THE ECONOMY

How viable is Northern Ireland?

MARTIN WALLACE

A full-page advertisement elsewhere in this supplement features a large photograph of a works band in County Fermanagh, with the caption in heavy type: 'This is the sort of marching in the streets of Northern Ireland that you don't see on television'. Arguably, the Ministry of Commerce might have taken the view that it was pointless to try promoting Ulster's attractions for new industry against the tide of events. But indus- trial incentives have been given a substantial boost since the outbreak of disturbances last year, and the message to put across is that industry has not been very much affected by the troubles.

It is hard to quantify this message. There were some factory-burnings in August last year, and there have been some since, but the actual loss of production has been very small. What is harder to determine is the effect of continued tension on the shop floor. The recent intimidation of Catholic workers in a Belfast shipyard was widely reported as were the peace-keeping moves which got the men back to work within a week. The ship- yard has been the scene of much violence in the past, and the workers were rightly com- mended for keeping their heads. On the other hand, Harland & Wolff have run into deep financial trouble, after a periol when Sir John Mallabar semed to be getting the firm on an even keel. The period of labo,ir troubles coincided with the period of grow- ing tension in the community, and produc- tivity was affected later by the fact that many workers spent fatiguing nights trying to preserve peace and protect their homes.

The director of a firm which employs many Catholics told me recently that the work force had become more militant and ready to engage in disruptive disputes follow- ing the period when the ordinary forces of law and order were excluded from 'Free Belfast'. Whether or not this is a common experience, there is no doubt that the troubles do impose some mental strain on everyone in Northern Ireland.

_Thus, it is not merely the drive for new industry which could be affected by a con- tinuation of troubles. Existing industry could find its troubles increasing, and it may be- come harder to encourage British executives to take up appointments in Ulster or to per- suade young Ulstermen with marketable skills to remain in the province. In recent years, the Northern Ireland government has spent generously on creating an environment in which modern industry can flourish; im- proved internal and external communications have reduced the province's isolation, and the physical and recreational attractions out- do many parts of industrial Britain. But the government cannot yet promise political stability. It can now offer incoming firms compensation for any damage or loss which may be suffered as a result of rioting or Other disturbances, but there is no real way of compensating for the loss of customers' goodwill if delivery dates are not met. If disorders are posing a particular prob- lem at the moment, it is also true to say that

Northern Ireland has been running hard merely to remain stationary since the new industries drive got under way in 1945. The percentage of workless has usually been about four times the national level, and per- sistently higher than in any other region of the United Kingdom. The provision of new jobs has been offset by the decline of tradi- tional industries, though the greater diversi- fication has left the provincial economy less vulnerable. Moreover, the impact of a new fac ory on the unemployment figures may be lin ted; some Ulster workers may return from Great Britain, while others enter the labour market for the first time.

It is a measure of the lack of local oppor- tunities that the 'activity rate'—the propor- tion of the population in employment—is appreciably lower than in Great Britain. Northern Ireland also has a smaller share of ,growth industries, and output per head is about three-quarters of the national average. On the other hand, the different industries in Northern Ireland have tended to expand (in terms of jobs) rather more rapidly than in Great Britain.

Is Northern Ireland viable? The question is posed by the government's consultants in their introduction to the development pro- gramme for 1970-75. Not surprisingly, the question remains unanswered—for it all de- pends on what you mean by viability. The region is obviously not self-supporting, and must depend for an indefinite period on various forms of financial assistance from Great Britain; but several parts of Great Britain are not self-supporting, and Northern Ireland is unfortunate in that its revenue and expenditure are set out in black and white. Some of the important indices—output per head, for example, and gross domestic pro- duct—show that Northern Ireland has been expanding even more rapidly than Great Britain.

But it is nine years since a working party of senior officials from the British and Northern Ireland governments was asked to recommend measures to bring about a last- ing improvement in the unemployment prob- lem, and there has really been little progress. To illustrate the point, the percentage of un- employed in June over the past ten years has been: 6.9, 7.1, 7.4, 6.5, 5.8, 6.0, 7.7, 7.0, 6.8 and 6.2. Of course, the fluctuations in the national economy tend to be reflected in the local figures, but it is also possible to see in them some of the buoyancy which marked the early years of Lord O'Neill's premiership. He came to office in 1963, and dispelled much of the gloom induced by the working party's findings (the Hall report), which seemed to favour emigration as the most promising cure for unemployment. To O'Neill's first months in office belong Pro- fessor Tom Wilson's first economic plan, covering the period 1964-70; Sir Robert Matthew's 1962 physical plan for the Belfast region was also being implemented, as an integral part of O'Neill's bid to 'change the face of Ulster'.

Clearly, O'Neill hoped that economic de-

velopment—encouraged by substantial gov- ernment spending on 'infrastructure'— would alleviate the traditional antagonisms of Ulster society. The policy failed in this ultimate objective, though possibly it might have turned out differently if he had not issued that fateful invitation to Mr Sean Lemass to visit Stormont in 1965. Yet essen- tially the policy is unchanged under a new Prime Minister, and one suspects that the Minister of Community Relations, Dr Simp- son, would gladly abandon the work of his ministry and of the Community Relations Commission :n return for several thousand new jobs and new houses.

An increase in the housing programme is promised over the next five years, under a

new public housing authority agreed on with the former Home Secretary, Mr Callaghan. But although the target of 17,000 houses a year by 1975 will mean a building rate pro- portionately far above the cross-channel level, there is a great deal to be accomplished in slum clearance and redevelopment of Bel- fast and (to a lesser extent) Londonderry. Housing is one area in which the inter- governmental agreement on making good 'leeway' was inadequately implemented for a number of years after the war. The house- building rate was allowed to decline dis- astrously in the late 1950s before the govern- ment devised a system whereby subsidies were increased in response to rising building costs or interest rates.

The new housing authority, likely to be appointed early next year if the legislation goes through on schedule, will have to find ways of speeding up redevelopment; it will also have to make sure that its estates have amenities rather more generous than are at present provided.

Jobs are more difficult. The Wilson plan aimed for 30,000 new manufacturing jobs in 1964-70, and the target was just about accomplished; however, the gains were largely offset by the decline of existing indus- tries. The construction industry provided more jobs than anticipated, but the service industries disappointed. The development programme for 1970-75 sets no targets. A figure of 40,000 new jobs in manufacturing industry would have seemed attainable before the disturbances of the past two years, and could still be possible if sanity returns. However, Stormont has so little control over the local economy that any target must include a substantial element of wishful thinking.

Much will depend on the Conserva- tives' handling of the national economy, on their regional policies, and specifically on whether, they are as generous to Northern Ireland as their Labour predecessors were in the past.

It is too soon to be pessimistic, and there is a danger of looking at Northern Ireland only in the context of its own local troubles.

Not only is the state of the British economy a governing factor, but British entry into the Common Market could have more impact on Northern Ireland than all the petrol bombs and gelignite. It is worth noting also that much of the new employment has come from giant international concerns who are not unaccustomed to political instability as a business risk.

However, there is still a need for the community to demonstrate a collective will to lift itself out of the present morass. The Government is doing the best it can, cer- tainly, but that vital corner has still to be turned.