'Economic wasteland' warning on insurance costs

Northern Ireland risks become an economic wasteland if the Government continues to refuse help to small businesses struggling for survival, an MLA warned today.

East Londonderry Assembly member David McClarty said that at a time when more should be done to encourage local businesses to grow and develop, the Government is failing to tackle one of the key difficulties the business community is struggling to contend with – soaring insurance premiums.

Backing the launch of the latest survey by the Federation of Small Businesses (FSB) on insurance costs which reveals that 99% of small business owners believe the Government is not doing enough to deal with the issue, Mr McClarty said he knew of firms in his constituency which were being forced to downsize operations or close because of crippling insurance costs.

A member of the last Assembly’s Enterprise, Trade and Investment Committee, Mr McClarty jointly hosted the FSB launch at Stormont.

He said: “I have made representations about this issue in the past and it makes me angry to think that since then the issue has largely been swept under the carpet.

“You don’t have to go too far from your own doorstep to discover people who own small businesses who are almost tearing their hair out in frustration over this issue.

“The Government has been warned by all sections of commerce about the huge negative impact rising insurance premiums are having on businesses across the country and obviously it is having devastating effect on smaller firms.

“It is time for action on the part of Government. It must move to protect and nurture small businesses.”

The FSB has called for the Treasury to set up an emergency fund for those businesses that cannot obtain insurance at any price. The FSB recommends that the fund should be financed by revenue generated from Insurance Premium Tax.

The FSB has also called on the Department of Trade and Industry to produce strategies to attract more underwriters into NI and set up an Insurance Taskforce, chaired by the ETI minister and made up of key agencies and business groups to agree a way forward in resolving the most important issue affecting local business.

Mr McClarty said jobs would continue to be lost if there was no serious attempt to support small businesses which are the backbone of the local economy.

(SP)