BELFAST BRIEFING:A lobby group has pinned its hopes on getting the corporation tax rate reduced, writes FRANCESS McDONNELL

IN AN ideal world I would like a dinner date with George Clooney, my mortgage paid off by a financial fairy godmother and several thousand pounds in unmarked notes under my bed.

In the real world this is never going happen but who is to say you cannot daydream? That’s exactly what the Northern Ireland Economic Reform Group is

about – wishful thinking. The group of business people, economists and accountants have got together to campaign for a cut in the level of corporation tax that businesses located in Northern Ireland pay.

Any company based North of the Border has to pay a headline rate of 28 per cent. In the Republic, corporation tax levels are set at 12.5 per cent.

Imagine if your company, located somewhere around Newry, was hypothetically within a stone’s throw of a competitor who benefits from much lower tax rates. It would quite reasonably appear grossly unfair. That in a nutshell is the argument which the Northern Ireland Economic Reform Group (or ergNI to its friends) is putting forward. ErgNI argues that the quickest way for Northern Ireland to solve the myriad economic problems it faces is with a reduction in corporation tax levels.

In its first major report, the group asserts that, 12 years after the Good Friday agreement, Northern Ireland remains the UK’s poorest region. “It has the lowest average wages and among the lowest productivity.

“Despite having proportionately the smallest private sector, it has suffered the largest percentage loss of jobs of any region during the current recession,” it states.

The ergNI report highlights that around half of all government expenditure in Northern Ireland is financed by taxpayers in Britain. It claims that this subsidy is worth £9 billion to Northern Ireland every year – the equivalent of every man, woman and child in the North receiving £5,000.

ErgNI’s core argument is that if Northern Ireland had a lower rate of taxation – more in line with its neighbours – it could attract a lot more new investors, who would in turn create jobs and make the North a much happier place for everyone.

The group has creatively suggested that an estimated 90,000 extra jobs could be created in two decades if Gordon Brown just let Northern Ireland have a lower rate of taxation.

Not everyone supports this theory. The assistant general secretary of the Irish Congress of Trade Unions Peter Bunting has described the ergNI’s first report as a “tax avoidance charter”.

Bunting does not believe that a sudden reduction in corporation tax levels in the North would magically solve local economic problems. “Would it act as an incentive to companies to create jobs in Northern Ireland and help grow the economy or would it just encourage companies to locate here to create more profits for themselves and then relocate to lower wage economies in time?”

ErgNI underlines its argument by reminding everyone that you only need to look South to see the validity of its claims. “The experience of the Irish Republic shows the ability of a highly competitive corporation tax regime to attract foreign direct investment,” its report states. “It would greatly enhance Northern Ireland’s promotional message . . . if it were able to look forward to having one of the lowest corporation tax rates in the world. A low tax regime would also, of course, act as a spur to investment by indigenous companies.”

ErgNI is probably correct in its assertion. But unless it has got its hands on a Northern Ireland-built DeLorean time machine, it cannot have escaped the attention, particularly of one of the business body’s key members, Sir George Quigley, that Gordon Brown has previously dismissed the corporation tax argument.

Three years ago, Brown commissioned Sir David Varney to review tax policy in the North. Varney was pretty clear about his thoughts on the issue. “In considering the costs and benefits for Northern Ireland and for the UK as a whole, a clear case for a reduction in the corporation tax rate for Northern Ireland cannot be made,” he stated in his report.

There is a certain case of deja vu about this latest reincarnation of the corporation tax debate in the North so why is ergNI walking out this particular horse again?

Perhaps because a UK general election is looming and they believe they might find a more receptive audience for their argument with the Tories.

The shadow secretary of state for Northern Ireland, Owen Paterson, has already said that the party is keen to explore ways of turning the North into an enterprise zone. Between now and the UK general election, the ergNI can do little more than daydream.