Belfast Telegraph

Bailout for Wrightbus and H&W could be part of DUP voting deal with Johnson

Dr Esmond Birnie
Dr Esmond Birnie
Ian Paisley

By Steven Alexander

The DUP could negotiate rescue packages for two Northern Ireland companies as part of talks with Boris Johnson's new Government, according to a leading economist.

Ulster University's Dr Esmond Birnie said the cash crisis at two of Northern Ireland's most respected manufacturing businesses - Wrightbus and Harland and Wolff - may well figure in the negotiations between the DUP and Conservatives.

Both parties are due to meet over the coming weeks to negotiate a second confidence-and-supply deal to prop up Mr Johnson's Conservative Government, which currently has a majority of just two, with support from the DUP's 10 MPs.

A rescue package for the troubled companies - both based in DUP constituencies - is likely to place them on the talks agenda.

"The fact that both firms produce high-quality products in markets which have good, long-term prospects would be a case for some short-term cash aid," Dr Birnie said.

Wrightbus employs 1,400 staff and is one of Northern Ireland's biggest manufacturers.

However, earlier this week the Ballymena company that manufactured the Routemaster 'Boris bus' when Mr Johnson was Mayor of London, confirmed it is seeking a capital investment of at least £30m.

Harland & Wolff, which employs 132 people and currently has no contracts, could go bust within days if a buyer cannot be found.

Unions have already called for Mr Johnson to intervene, as the yard could close before crucial Government contracts for the Type 31e frigate are awarded.

Ian Paisley's North Antrim constituency has already been devastated by the recent closures of JTI (formerly Gallaher's tobacco) and Michelin's tyre factory.

Mr Paisley yesterday said that he had already contacted Mr Johnson over the financial difficulties suffered by Wrightbus.

"I'm looking at something that would need to have a Government response within a fortnight, if not sooner, and I certainly hope someone in Government will hear those concerns and respond to them," he said.

Mr Paisley said the situation at the firm had grown "serious".

"There is a major cashflow problem that needs to be resolved," he said.

"A lot of work has gone on over the last nine months to try and help those issues.

"It needs cash to keep running. I've already contacted Boris Johnson's office - I had spoken to him before about this, but now he is in a position of influence I will be asking the Government to make a major intervention to try and help this company."

DUP deputy leader Nigel Dodds confirmed his party would be discussing the issue with the Government.

Mr Dodds told BBC Radio Ulster that "the job situation in manufacturing in Northern Ireland at Wrightbus is important, we'll certainly be raising all of those issues".

Dr Birnie also said that "more cash will always be useful to a still cash-strapped Northern Ireland public sector".

But he warned: "It is extremely unlikely that HM Treasury will offer anything large enough to plug some massive holes in the NI Budget."

Dr Birnie said further funding through a second confidence-and-supply deal will be "useful, especially if they are invested in future growth capacity, as opposed to frittered away in crisis management of current cash crises".

But the former Ulster Unionist MLA said the money would be "no substitute for a transformation agenda in the NI public sector or an NI industrial strategy - both of which, ideally, directed by devolved ministers or, as second best, by active direct rule ministers".

Looking back at the confidence-and-supply deal, Dr Birnie said there had been "relative success in spending the money - about £750m out of just over £900m over the two years".

He said the extra money had been useful at a time when most Stormont departments outside of Health were facing real term budget cuts.

But he said that even £900m over two years "looks small when compared to the underlying gaps in the NI Budget" - an estimated shortfall in capital spending of close to £4.5bn.

He predicted any future deal would also "probably be small compared to some of the looming unfunded Budget demands".

He said the DUP could ask for the 12.5% NI corporation tax rate to be implemented without the two existing pre-conditions applying - a Stormont Executive in place and a deduction from the block grant.

But a "possibly more modest fiscal proposal would be to devolve all of air passenger duty and/or a VAT rate for tourism".

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