The case for a Corporation Tax reduction was seriously hindered by the delay in implementing Welfare Reform. There are all kinds of reasons for this – not least that any delays in the latter cost money in so-called (but not actual) “fines” paid out of the NI Executive account to the UK Treasury.
I am not at all sure, however, it is wise to link the two at all. Rather, Corporation Tax reduction should be linked to tackling the Costs of Division.
This is not because there is a link between an open, shared, multi-cultural society at ease with itself and successful enterprises – although there is, of course. It is because the Executive needs to prove it can reform public services and make them more efficient. “Costs of Division” is a prominent, easily measurable, easily identifiable means of demonstrating this.
Fundamentally, the Executive has a choice to make. Is it going to tackle the Costs of Division?
If it is not – and so far, it is not (it cannot even save £2.2 million on unnecessarily segregated and inefficient teacher training) – then it needs to admit it will never have highly efficient public services and will have to accept that hindrance when attracting potential investors. Those investors will be entering a permanently pillarised society where social, political, educational and potentially even economic choices are dictated along ethnic fault lines, about which they will have to learn. Many will not be bothered with the hassle, of course.
If it is, then it will have to prepare to take on the vested interests and deliver real reform. That does not just mean taking on the interests of independent teacher training colleges (who will have to merge into Universities in this new, efficient world which requires fewer teachers trained anyway to free up space for engineers and designers). It ultimately means a change in direction, where no public service provider of any kind is able to deliver that service other than in an open and integrated fashion. In practice, the Costs of Division will not be saved overnight; but this would begin a process guaranteed to save hundreds of millions a year, while also delivering a wider understanding of diversity among the population and thus a more open society in which people (either from inside or outside Northern Ireland) may consider investing. Such a society would be one in which it would be worth the risk of £325 million a year for reduced Corporation Tax, and in which that money would already be in the process of being saved from the overall devolved Budget.
Without tackling the Costs of Division, the reduction in Corporation Tax is unaffordable and close to pointless, as we would not be in a position to capitalise fully on it anyway (thus the risk inherent in it increases). This is not just a budgetary point; it is a point which emphasises that open, tolerant societies are in any case the likeliest to develop prosperity. In other words, Good Relations and a Good Economy (in every sense) are inextricably linked…
The case is clear. Who is going to make it?!