This was published under the 2010 to 2015 Conservative and Liberal Democrat coalition government
Theresa Villiers discusses the economic and community relations issues still to be resolved in NI, and the opportunities to be promoted.
It’s a great pleasure for me to be able to speak to you this morning in this historic venue. It’s in this building that Parliament sat through many of the darkest days of the Second World War. It’s also where the first meetings took place of the UN Preparatory Commission and the Security Council. So it has an impressive pedigree as a place to debate and discuss the matters of great significance that you will be considering today.
I’m very grateful to your Co-Chairmen, Laurence Robertson and Joe McHugh for their kind invitation to address your assembly. On behalf of the UK government, I’d like to thank you for the hugely valuable work that you do.
Over the years, BIPA has played a significant role in bringing about a much better understanding between Parliamentarians from London and Dublin. And now also from Belfast, Cardiff and Edinburgh.
In recent years your focus has rightly extended beyond the consideration of Northern Ireland affairs to look at the benefits of broader and deeper co-operation between the UK and Irish governments. Both governments take that goal very seriously and it was embodied in the joint statement on the next decade of UK-Irish relations which was made by the Prime Minister and the Taoiseach in March last year.
That has led to an intensive programme of work between our 2 countries, which is being pursued vigorously and which is reviewed annually by the Prime Minister and the Taoiseach. As David Cameron has said many times, the relationship between the UK and Ireland has been transformed and it continues to go from strength to strength. And that’s how it should be when you consider just how closely we are linked not least when it comes to the economy and trade. Just consider the following.
The stock of foreign direct investment from the UK to Ireland is worth around $70 billion a year and from Ireland to the UK the figure is around $65 billion. The UK is Ireland’s largest recipient of service exports and around a third of goods imported by Ireland are from the UK. And combined trade between the UK and Ireland supports over 400,000 jobs in our economies.
The rewards this brings to both countries are substantial and they are expected to grow. According to one forecast, Ireland is expected to overtake France as the UK’s third largest export market for goods and services in the next fifteen years. And of course trade between Northern Ireland and the Republic remains hugely important.
So our economies are inextricably linked. The success of one can help feed the success of the other. And the benefits of growing trade between us will only continue if we carry on with the necessary steps to deal with our debts, fix our economies and promote sustainable growth.
So let me say a brief word about what we’re doing in the UK to achieve that.
Strengthening the economy
We set out our plan in 2010 with our three strand approach of fiscal responsibility, monetary activism and structural reform. As a result of the measures the government has taken our deficit is now down by a third, helping to keep interest rates low. We’re cutting business taxes, including corporation tax and employer national insurance contributions. And we’re reducing the regulatory burden to save business a billion a year.
We held our nerve and now the UK economy is growing again. 1.4 million new jobs have been created in the private sector, employment is at record levels and earlier this month the IMF upgraded its growth forecast for the UK. But while we can be increasingly confident that we’re turning the corner, the need for firm fiscal discipline remains.
Global risks remain high and the recovery cannot be taken for granted. And that’s why the government is determined to stick to the plan we set out in 2010.
Northern Ireland economy
The UK’s recovery is also being felt in Northern Ireland. According to the Ulster Bank PMI Survey, business activity there is now at its highest level for 6 years. Unemployment has fallen for 8 successive months and is now well below the UK average at 7.3%. At long last the property market is beginning to stabilise. The construction sector is finally starting to pick up after the ravages of the recession and the property crash which was so severe both north and south of the border.
The UK Government continues to provide generous support to the Northern Ireland Executive, with public spending per head 20% higher than the UK average. We’re on track to deliver the promise of £18 billion of capital funding by 2017. And Northern Ireland’s top quality telecoms infrastructure continues to benefit from the UK government’s broadband programme with both Belfast and Londonderry included in our super-connected cities funding stream.
But it’s still the case that economic recovery in Northern Ireland lags behind the rest of the UK and I’m acutely conscious that life continues to be tough for many hard working people. The economy remains over-dependent on public spending and fiscal transfers from the UK Treasury. So we remain committed to working closely with the Northern Ireland Executive on our shared goal of boosting the private sector and rebalancing the economy.
Together, back in June, we published a new package under the heading, Building a Prosperous and United Community to help Northern Ireland compete in the global race for investment and jobs.
Just some of the measures it contains include start up loans for young entrepreneurs; planning reform; additional borrowing powers for the Executive for shared future initiatives and helping businesses to access much needed finance. Crucially, we’ve also been able to ensure that Northern Ireland has kept its 100% Assisted Area Status which has been such a successful part of Northern Ireland’s offer to overseas investors.
We’ve just published an update on progress in implementing the package.
A joint UK government and Northern Ireland Executive ministerial task force has been set up on banking and access to finance and has started its work.
The first tranche of additional borrowing has been authorised to provide £15m to progress the Executive’s flagship shared education campus at Lisanelly, where 6 schools from a range of sectors will cater for around 3,700 pupils.
And the joint UK government and Northern Ireland Executive contribution to a £120 million Bombardier research and development project has been confirmed.
Another key element of the package, building on the hugely successful G8 summit in Co Fermanagh in June, was the international investment conference that took place at Titanic Belfast just over a week ago. The buzz, the energy and the enthusiasm around that conference was palpable, and once again we were able to show a Northern Ireland that’s confident, forward looking and open for business.
And some of our greatest ambassadors are those who’ve already set up business there. Like President and CEO of Bombardier, who last week announced the largest ever private sector investment in Northern Ireland. He said:
I would strongly recommend Northern Ireland as a place to do business and a good place in which to grow that business.
Or the Senior Vice President of HBO who film ‘Game of Thrones’ in Northern Ireland, thanks in no small part to the Chancellor’s tax credit for high end TV production. He said:
The success of HBO’s Game of Thrones is in large part due to our presence and the collaboration with the people here in Northern Ireland.
And the Executive Vice President of Allstate told the conference that their operations in Northern Ireland had saved the company more than a billion dollars.
So it shouldn’t come as a big surprise that with over 800 foreign investors, Northern Ireland is now second only to London as the top UK destination for inward investment, with almost 8,000 jobs from foreign investment in just the last 3 years.
Northern Ireland is increasingly becoming a destination of choice - and rightly so - for business, for culture and for tourism. But we all acknowledge that there is more to be done. More to be done to attract investment. More to be done to energize local business and enterprise. And more to be done to persuade talented young people to stay in Northern Ireland rather than feel they have to look elsewhere for the high quality career opportunities they want in life.
And it’s clear that Northern Ireland will never reach its full economic potential unless we also address continuing community division and the consequences that can so often flow from them.
Over the past 12 months we’ve have enough reminders of how far we still need to go, be it shameful scenes around flags and parade or insensitive commemorations which heighten the suffering of victims and leave them alienated from their neighbours. These events have set back community relations and negatively affected the way in which the Executive goes about its business. And there is no doubt that street disorder and continuing protests take a heavy toll on the men and women of the Police Service of Northern Ireland.
I pay tribute to their bravery, fortitude and professionalism. They have the unequivocal support of the government for what they do to protect the community and keep people in Northern Ireland safe.
I would also like to take this opportunity again to thank the Irish government and the Garda Síochána for their unprecedented co-operation on security matters which is playing such an important part in countering the continuing threat from terrorism and criminality.
So be in no doubt, the Government takes these matters extremely seriously. I and the Prime Minister have repeatedly pressed for progress over the last 12 months on addressing community division. So I warmly welcomed the publication by the First and deputy First Ministers of their community relations initiative, Together: Building a United Community in May. It’s now very important that momentum is maintained in delivering the programmes it contains.
And I also strongly support the initiative announced by the Executive on flags, emblems, parades and the past. In establishing the Haass process, Northern Ireland’s political leaders are demonstrating that they’re prepared to take ownership of these persistently divisive issues. Something that I and my predecessor Owen Paterson and the Prime Minister have long been encouraging them to do.
It’s a sign of the distance we’ve come that the Northern Ireland political parties are taking the initiative themselves rather than responding to proposals put together in London or Dublin. But while the Government is not formally part of the process, we’re fully engaged with it.
I and my officials have had the welcome opportunity to meet and speak to Richard Haass and his team on a number of occasions, with a further meeting scheduled for next week. And last week Dr Haass attended meetings in Downing Street where the Prime Minister offered his full backing for the crucially important task he has undertaken.
Of course the Haass talks are dealing with some of Northern Ireland’s most deep-seated and difficult issues, so there is no guarantee of success. But I believe that there is a genuine willingness on the part of Northern Ireland’s political leadership to make progress. And from my discussions with Dr Haass, I believe that there’s no better person to help achieve it.
I was encouraged by the speech made by Peter Robinson to the Cooperation Ireland dinner for the GAA at Queen’s which I attended last week. That a First Minister from the unionist tradition was asked to and accepted an invitation to address the GAA was in itself progress and a further demonstration of how far Northern Ireland has come in recent years.
I’m sure all of us will welcome the call the First Minister made for politicians to resist the temptation to retreat to safe and familiar ground and refight old battles, but instead to reach out beyond what has been seen as their “own community” and together create an environment in which difficult decisions can be made.
As he said, the key challenge here is for those fine words to be turned into “meaningful reality” as the Haass work goes forward. It is essential for the success of the process that they are.
Few would suggest that this year hasn’t seen setbacks in Northern Ireland. But it’s also seen some positive moves forward too.
Derry-Londonderry has far exceeded expectations as an immensely successful UK city of culture, including hosting the All-Ireland Fleadh which I was privileged to attend.
The World Police and Fire Games brought thousands of athletes and spectators to Northern Ireland, giving them all the chance to experience its legendary hospitality.
And then of course there was the unforgettable G8 Summit when the eyes of the world really did focus on stunningly beautiful Co Fermanagh, something that would have been unthinkable just a few years ago.
And it is also important to acknowledge in this 15th anniversary year since the Belfast Agreement and the 20th since the Downing Street Declaration that the devolved institutions, whatever their imperfections, continue to deliver unprecedented political stability in Northern Ireland.
So, yes, there are issues to be resolved. But there are also great opportunities. And as a government, working closely with our partners in Dublin and supported by our allies in Washington we are determined to take them.