Hain comments on future of industrial derating

The Secretary of State, Peter Hain, has today discussed the future of industrial derating with members of the Amicus Parliamentary Group, Amicus and the Northern Ireland Manufacturing Focus Group at Westminster.

The reform of the rating system in Northern Ireland, including the future of industrial derating, was under consideration by the Assembly and Executive when it was suspended in October 2002.

The reform programme was then taken up by government Ministers, who in 2003 announced its intention to phase out industrial derating.

The relevant legislation was passed at Westminster in 2004, which provides for the phasing out of derating over the period to 2011.

The Government has already given a commitment to review the policy and legislation on industrial derating at the same time as it conducts its review of the financial and equality impacts, which is due to begin in April 2007.

The Secretary of State said: "I have received further representation on the issue of industrial derating from the Northern Ireland Manufacturing Group and Amicus. I am well aware of the concerns that exist about the potential impact on manufacturing of the changes we are making and we discussed this further.

"As I have explained, any change to our proposals would leave a hole in our planned public expenditure. A freeze in Industrial Rates at 25% would remove £8 million from published budgets for next year, rising to £60 million a year by from 2011 onwards, which could impact on frontline services."

He continued: "I also reiterated that if the Assembly was to be restored then they would obviously be able to make their own decisions on changing this policy and on how to manage the budget implications that would follow. However, following our discussions I have agreed that we will postpone any further changes to Industrial Rates until after the November 24 deadline for the Assembly to restore to give local politicians a chance to make the final decisions on this policy.

"However in the meantime I've also agreed to establish a working group, to be chaired by David Hanson, that will include the Northern Ireland Manufacturing Group and Amicus to look for a way forward on this issue that takes account of the concerns of manufacturers. I will ask this group to report in November."

(EF/SP)