Economic Vision

Ministerial Statement – in the Northern Ireland Assembly at 12:15 pm on 19 February 2024.

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Photo of Steve Aiken Steve Aiken UUP 12:15, 19 February 2024

Good afternoon, everybody. I have received notice from the Minister for the Economy that he wishes to make a statement. I remind the Assembly of the convention that Members who wish to ask a question should be in the Chamber to hear the Minister's statement in its entirety. Before I call the Minister, I also remind Members that they must be concise in asking their questions. This is not an opportunity for debate, and long introductions will not be allowed.

Photo of Conor Murphy Conor Murphy Sinn Féin

In setting out my approach to the economy, it is important to be honest about the challenges that we face. The problems of our low employment rate, low productivity, low wages and severe regional imbalances have deep roots, but they can be overcome. Many of the key levers needed to tackle those issues, including the regulation of financial services, trade policy, monetary policy and fiscal policy, are reserved to London. However, devolution provides significant control over business supports, skills, innovation policy and employment law.

As a small region, we are well placed to tailor support to local industries through partnership and co-design. In addition, as a result of the Windsor framework, we alone can export goods to the British and EU markets without the frictions and paperwork that others now endure. The Windsor framework also protects the all-Ireland economy, which has tremendous unrealised potential, so there are opportunities for change. In order to use our limited resources and powers effectively, strategic focus is critical. I am setting four key objectives as part of a new economic mission.

'New Decade, New Approach' recognised that good jobs, where workers have a voice and that provide a level of autonomy, a decent income, security of tenure, satisfying work in the right quantities and decent working conditions, should be integral to public policy. Accordingly, one objective is to increase the proportion of working-age people in good jobs. It is not acceptable that being in work does not guarantee a reasonable standard of living. That is particularly the case for women and people with disabilities, who disproportionately make up the low-paid. We can increase the number of people working in good jobs by investing in affordable childcare and fair pay for childcare workers; creating more and better paid apprenticeships and skills academies; replacing zero-hour contracts with contracts that provide flexibility and protect workers' rights; strengthening the role of trade unions, particularly in the low-paying sectors; altering our economic structure by supporting industries that provide good jobs; harnessing the unrealised potential of the social economy; and improving careers advice, including in schools, so that people are fully informed about the opportunities available to them.

Another objective is to promote regional balance. Everyone, no matter where they live, should have the same opportunity to earn a living. A number of areas suffer from economic disadvantage. The north-west, in particular, has long had a low level of employment despite its huge potential for growth. We can create a more regionally balanced economy by setting local economic targets and funding local economic strategies that are designed in partnership with councils and local enterprise agencies and are based on local strengths and potential; offering greater financial incentives for inward investors and indigenous companies that are expanding to locate in areas that are underdeveloped; developing industries with a strong subregional presence, such as tourism, hospitality and manufacturing; building the portfolio of land and property for business development in disadvantaged areas; and driving forward the delivery of projects that improve regional balance, such as the expansion of the Magee campus and city and growth deal projects.

A third objective is to raise productivity, because productivity is a fundamental driver of overall living standards. Output per worker here is 11% lower than in Britain and, according to a recent study by the Economic and Social Research Institute, almost 40% lower than in the South. We must close that gap by using dual market access to grow domestic exports and attract highly productive FDI; developing all-Ireland clusters in high-productivity sectors; improving work-relevant skills, including through upskilling workers and increasing the number of students in further and higher education; working with business to adopt productivity-improving technologies, such as AI and robotics; supporting R&D and driving innovation through collaboration across government, academia and the private sector; and improving management practices.

The final critical objective is to reduce carbon emissions. Colleagues are well aware of the legal and moral obligation to reach net zero by 2050 at the latest. Done right, the transition to a greener and more sustainable economy can be a just transition that also generates prosperity for all. We can build a green economy by increasing our energy efficiency; becoming self-sufficient in and even an exporter of affordable renewable energy. We have the resources, including wind, biomethane and geothermal, to do that; breaking the link with the global commodity prices and ensuring that people and businesses pay a fair price for the energy produced locally; collaborating strategically on the opportunities and investments needed to realise our energy aspirations on the island of Ireland within the single electricity market; establishing a net zero accelerator fund to help plug the funding gap for projects that are not fully financed by private sources; developing the circular economy and taking advantage of the opportunities that exist to reduce waste and cost and increase collaboration and competitiveness across the island; and using the investment zone funding to support green technologies and the skills needed for a green economy.

In taking forward this important work, it will be useful to have independent experts to advise on how, at a strategic level, those objectives should be pursued and to help monitor progress.

Four people who combine academic rigour with real-life practical application will act as critical friends: on good jobs, Dr Lisa Wilson from the Nevin Economic Research Institute; on regional balance, Dr Conor Patterson from the Newry and Mourne Co-operative and Enterprise Agency; on productivity, Dr David Jordan from the Productivity Institute; and on net zero, Professor David Rooney from the Centre for Advanced Sustainable Energy.

My Department's economic development agency has a key role to play in delivering this mission, and Invest NI has many highly skilled and highly committed people. As the independent review confirmed, however, the organisation must restructure and refocus its activities if it is to be effective in the time ahead. There are three particularly important aspects of this reform.

First, attaching stronger conditions and incentives to its support for business in line with the mission that I have set. That may involve requiring a company to recruit people who want to come back into the labour market, particularly people from underrepresented groups; to locate in a disadvantaged area; or to decarbonise its operations.

Secondly, Invest needs a new regional structure that is dedicated to home-grown small and medium-sized enterprises (SMEs) and start-ups. It should provide a similar service to that which was previously provided by the Local Enterprise Development Unit (LEDU) and by Enterprise Ireland in the South. Regional offices must work on an inclusive basis and in partnership with councils, the business community, trade unions and local enterprise agencies.

Thirdly, Invest NI must develop industries as well as individual firms. Fostering collections of interconnected companies, whether that is clusters, networks, sectors or industries, will have a more significant impact and will help us to turn the dial on economic indicators. Businesses that are operating inside clusters have higher levels of innovation, productivity and resilience, and those benefits are particularly high for small firms. To capitalise on those opportunities, we will work in partnership with industry and academia to develop sectors such as advanced manufacturing, life and health sciences, and low carbon.

This new approach to economic strategy involves using the Windsor framework to grow local exports and attract better-quality FDI, taking full advantage of the all-Ireland economy, genuine collaboration with business representatives, trade unions and academia, and setting a clear mission of a highly productive, zero-carbon, regionally balanced economy with good jobs. In order to deliver the strategy, Invest NI will strategically use conditions and incentives as part of its work with business, support SMEs and start-ups in collaboration with councils and other stakeholders, and develop clusters of businesses, rather than just individual companies in isolation. Working with our expert advisers, my Department will move at pace to put this vision into action, and its focus will be on delivery. We have a lot of work to do to turn this economy around, and that work starts now.

Photo of Matthew O'Toole Matthew O'Toole Social Democratic and Labour Party 12:30, 19 February 2024

First, with all sincerity, I congratulate the Minister on his appointment as Economy Minister. I also commend the fact that, in this statement and in his early actions, he has clearly prioritised the development of the all-island economy, North/South cooperation and dual market access. That is hugely welcome, and he will have our support as he pursues those. However, I will also draw his attention to the contents of the UK Government's Command Paper, 'Safeguarding the Union', which included a specific commitment to the abolition of British Government legal duties around promoting the all-island economy. I assume that he will not support that, but his party president, Mary Lou McDonald, said that she had been in contact with the British Government before that paper was drafted and was satisfied that the Good Friday Agreement was undermined. Did the Economy Minister see that commitment — that the UK Government were seeking to remove obligations around the all-island economy — before it was published, and, in his office, what action is he going to take to ensure that they do not go ahead with that objectionable action?

Photo of Conor Murphy Conor Murphy Sinn Féin

The fact is that I find it difficult to find a measure of the British Government's legal obligations in that. The all-Ireland economy was growing organically anyway, and the figures show that cross-border trade between 2015 and 2022 has gone from €2·8 billion to €10·2 billion. Regardless of what the British Government were doing or not doing, there is a clear sense of growth there, and that will only accelerate with the new trading arrangements that have managed to come from that. So, like a lot of others, I saw a lot of rhetoric related to the Command Paper, which was clearly designed to give comfort to people, but, in practical terms, had very little effect.

For our purpose, we will continue to promote that, because it makes sense economically for the whole island, just as we will promote east-west trade, because that makes sense economically as well. We will continue to press home the advantages that we have as part of that and create some sense of certainty. I say very clearly that any attempt to create continued uncertainty around our trading arrangements will be damaging to our indigenous companies and their desire to export and will also be damaging to attracting inward investment. The very clear message that I have been getting from business at home and internationally is that business wants to see certainty established, for things to settle down and for people to come to terms with the new arrangements.

Photo of Phillip Brett Phillip Brett DUP

Thank you, Mr Deputy Speaker, and I congratulate you on your appointment to your role. This is the first time that I have served under your chairmanship. I thank the Minister for advance sight of his statement. The Committee and I look forward to working with him positively.

Minister, one of the key components of the 10X Economy strategy was its partnership approach. You outline that approach in your statement. The 10X strategy received endorsements from across the business community, including from the Institute of Directors (IoD), the Northern Ireland Chamber of Commerce and Industry and the tourism sector. Will the Minister confirm his commitment to the 10X strategy and outline what endorsements he has received from those organisations for his remarks today?

Photo of Conor Murphy Conor Murphy Sinn Féin

I thank the Member for his question and for his cooperation. I wish him and his Deputy Chairperson well. I look forward to working with them and the rest of the Economy Committee as we move forward. I believe that we have a shared view on trying to make the economy a success and on trying to grow prosperity and create opportunities for all of our people.

The 10X strategy was taken forward in a period where, first, the review of Invest had not taken place. That is the primary delivery mechanism for that. That review was critical of the strategy's lack of strategic focus. Invest has suffered because of a lack of strategic focus, so, very clearly, things needed to change with that. Some elements of 10X are beneficial, but others need to be taken forward, particularly in relation to how Invest does its business and the strategic focus that it requires, and also in relation to the fact that more certainty exists with the post-Brexit trading arrangements and what that means for our proposition to the rest of the world for how business will be done here.

In developing this statement and this vision, we have had shared dialogue with many sectors of the Department, including Invest NI. We have a strong sense of engagement and enthusiasm for moving forward with it. We continue to work with all the sectors across the Department for the Economy to make sure that we are all on the same hymn sheet on this and are all pushing forward together. Some of the criticisms in the review of Invest NI, which I think were merited, are being addressed as we go forward to try to get a more cohesive economic proposition.

Photo of Pádraig Delargy Pádraig Delargy Sinn Féin

I thank the Minister for his statement. One of the really important points in the statement is about good careers advice, particularly in schools. What can the Minister do jointly with the Education Minister to further enhance that?

Photo of Conor Murphy Conor Murphy Sinn Féin

I had a brief off-the-record chat with the Education Minister, on the side of an Executive meeting one day, during which we agreed that careers advice has to be in sync right through from schools to colleges. There is, understandably, a big focus on getting kids through academic education and getting them into universities, but there are so many opportunities now with our colleges, which we are very significantly invested in, and for people to go straight into the work environment and get high-level apprenticeships. We need to make sure that the full picture of what is available to our young people is on offer to them from that early age. Kids are getting advice at 14 years of age, and many of the people who are giving that advice — myself included, if I were in that position — do not know the types of jobs that will exist in 10 years' time for them and the areas that they are moving into, given that technology and job opportunities are changing so rapidly. Therefore, we need to make sure that the education system is in sync with the economy system.

It is not just about growing young people for jobs, because education is a much more holistic thing in the development of young people. It is about making sure that kids have an understanding of what is available, what is out there and what pathways are there, so that they are not just on the same pathway through school, into university, out the other side and then waiting to see what opportunities there are. If we can create clear opportunities and a sense of what is available to people, I think that that will be very important. From my early discussions with the Education Minister, it seems that he is quite interested in that conversation, so I look forward to working with him in the time ahead.

Photo of David Honeyford David Honeyford Alliance 12:45, 19 February 2024

I welcome the Minister's statement. It is the first time that I have spoken to him as Minister, so I congratulate him on his new role. Having run my own business for many years, I have learnt that it is easy to get caught up in the focus on yourself and your business rather than on selling your product. I associate myself with the comments that we have some highly skilled Invest NI staff, but, following the independent review and the substantial reform that is needed in Invest NI, can the Minister reassure us that Invest NI is able, is capable and has the resources available to focus on selling Northern Ireland and its dual market access around the world?

Photo of Conor Murphy Conor Murphy Sinn Féin

The Lyons report on Invest NI did not pull any punches about the organisation, where it was at and where it needed to go, and that was a significant wake-up call. Some of the criticisms chimed with some that we have made and that I have heard in the Chamber over the past number of years. There are some very good people in Invest NI who want to move forward, try to grow the economy and develop prosperity for people. As the Member will know, Invest NI has a new chair and a new chief executive. I have met both of them. I have met the chief executive a number of times and have a strong sense of the work that the two of them have been doing in the background to try to turn the organisation around. We want to support them in doing that, because the report on Invest NI clearly indicated that the organisation needs to be reorientated.

In today's statement, we have tried to give Invest NI a strategic focus, and I think that it is one that it welcomes. Yes, we need to ensure that we develop the proposition for here and that we have the certainty in the post-Brexit trading arrangements that I hope that we now have. It should be allowed to bed in and not continuously be picked at over the time ahead so that we can give people some sense of certainty by working on that proposition and taking it abroad. It is also important because 90% of people employed in the private sector here are employed by small to medium-sized enterprises. Local companies that can take advantage of those trading arrangements have more certainty about how they can grow their business and get involved in exports as well. We therefore need that focus in order to attract investment but also to grow our local economy.

Photo of Mike Nesbitt Mike Nesbitt UUP

I thank the Minister for his statement and wish him well in his important role. I have studied many economic statements and policies down the years. I think that the first was Peter Viggers's pathfinder process in 1987. All identify productivity as the key, yet it remains stubbornly low. Does the Minister accept that that is the holy grail of economic policy?

Photo of Conor Murphy Conor Murphy Sinn Féin

As the Member says, productivity has been stubbornly low. It is the lowest in these islands, and it has been for some time. The gap between North and South has been opening up. It is now something like a 40% difference. A number of factors contribute to that, and we cannot continue to ignore them. We credit ourselves with having a world-class education system, yet its outcome is very substandard and not world class at all. It is not the be-all and end-all, but it is an important factor that has not shifted, and we have to find ways in which to get it to shift.

Productivity is a complex measurement. There is a mathematical formula for it, but a lot of complex factors go into it. As part of this, we have invited in expert critical friends, if you like: people who know this work. I am not saying that people in the Department do not know it as well, but, sometimes, we can be so bogged down in the minutiae of it all that we do not see the bigger picture. Not only are we trying to set strategic targets for these things but we are trying to ensure that they have outside monitoring and assistance from people who are experts in the field. All those targets can be measured, and we recognise that we have only three years and a couple of months in which to try to make a significant change. That is the target in the time ahead, and, like the Member, I hope very much that we see a change in that particular stubborn index, which has never shifted substantially over the years.

Photo of Declan Kearney Declan Kearney Sinn Féin

Gabhaim buíochas leis an Aire as ucht a ráitis.

[Translation: I thank the Minister for his statement.]

Minister, will you commit to introducing legislation to improve workers' rights and, in so doing, liaise directly with the Irish Congress of Trade Unions?

Photo of Conor Murphy Conor Murphy Sinn Féin

The short answer is yes, I will. We have been engaging and will continue to engage. There is legislation in the pipeline on working conditions. We want to ensure that it takes the opportunity to address things such as conditions that create low pay and insecurity in jobs, including zero-hour contracts and other factors. Far too many young people, women and people with disabilities find themselves in that sector, and that is why we have low productivity and low wages. There are opportunities in the time ahead to introduce legislation, which has been in the pipeline. We want to get that right, and, of necessity, that will involve a dialogue with trade unions and others. I look forward to a very early dialogue and to bringing together a legislative proposition to the Assembly that addresses some of those big challenges.

Photo of Gary Middleton Gary Middleton DUP

I thank the Minister for his statement, particularly the comments about addressing regional balance. One of the ways to do that, of course, is through the city and growth deals. There is a lot of frustration, particularly in my council area of Foyle, at the delay in getting those projects over the line. What can the Minister do to progress the city and growth deals as fast as possible?

Photo of Conor Murphy Conor Murphy Sinn Féin

Last week, I had the opportunity to visit Derry and speak to people involved in that at the chamber of commerce and at Magee, which is one of the central projects to the growth deal. I am concerned that some of the momentum has gone out of that. There is a necessity, when public money is involved and projects are put forward, to have due diligence to make sure that they work, but we also need momentum. The longer it takes to get the growth deals done, the more the cost goes up: as we have seen with all capital projects, for every year that they are delayed, the cost goes up.

I want to ensure that due diligence is done but that it is not done in a way that effectively strangles the projects. We need to get them moving. There are big opportunities. I was impressed with the level of enthusiasm and the sense of opportunity that there is in Derry. I want the Department to be an enabler for that, and that means that Invest NI will have a much more proactive role with the council, the chamber, business partners and other community and voluntary sector partners in Derry and the north-west.

It also means working with the Southern Government, because significant investment has come from Dublin, and there are strong linkages, particularly in the education sector, between Magee and Letterkenny. I have spoken to Minister Harris about that, and we intend to jointly visit the area to continue to promote that.

There are opportunities, and we need to make sure that the system of government is not slowing that down when we should be pressing ahead with it.

Photo of Sorcha Eastwood Sorcha Eastwood Alliance

I thank the Minister for his statement. The statement acknowledges the issue of productivity and skills. I hope that the Minister commits to implementing the skills strategy in full, and I welcome the statement about careers advice in schools; I have previously expressed an interest in doing a private Member's Bill on that.

What are the Minister's plans to reform the apprenticeship levy, whereby circa £80 million is paid by Northern Irish businesses each year? Will he commit to making sure that that money returns to Northern Ireland and is ring-fenced specifically for skills?

Photo of Conor Murphy Conor Murphy Sinn Féin

I agree with the Member on skills. One of the difficulties over recent years — I know this from my previous experience in office — was that the money that we primarily had for skills was European money that ended and was not replaced by the British Government. That has left a significant hole in the Department for the Economy's budget. We managed to fill that, during COVID, with moneys from Whitehall to keep the support for skills and trying to take people into the workforce. However, that is a real challenge in the time ahead.

The apprenticeship levy has not really worked for us. It was designed in Britain. We have such a high level of public-sector employment that we end up being almost a net contributor to rather than a beneficiary from it. We have to revisit that. The Department of Finance has a role, because it generally speaks to Treasury on that, but I look forward to a discussion with my colleague to find a way to change that, because it has not worked for us in the way that it has worked in Britain. We need to revisit that.

We have to find creative ways, particularly in the current restrained public finance situation, to get money into skills and education, because that will get more people into the economy and that generates more income.

Photo of Áine Murphy Áine Murphy Sinn Féin

I thank the Minister for making his statement this afternoon. With funding running out in March of next year, will he work with local enterprise agencies, such as Fermanagh Enterprise in my constituency, to co-design a successor to the Go Succeed programme?

Photo of Conor Murphy Conor Murphy Sinn Féin

The thrust of what we have said on regional balance is that it has been much too Belfast-centric; the report on Invest NI recognised that. That does not mean that Belfast will not continue to get support. It is an economic hub for the entire region, but that has come at the expense of working with and supporting local areas. If we have more of a co-design process, as the Member mentioned, for Invest NI that means strengthening regional offices, working with councils, business interests and the community and voluntary sector in areas to design what is needed for them, and having the resources to support that.

Each area has a different approach and emphasis. It is about trying to make sure that we provide support for local economic growth. That will be a much more successful formula for trying to ensure that we have proper regional balance in the time ahead.

Photo of Jonathan Buckley Jonathan Buckley DUP

I pay tribute to the many professional staff at Invest NI who, over many years, have created jobs and facilitated investment in the Northern Ireland economy. One of the main criticisms was, evidently, the lack of support for indigenous businesses, which was mentioned in the statement. How does the Minister propose that, in line with the review, we ensure that businesses clearly know what support is available via Invest NI so that they can grow and meet their true potential?

Photo of Conor Murphy Conor Murphy Sinn Féin

One of the first ways to do that is to provide that level of strategic focus so that businesses know what areas are getting supported. The client-company mechanism was severely criticised in the report. A lot of businesses that received support from Invest NI were content, but an awful lot of businesses were outside that tent and could not get any support. Unfortunately, we do not have the public finances to provide support for everyone — would that we had. That means that we need a strategic focus on the industries and businesses that we want to grow. We need to encourage the use of clusters so that people can feed off each other to grow their business. Small businesses, in particular, that find themselves part of clusters have proved to be much more resilient and productive. We have to do that in a way that continues to grow the economy, recognising, even though I will argue for all the money that I can get for Invest and other sections of the Department for the Economy in the time ahead, the difficult financial situation that we face. It is about giving a clearer focus and businesses understanding what that focus is. One of the criticisms was that Invest NI had a lack of strategic focus. How do you translate that into businesses understanding what the organisation is doing? I hope that, in the time ahead, we will have a much clearer picture of what Invest NI is about and how it does its business so that businesses can engage with it.

Photo of Philip McGuigan Philip McGuigan Sinn Féin

Minister, I welcome your statement and economic vision. I also welcome the acknowledgement in your statement that tourism spreads prosperity across the North. Does the Minister agree that the British Government's electronic travel authorisation scheme poses a significant threat to our tourism industry?

Photo of Conor Murphy Conor Murphy Sinn Féin

Yes, there is a real concern about that among tourism providers. It is one of the issues that have been raised with me, in the north-west in particular, before I came into office and since. When people visit the area for tourism, they visit Derry and Donegal, so Derry could be the centre of something that is much bigger than just the city itself. There is a real concern about the impact of the scheme. A lot of consequences, whether foreseen or unforeseen, of the British Government's Brexit approach are damaging to the island of Ireland. It is an issue that I would like to engage early on with the Home Office in particular and relevant authorities in Whitehall to try to get them to see sense on the damage that that scheme would do to our tourism industry in the time ahead.

Photo of Paula Bradshaw Paula Bradshaw Alliance

Thank you, Minister, for your statement. I wish you well in your new role. You will be aware that the Executive Office is responsible for the re-establishment of the economic policy unit and the development and delivery of the investment strategy for Northern Ireland. Will you outline how your statement today will align with those pieces of work, please?

Photo of Conor Murphy Conor Murphy Sinn Féin

The economy here is not the remit solely of the Department for the Economy; many factors feed into it. We talked about the Department of Education being one, but Finance, Infrastructure and Agriculture all have a contribution to make when it comes to the growth of our economy. There is an economic policy function in TEO. I look forward to engaging in that regard. I think that I have a meeting arranged next week with the head of the Civil Service to discuss economic policy and how the operations of the Department that is under her remit and my Department can come together more closely. All Ministers across the Executive have key priorities to bring to the table, such as childcare and economic growth, in the time ahead, and it is incumbent on us all to make sure that we act cohesively rather than contradicting each other in the approaches that we take.

Photo of Deborah Erskine Deborah Erskine DUP 1:00, 19 February 2024

I thank the Economy Minister for his statement. I notice that he referenced our further education colleges. In my constituency, we can boast excellent facilities in Enniskillen at the South West College campus, which feeds into our Northern Ireland workforce. Will he commit to ensuring that his vision will have regional balance across all sectors of employment in order to tackle the brain drain from our rural areas to elsewhere around the world? What exact plans does he have to strategically promote the north-west and south-west regions around the world as areas of employment in order to ensure the levelling up of our economy?

Photo of Conor Murphy Conor Murphy Sinn Féin

The Member makes a fair point in that there has been investment in a lot of our college infrastructure, including in the south-west. We have a good product and good infrastructure there. We need to make sure that the opportunities that that can create for local young people and other people who return to education can be availed of. Those colleges are underutilised, in terms of the attendance at them, and I would like to see those figures go up and more people availing themselves of the opportunities that our colleges provide.

On promotion, as I said in the statement, there are things that Invest NI can do. Other development agencies put stronger conditions on people about where they want them to go and whom they want them to employ in terms of their net zero contribution, so we have an opportunity to look at how Invest NI does that. It is not simply about saying, "Come here, and we'll give you whatever support we can". We want to see investment go to areas where it has not been so frequently before. We can use the levers that we have in Invest NI to achieve more regional balance, including for the south-west.

Photo of Sinéad McLaughlin Sinéad McLaughlin Social Democratic and Labour Party

Minister, I appreciate the prioritisation that you have given in your statement to regional balance. We in the north-west have seen many visions and have been promised prioritisation, but, unfortunately, we never get to the delivery point. Many countries across Europe put the provision of regional balance in legislation. Do you agree that we need to tackle regional, economic and social imbalance through legislation? Will you commit to such legislation?

Photo of Conor Murphy Conor Murphy Sinn Féin

I am conscious of the time frame that we are working with. I wish that it were a five-year mandate; we are dealing with a three-year mandate now. The choice is that either I get on with reorientating Invest NI — the delivery mechanism for this is Invest NI, which has not had this orientation in its past — try to get more regional work done with the partners in those areas who have told us how they want things to work and get that going now or I go out and start to consult on legislation, which would probably take, in a best-case scenario, a year to 18 months to get in place. I am not averse to legislating, and, if legislation is required in the future, I would be happy to do that. My focus today is on trying to get the policy changed, trying to get the implementation arm orientated to match the new policy and delivering on the ground.

Photo of Liz Kimmins Liz Kimmins Sinn Féin

I thank the Minister for his statement. I am pleased to see the focus on affordable childcare and on paying childcare workers. That is good news, especially as the Executive have agreed it as a priority. Given that the 30-hour scheme in Britain has not been successful — we have heard the reasons — what sort of scheme do you envision being delivered locally?

Photo of Conor Murphy Conor Murphy Sinn Féin

I envision one that the Executive can agree on. There was a discussion about it last week at the Executive, and I was struck by the cohesion across all Ministers about getting the right policy for here. There are other policies out there that may work. It is a bit like the apprenticeship levy that was referred to: it worked in Britain, but it does not necessarily fit the circumstances that we have here. There was a useful conversation and a strong sense that this is a collective Executive priority. It is primarily led by the Minister of Education — everyone understands that — but he was at pains to point out that we want a collective approach to make sure that we are all comfortable with the policy that emerges, that it fits what is needed for this area and that we get that agreed level of support for it across the Executive. The policy that I would like to see is one that matches our needs and one that the Executive as a whole can buy into, and I think that that is the intention.

Photo of Brian Kingston Brian Kingston DUP

While we all want to see a more regionally balanced economy, does the Minister accept that, ultimately, it is for investors to decide where they will invest? While we can present opportunities and incentives, being overly prescriptive and restrictive could result in potential inward investment going elsewhere and being lost to Northern Ireland.

Photo of Conor Murphy Conor Murphy Sinn Féin

Many other business development agencies use more levers than Invest NI uses to encourage people to other areas. It is not the case that, if somebody is refusing to go somewhere, you say, "Well, don't come". You can certainly use those levers. I am not certain that that has been deployed to any great extent prior to this. The record of levels of investment clearly show that other areas across the region have been suffering as a consequence of a very Belfast-centric approach. That is not to say that Belfast will not continue to be the economic driver for the entire area, but there are opportunities to create for other places.

The infrastructure is improving. Our roads network is improving. Our Wi-Fi infrastructure is improving. This is not a big place. People come here from other countries. This is almost a little city region compared with what people who come from the United States or other areas are used to. We have levers with which we can try to develop regional balance to the best of our ability, and we will use those. However, we want to see investment. We want to see local companies growing and expanding into areas and make sure that the prosperity that comes from that is shared around the individuals involved but also the geographical areas involved.

Photo of Kate Nicholl Kate Nicholl Alliance

I congratulate the Minister on his new role and wish him well.

Some of the most precious work in our economy is done by childcare practitioners. They are paid poverty wages, so it is really welcome to see that and flexibility highlighted in your vision. Given that recruitment and retention are massive problems and the potential cliff edge that the rise in the minimum wage, which is welcome, will cause providers in April, will the Minister outline how he will work with the Education Minister and ensure delivery as a matter of urgency? We have so many childcare providers facing closure, and some sort of emergency support needs to be put in place.

Photo of Conor Murphy Conor Murphy Sinn Féin

There is general agreement that a childcare strategy does not involve just the provision of support for parents, although I know that that is an important issue for many people who have young kids. It also involves those who work in that sector, the vast majority of whom are women, who have been underpaid and have little job security. We will not get an effective childcare sector if we do not look after the people who work in it as well as the people who need the provision. That will be the challenge.

I am happy to work with the Education Minister and other Executive colleagues. As I said in response to a previous question, I get a strong sense at Executive meetings of a collective ambition in this regard. It is a policy that, before we managed to come back, the parties who were going to make up the Executive set as a priority. It is something that we will be judged on over the course of the mandate, so I want to see the most effective policy delivered.

Photo of Linda Dillon Linda Dillon Sinn Féin

I wish the Minister well in his role as our new Economy Minister.

I am glad to hear your comments and to see in your statement that notion of reorientation and a focus on other areas. I speak, in particular, of my area of mid-Ulster, where our engineering and manufacturing sector has been successful in spite of Invest NI and central government help, not because of it. Will your emphasis on clusters include local networks like Manufacturing and Engineering Growth and Advancement (MEGA) in mid-Ulster, which has been doing brilliant and transformative work? A focus on that from central government would be much appreciated.

Photo of Conor Murphy Conor Murphy Sinn Féin

I thank the Member. Yes. I had the opportunity to speak to people there on a couple of occasions over the past six to nine months. I concur with her view that there is an excellence in manufacturing there that plays a leading role on the world stage in terms of some of the products produced.

One of the issues that we refer to is the availability of land. We were told that Invest NI does not have any land left in mid-Ulster. That is not a tenable situation, given the manufacturing sector there, which is internationally recognised and has the potential to grow much bigger.

Some of the levers that have been available to us now need to be put in place and deployed. We need to make sure that land is available where we find growing clusters like that. We need to make sure that everyone is linked in. We need to ensure that the skills are there, particularly for young people, as the local colleges have already been doing, so that a workforce can be provided to meet the ambition in that area.

There are many levers with which we can assist and enable continued growth. My sense from talking to the people involved in manufacturing down there is that they want to go further and to create more jobs and prosperity in the area. They have deep roots in the area that they come from, which is important, and they want to create economic success there. I see our job and that of Invest NI as enabling that to happen.

Photo of Ciara Ferguson Ciara Ferguson Sinn Féin

I thank the Minister for his statement. As we are a small island, connectivity is crucial to our economy. Having supported City of Derry Airport's public service obligation (PSO) route to Heathrow, will the Minister look at the Derry to Dublin route, as was promised under 'New Decade, New Approach'?

Photo of Conor Murphy Conor Murphy Sinn Féin

I was pleased to be up there with the Infrastructure Minister last week and to provide support to City of Derry Airport. That connector to Heathrow — one of the busiest airports in the world — is critical to the airport. Also critical to it, as I have said many times, is the connection with Dublin and the potential to grow the business of the airport through that connection. I am pleased, now that the Executive and this institution are up and functioning, that the North/South Ministerial Council will also be functioning. I have already been in touch with my counterparts in Dublin, and those are some of the issues that we want to progress in the time ahead.

Photo of Mark Durkan Mark Durkan Social Democratic and Labour Party

Gabhaim buíochas leis an Aire as ucht a ráitis, agus déanaim comhghairdeas leis faoina phost nua.

[Translation: I thank the Minister for his statement and congratulate him on his new job.]

We welcome and look forward to the transition to a greener and more sustainable economy, but will that include a legislative ban on fracking and petroleum exploration and extraction?

Photo of Conor Murphy Conor Murphy Sinn Féin

As the Member will know, Economy is a vast Department. I have been getting to grips with all the issues there. The Department is looking at legislation on that, and I will bring forward propositions in the not-too-distant future.

Photo of Daniel McCrossan Daniel McCrossan Social Democratic and Labour Party

Among the key criticisms of Invest NI from many businesses and investors that I have spoken to are that it is disconnected, difficult to deal with and unrealistic, that it places more hurdles in the way than it offers solutions and assistance and that the north-west does not feature on its radar at all. With the new changes and reforms of the organisation in place, which are much welcomed, what measurable checks can be put in place to ensure that the north-west finally gets its fair share of the cake?

Photo of Conor Murphy Conor Murphy Sinn Féin

When we talked to people in the north-west and other areas, we found that they want to have their own input into Invest NI. That is what I envisage. Every area in the north-west has its own particular interests in this regard. We are looking for co-design, with Invest NI having a stronger resourced regional presence, working in conjunction with councils, businesses, the community and voluntary sector, trade unions and other interests, so that we agree a plan. That is the measurable part of it: the plan that an area wants delivered to kick-start and support growth will be unique to that area. That will be the measurement.

I have heard many of the criticisms that the Member has made. I have a sense that Invest NI wants to change the way that it does things. I have had good conversations with senior people in Invest NI. We want to see a quick turnaround and a different approach to this, and we want to measure the outcomes accordingly.

Photo of Jim Allister Jim Allister Traditional Unionist Voice

Following Mr O'Toole's question, I waited in vain for a DUP MLA to burst the Minister's bubble about his reaffirmation of the all-island economy, because this wonderful document suggests that all of that has been torpedoed. It seems that the DUP MLAs do not even believe their own propaganda. Does the Minister believe that the unaltered Windsor framework, with all its dimensions, aids the growth of the all-island economy? Does he further believe that the existence of the Irish Sea border, which did not even merit a mention in his statement, has the same effect by inhibiting trade from GB?

Photo of Conor Murphy Conor Murphy Sinn Féin

I would say, in the first instance, that I believe that Brexit was a bad idea, even for those of you who supported it, and that any alteration to the trading arrangements between Britain and Europe was going to have an impact. The outcome is that we are not where we were, and we have been trying ever since to make the best of a bad idea by trying to improve those relationships.

I see the opportunity. It is not about whether I think it makes things easier; the statistics show that trade has grown North-South and South-North. That has happened organically because people have been doing business together. That is good. It is good for people in the Member's constituency in the same way as it is good for people in mine. Making east-west links as frictionless as possible is good for people in his constituency in the same way as it is good for people in mine. We want to see the economic prosperity of the region change. It has been left in the doldrums for far too long, with low productivity, low pay and no real sense of economic opportunity. It is the responsibility of all of us to change the dial on that, and that is what I intend to do through the strategy that I have laid out.

Photo of Claire Sugden Claire Sugden Independent 1:15, 19 February 2024

I congratulate the Minister on his new post. Minister, your statement referenced energy efficiency. Do you have any plans to introduce energy efficiency grants similar to what we see in GB with the green deal for commercial and residential properties?

Photo of Conor Murphy Conor Murphy Sinn Féin

There are opportunities. As the Member knows, we have a limited Budget. Departments are not being asked to submit new bids; they are being asked to find out how they can not spend rather than spend money. There are opportunities, however; other funding streams are available. It is incumbent on us to put the renewable heat incentive (RHI) situation to bed finally, and I hope to do so quickly. That will open up opportunities to support green projects. I want us to get to a situation in which we can take advantage of other supports. We will have to work through what that looks like, but we are legally and morally obliged to move to a situation where we produce more green energy. Given the island that we are on, we will have, over the years ahead, a significant opportunity to become not only self-sufficient but perhaps even an exporter of energy, which would be very beneficial to us. We have to harbour those ambitions and then try to work the strategy in order to get there. There is limited resource available in our budgets, but additional resource may be available elsewhere. We need to be in a position to do that, and part of it is to conclude the RHI experiment, which is a sorry tale for all of us.

Photo of Justin McNulty Justin McNulty Social Democratic and Labour Party

Go raibh maith agat, a Leas-Cheann Comhairle. Ádh mór ort

[Translation: Thank you, Mr Deputy Speaker. Good luck to you]

in your new role and to my constituency colleague, the new Minister for the Economy.

Minister, like me, you will be aware of the specific challenges faced by businesses in Newry and south Armagh with respect to the availability of full insurance and of government-backed support for businesses unable to obtain insurance. Your commitments to a regionally balanced economy are most welcome. However, do you accept my assessment that any efforts to balance and support our economy at the micro level must be attuned to grassroots needs and, with respect to Newry and south Armagh and elsewhere, will require specific action on insurance costs and coverage?

Photo of Conor Murphy Conor Murphy Sinn Féin

The Member will know that fiscal matters such as insurance and the control and regulation of them lie in London. That is unfortunate, because there is an inherent unfairness in the way in which insurance companies treat people, particularly in the area that we represent. We saw how inadequate the insurance arrangements for flooding were. It is a big challenge, and the difficulty is that it is regulated in London. As part of my engagement with the Government and Departments in Whitehall, I will be happy to pursue all those issues, just as we pursued the travel restrictions that are proposed.

Yes, we absolutely want to see businesses supported and continuing to grow. That is why a regional strategy will benefit Newry and south Armagh and south Down as much as it will benefit the north-west. Having clarity of arrangements between North and South will grow the all-island economy, which, we know, will be beneficial to the people whom we collectively represent. Insurance is a significant challenge, however, and one for which, unfortunately, we do not have direct responsibility here. We can make representation, and we will do so in the time ahead.

Photo of Steve Aiken Steve Aiken UUP

Before I call the last person to speak, who will be Gerry Carroll, more observant Members will have noticed that Gerry was not in his seat at the beginning of the Minister's statement. However, in view of the exceptional circumstances of the Finance Committee's meeting, I have decided to use my discretion to call him.

Photo of Gerry Carroll Gerry Carroll People Before Profit Alliance

Thank you, Mr Deputy Speaker. I hope that you do more of that as the session goes on.

Minister, I want to know your view on cutting corporation tax as part of your vision for the economy. Essentially, it is a Thatcherite view that, if corporate taxes are slashed, wealth trickles down, but it never trickles down; it always stays in the bank accounts of the wealthy. As he will know, the latest DUP-Tory deal document, 'Safeguarding the Union', mentions devolving corporation tax, presumably to reduce it. Are the Minister and his Executive colleagues rushing, clamouring and demanding to devolve corporation tax to reduce it? What is his opinion?

Photo of Conor Murphy Conor Murphy Sinn Féin

I could tell the Member that he missed all the best bits of my statement.

I said this when I had the Finance portfolio, and the Economy Minister at the time agreed with me: it is not something that we are rushing into. The difficulty for us is that the Treasury's approach to the devolution of taxation, particularly corporation tax, is that it wants the money up front that, it thinks, it would yield. That money comes directly from our public services. Our public services are so underfunded, and we are so underfunded in relation to our level of need, that it would not be conscionable to denude them of any more finance in order to hope for the benefit that a lower rate of corporation tax might bring. There are no guarantees, so we would have to hope for what it would bring back to us. We have economic levers in our approach to business, with policies that we can set, and we have to use them as best we can in the time ahead to try to grow the economy. I do not see corporation tax playing any part in that any time soon.

Photo of Steve Aiken Steve Aiken UUP

That concludes questions on the statement. I ask Members to take their ease while there is a change at the top Table.

(Mr Speaker in the Chair)