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10 October 2014

FSB responds to Stormonts eleventh hour loan deal

Reference number: FSB PR NI 2014 37

FSB NORTHERN IRELAND has welcomed the eleventh hour budget deal by the NI Executive, as a "temporary solution" however emphasises that there is a need for greater certainty for the business community – which can be achieved through Stormont committing to make difficult budgetary decisions for the long-term.

The recently published quarterly survey of the UK''s largest business organisation again revealed a rise in confidence amongst SMEs throughout the UK, however the FSB Northern Ireland points out that the difficult mix of politics and finance has been a cause for significant concern upon the daily lives of business owners throughout NI.

This was emphasised when a growing number of small businesses were the first victims of the £78m spending cuts to the NI Executive, announced earlier this year.

Wilfred Mitchell OBE, FSB NI Policy Chair explained: "There is a wide misconception that public cuts impact most on those working in Northern Ireland's inflated public sector, however, this has not been the case. One of the primary sources of income for a substantial number of small businesses in Northern Ireland has been through public contracts, by supplying services and products to our public sector. With recent budget cuts, it appears that the private sector is the first line of attack. By reaching the Executive reaching this agreement to resolve budget pressures with immediate effect, there is greater chance of establishing an orderly process through which there can be a reduction of costs in the public sector itself, rather than in public services."

Speaking directly on yesterday's late night budget agreement, Mr Mitchell OBE stressed the need for political agreement on difficult decisions to encourage economic growth.

He continued: "As we emerge from the financial crisis, businesses which have survived remain vulnerable, so our Executive needs to invest in their future. Small businesses, which make up over 98% of our local economy, are the stalwarts of recovery and growth and many functions of government could reside much more effectively within the private sector.

Mr Mitchell concluded: "This agreement is a small step in the right direction but there remains many challenges, so there is a strong need for political agreement to give businesses the confidence to plan, invest and grow so they can contribute to the economy."