Supplementary memorandum submitted by
the Construction Employers Federation, Northern Ireland
Thank you for your letter of 5 November regarding
further evidence in relation to Mr Bailey's question regarding
the proposed National Insurance rebate.
The total annual volume of aggregate used in
the construction industry in Northern Ireland is 22 million tonnes.
At £1.60 per tonne, this will generate some £35.2 million
Employment in the construction industry is 34,500
which added to the Quarrying sector of 5,600 gives total employment
With average earnings in Northern Ireland that
attract NIC of £13,465 pa (av earnings is £18,000 but
first £4,535 of all earnings is exempt from NIC), multiplied
by the 0.1 per cent rebate gives total rebate of £539,947
So you can see that the industry gives in tax
some £35.2 million but is only going to receive £539,947
back in NIC concession, leaving the industry in deficit to the
tune of £34.66 million.
One further point to add is that the rebate
is for all industries in Northern Ireland so it begs the question
why should the construction and quarrying industries subsidise
an NIC rebate for all other industries?
On Monday 5 November, the Minister for Transport
(Mr John Spellar) announced Travel Concessions for people who
are economically disadvantaged (see Hansard column 30 and 31 attached)
and concessions for England and Wales as measures to tackle social
exclusion. These concessions have implications for HM Treasury
and were only introduced after Treasury approval. This would suggest
that there is precedent for derogation from the principle of universal
taxation in the UK to achieve social objectives.
The Committee may wish to consider whether this
principle should be applied in Northern Ireland with regard to
the Aggregates Tax because of the effects on the industry arising
from the land border with the Republic of Ireland.
I understand that Rt Hon Paul Boateng MP, will
be appearing before the Committee. The Committee may wish to explore
this principle with Mr Boateng.
8 November 2001