amendment of the law

Naomi Long Excerpts

Monday 25th March 2013 Commons Chamber

[Naomi Long (Belfast East) (Alliance)]

All of us who sat in the Chamber throughout last week’s Budget statement will be acutely aware of the context in which this debate is taking place. Global economic conditions remain extremely challenging and the impact on the UK economy has led to the downgrading of many of last year’s Budget predictions.

The people we represent, who listened to the statement outside this place, were realistic about the Budget, but they also hoped for measures that would encourage inward investment and growth; give businesses confidence and access to finance to create new jobs and help grow their export markets; ease the pressure on family budgets and small businesses alike; tackle inequality in society; and stimulate desperately needed growth.

Although talk of an aspiration nation is great rhetoric and a worthy aim, it is the job of Government not only to ensure that people are encouraged to have aspirations, but, if there is to be real improvement, to create the context in which they have the opportunities and support to fulfil them.

In the brief time available I want to focus on a few aspects of the Budget, welcoming some of the positive measures and highlighting a number of areas where more could be done.

I commend the Government for upholding their commitment to spending 0.7% of gross national income on international development. Given the current economic climate, it is understandable, though regrettable, that, despite the fact that this allocation represents a small fraction of overall Government expenditure, it comes under continuing pressure. However, by standing by the commitment, the UK is showing leadership in the international community. Aid well spent is a powerful tool to tackle severe global poverty, to assist some of the poorest nations in becoming more self-sustaining and to support global justice, human rights and security. Moreover, although it is spent abroad, it also contributes to protecting our own national interest.

In that vein, I also welcome the fact that at the same time as the Treasury is seeking to tackle tax avoidance in the UK—which we all welcome—it has also committed to prioritising dealing with international tax avoidance by UK companies, which is depriving many nations from the transition from aid to trade. I hope that it will be robust in its actions.

I also welcome the increase in the personal tax allowance, which will lift many of those in the lowest paid employment out of tax altogether. If it were part of a package of measures to tackle poverty more comprehensively, it would be even more welcome. However, as I noted last year, as an anti-poverty measure it is neither the most effective nor the most targeted approach. Although the poorest working families will benefit, raising the personal allowance will also benefit many others.

In the time remaining, I want to comment briefly on measures that will impact on Northern Ireland in particular. I welcome the reduction in corporation tax, which is a particularly sensitive issue given our land border with the Republic of Ireland, where corporation tax is significantly lower at 12.5%. Although it would not be a silver bullet, the devolution of corporation tax has been identified by industry, the Northern Ireland Affairs Committee and the Northern Ireland Executive as an important tool in stimulating the economy and attracting inward investment. The UK-wide reduction, though modest, is a step in the right direction and will also lower the potential cost to the Northern Ireland Assembly should this tax power be devolved, as many of us wish. It is disappointing that that devolution was not announced in the Budget. I trust that the Prime Minister will have more positive news for the First and Deputy First Ministers when he meets them to discuss the matter tomorrow.

[Mr Nigel Dodds (Belfast North) (DUP)]

The hon. Lady can be assured that virtually all the Northern Ireland Assembly parties support what she has just said. Does she agree that it is important that their meeting with the Prime Minister tomorrow has the endorsement of all major business groups, major community groups and people who are concerned about jobs and employment in Northern Ireland?

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[Naomi Long]

I agree entirely that they have that endorsement, and the Prime Minister’s Twitter feed today suggests that all of those sectors are engaged in lobbying activity.

Being geographically more remote adds to household bills and business costs. The cost of fuel, for example, is a particular pressure, with Northern Ireland consumers facing the highest petrol and diesel prices in the UK and some of the highest in Europe. This impacts on households, business and our international competitiveness, so I welcome the cancellation of the fuel duty increase that was planned for September. The cost of energy generation more widely is also greater in Northern Ireland and the exemption from the carbon price floor is a welcome measure for energy producers and consumers alike.

Regrettably, the Chancellor offered no good news on another significant cost of our peripherality—air passenger duty. I recognise the previous work done to devolve APD for direct long-haul flights from Northern Ireland, but if we are to support essential connectivity, reduce business costs and grow our inbound and outbound tourism sectors, both of which contribute significantly to the Northern Ireland and UK economy, the Treasury needs to look at the issue again. A recent report by PricewaterhouseCoopers, which has been referenced by the hon. Member for Crawley (Henry Smith), indicated that reducing or abolishing APD could stimulate growth and lead to the raising of more revenue, rather than less. The Treasury appears to have dismissed that analysis, but I urge it to do its own study on the impact of APD on growth.

There are many other issues that I would like to raise, but little further time to do so. In conclusion, talk of creating an aspiration nation is a good thing but, at a time when unemployment figures in Northern Ireland are at their highest for 15 years, taking action that will match aspiration with real opportunity is much more important. I remain to be convinced that this Budget will do that for the people whom I represent.