Cut-Backs 'Will Hit Investments'

Invest NI has said it fears it could miss out on opportunities for inward investment because of a lack of funds brought about by public spending cuts.

However, provisional figures for the year ended 31 March 2010 indicate that Invest NI supported activity will result in businesses in Northern Ireland investing £686m over the coming years as they "work through short term challenges and maintain a focus on the longer term aim of growing a higher value economy".

There's no doubt though that the agency is bracing itself for reductions in its budget over the next few years as there are already plans to trim £6m from its £208m budget and Invest NI's Chief Executive Alastair Hamilton said the budget for 2010/11 was already almost 90% committed.

"Potentially, if it gets really severe, it could eat into those contractural commitments to such a point I would have to go back and renegotiate with companies," Mr Hamilton added.

However, there's good news to report too as the £686 million of investment commitments secured will generate £164m annually in wages and salaries and there has been £181m of support offered (up 20%) through 3,745 offers of assistance.

Ninety-three per cent of these offers, and 63% of all support (2008/09: 54%), were to locally owned businesses, ranging from small, young companies to established global players, such as First Derivatives, Almac Group, Dale Farm, Wrightbus and Randox and 55 new employment related inward investments committing £196m including major projects from NYSE Technologies, Seagate and Norfolkline.

Some 74% of new jobs arising from these investments will pay salaries above the NI Private Sector Median (2008/09: 55%) and a total of 6,575 jobs were either promoted or safeguarded - 4,300 new and 2,275 safeguarded and 2,296 locally-owned business starts were supported.

The agency also reported a 134% increase in planned private sector investment to innovate and develop their capability and a strong demand for Trade Support with 3,346 participants taking part in market visits, accessing in-market support, or receiving export skills and sales training.

"As we emerge, hopefully, out of the economic downturn there are more companies both foreign direct investors and local companies who have projects around growth and growing the private sector which is the big thing we're trying to do in Northern Ireland.

"We will have to draw the threshold in those projects that we support this year at a different level because of the availability of funds."

That's not to say the economic downturn hasn't already had an impact.

While Invest NI said it created 4,300 new jobs last year, that's down from 6,500 the previous year.

"A lot of our efforts last year, and a lot of our funding last year, went into protecting companies in the downturn," he said.

"As soon as we see the upturn - and we're beginning to see a little bit of that now - those companies are ready to go and ready to drive forward."

(BMcC/GK)