Corporation Tax Devolution 'In The Balance'

NI's money matters have been in focus nationally with news that the NI Secretary of State's plan to vary corporation tax and devolve it to the Stormont Assembly may not be achieved as easily as first thought.

However, Owen Paterson has told the Tory conference on Sunday that he was going ahead with setting up a Joint Ministerial Group to examine a number of issues.

He said: "It is absolutely right as a responsible government that we should get into the nitty-gritty."

But, he said that the transfer of the power to Stormont would mean a corresponding cut in the block grant from Westminster.

But there's a complication in that, a public consultation on the issue had raised "considerable disagreement" on how much the block grant should be reduced.

He said on Monday: "As of this morning, as of last year, as of during the consultation process, I would not tell you which way this is going to go."

Money matters were also in the news last week when Owen Paterson welcomed the announcement by his colleague, the Chancellor of the Exchequer, George Osborne, of reduced Airline Passenger Duty on all direct long haul flights from Northern Ireland from 1 November.

Mr Paterson said: "This is really good news for Northern Ireland. Our priority is to protect jobs and help create more jobs. First-rate transport links are essential to Northern Ireland's future prosperity and that is why we have worked so hard with the Chancellor on this issue."

Speaking last week he said the announcement would help safeguard the vital direct link from Belfast to the United States.

"It makes it easier for the Executive to develop other long haul routes to attract foreign direct investment and increase tourism," he said.

However, the devolution of corporation tax - long an aim of the First Minister, Peter Robinson, may be a more complex process.

The Joint Ministerial Working Group is to be chaired by the Exchequer Secretary, David Gauke, and comprising Mr Paterson, Hugo Swire and NI Executive Ministers.

"It will seek to establish with absolute clarity the costs, the administrative changes and the potential legislative vehicle for transferring these powers to Stormont.

"It's essential that we pin down these details before the Government decides whether or not to proceed further," continued the NIO boss.

The Executive members expected to be involved are First and acting Deputy First Ministers Peter Robinson and John O'Dowd, Finance Minister Sammy Wilson and Enterprise Minister Arlene Foster.

The aim is to see the rate of corporation tax lowered from the current UK rate of 26% to the Republic of Ireland's 12.5% so that it will boost the economy and help NI companies compete.

Welcome

The Alliance Leader and Stormont Justice Minister David Ford, has welcomed the announcement to establish an Executive working group looking into the possibility of devolving the power to vary corporation tax.

"The establishment of this working group is a further step closer to the decision to devolve the power to vary corporation tax.

"The fact that it is joint working group with Ministers from Westminster just shows how seriously the Government are taking our calls for the Northern Ireland Assembly to be given these powers," said the MLA.

"Westminster has been very responsive to calls from Northern Ireland politicians on areas that have not been devolved but on such an important economic issue, it should be our Assembly and Executive that makes the decision as to whether this power gets devolved.

"I would however like to see this working group include other Ministers outside of OFMDFM and the Enterprise and Finance Departments.

"This issue has knock on effects for many other Departments such as Employment and Learning, who would have important points and issues to raise," he added.

"I also believe that on an issue as important as this, the working group should contain Ministers on a cross party basis."

(BMcC/GK)