Budget Resolutions and Economic Situation

Lord Elliott of Ballinamallard Excerpts

Wednesday 16th March 2016 Commons Chamber

[Tom Elliott (Fermanagh and South Tyrone) (UUP)]

It is interesting to witness the Budget unfolding in the Chamber today, because, in years past, I have watched the Chancellor deliver his speech from the comfort of my own home, or read about it in the papers the next morning. There is almost a sense of anti-climax this afternoon. I remember huge controversies around the Budget, particularly some years ago when there were huge increases in income tax, but I do not see that so much now, as we seem to have a slightly more settled economy. We have seen much less controversy in the Budget not just for this year, but for the last number of years, and if we look at some of the empty Benches in the Chamber, we can see that perhaps there is something in that. Like all financial statements, there are some good parts and some bad parts, and that has been recognised even on the Opposition Benches.

First, let me highlight some of the significant investments that are going into the English regions. I guess that much of that will not be a huge benefit to Northern Ireland, or indeed to Scotland or Wales. Of course, those regions are getting some of their own financial benefits as well.

One aspect that I have been looking at is the £700 million that has gone into flood defences in England. I just wonder whether there will be Barnett consequentials around that for Northern Ireland, or indeed for Scotland or Wales, as those regions have suffered significantly from flooding as well. In my constituency of Fermanagh and South Tyrone, one person sadly lost their life in the flooding this winter. Many people in my constituency were severely affected by the flooding, and I am sure that it was equally as bad in other areas. I am keen to know whether there will be Barnett consequentials around that £700 million that will come to the Northern Ireland Executive.

[Mr Angus Brendan MacNeil (Na h-Eileanan an Iar) (SNP)]

The hon. Gentleman raises a good point. The Barnett consequentials are a consequence of a need in England. If there is a need in Northern Ireland, Wales or Scotland, the Treasury does not react to that need. We have to wait until there is a need somewhere else before we get the money. It is our taxes as well. When we have a need, we should get the money. If there is a need in Northern Ireland, the consequentials should follow to the other nations, but that never happens. It is always about need in England, and the rest will take what comes of that.

[Tom Elliott]

I appreciate the hon. Gentleman’s intervention. Perhaps he is explaining some of the Treasury’s rationale on this. I do not know whether there has been any co-operation on this, but he does seem to be offering some kind of explanation.

The devolution of corporation tax to Northern Ireland has been a live issue for at least eight years, perhaps even longer. I assume that the proposal for a reduction in corporation tax to 17% in the UK, will mean that, with our 12.5% rate in Northern Ireland, we will have a lower overall reduction in our block grant. Some argue that if the UK decides to leave the European Union in the forthcoming referendum there may not be any reduction at all in the Northern Ireland block grant to reflect the fact that our corporation tax is devolved, simply because the Azores ruling does not come into effect. I am interested to hear the debate about that, because it is an issue that we have already raised with the Prime Minister.

One measure that I really welcome for Northern Ireland is the £4 million investment in an air ambulance. I have personally lobbied for that for quite a long time. Northern Ireland is the one region in the United Kingdom that does not have an air ambulance and that support mechanism. I thank the Treasury for that. It will be a great memorial for the family of the late Dr John Hinds who lost his life campaigning for an air ambulance. He was a great motorcycle enthusiast, and his campaign will hopefully now come to fruition. It is also good news for those currently involved in the air ambulance campaign, including my constituent, Mr Rodney Connor, who has been a great campaigner in that respect.

[Pat Glass]

It is really good that there will be an air ambulance supported by Government money in Northern Ireland, but does he not agree that the same should apply to all other regions? In my area, the north-east, the air ambulance service is funded entirely by charity.

[Tom Elliott]

Perhaps we in Northern Ireland have done a better job of lobbying the Government than the north-east has, and it is entirely up to the hon. Lady to take up that challenge. I am proud of what we have done in Northern Ireland and I thank the Government for that.

I also welcome the freeze in fuel duty, which affects Northern Ireland greatly. I know that there has been an argument for some years about the devolution of corporation tax levies in Northern Ireland, but I believe that an equally important duty that we could have devolved to Northern Ireland is that on fuel, for a number of reasons. As we have a land border with another European nation, the Republic of Ireland, a huge amount of fuel is purchased in the Republic and the UK Treasury and Government lose that tax because it is not coming into our economy. The second and more important point is the level of fuel laundering in Northern Ireland in the border regions. The fuel that is laundered is sold at a much cheaper rate, and sometimes even at the same rate, as proper fuel. That is having a huge impact on our vehicles and our economy and also means a huge loss to the Treasury.

I want to see more effort, particularly from HMRC. We received a response to a freedom of information request that showed that in a short period almost 500 fuel filling stations in Northern Ireland were found to be selling illegal fuel. Not one of those filling stations has been named, not one has been charged or convicted of any offence, but if some poor person has bought some of that fuel and is found to be carrying it, they will be fined immediately. There are on-the-spot fines. A huge wrong is being committed and I want the Government to take that up. I have tried earnestly in Northern Ireland to rectify the situation through HMRC, but there appears to be a reluctance to deal with it. Decommissioned laundering stations have been found many times, but they have been operational for many years and it seems that as soon as they are reported, they are decommissioned. HMRC cannot get to the bottom of that. That is one point on which I would appeal and it is why it is important that fuel duty in Northern Ireland has not been increased.

I welcome the opportunity to speak in the debate and genuinely and earnestly thank the Government for their support on the few issues I have described, but I want them to consider the Barnett consequentials to support Northern Ireland and the other regions as they are supporting the English regions.