Sir David Varney launches
his Review of the Competitiveness of Northern Ireland
HM TREASURY News
Release (PN Varney) issued by The Government News Network on 30
April 2008
Sir David Varney
today published his Review of the Competitiveness of Northern
Ireland, which follows on from the conclusions of his Review of
Tax Policy in Northern Ireland published in December 2007. Sir
David's Review identifies a number of core strengths that
make Northern Ireland a good place to do business and attractive
to a wide range of investors. These strengths include a young
population, an excellent education system, macroeconomic
stability, strong transport links with the rest of the UK, Ireland
and Europe and ambitious plans for further infrastructure
investment. These strengths - alongside a range of investment
incentives - have already attracted notable inward investment, and
seen some of the strongest growth in output of any UK region.
The Review makes the case that increasing globalisation will
bring a number of new challenges to the Northern Ireland economy
in the years ahead, as emerging economies compete increasingly in
a range of sectors. To succeed in the face of this growing
competition, Northern Ireland will need to continue to raise its
relatively low productivity and employment rates and reduce the
number of low-skilled workers in the economy. Sir David found that
the Northern Ireland Executive has responded well to many of these
challenges, and welcomes the priority given to the economy in
Northern Ireland's Programme for Government and the
strategies developed to support economic development. The Review
concludes that the Executive should now focus on the rapid and
effective implementation of those strategies.
To boost the competitiveness of the Northern Ireland economy
further, the Review recommends action in a number of areas, including:
* deepening and intensifying public sector reform, in particular
increasing the role of the private sector in the delivery of core
public services and transferring non-core services to the private
sector in order to help stimulate its growth;
* ambitious labour market and welfare reform, aimed at increasing
the employment rate and reducing the number of people on
Incapacity Benefit;
* more employer-led skills training to help tackle weaknesses in
the stock of skills in the labour market, which is a legacy from
the past;
* ensuring a joined up approach between Invest Northern Ireland,
UK Trade & Investment and the Irish Industrial Development
Agency (IDA) to market Northern Ireland to the full; and
* continuing development of the all-island economy with the Irish
Government, supported by the UK Government, including increased
trade, movement of labour and capital, tourism, energy markets and
financial services as well as many other sectors.
Sir David said today:
"I believe that Northern Ireland has the potential to be a
21st century economic success story. My findings suggest that
Northern Ireland has a number of substantial competitive
advantages and is already a very good place to do business with a
young and skilled workforce. The Northern Ireland Executive has
already made excellent progress, putting economic development at
the heart of its programme, and setting out a range of programmes
to create a vibrant and prosperous economy. This commitment to
economic growth is shared by political parties, the public and
private sectors and the Irish and UK Governments.
The next stage of Northern Ireland's progress should be the
rapid and effective implementation of the Executive's
ambitious economic strategy and the widening and deepening of
existing reform. My recommendations for the Northern Ireland
Executive and the UK Government are intended to assist the
Executive and the UK Government, supported by the Irish
government, in delivering their central economic objectives for
Northern Ireland The forthcoming US investment conference will be
an important staging post in Northern Ireland's transformation."
Notes for Editors
1. Following representations by political parties in Northern
Ireland, the Government commissioned Sir David Varney, in March
2007, to carry out a review of tax policy in Northern Ireland. The
review was published in December 2007 (http://www.hm-treasury.gov.uk/media/1/3/varney171207.pdf).
He concluded that the best way forward for building a strong
investment strategy for Northern Ireland was a strategy based on
maximising the benefits of the competitive advantages that already
exist in Northern Ireland, including current financial investment
incentives, and realising the potential further to improve this
competitive advantage rather than a policy of a preferential
corporation tax rate for Northern Ireland, as compared to the rest
of the UK.
2. The report identified Northern Ireland's key competitive
advantages, which make Northern Ireland an attractive and
competitive location for investment. However, Sir David's
review noted that the Northern Ireland economy still faced some
demanding challenges. So the Government asked Sir David to
undertake a second review of competitiveness in Northern Ireland.
The Review commenced in January 2008.
3. The terms of reference were: "Building on Sir
David's earlier analysis and agreement from all parties about
the unique circumstances of Northern Ireland (in relation to the
opportunities provided by the peace process, the need to
strengthen the private sector, to create increased employment
opportunities and to reform the public sector) this review will
explore in more detail how to expand the private sector and to
enhance Northern Ireland's competitiveness."
4. The full report can be found at: http://www.hm-treasury.gov.uk/independent_reviews/varney_review/varney_competitiveness_index.cfm
5. Sir David Varney (born 1946) was the chairman of HM Revenue
and Customs from its establishment in April 2005 to the end of
August 2006. After graduating in Chemistry from the University of
Surrey, David Varney joined Shell in 1968. In 1990 he was
appointed Head of Marketing, Branding and Product Development for
Shell International Petroleum and in 1991 was appointed a Managing
Director of Shell UK with responsibility for downstream
activities. He was appointed a Director of Shell International
Petroleum in 1996. In June 1996 Varney joined BG (formerly British
Gas), as Chief Executive designate of the proposed BG plc and was
appointed Chief Executive the following year, overseeing the
successful demerger of Lattice plc. He was Chairman of mobile
phone operator mmO2 between 2001 and 2004. He was also Chairman of
Business in the Community and is president of the Chartered
Management Institute. Since leaving HM Revenue and Customs, Sir
David has advised the Prime Minister on public service
transformation and chairs the cross-Whitehall service delivery council.
6. Non-media enquiries should be addressed to the Treasury
Correspondence and Enquiry Unit on 020 7270 4558, or by e-mail to public.enquiries@hm-treasury.gov.uk.
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