Belfast port celebrated as hopes rise for lower corporation tax

The House of Lords was the suitably grand venue for the London launch of Alf McCreary’s magnificently illustrated tome Titanic Port, a history of Belfast Harbour. Before I got a chance to take a good look at my copy, my ears pricked up when the chairman of the harbour commissioners Len O’Hagan said hopes were high that Northern Ireland would “soon be allowed to set its own rate of corporation tax”. Sitting nearby was the Secretary of State Owen Paterson who didn’t move a muscle when the words were spoken. 

The idea, apparently setting the tax at a rate rivalling or perhaps even less than the Republic’s would be the coping stone for the enterprise zone that the whole of  Northern Ireland would become next year, it’s hoped. David Cameron had promised something like this if he won the election, without going into details or even knowing what they might be at that point.

The zone would allow the Port of Belfast in particular to compete with Dublin Docks under a preferential tax regime for a set period of years. The idea recalls Charlie Haughey’s creation of the enterprise zone in the down -at -heel Dublin port area that was one of the foundations of the Celtic Tiger.

While my scepticism is less than it was, it  would still be unwise to think this is a done deal. If the O’Hagan kite flies it will be likely to provoke howls of protest in other equally deserving regions of the UK and prompt fears of a reduction in the block grant of between £200m and £250m. The risks as well as the opportunities would be considerable to put it mildly and the challenge to business virtually unprecedented. 

As for the volume Titanic Port , it’s a magnificently illustrated coffee table book for Christmas, and an absorbing  if  mainly celebratory read ( the Harbour Commissioners commissioned it). It recounts Belfast’s progress from modest village on the Farset to  international port in less than two hundred years. It’s not exactly a new tale but the facts have been updated and never before have they been so handsomely laid out. The big Belfast names are given biographies and faces – Ritchie, Dargan, Mitchell, Herdman, Harland, Wolff, Pirrie, Thompson, Sinclair, Rebbeck. The grandee Harbour Commissioners are seen in their finery of tailcoats, top hats and cashmere waistcoats.

While the portraits are of the bosses the workers  do get a look in, even Jim Larkin’s strikers of 1907 and Wee Joe Devlin’s headcount of “only one or two Catholics in the whole port” with a pilot the highest graded.  Sam Thompson’s trail blazing play of sectarian conflict, Over the Bridge is  commemorated. 

There’s plenty of Titanic in the book of course but this one ill-fated ship is not allowed to overshadow the epic story. Tension is sometimes recorded between the titans of the Yard and the Port but was usually resolved. And this is just as well, for it is the Port which has survived as a major enterprise upon which much depends for Northern Ireland’s future.

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  • JH

    Fears of a cut to the block grant of around £250m aren’t unfounded. It’s probably cost AT LEAST that. I’m all over this lately, but the Azores Ruling basically spelled this out. You cannot arbitrarily lower the Corporation Tax of one region without making a corresponding cut to that region’s budget. I’ll find and link the ruling if there’s any interest, but you can Google it easily enough.

    I’d say it’s a no-go. For a decade or so at least, unless local politicians can demonstrate that they can make the c£4bn cuts that are already coming up relatively quickly and painlessly.

    Even with the lower CT, the size of the public sector is still keeping wages artificially high and making skills very costly to obtain here. It’s likely to stimulate FDI but I would expect private industry would still be at a major disadvantage as a result of this.

  • JH

    By that I mean indigenous private industry.

  • Frustrated Democrat

    It is not if we can do it we have to do it; without it we are destined to remain as a begging bowl economy and a drain on UK resources.

    It is not a cut, it is an investment in all our futures.

    It is not handouts to fat cats it is about creating jobs directly from FDI and the resulting jobs created in local companies to service them.

    The investment can be made by transfering expediture from unnecessary areas, such as the pet projects of the two big parties.

  • slug

    Perhaps we should talk to ROI. Why compete taxes in a race to the bottom. Rather than undercut them, how about asking them to raise theirs a little, to say 17%? Then we could match that and this would cost the executive much less.

  • This sort of book is timed wonderfully ahead of dispatching the Port into the private sector and the enterprise zone will give it an excellent leg up into that world.

  • GoldenFleece

    The IMF will probably force them to raise their corp tax anyway when they get called in.

  • Zig70

    I’m a big fan of lower corporation tax. Companies in the initial stages look at the big picture and wages and taxes are in there. The wages here are lower so it should help attract investment and offset the cost of reducing the tax. The problem in NI is investni is still run on the old ledu setup with ledu and the local businessman the poor relation. If I had a company to startup investni would tell me to ask an uncle for the money. If I was a yank, there’d be champagne all round.

  • JH

    The south are never going to raise their Corporation Tax just to appease a couple of million people in the North. It’s their one ace in the hole, that created the Celtic Tiger in the first place and allowed them to compete with the largest economies in the world. The northern CT would maybe be lowered to 12.5% to match it but i couldn’t really see it going lower than the CT rate in the South.

    I don’t think the IMF will be ‘called in’ btw. More likely a bailout from ECB, who might expect the country to raise it’s CT.

  • Interesting Brain thinks that “hopes” of a cut in corporation tax (for all business or targeted at SME’s?) rise on the very day Arlene Foster rules out any change whatsoever until “after the next Assembly election” ie never. Since our “never do today what you can postpone until tomorrow” Executive is hopelessly divided on the issue, a coherent strategy with clear time lines is not a remote possibility at this point.

  • slug

    Tends to be over stated. Education is more important than anything else.

  • “the Harbour Commissioners commissioned it”

    Brian, as I pointed out recently, the Commissioners are in troubled waters. They’re appointed by the Minister for Regional Development, currently a SF ministry, and they put £20,000 sponsorship into a SF related project, despite their apolitical pose. The project’s organiser shortly afterwards became an additional NI Water NED and NIW is a DRD GoCo/NDPB.

    As they say, NI is a small place. Does it also mean that the MSM is reluctant to rock the boat?

  • Ministers due at select committee over corporation tax.

    “Corporation Tax in Northern Ireland

    Wednesday 10 November 2010

    Committee Room 5, House of Commons

    At 3.00pm Terrence Brannigan, Chairman, CBI Northern Ireland
    Nigel Smyth, Director, CBI Northern Ireland

    At 3.45pm Arlene Foster MLA, Minister of Enterprise, Trade and Investment
    Sammy Wilson MP MLA, Minister of Finance and Personnel, Northern Ireland Assembly”

  • dennis

    if we are going to spend £200 Mil a year , does anyone have any idea how many jobs we can expect from this??

  • Count Eric Bisto von Granules

    Will she be operating out of Belfast Port – check out the name

  • Zeno

    Len O’Hagan said hopes were high that Northern Ireland would “soon be allowed to set its own rate of corporation tax”.

    I assume he meant sooner than now.
    Just as well. All that would happen is hundreds of millions would come off the NI Budget and go into the pockets of already wealthy businessmen.