's prosperity must not be built on "snatching investment from our country", the DUP's Sammy Wilson argued last night.

He pressed Prime Minister David Cameron on the UK's bill for bailing out struggling Eurozone countries.

Mr Wilson claimed the tally amounts to half of savings from the deficit reduction plan, a fact that would "stagger and appall many".

But Mr Cameron told him the only country to receive direct cash was the Republic.

"The point that I would make is this - the only money that Britain has lent directly is to the Republic of Ireland, and I think it is actually in our national interest and, I would say, in the interests of Northern Ireland, that we do not see a collapse in the economy in the Republic," Mr Cameron said during Prime Minister's Questions.

"That was a difficult decision but the right decision to make. The other contingent liabilities on Britain flow through the finance mechanism in Europe, which we did not support the establishment of and have negotiated to get rid of when the new arrangements come in in 2013, and we will do everything that we can to safeguard Britain's finances."

But Mr Wilson claimed the Republic was able to run an advantageous taxation system, as a result of UK cash.

Weekly Business Digest

Margaret Canning’s selection of the must-read business stories straight to your inbox every Tuesday morning

This field is required

"While the UK Government has imposed Air Passenger Duty of £100 on business class flights to North America the Irish Government has reduced theirs to €6 (£5) and may even abolish it. Their ability to do so has been enhanced by the £7 billion loan from the British Government and has put in jeopardy Northern Ireland's only air link with North America which will have a detrimental impact when trying to attract investment from that area to Northern Ireland.

"It is important that the Government seeks to ensure that any money made available to the Republic of Ireland cannot be used to reduce Irish taxes below the level of UK taxation to the detriment of the UK economy such as has happened with Air Passenger Duty."

APD was introduced in 1994 at £5 for European destinations and £20 elsewhere.

After a succession of rises, since November each Belfast economy passenger must pay £12 for flights up to 2,000 miles (inc Europe).

That levy increases to £60 per passenger travelling between 2,001 and 4,000 miles (inc the USA).

Travellers making their way from Dublin pay APD of €3 (£2.60) from next month.