£417,000 spent on stalled bid to lower NI corporation tax
New rate can't proceed without Stormont
Stormont has spent £417,000 preparing for a tax break for businesses that is supposed to start next month but can't proceed without an Executive.
The plan to slash corporation tax to 12.5%, which would put Northern Ireland on a level footing with the Republic, united local politicians - but it cannot go ahead because there is no Executive in place.
The cut to the business tax was one of the key planks in Northern Ireland's drive for inward investment. The original plan had been for the lower rate to kick in next month - but with Stormont in limbo, the policy is increasingly in doubt.
A Freedom of Information request from the Ulster Unionists showed that most of the £417,000 cost, over £380,000, has been spent on developing a new IT system and associated devolved regime costs. A further £35,000 was spent on "external research", the Department of Finance said.
The department's response to the UUP noted the "project is ongoing and further costs are expected to be incurred".
Ulster Unionist finance spokesman Steve Aiken MLA called it a missed opportunity.
"The reduction of corporation tax should have been a real economic game changer for Northern Ireland," he said.
"It's outrageous that less than four weeks to go from when the tax rate should have been reduced to 12.5%, we have nothing to show for it but a cost to the public purse of over £417,000.
"Companies, both here and abroad, were repeatedly promised Northern Ireland would have a lower rate of corporation tax."
Mr Aiken said the change could have reversed the "long-standing advantage" businesses in the Republic enjoy, and it could have attracted inward investors, creating tens of thousands of jobs.
"All that has happened is our international reputation has been further tarnished as the DUP and Sinn Fein simply failed to deliver on this keynote policy," he said.
"At a time of spiralling hospital lists and chaos in school budgets, we will soon have to make a decision on whether Northern Ireland can really afford to keep spending money on a policy which needs a stable and competent local government as an absolute pre-requisite."
Mr Aiken said the current stalemate made the policy look "increasingly undeliverable", and that even if a new Executive was formed, "so much reputational damage has been done that the full benefits of a reduced tax rate will never now be fully achieved".
Christopher Morrow, head of policy at the NI Chamber of Commerce and Industry, said: "This is an example of how the lack of a functioning Executive is not helping business and is in effect holding back critical decisions to drive growth here.
"With the proposed implementation date of April 2018 unlikely, this is a significant blow to the Northern Ireland economy as the cut in the level of corporation tax is intended to encourage inward investment, create jobs and compete with the Republic of Ireland's rate."
A Department of Finance spokesperson said: "The devolution of corporation tax has been a long-standing commitment of the previous NI Executive and expenditure has been incurred in line with that policy. This preparatory work, and the IT systems developed as part of that, will remain in place to deliver on the corporation tax policy of a returning Executive."