Stormont’s Sectarian Squabbles Hides Failure to Run the Economy
While DUP and Sinn Fein politicians in the Stormont coalition argue about policing and parades the economy of Northern Ireland is worsening by the day. Twenty thousand people lost their jobs in Northern Ireland 1n 2009.You’d think that our elected representatives might want to discuss that instead.
Last week while political leaders from the DUP and Sinn Féin were in Hillsborough Castle arguing over the small print of an agreement on policing and justice and parades, US companies Avaya and Baker Hughes announced hundreds of job losses.
And this is only the latest of Northern Ireland’s economic woes. Figures indicate that by the middle of this year, there will be fewer people in employment in Northern Ireland than there were 13 years ago. While the unemployment rates have fallen elsewhere in the UK, this hasn’t happened here. Last month, the number of people claiming unemployment benefits climbed to a new high of 54,500 on top of which we must add 49,000 people on the economically inactive register who are still looking for work.
The current manufactured crisis in Stormont shows how little the coalition parties care about the real crisis on the streets of our towns and cities. Perhaps they prepare the comfort of sectarian squabbling to running an economy. After all, they’re good at sectarianism but not so good at creating lasting jobs and economic well-being.
Of course, part of the blame can be placed on the ill-winds of the world economy. But the approach towards economic development taken by then Stormont coalition partners has been deeply flawed, not to say suicidal. It is true that jobs have been growing since the early 80s but, as the recently published Independent Review of Economic Policy (DETI and Invest NI) [the Barnett Report] into economic practices in Northern Ireland makes clear, many of these jobs, especially those in the retail and construction sectors, reflected the extreme bubble in the housing market that was more pronounced in NI than elsewhere in the UK, and also a ‘post-troubles’ catch-up in retail provision as major retail groups moved into the region.
The government in Northern Ireland had little part to play in this job growth. Apart from putting much of its faith in construction and shopping as engines of growth, the only other string to its bow was manifested in the attempts by the publically funded Thatcherite quango, Invest NI, to lure multinationals here. Both Avaya and Baker Hughes are huge Multinational companies. In 2006, Avaya posted a net profit of $201 million on revenue of $5.12 billion and Baker Hughes is an equally huge concern. In 2009 revenue in the company came to $2.43 billion, a 24% drop on the 2008 profit .Of course, they’ve lost out in the recession and they want to be richer, but they can hardly be described as poor. Yet in 2007 when Baker Hughes took over the firm in East Belfast that it is currently in the process of abandoning, it received £900,000 in money from Invest NI. In fact, Invest NI have admitted that the company had received millions of pounds in grants since 1995, of which only £500,000 may be clawed back
Speaking at the opening of the Hughes Christensen plant in 2007, Invest NI’s Chief Executive, Leslie Morrison said that ‘the establishment of this new facility further establishes Northern Ireland as a prime location for high value added product design and manufacture.’ This didn’t prove to be the case and again and again we have seen local investment in multinational companies which run off when it suits them. After all, the bottom line for these companies is the profit margin. Nothing is more important to them. As Unite regional organiser Sean Smyth, put it: ‘Our politicians need to stop messing about and wise up so that we make sure companies are not coming here for a quick buck but are here to stay’ . And in order to do that they have to rethink their investment policy. Since it was established in 2002 Invest NI has spent in the region of £1 billion and, as the Barnett Report admits, it has not succeeded in raising productivity levels here. What could a government focused on the needs of our people instead of luring multinationals have done with that £1 billion?
The Barnett Report found that the main differentiating factor between NI and other regions is wages. On average, private sector weekly wages in NI are almost 20% below the UK average, and are lower than every other UK region. The Stormont parties are attempting to build a low-wage economy to suit the interests of multinational capitalists. The people of Northern Ireland - the victims of the recession and the cutbacks and privatisations which will follow it -should consider their options.
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