The focus of politics over the last few weeks has been on disorder on the streets, rather than the economy. Yet the protests, violence and attempted terrorist attacks, as well as being an unwelcome throwback to the past, have taken a toll on shops, restaurants, hotels and bars at the worst possible time. The probable result is that more jobs will be lost during 2013.
A growing economy is critical if Northern Ireland is to have a hopeful future. And just as the executive is failing to deliver on cohesion, sharing and integration, it is failing to create the jobs and encourage the enterprise, which are so critical to a successful, happy society.
The Ulster Bank’s monthly surveys show that both the number of manufacturing jobs in Northern Ireland and the value of goods we export abroad are still falling steadily. In contrast, in Great Britain employment is going up and workers are moving from the public to the private sector.
The executive claims to prioritise creating more private sector jobs, but it is failing in spectacular fashion and the response to its failure from the enterprise minister, Arlene Foster, has been complacent. That is particularly concerning because all the experts agree that our economy needs to be rebalanced urgently. An unsustainable proportion of jobs here are in the public sector and the executive’s failure to address that imbalance could have serious consequences in the future. In reality our ministers are focused only on protecting the block grant, rather than encouraging enterprise.
Unlike some members of the executive, like Sammy Wilson, NI Conservatives have consistently supported the devolution of powers to lower Corporation Tax to the Assembly, but while we believe this is still necessary to make Northern Ireland competitive in the long term, there are other things which the executive can do to improve matters immediately.
First of all there is the issue of shared future. Any future cut in taxes will not be successful unless foreign investors are sure that Northern Ireland is a stable, harmonious society where they want to come to live and work. The executive has so far failed utterly to produce its promised Cohesion, Sharing and Integration strategy. Unless this document is produced quickly and unless it contains meaningful targets and concrete aims, in terms of integrated housing, education, sport and so on, then Northern Ireland will keep being weighed down by the divisions of the past. Segregation costs £1 billion per year; an unsustainable sum, which could be used to create jobs.
The executive is also failing to deploy various tools which it already has at its disposal to get the economy moving, in the absence of a decision on Corporation Tax. These include things like creating enterprise zones, which the rest of the UK is getting on with, providing incentives to exporters and stimulating research and development through the tax system. The executive needs to listen to business and step up efforts to provide skills which companies need, particularly in the STEM subjects of science, technology, engineering and maths, and in computer sciences.
It needs a coherent strategy for improving infrastructure and making our towns and villages attractive places to live and work.
The Chancellor, George Osborne, recently provided an extra £132 million which can be spent on projects like these, giving our construction industry a boost and stimulating the wider economy. It is estimated that £1 of government spending on infrastructure generates an additional £7 for Northern Ireland, so the coalition’s plans can make an enormous difference. The executive has brought forward some spending, which was already in the pipeline for infrastructure, but its efforts to boost construction have been far too little, far too late for important companies like Pattons.
Ministers allotted half of their budget for improving roads to the A5 project, which was unwanted by many people and, as a consequence, is now mired in judicial reviews. The executive needs to be more creative, with more innovative thinking on using PFI funding for new projects. The money which the Chancellor has provided must be spent much more wisely, for instance by upgrading the A6 road between Belfast and Londonderry. Most importantly, the funds should be targeted toward schemes which can be started quickly, in order to create jobs and stimulate the Northern Ireland economy immediately.
There is no disguising the fact that the economic situation in Northern Ireland is not good. During the last two years the UK as a whole has created 400,000 private sector jobs, while, in Northern Ireland, we have lost 11,000. Manufacturing companies in Great Britain are driving the recovery there and exporting goods, while our sector continues to contract.
Better news is that things aren’t irrecoverable. But we do need a step change at executive level, from ministers who are currently hindering business, to a devolved government which understands the importance of private sector jobs and tries to help business create them.
We have some great companies, which perform strongly in areas like food and drink and software. The key is keeping politicians focussed on jobs and growth. We badly need some positive, serious and innovative thinking from our executive to get our economy moving and to give people on the streets hope and motivation for the future.