23 November 2006 Hanson puts industrial derating on temporary hold at 30%
The removal of industrial de-rating – the phased application of rates on manufacturing firms in Northern Ireland – is to be pegged at 30% until after April 2007.
Announcing the move, Finance Minister, David Hanson MP, said today that next year industrial rates would not rise to the expected 35%, but instead would be held at 30% until after April when a scheduled formal review into industrial de-rating is due to be held. He said:
“We promised earlier this year that there would be a formal review in April 2007 of the effects of the policy of industrial de-rating. This will take place as planned and, hopefully, under the direction of a restored Executive.
“In the meantime I have taken account of the representations made by the Northern Ireland Manufacturers’ Focus Group, the Amicus trade union and the political parties and have decided to reduce the planned increase in industrial rates from 35% to 30% until the review in April 2007 is concluded. The Group made the case in an effective way and their engagement was welcome. Amicus have been very keen to support training and skills funding. Government has already established a new fund to develop and provide extra help to this area and the money raised is helping this fund.
“This announcement should not be seen as a signal for future decisions in this area because there is a very real consequence to the money available for spending on public services here if full industrial de-rating does not take place. Indeed this announcement today is a measure that has cost £3.7 million in lost revenue for 2007-2008. It will be up to a restored Assembly to make a judgment call on the way forward.
“Government is not yet persuaded that there is a case for the retention of full de-rating for manufacturing industry here. It is a blanket measure that in many cases helps those who don’t need help. However, I think the review will prove a useful means of examining the de-rating issue in full,”
Mr Hanson added.
Notes to Editors
Industrial rating was introduced in April 2005 at 15% of full rate liability and will be phased in up to 100% by 2011-2012. The rate this year is 25% and was planned to rise to 35% in 2007-2008.
