Select Committee on Northern Ireland Affairs Fifth Report


IV. OTHER BODIES AND THEIR INWARD INVESTMENT ROLES

Local authorities

20. Following the increased powers given to local authorities in the field of economic development, many have sought to play a part in attracting inward investment to their areas. We gave each of the local authorities in Northern Ireland the opportunity to submit written evidence, and the majority have done so.[33] We have also taken evidence from two consortia of local authorities (CORE and Into the West), the constituent authorities of which elect, through these bodies, to promote themselves collectively in relation to seeking inward investment, and from the bodies set up, with substantial local authority involvement, to promote and market the cities of Londonderry and Belfast respectively.

21. IDB was very supportive of the involvement of local authorities and has dedicated a resource to maintain liaison with them. It saw particular value in their involvement in America, as business there is used to involvement with the local political infrastructure.[34] IDB had also noted in the last 18 months that a certain amount of work had been done by local authorities on developing promotional material and that councils themselves had come to realise that their effectiveness would be enhanced if they started to come together in larger groups[35] (such as CORE and Into the West). Investment Belfast considered that there might be scope for a closer working relationship between IDB and local councils. It also claimed that IDB tended to be cautious in its relations with local authorities in case it was accused of favouring particular areas.[36] Some local authorities also supported closer working relations with IDB.

22. Adam Ingram praised the contribution made by local authorities, stressing that this was of particular value when it was done on a cross-party basis. He said:[37]

    "...On the basis that this was cross­community there can be nothing more important, I would suggest, than having representatives from all parties, representing the council, saying, "We are working for the good of our area." That plays very big with potential investors because it goes back to what I said earlier about creating a climate that this process is becoming embedded and it is working. There could be no greater lesson than that. Sinn Fein representatives sitting down with the DUP representatives saying, "Come and invest in our area." That happens.".

23. One of the concerns of many of the local authorities is the uneven distribution of visits by inward investors. The tables overleaf show the number and distribution of visits to local authority areas from 1994-95 to 1999-2000. This shows a distinct clustering in certain areas, particularly Belfast and its hinterland. Beyond that, significant numbers of visits are made to Londonderry.

Visits by potential inward investors


1995/96

1996/97

1997/98

1998/99

1999/00

First time visits

156

121

128

132

132

Repeat visits

87

81

74

66

76

Total visits

243

202

202

198

208

Source: IDB End of Year Statement, 1999-2000, p. 8.

IDB sponsored inward investment visits by companies



1994-95

Total


1995-96

1996-97

1997-98

1998-99

1999-00



Overseas


UK


Overseas


UK


Overseas


UK


Overseas


UK


Overseas


UK

Antrim

26

13

5

26

8

18

3

37

7

16

2

Ards

5

3

0

10

0

1

0

3

1

4

0

Armagh

1

1

0

4

0

2

0

2

0

2

0

Ballymena

13

3

0

0

0

5

0

3

1

1

0

Ballymoney

3

1

0

3

0

2

0

1

1

0

0

Banbridge

2

2

1

1

0

1

0

1

0

0

0

Belfast

65

38

17

48

14

65

17

52

26

83

19

Carrickfergus

13

6

1

21

1

15

0

7

4

5

3

Castlereagh

1

8

0

6

0

2

0

4

3

5

1

Coleraine

5

3

0

7

0

7

0

3

0

1

0

Cookstown

4

15

2

9

1

9

0

3

0

4

0

Craigavon

12

16

0

15

0

15

1

11

0

9

0

Derry

18

29

1

27

5

14

0

25

4

11

5

Down

10

2

0

3

0

4

0

5

0

2

1

Dungannon

13

9

0

4

0

3

0

1

0

1

0

Fermangh

3

11

0

10

5

3

2

2

0

6

0

Larne

6

4

0

1

0

9

0

7

3

2

0

Limavady

3

2

0

7

0

2

0

30

0

2

0

Lisburn

19

36

5

30

1

23

0

30

5

11

0

Magherafelt

3

4

0

0

0

1

0

1

0

0

0

Moyle

0

0

0

0

0

0

0

0

0

0

0

Newry & Mourne

15

12

4

9

0

4

1

7

0

7

3

Newtownabbey

17

18

1

21

1

20

0

11

7

31

2

North Down

4

9

0

3

0

3

1

6

1

2

3

Omagh

2

6

0

8

0

5

0

5

0

6

2

Strabane

2

9

0

9

1

2

0

6

1

4

0

Total

265

260

37

282

37

235

25

235

64

215

41

Notes:

1. Visit elements for other than inward investment purposes, such as visits to tourist attractions, are excluded.

2. General visits to Northern Ireland not including a specific council area excluded.

3. Total District Council visits may exceed total visits to Northern Ireland as a company visit may cover more than one District Council area.

4. Separate figures for 1994-95 are not available


Source:   Official Report, 28 October 1999, Vol. 336, Cols. 932-4W. (1994-95 to 1997-98).

Official Report, 19 April 2000, Vol. 348, Col. 525W (1999-2000).

See also Appendix 22, p. 204-205.

24. Without exception, local authorities were of the view that they could complement the role of IDB. Derry Investment Initiative considered that their network of contacts produced investment leads additional to IDB's own intelligence and that it could provide the regional impetus missing from centralised bodies.[38] It also maintained that it could add value to IDB's efforts.[39] Derry Investment Initiative told us that they had organised a number of outward missions to North America.[40] Investment Belfast also supports trade missions to North America and pointed to 80 jobs created by small inward investment projects.[41] It considered that IDB, although making a concerted effort to engage with local authorities, "has not fully grasped the potential added value which the main local authorities can bring to the task of attracting inward investment."[42] Derry Investment Initiative also stressed the part they could play in promoting business-to-business contacts, and the role of such contacts in securing inward investment projects.[43] Representatives of the Northern Ireland Committee of the Irish Congress of Trade Unions (ICTU) commented that local authorities did a lot of promotional work and could "impact at the macro level."[44]

25. Investment Belfast also commented that it had received referrals from IDB relating to companies in areas the Board was not promoting, and also in relation to companies too small for IDB to deal with. In the last 12 months, it had dealt with 66 enquiries, three of which had come to fruition, creating 80 jobs. Eleven enquiries are classified as still ongoing.[45]

26. Into the West maintained that there was a particular niche for local authorities in relation to the smaller projects. Mr Doherty, the Company Secretary, considered that IDB did not have sufficient local knowledge or experience of small employers "because they tend not to get into serious negotiations with a prospective employer who is going to employ less than 30 people, whereas we definitely would. That is our bread and butter. Therefore, that is where we feel we add the value."[46] Sir Reg Empey also saw a particular role for local authorities with the smaller inward investor.[47]

27. Investment Belfast and Derry Investment Initiative both had the advantage of being able to draw on outside funding. Both attract support from the European Regional Development Fund and from the private sector. In addition, Derry Investment Initiative receives the majority of its funding at present from the Peace and Reconciliation Programme.[48] The two local authority consortia, CORE and Into the West, also draw on outside funds.[49]

28. We raised with Investment Belfast and Derry Investment Initiative the risk of potentially harmful competition if all 26 local authorities in Northern Ireland actively promoted their areas as locations for inward investment. Dr Toal thought the risk was more that it would be confusing to inward investors and Mr Mullan agreed.[50]

Other bodies

29. The Local Enterprise Development Unit (LEDU) has no direct involvement in the attraction of mobile inward investment into Northern Ireland but, from time to time, negotiates very small cases referred from IDB. Through its local economic development partnership with 'Into the West', it also encourages talented expatriates to return and start up their own businesses and brokers International Strategic Business Alliances between small and medium-sized enterprises in Northern Ireland and their counterparts in the USA, Canada, Australia and New Zealand.[51]

30. We think this initiative in Tyrone and Fermanagh is a useful way to encourage small inward investment projects. It is worth considering whether there is scope for extending a similar scheme throughout the Province, to provide a focus for potential investors in very small projects. We commend it to Sir Reg Empey in the context of his review.


33  See the Appendices to the Minutes of Evidence. Back

34  Q 32. See also Q 413. Back

35  Q 32. Back

36  Q 147. See also Q 153. Back

37  Q 362. Back

38  Ev. p. 67. Back

39  Q 147. See also Q 153. Back

40  Ev. p. 66. Back

41  Ev. p. 68. Back

42  Ev. p. 69. Back

43  Q 149. Back

44  Q 351. Back

45  Q 147. Back

46  Q 240. Back

47  Q 413. Back

48  Q 148. Back

49  Ev. p. 100; Q 228-229. Back

50  Q 155. Back

51  Appendix 20, p. 191. Back


 
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