Devolution and Growth across Britain

Jim Shannon Excerpts

Wednesday 3rd June 2015 Commons Chamber

[Sammy Wilson (East Antrim) (DUP)]

I welcome this commitment in the Queen’s Speech:

“To bring different parts of our country together, my Government will…bring about a balanced economic recovery.”

That is, first of all, essential economically, because, if we are to avoid certain parts of the economy overheating while resources lie idle in others, we will need to take that balanced approach. Secondly, as a Unionist, I believe it is essential politically, because nationalist parties in Northern Ireland, Scotland and Wales are good at exploiting economic grievances—or perceived economic grievances. Therefore, it is very important that together we have an economy that is growing.

Unfortunately, the Government’s record over the previous five years has not been one of promoting a balanced economy. Yes, there have been successes—we have seen economic growth and an upturn in the economy—but it has not been universal across the United Kingdom. There are still parts where unemployment is high, where there is huge dependency on welfare and where there is still very little economic growth. It will be interesting, therefore, to see how that promise is put into practice.

Devolution is one of the ways it can be done. In Northern Ireland we have been working at coalition government with five parties—which makes the coalition Government here in Westminster look like a love-in, because we have been dealing with people who are, quite frankly, almost impossible to work with. Despite that, with the powers we have had we have kept unemployment in Northern Ireland at this stage of the economic cycle at a level that would not have been experienced in the past. We have promoted the best inward investment of any region in the United Kingdom, and we have built more social and affordable housing, despite the cuts in capital budgets, by using resources and selling assets.

[Jim Shannon (Strangford) (DUP)]

All that is threatened by the abstentionist policy of Sinn Féin, who do not take their seats here, and by the SDLP, who do. They object to the welfare reform proposals that have been introduced. Does our economic course in Northern Ireland depend on the settlement of that process in Northern Ireland?

[Sammy Wilson]

It is jeopardised by some actions of the coalition partners, and I want to get a commitment from the Government on that issue.

In my experience over the past five years, when a case has been made for additional powers for devolved government, the Government have responded. We have seen the limited devolution of air passenger duty to the Northern Ireland Executive; the promised devolution of corporation tax, which my hon. Friend says is now being put in jeopardy; the exemption from the carbon price floor because of the structure of our energy market; flexibility over budget spending; and carry-forward powers. All those things have been good, positive ways in which the Government have responded in the past. I look forward to working with them, given the commitment shown in the Queen’s Speech.

During the election, we presented our Northern Ireland economic plan. It includes a range of measures, some of which require additional spending, changes in legislation and co-operation between central Government and the devolved Government, but they are all designed to help Northern Ireland reduce its dependency on the public sector, grow the local economy and increase the private sector. I look forward to working with the Government in implementing those plans and testing their commitment to using devolution to promote uniform growth across the United Kingdom.

Although some central Government policies might make sense in the wider UK context, they have a disproportionate impact on parts of the economy that, because of our structural differences, the historical difficulties we have experienced and our geographical disadvantage, are not robust or that are different and therefore require different treatment.

I am interested in the promise in the Gracious Speech to introduce legislation to give effect to the Stormont House agreement in Northern Ireland. It is a very important agreement because it is about not just implementing welfare reform, but devolving corporation tax and giving the Northern Ireland Executive the power to borrow in order to effect structural changes in the public sector. It is also about getting additional funding for infrastructure developments and the ability to pay off previous loans by having flexibility in our spending arrangements.

A lot is at stake with the Stormont House agreement, and yet it has been put in jeopardy by the refusal of the Social Democratic and Labour party and Sinn Féin to implement one important aspect of it, namely welfare reform. Despite the fact that, in an Assembly vote, the vast majority of Members voted to put through the agreement and welfare reform part of it, because of our constitutional arrangements in Northern Ireland and the requirement for a cross-community vote, it has been blocked. As a result, not only have many of the important things that would have been available to the devolved Government been stopped, but we have a hole in this year’s budget of more than £600 million—or 6% of the budget—which is fiscally impossible to repair at this time.

If the situation persists, there is one power that the Government must bring back to this House. It will disadvantage the people of Northern Ireland because the concessions will be lost, but we cannot afford for welfare reform to be a blockage to all the other changes. Although we are talking about devolving more powers, if parties persistently refuse to implement the welfare reform package—which I suspect most Members of this House would be jealous of because of the concessions Northern Ireland has been given—I appeal to the Government to take that power back.