Republican News · Thursday 26 June 2003

Radical action needed to revitalise west of the Bann

BY PAT DOHERTY, Sinn Féin MP for West Tyrone

The unemployment claimant count for West Tyrone currently stands at 2,243. However, this is only half the story. There is a significant amount of hidden unemployment, with very high levels of long-term sickness, stay at home parents and discouraged workers in Omagh and Strabane District Council areas.

According to the Census 2001, the percentage of economically inactive in Omagh was 39%(or 12.820 individuals) with Strabane having an even worse figure of 44% (or 11,534) compared to the Six-County figure of 38%.

If the difference between these figures were considered to consist entirely of the 'hidden' unemployment, this would increase the total unemployment rate for Strabane District Council to 11.9%, almost four times the equivalent rate for the North. The equivalent rate for Omagh District Council would be 4.9%, almost 50% higher than the Six-County equivalent.

Of course, all figures would need to be reduced to take account of hidden unemployment and this would reduce comparators; however, what is clear is that Omagh is significantly disadvantaged vis-‡-vis the Six Counties and Strabane is exceptionally disadvantaged under the same measures.

Similar patterns of unemployment disadvantage pertain in District Council areas throughout the west of the Bann.

This disadvantage is primarily a result of historical neglect.

However, with ever-increasing globalisation, this historical neglect is being overlaid with a layer of disinvestments. Given that areas West of the Bann have been historically reliant on the manufacturing sector and particularly on textiles, the region is disproportionately suffering as a result of globalisation.

Multinationals and even large indigenous manufacturers are claiming that they are having to relocate to developing countries in an effort to stay competitive, but more likely is the lure of cheap labour and increased profit margins.

Everything points to this trend of disinvestments continuing unabated, with areas west of the Bann becoming increasingly reliant on the creation of small indigenous businesses to sustain the local economy.

It is highly unlikely that the rate of small business creation will be sufficient to replace the jobs currently being lost in the manufacturing sector, never mind having any beneficial impact in decreasing the unemployment disadvantage west of the Ban.

Recently, Martin McGuinness, Michelle Gildernew and myself met with Direct Rule Industry Minister Ian Pearson. We drew his attention to the British government's commitment under the Rights, Safeguards and Equality of Opportunity aspect of the Good Friday Agreement to making rapid progress with "a range of measures aimed at combating unemployment and progressively eliminating the differential in unemployment rates between the two communities by targeting objective need".

We impressed upon him the need to initiate a cross-departmental task force and put in place a holistic strategy encompassing infrastructure development, worthwhile and targeted retraining, dealing with high energy and insurance costs, greater support for indigenous industry and taking steps to attract inward investment.

Unless such an integrated strategy is formulated and implemented, we will be destined to remain in the economic doldrums and suffer the same levels of unemployment disadvantage.

In terms of the largescale inward investment, the Six Counties are not at the races. The massive disparity in Corporate Tax between the 6 and 26 Counties completely militates against getting industries to set up on this side of the border.

The possibility of getting the British government to harmonise the level of Corporate tax in the Six Counties with the 26 Counties is highly unlikely for the foreseeable future.

In light of this, the only hope of attracting the level of inward investment that is needed west of the Bann is through the development of an all-island investment body.

Michael F Smyth, a senior lecturer in economics in the University of Ulster's School of Economics and Politics, outlined the wisdom and benefits of such a body:

The promotion of Ireland as a single tourism destination under the Tourism Ireland banner proves that mutually beneficial cooperation is both feasible and desirable. There could be similar cooperation to sell the benefits of Ireland as a whole to foreign investors, as both economies stand to gain from a pooling of efforts and resources.

The North would have the potential to develop new supply chains to service externally-owned sectors, and there would be opportunities to deepen existing supply chains. The 26 Counties would gain increased industrial and commercial capacity and would benefit from a virtual single labour market. Foreign direct investment to Ireland would be made a more attractive proposition.

Sceptics might ask what the North has to contribute. Try lower property costs, more generous capital allowances, additional university research excellence, competitive wage costs and a ready supply of skilled human capital.

If the economic decline and unemployment disadvantage west of the Bann is to be halted and reversed, there needs to be a sea change in thinking. Piecemeal interventions will only perpetuate the status quo. It's time for radical steps to be taken.