Fiddling While Manufacturing and Food Processing Sector Burns

Commenting on the stark lessons to be drawn from the closure of factories in Coleraine and Lisburn SDLP Enterprise, Trade and Investment Spokesperson Seán Farren said:

“The devastating blow dealt to the local and Northern Ireland economy generally by Friday’s two announcements of the closure of Farm Fed Chickens in Coleraine and Barbour Coats in Lisburn only serves to underline the growing lack of competitiveness of Northern Irish firms attempting to gain and retain market share internationally and even locally.

“Try as they might to innovate, to introduce more effective work practices, to cut overheads like energy and transport, companies across many sectors find it increasingly difficult to maintain a competitive edge against competition from much lower cost countries.

“After all the changes they make companies still have a mountain to climb.

“If we are to save our manufacturing and food processing base the time has now come to examine with real determination what more is needed and to examine clearly what government can do.

“Since government controls the tax burden it is a responsibility of government to ensure that taxation does not end up putting companies out of business.

“Direct and indirect taxes can have this effect and the one move that a stroke would protect against that danger is a reduction of corporation tax to the level enjoyed by businesses in the South.

“Northern Ireland contributes about £500m to the Treasury in corporation tax at present. Any further decline in the manufacturing and food processing sectors will seriously eat into this contribution. Much better therefore to have successful businesses contributing at a lower rate, than fewer businesses contributing at a higher rate.

“The SDLP is calling on the government to immediately address this issue. The call for a similar rate of corporation tax to that in the South is widely supported, in the business world and more generally.

“Fiddling around with other solutions will see more and more of manufacturing and food processing companies go out of business. Then it will be too late.”