Phew, what a relief!

So Northern Ireland isn’t to be picked out for drastic cuts after all.  On his flying visit  the Prime Minister couldn’t have been more reassuring, backed up by his Secretary of State.

He said the assembly could defer cuts to the Northern Ireland budget for a year if it wanted to.

Secretary of State Owen Paterson said it was not sustainable for Northern Ireland to have more than 70% of its gross domestic product spent on public spending.

“What we need to do, and I’ve suggested it will take 25 years to do this, is to steadily rebalance the economy, by bringing up the size of the private sector and steadily bringing down dependence on public spending.

“But we’ve said it’s irresponsible to do nothing. It’s equally irresponsible to do anything too drastic,” he said.

The new government has been reminding itself of the importance of the public sector in preserving living standards.  In his indispensable column John Simpson has laid out NI’s poorer performance production relative to  UK wide levels.

This may have brought  home to  the Treasury that at least in NI, now was not the time  to wield the axe.  And there’s more.  Sir David Varney’s brutal dismissal of the Quigley case for a 12.5% corporation tax harmonised with the Republic is dead, even if the Treasury won’t go all the way. UK wide corporation tax rates are coming down but perhaps by not as much as the Conservatives promised in opposition. We’ll know more at the Budget on June 22. The Barnett  report recommended a policy of picking better winners than shovelling grants out willy nilly. So where are those ideas for creating an enterprise zone? This is one that needs wider endorsement than the Executive can muster alone.