Cameron was clumsy but accurate…

David Cameron has touched off something of a bush fire in his interview with Jeremy Paxman on BBC2 in speaking of the dependency culture in Northern Ireland. He compared the amount of state support to that of some of the Communist Eastern bloc countries.

The potential PM was clumsy in his exposition despite the accuracy of what he was actually saying.

My suggestion that there was ‘a whiff’ of the infamous Harold Wilson “spongers” sobriquet about Mr Cameron’s observation, sent , exercised Tory/Unionists to their blackberries and to the phone.

This is an attempt to bring some sanity to the discussion arising from David Cameron’s somewhat louche utterance.

Reg Empey, the other partner to UCUNF must have come close to choking on his cornflakes on hearing the drift of David Cameron’s remarks.

DEL, the Departmental Expenditure Limits in Northern Ireland, or block grant annually, is £10b.

AME/ the Annual Managed Expenditure for Northern Ireland is £7/8b. This goes to cover pensions and social security.

Our annual allocation of UK funds is governed by the so called Barnett principles.

Neither David Cameron nor anyone else is free to alter that willy nilly or else this impacts  elsewhere, in Scotland, Wales etc.

If Northern Ireland raises £12b in taxes then logically the Treasury gives us £6b on top of this, almost one third, to keep us afloat annually.

David Cameron seems to want to refashion the economy in Northern Ireland making it more entrepreneurial and self sufficient.

One way of doing that, I am told, would be to allow the Assembly to set its own corporation tax rate, possibly 12.5% in line with RO1 or even lower than this,10%.

The upside of this would possibly be to attract ‘high end’ jobs and inward investment.

The downside from Northern Ireland’s point of view would be that any loss of business  taxes to the Exchequer would necessarily result in a reduction in the block grant until such time as a buoyant economy would produce higher corporation taxes.

In the meantime Northern Ireland I would have the benefit of attracting premier division investment which would pay decent salaries.

If David Cameron were to go down this road, this might remodel  the economy here and establish a credible industrial base.

All this is predicated on Mr. Cameron, should he become PM, lowering corporation tax to facilitate the Assembly to create conditions to stimulate economic activity and attract fresh inward investment.

Our politicians should do a little more homework and take more care in explaining and expressing what they are really saying.