7 May 1996
Working for Improvement
Northern Ireland is an integral part of the United Kingdom and will remain so. Although many important decisions on economic policy will be taken at Westminster, we envisage a strong role for a revived Northern Ireland Assembly and for local authorities within the region. For too long local economic policy has been determined by junior Ministers with little knowledge of or commitment to Northern Ireland, or by unelected bodies. The Ulster Unionist Party is determined to return this local economic policy-making to the control of those elected by the people whom the policies affect.
Ulster Unionist representatives will play a full role in ensuring that national economic policy fully benefits Northern Ireland. We will develop imaginative and effective economic policies at regional level to maximise Northern Ireland's prosperity within the UK. Ulster Unionists will also work at local level to obtain an equitable distribution of economic prosperity.
The Northern Ireland Economy Today
The Northern Ireland economy contains a mixture of strengths and weaknesses. We intend to build upon the strengths and to rectify the weaknesses. It is often not recognised that Northern Ireland is one of the fastest growing of the eleven regions of the United Kingdom. Only East Anglia and the South West of England have grown faster over the last ten years, and both of these regions benefited from jobs moving out of London. While the Northern Ireland public sector has been stable over the last decade the private sector has forged ahead, creating an extra 71,000 jobs (24%) since 1983. Northern Ireland was also the least affected part of the UK in the national recession of 1990-92. Manufacturing industry has performed particularly well. Since 1985 output has grown by 27% in Northern Ireland compared with 18% in Great Britain.
Unfortunately, this creditable performance is not sufficient to employ all of the region’s rapidly expanding labour force. With the highest birth-rate in Europe, the Northern Ireland economy would have to expand very rapidly indeed in order to create jobs for all. Each year some 25,000 young people leave Ulster's schools, while only half this number retire from work. This leaves a large gap which is difficult to bridge. On average over the last decade only 6,000 extra jobs have been created each year. This means that thousands of young people must leave Northern Ireland to seek work. Even so, the rate of unemployment remains one of the highest in the UK at some 12% of the labour force, and many others do not seek work at all, because little is available in their areas.
While Northern Ireland contains many outstandingly successful companies, too many are in traditional sectors facing stiff competition from low wage countries. Levels of Research & Development and product innovation are also too low, at only a quarter of the German level and one fifth of the Japanese. Despite the outstanding academic records of many Ulster schools it is also true that vocational skills do not match up to the best of our foreign competitors.
Public Expenditure
While Northern Ireland has public services equal to the rest of the kingdom, it remains true that the economy is heavily dependent on employment in the public sector. This can be a source of strength during a private sector recession as in the early 1990's. In the longer term it may prove a disadvantage as successive Governments seek to reduce public expenditure in order to reduce taxation. Some also argue that by attracting many of our most able young people, a large public sector diverts people of ability from the private sector. However, the current brain drain from Northern Ireland suggests no shortage in the supply of able young people.
The combination of lower incomes and higher levels of public service provision mean that locally raised taxes can not pay for the total public expenditure in Northern Ireland. This high level of support is in part a normal operation of the UK public expenditure system which seeks to maintain equality of service provision in all areas. The level of support for Northern Ireland is particularly high because of additional needs for security spending, high birth rates which generate needs for additional services in schools, hospitals etc., and because of the high rate of unemployment with its associated subsidies to both individuals and companies. The people of Northern Ireland are well provided for in ways which make membership of the United Kingdom a very considerable benefit. Even recognising the deep constitutional divisions which still exist, it seems unlikely that any but a small minority would wish to lose such benefits by voting to leave the Union.
A Competitive Economy
Much can be done within Northern Ireland to assist firms to become even more competitive, and Ulster Unionists will take steps to achieve major improvements. Economic thinking in Northern Ireland has become too cautious partly because responsible Ministers are not directly answerable to local electors, are in their jobs for short periods, and too often spend little time in the region . Ulster Unionists will explore new ideas to generate faster growth, and will pursue Government reforms wherever necessary.
Locally owned businesses, including small business have performed particularly well in recent years, even though this has attracted less attention than occasional successes of attracting inward investment from abroad. Ulster Unionists in Government will ensure that every assistance is given to support the development of this sector on which the future of the economy primarily depends.
We will merge the various agencies dealing with indigenous business to create an efficient and effective one-stop shop for business support. The new agency will include:- LEDU, the IRTU, the home industry division of the IDB and those parts of the Training and Employment Agency which are enhancing skill levels within companies. This new agency will contain a monitoring division to ensure that assistance is delivered with maximum speed and efficiency, and with the minimum of bureaucracy necessary to ensure proper administration of public funds. Major focuses of support will be in raising levels of innovation in new products and in raising levels of vocational skills.
Inward investment will become easier to attract to Northern Ireland if peace becomes secure. We recognise the work of the IDB in attracting firms under the difficult conditions of the past. However, the new IDB will be able to focus its efforts solely on the task of attracting external firms, thereby utilising its financial resources more effectively.
An Export Success
Every trading nation or region depends on its success in exporting. Northern Ireland industry has a good record, exporting more per employee than either England or Scotland. Our aim will be to build on this success to develop a high export economy. While many of Ulster's large and externally owned companies need no lessons in exporting, smaller and locally owned firms can be helped to achieve more. We will ensure that everything possible is done to provide this assistance.
Much has been done to modernise Northern Ireland's ports, airports, roads and railways. We will seek to maintain and improve facilities to further enable exports from local companies and to attract through trade from the Republic of Ireland.
In recent years much has been made of the need to stimulate trade between Northern Ireland and the Republic of Ireland. Many of these calls have been based on the mistaken belief that crossborder trade was substantially diminished by the Troubles and by the political disagreements. There is little evidence for this contention.
Thus we do not see any strong need to take exceptional action. We are as keen to promote trade with the Republic as with any other area. We will actively facilitate business opportunities and develop them whenever they benefit the people of Northern Ireland. We will not however invent bogus collaborative projects when the stimulus is political and the economic benefits are not commensurate with the cost.
The Food Industry
Primary agricultural production plays a relatively more important role in the economy of Northern Ireland than it does in the United Kingdom as a whole. As agricultural production and the food processing industry are inextricably linked; any policy aimed at one must take account of the other sector.
The Ulster Unionist Party will encourage the development of a competitive, modern, export led food processing industry which requires the provision of quality raw materials. We would place particular emphasis on education and training of the workforce and encourage research and development into new products and techniques. Smaller firms should be helped to attend trade fairs and missions to existing and emerging markets.
Agricultural production needs to be carried out in an environmentally sensitive manner. We believe that funds directed to agricultural production should have a greater degree of cross compliance with wider environmental issues built in. This is to ensure that agricultural production has a positive rather than negative effect on the countryside.
A Buoyant Tourist Industry
With its wealth of outstanding scenery and its welcoming people, Northern Ireland has a major potential for a thriving tourist industry. The industry contracted to around half of its natural level during the period of the Troubles, but could now continue to expand rapidly up to its true potential.
Ulster Unionists in government will strongly support future development of tourism. Local authorities in particular can play an important role in these developments. A network of high quality tourist attractions has recently been developed by local authorities. These should be supported until tourist numbers rise to a level at which they become economically viable.
The main constraint on future tourist development will be a lack of suitable accommodation. Estimates are that at least 40 major hotels will be needed to be built, as well as a large number of guest houses and the development of more bed and breakfast accommodation. We support attempts to develop new tourist accommodation, but question whether public sector subsidies will be necessary once the tourist boom gets underway.
Tourism is an industry which involves large parts of the community. Areas of outstanding scenery or of urban amenity need careful attention to maintain and enhance their beauty. We applaud the efforts of local authorities as widely spread as Londonderry and Carrickfergus to improve their areas. We are also aware of the considerable pressures on both urban and rural areas from commercial, residential and transport developments. Our aim would be to involve the whole community in protecting the countryside starting with the DOE and the Department of Agriculture. We will explore various models elsewhere; including the highly successful National Parks of Great Britain.
New Opportunities in the Service Sectors
Modern economies are increasingly selling sophisticated services as well as industrial goods and agricultural produce. The South East of England is now much more dependent on financial and business services, than on manufacturing or agriculture. In contrast, peripheral regions like Northern Ireland, north-east England or Wales sell few services to clients outside their local areas. Unless Northern Ireland can develop its tradable services industries it risks being left out of the services revolution.
Sectors as diverse as finance, insurance, advertising, film making and consultancy are all underdeveloped in Northern Ireland. This has occurred for historical reasons, but the problem has been made worse by 25 years of violence when clients were reluctant to visit Northern Ireland. While there are no panaceas for developing new businesses in these highly competitive sectors, now is the time that Northern Ireland should be developing a long-term strategy for competitive service sector firms.
Competition is essential to produce high quality businesses. Competition is never easy since it challenges and can destroy existing businesses which are unable to keep pace with a rapidly changing world. Ulster Unionists believe in maintaining a balance which supports local businesses, but does not allow them to stagnate through lack of competition. In this spirit we welcome the arrival of new retailers to Northern Ireland. We expect these to keep down costs for local consumers and to set competitive challenge for existing retailers. Ulster Unionists in government will encourage the economic vitality of town centres, and expect to work in partnership with local authorities, retailers and conservation groups to blend the best of the new with the best of the old.
A Balanced Economy
Ulster Unionists intend a brighter future in which all citizens of Northern Ireland have equal opportunities to share in the benefits of economic expansion. New jobs and business opportunities will be available to all parts of Northern Ireland and we expect a partnership with local authorities will ensure a fair division of growth.
There is a widespread but erroneous belief that economic growth in Northern Ireland has disproportionately advantaged the East and the Protestant populations. Official statistics clearly show that this has not been the case over the last 25 years. The Western areas have grown much faster than the East, and have been among the faster growing areas of the UK.
The difference in birth-rates makes a fair allocation of economic growth more difficult than it might otherwise be. It unbalanced the allocation of housing in the past, and contributes to higher Catholic than Protestant unemployment today. Ulster Unionists accept the changes of the last 25 years including the setting up of the NI Housing Executive and the Fair Employment Acts of 1975 and 1990. While we are concerned to maintain equal opportunities for all communities, we are also concerned that over-enthusiasm does not convert equal opportunities into positive discrimination. There is evidence that this is happening, especially since the Fair Employment Commission began publishing the religious composition of workforces on a company by company basis in 1992. While maintaining full support for the principle of fair employment we will insist on appropriate scrutiny of its impact.
Ulster Unionists also support equal rights for both women and men in the workplace. Wages for women generally remain below those for men, and we will support national legislation and the Equal Opportunities Commission in Northern Ireland to ensure equality of opportunity. We recognise the huge success that women have had in raising their employment, at the same time as male employment has fallen. Part of the success of females in gaining jobs may reflect their willingness to accept lower wages and flexible working conditions. While the ideal is clearly to have full employment, high wages and secure jobs, Ulster Unionists will be careful not to support legislation which prices people out of jobs or advantages those already in work against more marginal groups seeking to enter the labour force.
Jobs for All
The rise of unemployment over the last two decades has been the biggest failing of European economies. It has affected almost all European countries including the UK, and in particular Northern Ireland. The number of jobless people has remained stubbornly close to 100,000 over the last 20 years, with half of these being without work for more than one year. In many cases people have been unemployed for three, five or more years.
The key priority of Ulster Unionists in government will be to drastically reduce unemployment. Much of the solution to unemployment must come from expansionary economic policies. In part this will follow from decisions to enhance economic growth made at European and national level. However, we recognise that these will only work in the long term. More immediate local measures will also be necessary.
We will support existing measures to offer jobs or training to unemployed people, and will explore ideas for new measures such as vocational training and improved education. We are fully aware that schemes of this type run the danger of increasing dependence, but we are confident that with sufficient attention to detail that workable schemes can be devised at a cost which lies within the current resources available to Northern Ireland. To tackle long term unemployment we will examine work fare schemes in other countries which are showing signs of success.
Conclusion
While the Northern Ireland economy has suffered seriously from the Troubles, we believe that it has the potential to dramatically develop in a situation of genuine peace. A revived Northern Ireland Assembly could play a major part in the development of the economy.
To facilitate local economic growth, Ulster Unionists will:-
It is our aim to create a competitive export driven economy providing many more jobs.
While not ignoring current industries we intend to concentrate on assisting the development of the tourist industry and exploring new opportunities in the service sectors. This will require new thinking and ideas, combined with a great deal of effort, which could be helped by locally accountable representatives in an assembly.
With these measures the Ulster Unionist Party intends to strengthen the economy to make life better for the citizens of Northern Ireland.
COMMITTEE
Chairman: Mr Dennis Rogan
Vice Chairman: Cllr Michael McGimpsey
Secretary: Mr Richard Holmes
Other members:
Mr R Campbell
Cllr Alan Crowe
Mr Jim Hamilton
Ald William King
Cllr David McNarry
Mr Paddy Roche
Cllr David Smyth
Cllr William Wright
