Corporation Tax (Northern Ireland) Bill
Baroness Ritchie of Downpatrick Excerpts(10 years, 9 months ago)
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Mrs Villiers
As the hon. Lady will hear when I get further into my remarks, the approach in the Bill is to focus on genuine economic activity which generates jobs. We want to minimise the risks of matters such as brass-plating and artificial avoidance schemes, so the Bill maintains the coherence of the corporation tax system as a whole and also provides an incentive to bring genuine economic activity to Northern Ireland and assists in that rebalancing process.
The Wales Act 2014 came into effect on 6 January, providing the legislative framework to support the implementation of recommendations made in the first report of the Silk commission. As my right hon. Friend the Secretary of State for Wales has told the House, he continues to take forward discussions on the next steps for devolution in Wales. The debate continues on the most effective way to ensure that devolution operates in a fair way with regard to England, as one of the component nations of the United Kingdom.
Turning back to Northern Ireland matters, the devolved system for corporation tax rates set out in the Bill reflects the following overarching Government goals: we want to attract genuine economic activity to Northern Ireland, minimise additional administrative costs for business, keep the costs of a reduced rate for the Executive at a proportionate level, and ensure as much consistency as possible between the new NI provisions and the main UK corporation tax regime—and of course we need to comply with legal requirements.
The legislation does not cut off Northern Ireland from the rest of the UK tax system or establish a separate and distinct corporation tax regime for Northern Ireland. Control over what is taxed remains a matter for the UK Government and this House. The Bill devolves only the power to vary the rate, so Northern Ireland’s trading regime remains firmly and clearly within the overall UK corporation tax system. The Bill will insert new part 8B into the Corporation Tax Act 2010 and amend the Capital Allowances Act 2001. These changes would give the Assembly the power to set a rate of corporation tax for certain trading profits, based on a proposal from the Northern Ireland Executive. That would be a decision for Northern Ireland, independent of the UK Government or this House. It will give the Assembly and the Executive a powerful economic lever to drive potential growth and enable it to be exercised on the basis of the wishes of Northern Ireland voters, taxpayers and businesses.
Efforts are made to minimise the scope for artificial tax avoidance, as I said in response to interventions. Existing anti-avoidance measures will continue to apply, including the UK targeted anti-avoidance rules and the general anti-abuse rule, and further protections may be introduced before implementation. The overall structure of the devolved regime has been designed to limit the opportunities for avoidance, as I told the House in response to interventions.
A new Northern Ireland rate would cover trading profits, such as those associated with manufacturing and providing services. Other profits—non-trading profits, such as those associated with property income—that do not generate jobs or economic growth in the same way will continue to be subject to the UK-wide rate. Similarly, activities such as lending, leasing, and reinsurance offer significant scope for profit shifting without the benefits of bringing substantial new jobs, so these, too, will be excluded from the Northern Ireland provisions.
To promote continued success in Northern Ireland in attracting back-office functions, companies with excluded trades and activities may make a one-off election for the back-office functions of those excluded trades or activities to qualify for the Northern Ireland Office regime. This is an example of the UK Government’s responding specifically to areas of activity where Northern Ireland has demonstrated its great strength in attracting inward investment. It will not apply to the oil and gas or long-term insurance sectors, which have their own separate regimes and will not be included in the new devolved arrangements. Allowances and credits remain reserved to Westminster to help to maintain a common tax base across the United Kingdom and to prevent unnecessary new complexity from being added to the tax system.
However, a number of rules will be amended to reflect the new circumstances. For example, if there is a lower rate of tax in Northern Ireland, research and development tax credits, capital allowances and creative reliefs for the film, TV and computer game industries will be adjusted to ensure that they continue to be broadly equivalent in value to those in Great Britain. That means that Northern Ireland can continue to be just as attractive a location for successful projects such as “Game of Thrones” and other film and television productions.
The devolved tax regime will also operate differently for larger and small businesses. Larger businesses will need to divide their profits between Northern Ireland and Great Britain, as they do now between the UK and other countries. This effectively means that they will treat their Northern Ireland trading activity as a separate business from their activity in the rest of the UK and allocate the appropriate amount of profit to Northern Ireland. We recognise, however, that this would be burdensome for smaller businesses. Indeed, the issue of potential administrative burdens on small business was one of the key concerns brought out by the 2011 consultation, and the matter was raised by Northern Ireland Executive Ministers on a number of occasions at the ministerial working group. Therefore, if at least 75% of such a business’s staff time and staff costs relate to work in Northern Ireland, then all their trading profits will be chargeable at the Northern Ireland rate. If not, they will be chargeable at the UK corporation tax main rate. This simple in/out test will mean that the majority of small and medium-sized enterprises are spared the burden and cost of apportioning profits.
As I made clear in my previous statement to the House, the Bill’s progress through Parliament is dependent on the Executive parties delivering on their commitments in the Stormont House agreement. Those include agreeing and delivering a 2015-16 budget that works, legislating for changes to the welfare system, and taking the steps required to put the Executive’s finances on a stable footing for the long term. I warmly welcome the progress that is under way on those three crucially important matters, with, for example, the recent agreement on a budget for 2015-16. Given the practicalities of implementation, the earliest point at which reduced rates could come into effect is April 2017. The Bill contains a commencement clause meaning that these devolved powers will be switched on for the planned start date in 2017 only if the Executive can demonstrate that they have succeeded in the third goal of achieving sustainable public finances. This is in line with the approach used for other tax devolution measures in other parts of the UK.
The Government have been very clear that devolving corporation tax rates is not an end in itself. Certainly, on its own, it is clearly not the answer to all the economic challenges facing Northern Ireland. If the full potential benefit of corporation tax devolution is to be realised, a number of areas of economic reform need to be addressed, such as planning, skills and infrastructure. However, given the land border that Northern Ireland shares with a lower-tax jurisdiction, it is difficult to think of any one policy which, on its own, may potentially have such a transformational impact on the Northern Ireland economy—
Ms Ritchie
Does the Secretary of State agree that, as regards potential visits and potential locations for foreign direct investment, there is a need to address the historical legacy of under-investment and regional imbalance if the issue of corporation tax is to have any meaningful benefit in pump-priming the local economy?
Mrs Villiers
I know that the Northern Ireland Executive are committed to doing all they can to ensure that the effects of boosting the private sector and enhancing prosperity are felt throughout Northern Ireland. All Administrations grapple with the difficult problem of how to ensure that economic prosperity is appropriately spread. I believe that corporation tax devolution—coupled with a focus on other areas of economic reform such as skills, planning reform and investment in infrastructure—is a crucial way to enhance the private sector and boost prosperity throughout Northern Ireland. I am sure that the hon. Lady will be aware of some of the many difficulties that have been experienced in border areas over the years. People living in border areas stand to benefit as much as everyone else in Northern Ireland from a potentially significant and welcome impact in achieving the rebalancing of the Northern Ireland economy that we all want to see.
Members of the business community have told me on very many occasions that they are convinced that this is the right measure for Northern Ireland. They believe that it will boost the indigenous private sector, both large and small, as well as attract foreign direct investment, and will provide an effective means of rebalancing an economy which for decades has been over-dependent on the public sector. They have therefore strongly welcomed the Government’s introduction of this Bill. I am very grateful for the support for this measure shown within the Northern Ireland business community.
The Government will use our very best endeavours to get the Bill on to the statute book before the Dissolution of Parliament. This legislation has strong support in Northern Ireland. Moreover, the whole of the UK will benefit if corporation tax devolution can help to drive economic growth and rebalancing, and help to deliver a prosperous and stable Northern Ireland.
Sammy Wilson
I seem to have hit a sore spot or at least the tender parts of the body politic among those parties that have engaged in such activity.
We have to get the welfare reform proposals through the Executive, but agreement has been reached and I hope that, as this Bill makes progress, we will also see the passage of the welfare reforms in Northern Ireland, albeit with changes—mostly secured by my party—to the Welfare Reform Bill that will make it less draconian. Indeed, I think that some of the changes in the Welfare Reform Bill will have to be revisited by this Parliament at some stage.
Sammy Wilson
I will, because I know that the hon. Lady is feeling sore from some of my remarks.
Ms Ritchie
I assure the hon. Gentleman that I am not feeling sore in any way. He is avoiding the reality to suit a certain political situation. He used to be a sceptic about corporation tax, but he has had a damascene conversion. Notwithstanding that, can he tell us what measures will be introduced to achieve the benefits of welfare reform for the people of Northern Ireland?
Sammy Wilson
If the hon. Lady is not feeling sore from some of my remarks, she is more brazen than I thought she was—[Laughter.] As she has not yet heard the rest of my speech, she does not know what I am going to say or the balanced arguments that I am going to make about corporation tax.
Everyone who has spoken so far has suggested that there is widespread support for the Bill in Northern Ireland. That is, of course, not true. The Green party opposes it, but then that party opposes economic growth apparently, according to its latest manifesto. I can understand, therefore, why it would not want to see any measures that would encourage economic growth in Northern Ireland. I do not know how the Green party expects us to tackle our unemployment or standard of living problems with no economic growth, but in any event it opposes the Bill.
The other opponents of the Bill are the trade unions, which are organising a one-day strike against it and other measures some time in March. At the same time as they complain about youth unemployment and the low-wage economy, they oppose a measure that has the potential to address all of those issues and want to strike against it. I do not understand their logic.
The only other party that opposes the measure is the traditional Unionist voice, but I think that is because we support it. That seems to be the rationale for anything it does.
All parties in this House are agreed that tax incentives can be beneficial in stimulating business growth. Some may disagree about the actual form the tax incentive should take or the degree to which it should be used, but there is an undeniable correlation between such incentives—be they small business rates relief, corporation tax reductions or oil industry taxes—and growth. Shareholders are attracted to putting money into businesses, which in turn have more profits to plough back into investment. Tax incentives can also give businesses a competitive edge over those in other countries. That is the rationale behind the Bill and no one can deny that it will have an effect.
In Northern Ireland there is an additional reason to make the change in that we share a land boundary with a country that has had a lower corporation tax rate. Some people say that this will not have a beneficial effect, but it is significant that, even when the Government of the Irish Republic were having to slash public expenditure and incur the wrath of the population by reducing wages in the public sector, putting up taxes, introducing new charges for water and so on, the one area for which they were fiscally responsible and did not make any changes was corporation tax. They had obviously judged that when it came to fighting for business, corporation tax—albeit along with other measures—was a shock and awe tactic they could use to try to attract businesses to the Irish Republic. That is a significant argument.
I have a degree of scepticism about economic modelling. As I am sure the Financial Secretary would tell us, we can put whatever finely tuned assumptions we want into economic models, but they can be upset fairly quickly. In the next 15 years, it is estimated that output in the Northern Ireland economy will grow by 11%, creating about 37,500 jobs. Any economic model must come with a warning that the assumptions on which it is based can change fairly rapidly. However, the estimate has been made using the economic data we have at present: assumptions, past trends, information from other economies and so on. In Northern Ireland, we cannot afford to ignore that estimate, even if it is not totally correct, especially if it will grow the private sector and bring in well-paid, above-average jobs.
We had concerns about a number of issues. We did not want a Bill for people who simply moved their profits to Northern Ireland and did not create jobs. There is no benefit to us in having companies with just a brass plate outside the door, but no substance. I believe the Bill addresses that issue, as much as it can, by indicating that it will benefit trading profits only. In addition, there will be strict investigation by the Treasury of companies who try to move profits. As I understand it, there will be a charge for ensuring that compliance measures are put in place to avoid such scenarios.
If we do that, what about small businesses? Many small businesses, especially in the construction industry, have a substantial amount of work in Great Britain because of the decline in the construction industry. We did not want small businesses to have huge administrative costs imposed on them for differentiating where they made their profits. I welcome the proposal in the Bill that businesses based in Northern Ireland with 75% of their activity and employment there, will be exempt on all their profits. That should cover 99% of small businesses in Northern Ireland so there should not be administrative costs for small businesses.
Oil and gas is excluded from the legislation. I hope that very shortly, despite the endeavours of the Social and Democratic and Labour party Environment Minister, we will have a substantial oil and gas industry that can exploit the shale gas resources that we believe are buried under the ground in Northern Ireland. There may be some who play the populist line and say, “Let’s just keep those resources there. After all, they’re nasty CO2-producing fossil fuels.” I want them to be exploited for the benefit of the people of Northern Ireland and the United Kingdom. The profits from those companies would not currently be subject to the corporation tax arrangement, but I hope that if and when we develop such an industry, Northern Ireland will benefit from the kinds of promises that have been made to the north-east of England, including a sovereign wealth fund to take in part of the profits from those businesses and plough them back into public expenditure projects. I understand, however, why that has not been included at present.
On financial sector profits, there were two issues. I was not all that supportive of the argument about why those nasty banks, who nearly destroyed our economy, should benefit from reductions in corporation tax, paid for by reductions in the block grant. I understand the emotional rhetoric in that argument, but I am more concerned that the profits of banks and other financial institutions are much more volatile and more easily moved without detection than the profits of manufacturing or other companies. One has only to look at the difference between 2007-08 and 2008-09, when banks’ profits changed from £255 million to £45 million. That kind of volatility in tax revenue was a compelling reason why we should not include the profits of financial institutions in the Bill. I am glad that the Government have responded to that.
Ms Margaret Ritchie (South Down) (SDLP)
Like other right hon. and hon. Members, I broadly welcome the devolution of the power to vary the Northern Ireland rate of corporation tax. I cast my mind back to 2006, when I was a Member of the Northern Ireland Assembly while it was a shadow Assembly. My hon. Friend the Member for Foyle (Mark Durkan), who was my party leader at the time, appointed me to an all-party committee dealing with building and growing the economy in Northern Ireland. We took evidence, in sessions spanning a six-month period, from a range of people, some of whom were pivotal in raising the issue of the Northern Ireland Executive and Assembly having the ability to set our own rate of corporation tax. Central among them were the late Sir George Quigley, and Mr Hewitt from the Economic Research Institute of Northern Ireland. From the research that we carried out, we found that one of the impediments to a prospective Northern Ireland Executive setting corporation tax was the Azores judgment. We had to consider how the principle that it established could be circumvented so that we could achieve that power.
It was agreed in the committee’s report that other incentives were required to pump-prime the local economy. Chief among them were incentives in how small and large-scale developments were dealt with in the planning process. We said that we needed to equip our young people with skills and expertise, and that we needed manufacturing and industry to locate in Northern Ireland. I represent a constituency that was outside the area where foreign direct investment was located, and we said that we needed the visits that are normally the precursor to such investment. We wanted to see a balanced approach to regional development in the location of manufacturing, business, the financial sector and new types of infrastructure, so that we could underpin and grow our economy. Those factors remain the same and are still important to growing our economy.
As the shadow Secretary of State indicated, we still have a youth unemployment level of about 19%, and we still have a high level of economic inactivity. Our education and further education sectors are therefore important in making a contribution to growing our economy. Above all that, as my hon. Friend the Member for Foyle and the hon. Member for Upper Bann (David Simpson) said, is the need to ensure that our young people stay in Northern Ireland, are educated there, gain their vocational training and academic qualifications there, and invest that training, knowledge and know-how in developing our economy. Nobody would disagree with that.
Other measures are required because while we are a public sector economy, tourism is also a principal economic driver in my constituency. I have talked to the Minister about this on several occasions, but I repeat my request for a reduction in VAT on tourism and tourism products, which I see as a UK measure. Such a reduction would pump-prime the sector and create the necessary jobs. The economic modelling for such a change was carried out by the Treasury, so the research is available.
We also have the evidence of the south of Ireland, which—notwithstanding its economic difficulties—has been able to keep its rate of VAT on tourism at 9%, compared with ours of 20%. Representing a border constituency in the north of Ireland, I have many constituents who are involved in tourism and other businesses and have to compete with that VAT rate. That is extremely difficult with mobile investment and people who live in the north but work in the south, and vice versa. Those issues must be addressed.
Another issue within the remit of the Department of Enterprise, Trade and Investment and BT is proper and adequate access to broadband. Preference should be given to business centres so that they have immediate access to superhighway broadband, which they need to help build small to medium-sized businesses. That should be a priority.
I have several questions about the Bill. No doubt the details will be teased out in amendments to the legislation, but I also wish to raise them now. The Bill is 87 pages long and I have no doubt that it was drafted well in advance of the outcome of the Stormont House agreement. Is the engagement on the details between the Northern Ireland Executive, especially the Finance Minister, and Treasury Ministers still ongoing, or was the examination of the detail of the Bill carried out by the cross-ministerial working party on corporation tax? Or was the work solely done by the Treasury? I would also like to know what discussions were held with Northern Ireland authorities about applying the EU definition of small and medium-sized enterprises. We need clarity about the discussions and the agreement that was reached about the 75% threshold to be applied to determine what constitutes a Northern Ireland regional enterprise. We need that clarified in case any traps or restrictions are buried in the detail of the Bill.
At the moment, our principal economic lever is public expenditure and we all know that we face budgetary challenges, whether in the broader UK or in the Northern Ireland context. We all need to be aware of what will confront us down the road. My questions also concern implementation and the cost to the block grant. While the rate will be set by the Northern Ireland Executive and Assembly, what modelling and analysis did the Treasury do on the impact on jobs and the cost to the block grant of differential potential rates? I find it hard to believe that such work has not been carried out: if it has, when was it carried out and can that analysis be made available in the Library and that information be communicated to Members?
As a result of undertaking research for this debate, I know that way back in February or March 2011 the Minister came to Lisburn and presented a Government consultation paper, which stated:
“In order to meet the fiscal autonomy condition, the NIE would need to bear the full fiscal consequences of changes in tax revenues resulting from a new Northern Ireland corporation tax rate. This means that Northern Ireland’s block grant would be adjusted to reflect the fiscal costs of a reduction in the rate of corporation tax.”
Has any modelling been done in that respect? What specific work has been done?
The Treasury paper suggests that critics of corporate tax devolution have pointed out that receipts from corporation tax are one of the most volatile categories of tax revenue. As the Institute for Fiscal Studies has observed, over time they vary substantially more than total receipts or national income, and replacing an element of the block grant with these revenues carries a considerable risk to the devolved Administration. Has modelling been done in that respect?
About four months ago, in October 2014, Her Majesty’s Revenue and Customs published more detailed estimates for the shares of UK taxes arising in England, Wales, Scotland and Northern Ireland. Those estimates suggested that Northern Ireland’s share of corporation tax revenues had declined in the past few years and is now at about 1.2% of UK onshore corporation tax receipts. To increase those receipts and ensure they are invested in our local economy and in the businesses the hon. Member for East Antrim (Sammy Wilson) talked about, does the Minister not agree that there is a need to ensure not only that there is a greater regionally balanced location of foreign and direct investment, but that existing businesses are sustained in the local economy?
The Treasury paper also looked at the potential long-term impact of a cut in corporation tax boosting profits and consumption, thus increasing receipts based on consumption, and indicated that risks would be attached. It stated that if the tax cut failed to attract as much investment as expected, the Northern Ireland Executive would need to make up the difference. I am conscious of the challenging budgetary difficulties. Similarly, the risk associated with profit shifting from the rest of the UK would lie with the Northern Ireland Executive. Has that possibility been investigated fully, and what is the current prevailing view of the Treasury and the Northern Ireland Office? Have fluctuations in tax revenues for a small corporate base been factored in?
Professor Trench, professor of politics at Ulster university, gave evidence to the Northern Ireland Affairs Committee in 2011. He stated then that,
“to comply with EU law, a substantial and irrevocable cut in the block grant will have to be made, based on present tax receipts.”
Has that perspective been considered and is it reflected in the proposed legislation?
The hon. Member for Belfast East (Naomi Long) and the hon. Member for East Antrim referred to the issue of brass-plating, which has been factored into the Bill. I would hope that whatever is factored in is vigorous and robust. Chapter 17 relates to businesses excluded from claiming the new tax rate, including those lending and making investments, those undertaking investment management and those engaged in reinsurance. In addition, any back-office activity is excluded. What is meant by back office? The Bill does not say and just gives the Treasury the power to define it. It is a pretty fair bet, however, that some of the most mobile activities in the UK, such as accounting, data processing and even many call centres, will be back-office activities and so excluded. Further clarification is needed in that area.
In welcoming the Bill, I must add that we intend to table amendments in Committee to reflect our various concerns. We want a Northern Ireland economy that continues to grow and ensures that young people who have emigrated can come back and invest in the local economy, and that those with academic, degree-level educations or vocational training can deploy their skills and expertise in our economy for the betterment of the people. The litmus test for the Bill will be whether it brings continual benefit to the local population.
In conclusion, I welcome the devolution of corporation tax. I hope that, along with other incentives, it brings significant benefit to the people of Northern Ireland; that our local economy grows; that our people stay; and that business is underpinned and promoted. I can think of two areas in my constituency, Kilkeel and Warrenpoint, with significant entrepreneurial skill and activity. One is a harbour importing and exporting and the other is a fishing port seeking proper port status, because it is now involved in an initiative to utilise its marine and engineering skills. I hope that the Bill, along with other incentives from other Departments here at Westminster and in the Northern Ireland Executive, will achieve that better deal for the people I represent.
Stormont House Agreement
Baroness Ritchie of Downpatrick Excerpts(10 years, 9 months ago)
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Ms Margaret Ritchie (South Down) (SDLP)
I thank the Secretary of State for her statement. Can she possibly give us a little more detail on the specifics for the implementation of the legislation in the Chamber here in Westminster and in the Assembly? What particular legislation will apply to both? In relation to victims and the past, the detail is quite light. Many people will believe that the information sought in relation to inquests by those who have been deliberately affected—the victims and survivors—will not be met, because it falls far short of Haass and Eames-Bradley.
Mrs Villiers
I expect the House to receive news on legislation on corporation tax in the very, very near future. We are working on how the structure of legislation in the Assembly and Westminster on the rest of the package is precisely to be formulated. The procedures for review and monitoring are set out in paragraphs 73 to 75. In relation to inquests and the provision of information to families, it is crucial that we all work on this. The agreement has a commitment to reform. There is an acknowledgement that the current inquest system is not meeting the needs of the families effectively enough and not delivering the Government’s obligations under article 2 effectively enough. That will be a hugely important priority for the UK Government. We hope to work closely with the Department of Justice in the work that it will no doubt be doing on this.
Hallett Review
Baroness Ritchie of Downpatrick Excerpts(11 years, 3 months ago)
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Mrs Villiers
Let me take this opportunity to repeat the apology that I gave for the lack of transparency and the failure to discuss this scheme. I repeat my concerns about the way in which this scheme as a whole was run, including under my predecessors. I think that has been the cause of much of the distress to victims. The hon. Gentleman asks about the exact steps that will be taken to ensure that errors are corrected and problematic cases dealt with. I counsel against statements of that sort at this stage. We need to be careful to ensure that there is nothing that could be said in haste, which might end up hindering rather than helping a future prosecution. As soon as I am able, I will give further information on how we intend to implement the recommendations. Today, we need to be careful about commenting on specific cases and how they will be dealt with.
Ms Margaret Ritchie (South Down) (SDLP)
I thank the Secretary of State for her statement. We must never forget the victims and the survivors who have suffered. This whole sorry debacle has left a sour taste in the mouths of many people throughout Northern Ireland. Will the Secretary of State confirm that there must be a redoubling of efforts to get back to the talks table to discuss those outstanding issues of the past—parading and flags—and will she confirm that she will come back to this House to explain how she intends to implement those recommendations from Hallett?
Mrs Villiers
I am certainly happy to come back to the House to discuss the implementation of the Hallett recommendations. The hon. Lady will know that I fully support the all-party talks and agree on the importance of their resumption. She will also know that the Prime Minister shares that view, because she will have heard that in her conversation with him yesterday.
Oral Answers to Questions
Baroness Ritchie of Downpatrick Excerpts(11 years, 3 months ago)
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Dr Murrison
Through the noise I think I just about made that out, Mr Speaker. I am sure that Hansard will record it accurately and that my right hon. Friend the Secretary of State will take note of it for her next meeting with the Minister for Education.
Ms Margaret Ritchie (South Down) (SDLP)
8. What recent progress the Government have made on reducing youth unemployment levels in Northern Ireland.
The Parliamentary Under-Secretary of State for Northern Ireland (Dr Andrew Murrison)
Tackling youth unemployment remains a critical issue, but specific measures to address it in Northern Ireland are the responsibility of the Executive. The Government are reducing the largest structural deficit in UK peacetime history, and that, more than anything, will help deliver a sustainable economic recovery and so directly assist young people to get into employment.
Ms Ritchie
I welcome the new Minister to his position. Almost one in four young people in Northern Ireland are out of work. Many are forced to seek agency jobs on zero-hours contracts, while others are taking the path to emigration because of the downturn in the construction industry. Will the Secretary of State and the Minister have discussions with the Chancellor about the need to reduce VAT on tourism, as such a reduction would provide an opportunity for these young people to remain in Northern Ireland, working in tourism attractions and so on?
Dr Murrison
I am grateful to the hon. Lady for that. She will of course have seen today’s figures, which show that although youth unemployment in Northern Ireland is 20.4%—that is too high—it has dropped by 2.1% over the quarter. I am sure she will warmly welcome both that and the drop by 1% to 6.7% in the overall level of unemployment in Northern Ireland—the 18th successive drop in the claimant count. I hope she warmly welcomes that, as right hon. and hon. Members from across the House certainly will.
Oral Answers to Questions
Baroness Ritchie of Downpatrick Excerpts(11 years, 4 months ago)
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Mrs Villiers
In reflecting on how to build a shared society, it is important for the Northern Ireland Executive to look not just at the traditional divisions in Northern Ireland’s society, but at how more can be done to integrate and support minority communities in Northern Ireland. One way in which they can do that is by providing leadership and condemning the attacks that have taken place.
Ms Margaret Ritchie (South Down) (SDLP)
There has been a recent announcement about the resumption of inter-party talks, which will deal with issues that are a barrier to building a shared future: flags, parades and dealing with the past. Will the Secretary of State outline what she and the British Government will do to ensure that those talks are brought to a successful conclusion and what her exact role will be?
Mrs Villiers
I will continue to urge all the parties in Northern Ireland to engage in the discussions on flags, parading and the past. The Prime Minister is also taking a close interest in that, with his article in the Belfast Telegraph making a strong argument for pressing ahead with an agreement for the sake of the future of Northern Ireland. Both he and I have had several conversations with Northern Ireland’s leaders in recent days. We will continue to encourage, support and facilitate the discussions between party leaders and work in a co-ordinated way with colleagues in Dublin and Washington, who are of course also interested in these matters.
Northern Ireland (Miscellaneous Provisions) Bill
Baroness Ritchie of Downpatrick Excerpts(11 years, 7 months ago)
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Mr Robathan
Lords amendment 1 is the first of a number of amendments made in another place at the Government’s behest following extensive discussions there. They follow changes we made to the draft Bill after discussions in this House’s Northern Ireland Affairs Committee. I hope that it can therefore be said that we have listened to people during the passage of the Bill and that it has been improved as a consequence.
Lords amendment 1 limits any reduction in the size of the Northern Ireland Assembly to one Member for each constituency—from six to five. It also requires that any such reduction must have cross-community support in the Assembly. In the other place it was correctly pointed out that under the Bill’s previous provisions the larger parties in the Assembly could legislate to reduce its size by a substantial number. The House of Lords was of the view that there would be limited safeguards to prevent them so doing.
Many in Northern Ireland believe that, with 108 Members, the Assembly is too large, but it is not the Government’s intention that the Assembly should shrink dramatically. When it was established, the intention was that it should be a widely inclusive body, which is essential to the healthy functioning of the Northern Ireland settlement. The Government therefore tabled this amendment to ensure that the drafting of the Bill better reflects that policy. We hope that the Assembly will carefully reflect on the possibility of reducing its size at a time when spending in all parts of the public sector is under pressure.
We are, of course, leaving it to the Assembly to decide whether to reduce its size, and the amendment confines any reduction to one Member per constituency. If the Assembly decides to take that up, smaller parties and minority voices will still be well represented. I trust that the House will agree that these are welcome amendments.
Ms Margaret Ritchie (South Down) (SDLP)
My colleagues and I are comfortable with Lords amendments 1 to 3, which we think are sensible, so we will not oppose them. Any reduction in the size of the Northern Ireland Assembly should quite rightly be a decision for that Assembly. As an MP who no longer sits in the Assembly, like some of my Northern Ireland colleagues sitting behind me, I agree that any reduction in its size should be voted on by the Assembly, rather than imposed from here.
Although my party agrees that there is a case for reducing the number of Members of the Legislative Assembly at some stage, any discussion of that must take into account the sensitive local considerations. Such a move might be inadvisable at the current time. We firmly believe that any change to the Assembly’s composition must be guided by the principles that it should be representative, proportionate and reflective of both traditions in the wider community.
As Baroness O’Loan said in the other place, reducing the number of MLAs returned to each constituency could have serious consequences for representation in Northern Ireland. We must always be careful not to leave certain areas unbalanced or unrepresentative. We have a clear interest in retaining plurality of representation and must pay keen attention to factors that are specific to Northern Ireland when making these decisions.
We have also made it clear that we are concerned about the increasing concentration of power in the hands of two parties. We would be cautious about any measure that might exacerbate that situation. For that reason, we support the measure to ensure that the Secretary of State requires a cross-community vote in the Assembly before any legislation to reduce its size can be passed. That cross-community element is embedded in the Good Friday agreement of 1998 and the consequential Northern Ireland Act, which was passed in July that year. Embedded in that Act were the principles of proportionality, mutual respect and understanding. Given the unique circumstances in Northern Ireland, and given that we do not wish to exacerbate the situation, we feel it would be better if those principles were embedded in the size of the Assembly. I am therefore happy, on behalf of my colleagues, to support the amendment.
Mr Nigel Dodds (Belfast North) (DUP)
Our party strongly supports reducing the size of government generally in Northern Ireland—and across the United Kingdom for that matter—including the number of Government Departments in Northern Ireland. We are also on record as wanting to see a reduction in the number of Assembly Members. We believe that Northern Ireland can function more efficiently and in a leaner and better way with fewer politicians for the size of its population.
In May there will be elections to new councils in Northern Ireland, the number of which will have been dramatically reduced from the present number, and the number of councillors will also be reduced. We are in favour of the general thrust to reduce the size of government, and we have already put proposals to the Assembly’s Assembly and Executive Review Committee on that issue.
When the Minister responds to the debate, will he comment on the consultation that took place with the Assembly parties on the amendment? Although, under the amendment, the decision to reduce the number of MLAs can be taken by the Assembly, it can reduce the number by only one for each constituency—from six to five. I would certainly be very interested to know to what extent the Government consulted on that provision with the Assembly parties, because it has been generally understood that the measures that would come before the House would have the broad consensus of parties in Northern Ireland.
Stephen Pound (Ealing North) (Lab)
Inspired, as ever, by the wondrous words of the hon. Member for Strangford (Jim Shannon), I can only say that I am sure the Deputy Prime Minister, were he present, would say that he not only loves the people of North Down, but adores the people of South Down—in fact, of all the Downs—and that he would almost certainly express his adoration and passion for the whole of northern Europe, nay the globe. For the record, may I say on behalf of Her Majesty’s Opposition that we have immense respect and affection for the people of North Down and, if you will allow me, Mr Deputy Speaker, especially for their elected representative, the hon. Member for North Down (Lady Hermon)?
I apologise, Mr Deputy Speaker, that my hon. Friend the Member for Bury South (Mr Lewis) is not in the Chamber. He is currently gliding smoothly into Dulles airport for what used to be the St Patrick’s day celebrations, but are now the St Patrick’s fortnight celebrations. He has assured me that he will watch this debate with keen interest. I have no doubt that when the party starts in the White House, he will demur from any invitations in order to watch it on catch-up.
Mr Deputy Speaker (Mr Lindsay Hoyle)
Order. As much as I am enjoying the entertainment—I allow a little scope, but I am not sure how far that scope will take me to airports around the world—I think that the hon. Lady does not wish to intervene now, and I want to hear the hon. Gentleman get to at least some of the Lords amendments.
Mr Dodds
I do not know whether the hon. Lady will seek to catch your eye, Madam Deputy Speaker, but she makes a good point. I look forward to the Minister responding to it. As she says, the amendment mentions “internationally accepted principles” and their application vis-à-vis national human rights bodies. Her point is valid. The amendment says that not only the independence of the Northern Ireland Human Rights Commission is a matter for the report, but the relationship between the commission and the Assembly.
Given that the clause is a small provision—it simply provides an enabling power, which the Order in Council will implement—on what basis will the report be compiled? Will there be an investigation? Will there be an Assembly inquiry, with evidence being taken on how the measures operate? If it were devolved, it would be a matter for the Assembly, so what would be the purpose of reassuring ourselves in this House and in the other place about all these matters three months prior to a debate?
Ms Ritchie
I support the amendments and I understand the points that have been raised by the right hon. Member for Belfast North (Mr Dodds) on their reasoning and the rationale behind them. In relation to the Northern Ireland Human Rights Commission and the civil service commissioners, the amendments are sensible. It is right that before any discussion of the future devolution of these elements, proper consideration is given to the impact on the impartiality of the civil service.
I well recall the considerable discussions in 1988 and 1989 in this House and the other place on the advances to be made on ensuring there is respect for people in workplaces and on fair employment. References were made then to the need to respect the merit principle in private sector organisations above a certain level of employee. Comments were also made about the Northern Ireland civil service and the need for impartiality, fairness and due participation across the community if we were to build a society that was reflective of and proportionate to the wider Northern Ireland. I see the amendments in that context.
It is important that any report on the Northern Ireland Human Rights Commission pays regard to the importance of its independence in conforming to internationally recognised standards and maintaining a balanced relationship with the Assembly. In that respect, I regret that the Government have not seen fit to introduce a Bill of Rights in Northern Ireland. There has been considerable discussion and indeed, some months ago, the hon. Member for Belfast East (Naomi Long) sponsored the visit of the Northern Ireland Human Rights Consortium to discuss the need for such a Bill—and the impetus within the wider community for it—that would enshrine the rights of all in legislation. Such a Bill is still urgently needed. It cannot be covered by a UK Bill of Rights. There are rights that are peculiar to Northern Ireland, which has a particular political situation that needs to be recognised. I regret the fact that the Government did not see fit to introduce a Bill of Rights that could have run concurrently with the Bill through both Houses. I ask the Minister to reflect on that issue when he sums up, to talk to his colleagues in government, and to ensure that such legislation is introduced.
I know what the Minister’s response will be. He will say that such a Bill would need the support of all parties in Northern Ireland, but I can tell him that the idea has received considerable support among the wider community in Northern Ireland, with considerable impetus behind a Good Friday agreement based on the principle of consensus and agreement. I think he would also find such support here. I hope that the Minister will reflect on the need for a Bill of Rights.
This is our last opportunity to discuss a Bill which, although short, is important to Northern Ireland. I have only one regret. During the Bill’s earlier stages, we were concerned about the lack of transparency surrounding the issue of an increase in the Assembly’s mandate from four to five years. On Second Reading I described the issue as a mystery, because it was never resolved. I would not like to think that that was part of a secret deal between two principal parties in the Northern Ireland Executive and the British Government. Yet again, I ask the Minister to clarify that issue.
Other issues relating to Haass have been raised during the Bill’s passage. My hon. Friend the Member for Foyle (Mark Durkan) raised the issue of the Historical Enquiries Team, and asked how there could be more coherence in inquiries so that patterns and trends that emerged could be dealt with. In that connection, a book called “Lethal Allies”, about the Glenanne gang, was published recently. A pattern emerged in the type of activity involved in murders of that kind. We felt that those issues could have been reflected in the Bill.
All of us who represent Northern Ireland constituencies and take our seats here want a just and lasting settlement for everyone which is based on our moving on. It is interesting to note that Richard Haass, who spent six months in Northern Ireland drawing up proposals on reconciliation, on the past, and on flags and emblems, said today in a United States congressional committee that he wanted Northern Ireland to move on. He has expressed his fear that it could slip back into the violence of its troubled past if we, as politicians, do not grasp the opportunity to deal with divisive issues. I believe that that opportunity exists now, and that we should move forward.
I believe that there should be no more secret deals, no more on-the-run letters, and no more get-out-of jail passes, as I think they were termed by the right hon. Member for Belfast North (Mr Dodds). We must move forward on the basis of transparency, openness, fairness, equality and proportionality for all. The amendments will take us a step further towards fair representation, and a consensual approach to politics and to dealing with issues that still need to be addressed in Northern Ireland.
Jim Shannon
I want to make a couple of brief comments about the civil service commissioners and the Human Rights Commission.
Northern Ireland has had its own civil service since the 1920s, and, as others have said, it has done admirably over the years. The Northern Ireland civil service itself is and always has been a devolved matter, but in 1998 it was decided not to devolve the civil service commissioners at least for the time being. Like their Whitehall counterparts, they are responsible for ensuring that appointments to the civil service are made on merit, and on the basis of fair and open competition. I believe that the amendment will ensure that by requiring the Secretary of State to present a full report to the House, so that all will be open and transparent before any devolution takes place, and I therefore support it.
Ms Ritchie
I thank the Minister for giving way again. Further to the intervention of the hon. Member for Belfast East (Naomi Long), where in clauses 4, 5 or 6 is it specified that there will be consultation? Reference has been made by the Minister to consultation, but the Bill does not actually say that.
Mr Robathan
The reason for our discussion now is the amendments to the clauses. We are having a debate on the Floor of the House of Commons to discuss those matters. I am telling the hon. Lady that there will be consultation, whatever it says in the piece of paper in front of her. The point of the report is to inform parliamentarians of the Secretary of State’s view about the effect of devolution after consultation. She will not come to that view without having consultation. If there is agreement, there is not necessarily a requirement for debate; if there is some disagreement, there would be a requirement to debate—but we are aiming for consensus. The point made by the hon. Lady about what is actually written down in the amendment is somewhat spurious.
Ms Ritchie
I have to say, and my colleagues across the parties in Northern Ireland who sit here would agree, that the legislation would normally state whether there was to be consultation, so that that consultation could actually take place. No one was trying to say one thing, but to do the other.
Mr Robathan
I say quite categorically that the purpose is to allow the Secretary of State to consider the issues transparently, engendering trust, which has been mentioned. There will be consultation—I can assure the hon. Lady of that.
Let me deal with something else the hon. Lady mentioned. I was surprised she said that human rights in Northern Ireland were different from human rights elsewhere, as I seem to recall that human rights are usually referred to as being universal. Although there are sad and particular conditions in Northern Ireland, I do not think that the human rights of an individual there are any different, and nor should they be treated differently, from those of somebody elsewhere. We have the Human Rights Act 1998 in place, and if all parties in Northern Ireland wish to propose some special legislation at the Westminster Parliament, we would of course consider it, but I see no need for such a thing, and I have never heard anybody suggest there was a need before.
Ms Ritchie
May I suggest to the Minister that a Bill of Rights is required in Northern Ireland to deal with the special circumstances that exist in Northern Ireland? There may not necessarily be cross-party consensus, but there is a need for that Bill of Rights to deal not only with issues of the past, but those that have an impact on the present and the future.
Mr Robathan
I will take that suggestion away and consider it, but I have not heard that from anybody else in the four or five months I have been doing this job.
This has been a rather longer summing up than I expected and, on that note, I shall conclude.
Oral Answers to Questions
Baroness Ritchie of Downpatrick Excerpts(11 years, 8 months ago)
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Mr Robathan
May I just say that the programme a “Game of Thrones” is made in Belfast now? I do not recommend it personally, Mr Speaker, having watched the lot.
We are taking steps on the digital economy and indeed, throughout the United Kingdom, we are going for digital by default. We are very keen that more is done in Northern Ireland in terms of the use of internet and digital in general. We are very clear about that, but this matter is the responsibility of the Northern Ireland Executive and we help them with it through the economic pact.
Ms Margaret Ritchie (South Down) (SDLP)
Contrary to the views of the Minister, and given the importance of public sector jobs to the local economy, what further measures will be taken to protect and retain Driver and Vehicle Agency jobs in Northern Ireland as well as Her Majesty’s Revenue and Customs jobs in Newry?
Mr Robathan
The hon. Lady, for whom I have a great respect, has raised this matter with me before. What I would say about both public agencies is, first, they are not our responsibility: the DVA is, of course, the responsibility of the Department for Transport; and HMRC is the responsibility of HMRC. However, I would also say that we need to see in Northern Ireland and elsewhere—this refers to the last question—
The Prime Minister
My hon. Friend makes an important point. Right across this House, many experts have been saying that what we need is a balanced recovery—one that sees increases in exports as well as increases in consumption, and one that sees increases in investment from business. The uprating of the GDP figures showing an increase in exports, and, as he says, a very large increase in business investment, is hugely welcome for our country.
Ms Margaret Ritchie (South Down) (SDLP)
Q8. Given yesterday’s court revelations of a secret scheme, does the Prime Minister believe that, as well as the parties in Northern Ireland progressing the elements on dealing with the past from the Haass talks, there is a need for transparency from the two Governments regarding the confused and shabby ways in which they sought to deal with the past since the agreement, remembering that Downing street was involved in this matter?
The Prime Minister
I agree with the hon. Lady that the Haass talks made some good progress. They were trying to deal with some of the most difficult issues in Northern Ireland, in terms of flags and parades, and perhaps the most difficult issue of all, the past. It is going to take a lot of courage and bravery from people on all sides in order to make progress in this way. She wants to point the finger, apparently, particularly at Downing street. I would argue that, when it has come to dealing with things like the Bloody Sunday inquiry and the de Silva report, Downing street is very happy to play its role in helping to bring parties together to make sure that we continue with peace in Northern Ireland.
Oral Answers to Questions
Baroness Ritchie of Downpatrick Excerpts(11 years, 9 months ago)
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Mrs Villiers
There is much to be said for the proposals on parading in draft seven of Richard Haass’s work. It is disappointing that the parties have not felt able to agree with those proposals as yet. Further work is clearly needed before we can get an agreement among the five parties. I urge them to see whether they can find a way to resolve their differences, including on the issue of a code of conduct and what sanctions should accompany it.
Ms Margaret Ritchie (South Down) (SDLP)
8. If she will hold discussions with the responsible Minister in the Northern Ireland Executive on the number of middle-grade accident and emergency doctors in Northern Ireland; and if she will make a statement.
The Minister of State, Northern Ireland Office (Mr Andrew Robathan)
First, may I say how much I appreciated the hon. Lady’s contribution to the meeting we had yesterday with the disabled police officers in Northern Ireland, to whom we owe a great deal?
I understand the hon. Lady’s concerns about the issues she raises but these are entirely devolved. [Interruption.] The commissioning and provision of medical services in Northern Ireland are matters for the Minister of Health, Social Services and Public Safety in Northern Ireland and the Health and Social Care Board. [Interruption.]
Mr Speaker
Order. There is far too much discordant noise in the Chamber. The question must be heard and the Minister’s answers must be heard.
Ms Ritchie
I thank the Minister for his answer, but he and the Secretary of State need to be more proactive on this matter because the policy that dictated the lack of A and E doctors emerges from Whitehall and London. Will he and the Secretary of State co-host with the responsible Minister in Northern Ireland a summit to address the shortage in A and E doctors?
Mr Robathan
Well, we will certainly ensure that we have discussions with the responsible Minister in Northern Ireland. We have had to take some very difficult decisions since 2010, but there are now more than 20% more A and E consultants in England than there were in 2010. We need to go further, but it does take six years to train a doctor and I think all Members, even those on the other side, will have spotted that we were not in power six years ago.
Haass Talks
Baroness Ritchie of Downpatrick Excerpts(11 years, 9 months ago)
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Mrs Villiers
The timing envisaged for the commission on identity and flags is around 18 months. I have always thought that there might be scope for the development of new shared emblems, and I hope that that will be considered seriously by the new commission, if it is set up. I genuinely think that there are merits in trying to have a broader conversation with civic society about moving forward on the issues of culture, identity and tradition that have proved so intractable up to now.
Ms Margaret Ritchie (South Down) (SDLP)
May I thank the Secretary of State for her statement, and associate myself with the remarks about the late Paul Goggins? He represented the epitome of compassion, humility, decency and integrity in this House, and during his time as a Minister in the Northern Ireland Office and the Home Office.
On the Haass talks, I pay particular tribute to my hon. Friend the Member for Foyle (Mark Durkan), and to Alex Attwood and Joe Byrne, who formed a sterling team at the talks on behalf of the SDLP. In view of the compelling need of victims and survivors, it is important that an implementation plan is put in process. Will the Secretary of State and the Minister of State take an active interest in ensuring that immediate discussions take place with the five parties to ensure that legislation, implementation and a resolution are found for those whether two people I talked to last week: one whose father was killed as a result of the activities of the military reaction force; and a widow whose husband was a policeman in Northern Ireland? Those people came from different perspectives, but they were suffering none the less owing to their tragic and sudden loss.
Mrs Villiers
I reiterate the tributes paid to all participants in the working group, including the right hon. Member for Lagan Valley (Mr Donaldson). Despite the fact that an agreement has not yet been reached, a remarkable amount of consensus has developed between the parties. We must build on that, and ensure that this is not a wasted opportunity and that the parties can get together again to resolve the remaining issues that divide them. On an implementation plan, as I have said already at the Dispatch Box, if agreement is forthcoming, of course the UK Government would be keen to provide support and advice on the practicalities of implementing the proposals across the three areas.
Oral Answers to Questions
Baroness Ritchie of Downpatrick Excerpts(11 years, 11 months ago)
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Mr Robathan
The hon. Gentleman raises a very important issue, and I agree with him, of course. That is not the specific responsibility of the Northern Ireland Office; it is more for the Treasury and the Department for Business, Innovation and Skills. However, I absolutely support what he says. Everyone in the Chamber should deprecate the actions of any bank that has been pushing small businesses out of business.
Ms Margaret Ritchie (South Down) (SDLP)
9. As part of the need to address worklessness in Northern Ireland, will the Minister have immediate discussions with his ministerial colleagues in the Treasury to address the issue of the closure, in March 2015, of Her Majesty’s Revenue and Customs centre in Newry, which makes a major contribution to the local economy in the southern part of my constituency? Will the Minister meet my colleagues and me to discuss that important issue?
Mr Robathan
I am happy to meet the hon. Lady and her colleagues. We should be clear that any redundancies in HMRC in Newry are voluntary. Nobody likes to see people lose their jobs be it voluntarily or otherwise. However, I say gently to her that the way in which people do business with HMRC and other Government agencies is changing, with much more being done online. I think she would agree that the most important thing is that customers of HMRC—the taxpayers—get a decent service. It might be the case that by doing business online there is less need for the current number of employees.