VARNEY 2 – THE LAST CHANCE FOR A STEP CHANGE – EMPEY
Ulster Unionist Party Leader and Employment Minister Sir Reg Empey said that the last opportunity to achieve a step change in the Northern Ireland economy could be presented by the second report of Sir David Varney. In a statement Sir Reg said,
“This report was announced when Varney 1 was published last month with its disappointing finding that there was not going to be any special rate of Corporation Tax in Northern Ireland.
What then are the alternatives? If the Prime Minister and the Chancellor, with Alex Salmond breathing down their necks, feel unable to risk such change, what can be achieved, and where should we be steering Sir David Varney?
Some years ago Northern Ireland had special capital allowances to help our economy. These could be used again, especially for things such as training and they have the advantage that there is a precedent.
But one idea I have been advocating since 2001 is a reduction in Excise Duties on fuel sold in Northern Ireland.
For some inexplicable reason, the Treasury has tolerated the existence of a massive smuggling empire which has been operating for many years, spreading corruption and environmental damage throughout this island. I suspect that paramilitaries have been deeply embedded in this crime ring to their very substantial advantage. This trade must run into millions of pounds every year.
Surely it makes sense for the Chancellor, with the co-operation of his counterpart in Dublin, to move decisively to eliminate this business? This would clean up these gangs, and avoid further environmental damage, whereby large volumes of toxic chemicals are dumped in our countryside with as yet unknown long term consequences.
If all the fuel sold in Northern Ireland was taxed, even at a lower rate, a rate that represented a sufficient reduction to eliminate the profit margins of the gangsters, then the Treasury would be getting tax on all fuel and not part of it. Added into this equation must be the costs of all the customs and revenue officers, court time etc chasing after these criminals.
With the pro-active help of the Irish Government by perhaps raising slightly its excise duty to narrow the gap, this long running problem could be solved.
At Downing Street in early 2007, the then Chancellor Gordon Brown promised to let this matter be examined. Now is the time.
Lower fuel costs would help businesses improve their competitiveness and as Northern Ireland is the only part of the UK with a land border, it would be very difficult for the devolved regions to complain as this is a unique problem for us.
I hope this will be one of the ideas considered by Varney 2. Our task in coming weeks is to put forward a suite of proposals that really can make a difference to our economy.”