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Voucher scheme is a boost to retail, but can NI ever truly pay its own way?

4 13 5
23.10.2021

Spent your £100 voucher yet? I hesitate to spoil the fun, as the high street really needs a break, but the last time I got a three-figure sum for nothing was for passing Go on the Monopoly board. Stormont’s £166m giveaway is set against a long-standing, unresolved question: can Northern Ireland ever pay its way?

It has been the most heavily subsidised part of the UK since the 1960s. Geography and conflict provide two core explanations. But only one has been a constant. Amid relative peace, why does the region, in the words of its Secretary of State, “punch well below its weight economically?”

The UK Government spends 21% more on each Northern Ireland citizen than on those in south-east England. It’s not that I’m against subsidies. I inhabit the region with the second-highest level of subsidy in England.

But the deficit per head here — that is the amount spent per citizen minus the amount contributed — is a mere £3,000 for every individual. The figure for Northern Ireland is not far shy of £5,500.

Stormont controls 90% of what is spent locally. But the overwhelming bulk of Executive finance comes from the UK Treasury.

A big chunk of Executive spending is devoured by inescapable items, such as social security payments, with levels determined elsewhere.

Options for Executive action are limited. Unlike in Scotland and Wales, powers over income tax are not devolved. Even if eventually transferred, they would be no panacea.

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