UK’s recovery plan contains ambition and opportunity for Irish business

Britain, like Ireland, is emerging gradually and cautiously from lockdown and from a big economic shock. That was the backdrop to last week’s Budget statement from Chancellor Rishi Sunak. There’s a lot in it to excite and interest Irish businesses.

In particular, our commitment to the green agenda, focus on science and technology and a renewed appetite for innovation presents tremendous potential for trade and investment. A big part of this will be building the community, regional and national infrastructure that makes people’s lives better and increases connectivity.

The skills and experience of Irish entrepreneurs and investors, in construction, engineering, technology and professional services mean Ireland is in a strong position to take advantage of opportunities as both countries rebuild their economies and societies.

To shield the economy as we emerge from Covid, the UK government is pursuing emergency measures, including a new UK-wide Recovery Loan Scheme, with loans of up to £10m (€11.6m), to help businesses of all sizes through the next stage of recovery. The Coronavirus Job Support Scheme has also been extended to September with more support for trainees and apprenticeships as part of the package.

The government is also clear that we need to start addressing the fiscal consequences of the economic shock. We will raise corporation tax to 25pc, still the lowest rate in the G7, and applying only to companies with profits above £250,000. And it will kick in only in 2023, once the recovery is secure.

And there will be a new ‘super-deduction’. From next month and for the next two years, companies investing in new plant and machinery assets will benefit from a 130pc first-year capital allowance. What this means is companies will be able to cut their tax bill by up to 25p for every £1 they invest in qualifying assets, ensuring the UK capital allowances regime is amongst the world’s most competitive.

We are creating a new £375m ‘Breakthrough’ fund in life sciences, quantum computing and clean tech for innovators aiming to raise at least £20m of funding.

We want a green recovery, as well as a cutting-edge scientific one. The UK shares Ireland’s commitment to clean growth and responding to the global challenge of climate change.

So, as part of the Prime Minister’s 10-point Plan for a Green Industrial Revolution, a £20m fund has been announced to support a UK-wide competition to develop floating offshore wind demonstrators and help support the government’s aim to generate enough electricity from offshore wind to power every home by 2030.

The UK is funding £68m for another UK-wide competition to deliver first-of-a-kind long-duration energy storage prototypes that will reduce the cost of getting net zero by storing excess low carbon energy over longer periods.

We’re also pursuing our ‘levelling-up agenda’ of spreading wealth and opportunity across the country. A new UK Infrastructure Bank sited in Leeds will provide financing support to private sector and local authority infrastructure projects across the UK. 

Across the country, we will see new building and i nfrastructure programmes alongside expanded clean energy hubs (the Aberdeen Energy Transition Zone; the Global Underwater Hub in Scotland; a demonstration hydrogen hub in Holyhead) and upgraded and renewe d transportation networks.

And eight free ports have been announced for England with more to follow for the UK’s other nations; regeneration of 45 English towns as well as improved local transportation networks, community assets and cultural projects all designed to help communities build back better

For Northern Ireland, we have the £400m ‘New Decade New Approach’ package, half of which has already been allocated across four areas: new systems for supermarkets and small traders to manage new trading arrangements; building greater resilience in medicine supply chains; promoting Northern Ireland’s goods and services overseas; and supporting skills development.

The Government is committing over £100m for the Derry-Londonderry and Strabane City Deal. The project proposals for this focus on inclusive and sustainable growth and have the potential to create an additional 7,000 jobs.

And last but not least, there is football – the Budget announced £2.8m to support work to prepare a joint UK/Ireland bid to host the 2030 Men’s FIFA World Cup. I will never forget being in Paris to see Scotland play Brazil at the opening match of the 1998 tournament. How great would it be to see all the nations of these islands in the World Cup Centenary tournament in 2030?

Paul Johnston is the UK Ambassador to Ireland