Northern Ireland's incoming executive has not been given the policy weapons to address the North's economic structural problems, according to Bank of Ireland's head of research in Northern Ireland.
Speaking at a seminar in Belfast yesterday, Alan Bridle warned that expectations of jobs growth and economic reform needed to be lowered in the absence of a reduced corporation tax rate.
He said there was "universal disappointment" within the business community about the so-called peace dividend and he was fully in support of the campaign to bring corporation tax in the North, currently at 28 per cent, into line with the Republic's 12.5 per cent rate. "I'd be a little more cautious than others about what this might achieve in terms of jobs growth, but it would give us an excellent opportunity from a marketing perspective," he said.
Northern Ireland had benefited in recent years from a positive public spending cycle, but this was coming to an end, and the region would feel the pinch more than other parts of the UK because it was so dependent on the public purse, Mr Bridle said.
"There is buoyancy in the economy and a feel-good factor, and both are likely to remain for the next 12 months," he said. "But incoming ministers are being bombarded with wish-lists for reform - water rates, domestic rates, health service issues. It's all about expectations. In terms of expectations about the economy, people need to be realistic."
