Population: 1.84 million Area: 5,345 sq. miles GDP / inhabitant: £15,800.

More Governance, Less Government

De-institutionalise Policy to free up Enterprise

Derek McCallan, Northern Ireland Local Government Association

Northern Ireland in Europe

Population: 1.84 million   Area: 5,345 sq. miles GDP / inhabitant: £15,800

EER 2015 – A Challenge to Institutions on behalf of Enterprise Simplify access to

funding for SMEs Promote access to

finance through local loan programmes

Establish a business networking e-platform

Organise high profile events to promote different entrepreneurial sectors where entrepreneurs DECIDE what is best for them

Develop Entrepreneurial eco-system that maps out opportunities for young entrepreneurs

Establish a physical and cultural environment conducive to economic growth and business creation.

EER 2015: A Challenge to Institutions in NI

Reduction in Corporation Tax from 2016 will not cure our economy on its own (66% public sector)

Present Programme for Government and Economic Strategy refer to micro businesses and local economies as vital but few bottom up interventions

Start a Business Scheme supports start up but what about the conditions for enterprise, e.g. Retail / Artisan improvement zones (Lowell, Massechusetts)

EER 2015: A Challenge to Institutions in NI

Reduction in Corporation Tax in NI from 2016 will keep more profit within SMEs

UK = 20%, IRL = 12.5%, NI = ?? State Aid Rules means Cost is £200-

300 million p.a. SMEs need infrastructure, local

authorities and regional government can create the conditions and the places

Unsustainable – More Production, Less Consumption.

Source: NICEP/HMRC Graphics: JPR

And where do we get our money from?

Source: HMRC Graphics: JPR

A Culture of Consumption and Subsidy

Northern Ireland Assembly and Civil service undergoing reform.

20,000 public sector posts to go over the next 5 years

Lowest Business start rate in UK Reduction of the number of Government

Departments – Budget cuts Local authorities have just been merged from 26

to 11and have additional functions Northern Ireland’s economy is too reliant on

public employment...but change is coming and businesses want it.

How do we streamline policies for businesses?

New Council Community Plans: All partners must align their priorities to that of the area community plan.

NILGA plays a crucial role to bring closer the two tiers of government and avoid duplication and complexity

NILGA is lobbying for simplification of process with EU Managing Authorities to ensure that the end user gets the benefits of financial assistance, not the time-consuming administration/auditing of projects

“Businesses want assistance, they don’t want to know about the mechanics behind it”

Devolution of functions to local authorities are going to simplify processes for the end-user

BUT local authorities need to ensure that their reporting responsibilities will not be burdensome.

The 11 Councils should provide a framework where people who make decisions on business are entrepreneurs themselves.

The 11 Councils need to create a networking platform representing entrepreneurial interests to government and other public bodies to allow partnership & cooperation and to foster relationships based on PRAGMATISM & TRUST.

What are the imperatives to assist SMEs?

De-institutionalise from the top. It must be a political imperative

De-categorisation of businesses: ALL small businesses should be given broadly the same opportunities (from stall holders to small exporters).

Although technology is seen as the panacea for growth, we need to remember traditional industries and “hand down” skills before they are lost or forgotten. “the life so short, the craft so long to learn” - Hippocrates

Enterprising businesses within Enterprising States & Institutions

The Small Business Act – Make Public Administration responsive to SME needs – Think Small First – Create the right environment for SMEs

Direct statutory link between tiers of government and agencies, performance managed, using business growth drivers, not public sector data

Create actions underpinned by the SBA Learn from – but compete with - others Some answers lie in the Cities and Regions

(Lowell, pop 103,000, 6,000 jobs and 2000 SMEs in 20 years through City reinterpreting Federal, & State “Red Tape”

Public Sector Reform & Business Infrastructure - Key

Competing and duplicating campaigns like Living / Minimum Wage, Corporation Tax and VAT Tax reductions, Strategies for Skills, strategies for technology like Broadband, should be depoliticised

Cities and regions with autonomy to compete will mean “universal growth” is a panacea – it will be partial

NI is a medium sized City = Self Help is Key (Roads, Technology, Infrastructure, Competitive Region, Tourism, GVA drivers)

Business is the most powerful Institution, not Europe, not China, not any State

.'Business is the most powerful institution on earth today. It is more powerful than politics. Business serves us very well in some ways, but it doesn't serve us as fully as it should; it doesn't serve us fully as people.' Michael Rennie, Director, McKinsey & Co.

If we govern well / simplify our relationships with business and create conditions for growth, then sustainable prosperity is achievable for many

Avoid growing inequality Avoid creating public sector solutions