Examination of Witness (Questions 80 -
WEDNESDAY 31 OCTOBER 2001
80. Changing the subject slightly, you analysed
the reasons why there was a downturn in construction in Northern
Ireland and the first was the international economic situation
which obviously was to a certain extent before 11 September and
aggravated by those events. The others were internal to the politics
and the perceptions of the politics of Northern Ireland. Given
the changes which have taken place post decommissioning, would
you see any improvement in confidence, inward investment, arising
(Mr Doran) I would think over time that the answer
has to be positive, yes, there will be further advantages accruing
to Northern Ireland. However, in the short to medium-term disadvantages.
As the Assembly goes through a process of looking at PPP as alternatives
to traditional procurement and those priorities are made there
is that hiatus. The combination in the short term of that current
difficulty plus the international one means that the quarry tax
is just a further bite at confidence. It is the least opportune
moment, if that were possible, for the introduction of such a
81. Going back to one of the questions I asked
earlier about how the industry would react, which you have covered
to some extent under Mr Bailey's last question, I talked about
the short term and the long term. What is your view as an individual?
Will the industry look to avoid? Taking into account this mileage
from the border, how do you see that developing over the period?
That is perhaps an unfair question.
(Mr Doran) I would think the likelihood would be twofold:
one, that there would be job substitution in the Republic; secondly,
that there would be a natural level of avoidance, how large or
small I do not know. I would presume Customs & Excise, through
looking back at their licensing arrangements can see the gross
value of aggregate produced through gross tonnage and should be
fairly easily able to see £1.60 per tonne multiplied by the
gross tonnage. I should therefore think that avoidance would be
at the margin.
82. Obviously it will vary but do they tend
to be small builders or are they large firms?
(Mr Doran) The technical definition of most contracting
companies in Northern Ireland would be SMEs; there are half a
dozen who turn over more than £50 million. There would not
be more than 30 who turn over more than £20 million. The
vast majority affected by this are likely to be companies who
would trade on average between £1 and £5 million.
83. When and how did your Federation first become
aware of the possibility of this levy?
(Mr Doran) It was during the Chancellor's statement
in March 2000 when we first noticed it. We had had no direct approaches
from the Treasury or Northern Ireland Government on the issues.
84. So the first your Federation knew about
it was when you heard the Chancellor's statement.
(Mr Doran) It was an issue which was evolving but
when we first looked at the statement was when we first noticed
it. We were aware of the background issues to the Kyoto convention
and all the rest of it but that was the first time we became aware
of it specifically.
85. After you became aware of it, what exactly
has been the role of the Federation in making representations
to government or taking part in the consultations?
(Mr Doran) They have been twofold. First of all we
have a close association with the Quarry Products Association
and we have shared our energies and time with them. We basically
follow them as the lead body in the consultations, first with
the Treasury and then with Customs & Excise and Northern Ireland
departments. We have been significantly involved in lobbying both
Northern Ireland MPs and MLAs and it was one of the few issues
on which there has been full unanimity across all Northern Ireland
Assembly parties and the executive on the issue.
86. How long have you been the Director of the
(Mr Doran) I have been in the current post since 1995
and I joined the Federation in 1974. Man and boy.
87. A long time. I am curious about something.
We have listened today to your concerns but has a tax or a levy
been proposed during the period you have been the Director that
your Federation have approved of or have not said posed a risk
(Mr Doran) Nobody, in the construction industry or
otherwise, asks for additional taxation. There are areas of tax
such as the construction industry training board levy, where we
have sought to do that to improve the quality of training in the
industry. We recognise there are social issues involved in employment
but we also recognise that those are subject to consultation and
agreement. In the broadest sense, we have not to my memory complained
or lobbied at all against any particular tax in the last five
years. I cannot, going further back, remember having lobbied so
strenuously against any tax.
88. Could we turn to the use of the Sustainability
Fund? Within the written evidence both the Construction Employers
Federation and the Quarry Products Association note the unequal
distribution of the Sustainability Fund monies: even though Northern
Ireland produces 10 per cent of aggregates you will only receive
2.4 per cent of the revenue. Would you like to place on record
your feelings on that unequal distribution and then tell us how
you think it should be distributed and in particular from your
point of view as a federation involved in construction where the
money should be spent and on what sort of projects?
(Mr Doran) As we have said in our submission, approximately
10 per cent of aggregates are sourced in Northern Ireland therefore
broadly in equity 10 per cent of the Sustainability Fund, about
£3.5 million, should be made available to the Province. If
it is the case that government wants to improve the industry,
both at large and particularly the quarries industries' approach
to the environment, clearly the Quarry Products Association should
sit down with government and find how that money can best be targeted
on areas of the highest risk to the environment.
89. Do you think part of that money and the
sorts of projects that money would be spent on could be of benefit
to the industry?
(Mr Doran) I have not addressed my mind to what sort
of projects might be addressed. I could not answer the question.
90. Is there anything else you would like to
say to us? There are no more questions.
(Mr Doran) No, except to thank you again.
Chairman: Thank you very much indeed for coming.
A transcript of what you have said will be sent to you for checking
before we publish the evidence. Thank you very much.