Northern Ireland Economic Outlook 2016

BUSINESSFIRSTMAGAZINE

Northern Ireland Economic Outlook 2016 in association with

NORTHERN IRELAND ECONOMIC OUTLOOK 2016 FOREWORD

Corporation Tax rate and date an economic landmark T

Foreword to the Northern Ireland Econnomic Outlook 2016 by Jonathan Bell MLA, Minister for Enterprise, Trade and Investment

While undoubtedly we will face new challenges in our quest to achieving an economy that is characterised by a sustainable and growing private sector, we are in a strong position to face these head on.

Jonathan Bell

18 www.businessfirstonline.co.uk

he commitment to reduce the corporation tax rate in Northern Ireland to 12.5 per cent from 2018 has made 2015 a hugely significant year.

It marks a new economic era for Northern Ireland, with research from the Ulster University Economic Policy Centre estimating that by 2033, we could create well in excess of 30,000 additional jobs and the economy could be almost a tenth larger.

Of course, we need to ensure we reach this potential and our actions now will be pivotal in the policy’s long term success.

Invest Northern Ireland will be taking forward a range of actions to develop our proposition and sell the benefits of Northern Ireland to investors on a worldwide basis, and this will include targeted communications and marketing campaigns, advertising, investor engagement and inmarket events.

Invest Northern Ireland is also updating the intelligence on those sub-sectors and functions which will be most attracted by a lower corporation tax rate and will be reviewing its other solutions so that the best possible package of support is available to both new investors and existing businesses looking to grow.

This latter element involves close collaboration with colleagues in the Department for Employment and Learning so that companies have access to the skills and talent they need to make their operations a success.

In addition to the potential that corporation tax could bring in the future, we have been building on our local economic recovery during 2015 with overall conditions improving, driven predominantly by the local private sector.

The stronger growing private sector has allowed us to not only continue to rebuild the local economy but to rebalance towards greater private sector growth, allowing us to move towards the goals set out in the Executive’s Economic Strategy.

It was more than three years ago now that the Economic Strategy was launched and 89 per cent of its commitments have now been delivered.

To ensure the strategy reflects the latest economic conditions and developments in key policy areas, such as corporation tax, it will undergo a review and refocus over the coming year.

Export Northern Ireland

Shortly, we will also publish ‘Export Matters – an Exports Action Plan for Northern Ireland’ which has been developed to put our focus firmly on export-led economic growth which will also remain the key goal of the refocused Economic Strategy.

Tourism Northern Ireland Turning to tourism, the hosting of major international events continues to play a significant role in our tourism success with this year seeing the Irish Open at Royal County Down, the return of the Tall Ships and Sports Personality of the Year.

Existing attractions are also enjoying continued success, and this has been enhanced with the opening of the Gobbins Cliff Path. In 2016, we also look forward to the opening of the new Waterfront Hall Conference facilities while a key focus in 2016 will be ‘The Northern Ireland Year of Food and Drink’ which will be a celebration of all that is good about our local produce.

A little further down the line we can all look forward to the much anticipated return of the Open to Royal Portrush in 2019, an announcement that must surely rank as one of the most exciting developments of the year past.

Department for the Economy Of course there are many factors that will ultimately feed into our success as an economy, whether that be exploring how best we can support ongoing air access connectivity to key markets, cutting red tape or encouraging innovation. These are things we already aim to do but of course there are other things too, such as ensuring we have the right skills that businesses demand. The creation of the Department for the Economy in 2016 will ensure we are agile in our response to supporting the economy and that we can adapt quickly to changing business needs.

On an ending note our economic future is bright. While undoubtedly we will face new challenges in our quest to achieving an economy that is characterised by a sustainable and growing private sector, we are in a strong position to face these head on.

NORTHERN IRELAND ECONOMIC OUTLOOK 2016

The Year of the Monkey won’t be short on drama

by Richard Ramsey, Chief Economist Northern Ireland, Ulster Bank 015 will go down in the economic annals as a good year for the Northern Ireland consumer. Falling food and energy prices, coupled with a return of pay rises, have boosted disposable incomes.

At the same time, employment growth has continued, with over 90 percent of the jobs that were lost during the downturn having now been recovered.

This is in contrast to the Republic of Ireland, where less than half the jobs lost during the downturn have been recouped.

Meanwhile, the UK has recovered all of the jobs it lost.

It is a somewhat different picture though when it comes to economic output. Whist the Republic of Ireland returned to pre-recession output levels in 2015 - and the UK some twoand-a-half years ago – Northern Ireland is still some way off that mark.

Indeed, Northern Ireland’s economic recovery has been the weakest on record.

Since 2010, local commentators have consistently overpromised in their forecasts for economic growth.

Every year, however, the ONS official statistics have under-delivered on these expectations. Last month it was confirmed that the local economy expanded in 2014 by less than half the rate of growth projected.

Northern Ireland recorded growth of just 0.8 per cent in real terms. After Wales, this was the lowest rate of growth within the UK. The Northern Ireland economy has failed to record an annual growth rate of at least one per cent since the recovery began. Following zero per cent growth in 2010, Northern Ireland’s annual growth rates in the three subsequent years were: 0.5 per cent (2011), 0.9 per cent (2012) and 0.7 per cent (2013).

2015 and 2016 should be better, with low / no inflation coupled with a return of pay rises providing a much-needed boost to economic growth.

Consumer spending, stemming from real wage-growth will account for a greater share of economic growth, whilst the corporate sector should see its contribution moderate.

The local economy is estimated to have grown by 1.5 - 2 per cent in 2015 (UK +2.3 per cent).

Assuming this growth rate, the Northern Ireland economy will have recouped less than half the output lost during the downturn. For perspective, the Republic of Ireland economy returned to its pre-crisis levels in 2015 with its second successive year of >5 per cent growth.

The Northern Ireland economy is expected

2

20 www.businessfirstonline.co.uk

to lag behind its nearest neighbour and the UK in 2016. Over-optimistic projections in the past would suggest an expansion of close to but above one per cent is realistic. This compares with growth of two per cent in the UK and 4.5 per cent for the Republic of Ireland.

The Labour Market In terms of the labour market, falling real wages have blighted Northern Ireland’s recovery in recent years. However last year saw wage increases return with a vengeance, with the first real terms increase since 2009.

Indeed, Northern Ireland recorded the fastest rate of wage growth in 2015 of all the UK regions. Northern Ireland’s 5.4 per cent annual rise in pay last year (UK +1.9 per cent) represented the biggest rise in 11 years and the first real terms increase since 2009.

The local claimant count unemployment register has been falling for three years.

Last year saw the numbers claiming unemployment benefit fall by close to 12,000, taking the claimant count to its lowest level since January 2009 and 25,600 below (-40 per cent) its post-recession peak. The pace of decline should ease in 2016.

The headline ILO unemployment rate briefly dipped below six per cent in Q4 2014 for the first time in six years. However, it returned back above this level in Q1 2015 with the unemployment rate averaging 6.2 per cent in 2015. The UK and Northern Ireland unemployment rates are set to diverge in 2016 with the former expected to go sub-five per cent later this year while Northern Ireland moves towards seven per cent. Meanwhile the Republic of Ireland’s unemployment rate returned to single-digits last year for the first time since January 2009 and should average around 8.4 per cent in 2016.

Employment growth remained strong in 2015 although the pace of growth slowed towards the end of the year. The drivers of growth are expected to change in 2016 too. In the 12 months to Q3 2015, manufacturing accounted for more job gains than any other sector.

However, manufacturing output has been contracting sharply in the second half of last year. Indeed, output fell at its sharpest rate since Q2 2009 in Q3 last year.

Manufacturing still lags behind Local manufacturing is feeling the chill from the slowdown in global trade / manufacturing activity. In 2016 Northern

Ireland manufacturing is expected to lose more jobs than it creates. JTI and Michelin have already announced their plans to close with redundancies to commence this year.

Manufacturing, like the tourism industry will also be battling with an unfavourable sterling/euro exchange rate. Sterling is expected to strengthen further in the year ahead against the euro but weaken against the dollar.

Monetary Policy Divergence in monetary policy intentions by the Federal Reserve, the ECB and the Bank of England should be a big driver of currency moves in 2016. The Fed raised interest rates last month for the first time in almost nine years. Meanwhile the ECB is expected to embark upon more monetary policy stimulus.

The UK falls somewhere in between. While we may see a rate rise occurring in the latter half of the year, don’t rule out yet another year of no change.

The introduction of the National Living Wage in April presents a challenge for the hospitality industry and low salaried sectors such as the care home sector. Overall in the services sector there will be a divergence in performance between the public and private sectors.

The latter has already recovered the jobs lost during the downturn. Meanwhile the shrinking of the public sector is a multi-year project. Meanwhile, the construction sector expected to grow but is coming from such a low base, and employment remains 35 per cent below pre-downturn levels.

In 2016 – the Chinese Year of the Monkey Northern Ireland’s productivity challenge will be greater than ever before. Global factors will also loom large.

Northern Ireland is a £34.5billion economy of 1.8m people and is vulnerable to external influences both economic and political. And there will be plenty of these in 2016, notably a China slowdown / crisis, Eurozone economic uncertainty, and uncertain in relation to a potential Brexit. 2016 should not be short of drama.

NORTHERN IRELAND ECONOMIC OUTLOOK 2016

What are key concerns for Northern Ireland entrepreneurs in 2016?

D

ifficulty in attracting skilled labour is a key challenge facing some of Northern Ireland’s leading entrepreneurs, according to the latest EY Entrepreneur Of The Year™ (EOY) survey.

The survey shows that 30 per cent of the EOY community cited a shortage of experienced talent as their number one challenge. The survey was conducted among 416 of Ireland’s leading entrepreneurs (of which 70 are based in Northern Ireland) all of whom are previous EY Entrepreneur Of The Year™ finalists.

Shortage of experienced talent Attracting and retaining skilled talent is a key challenge to doing business in Northern Ireland. This applies across a range of sectors including tech, manufacturing, food and drink, retail, telecommunications and hospitality. This increased demand for skilled labour is evidenced by 84 per cent of respondents having grown their total headcount in the past year.

EY’s Sean Duffy, programme director, EY Entrepreneur Of The Year™ commented “Difficulties with recruitment are directly contributing to the issue of scaling their business. Entrepreneurs in Northern Ireland are struggling to compete with large multinationals that can offer higher salaries and fringe benefits in the race for top talent, particularly as we seek to expand the private sector.

“Interestingly, only six per cent rank graduate recruitment as their biggest challenge, favouring a more skilled workforce. We must continue to make Northern Ireland an attractive location for not just retaining the talent, but through targeted initiatives to attract expatriates and returning emigrants.”

Overall, the EOY community experienced strong growth in 2015, with 67 per cent of those surveyed stating that their business had grown by over five per cent in the past year.

This network of leading entrepreneurs have been driving real economic growth. In the last 12 months alone they have created over 17,800 new jobs, and in aggregate they currently employ 170,144 individuals.

Collectively they have generated €17.4bn in revenue for the same period.

But is Northern Ireland providing enough support in return to its entrepreneurs?

Although 87 per cent of respondents feel positive about the current economic environment, 64 per cent still believe that there is still not sufficient support in place for those whose businesses are struggling or have failed. This marks an increase when

compared to 37 per cent last year.

Of those surveyed, 46 per cent of the respondents said that they had had a business fail in the course of their career, with 52 per cent still describing themselves as a ‘serial entrepreneur’.

These findings indicate that although business failure is likely to be part of the entrepreneurial journey, most entrepreneurs are willing to start afresh with a new venture.

“During the economic crisis entrepreneurs typically faced issues such as accessing finance and consumer demand, they are now encountering a new wave of problems associated with growth. Many struggle to scale their businesses at manageable pace,” commented Sean.

He continued: “It therefore vital for government, industry and academia to understand the specific challenges facing entrepreneurs and to collaborate to solve problems, address legislative and cultural barriers to success, and together shape the future of entrepreneurship in Northern Ireland”.

Building on tax advantages “High taxes, particularly personal income tax and capital gains tax, were listed by respondents in the Republic of Ireland as some of the biggest inhibitors to daily business.

“Meanwhile in Northern Ireland, entrepreneurs are benefitting from a more accommodating CGT structure, which puts them at a relative advantage in terms of equity and provides an incentive for inward investment.

“The announcement last week to cut the corporate tax to 12.5 per cent from April 2018 in line with the Republic will be warmly received by entrepreneurs, levelling the playing field for attracting investment and jobs across the island.

Sean continued “The survey results show that while some very positive steps have already been taken, particularly taking fiscal structures into account, more could still be done to encourage a culture of entrepreneurship in Northern Ireland.

“We now need to focus on finding ways to encourage failed entrepreneurs to start again, as well as facilitating scaling for successful businesses. Entrepreneurs are playing a huge role in the expansion of the private sector here through job creation and export-led growth.

“We need to put mechanisms in place that will support them in their efforts, releasing the equity required to reinvest into new businesses’.

Ease of doing business Access to finance also continues to play a role, but encouragingly this was deemed to be relatively less problematic this year with only 11 per cent listing it as their main challenge, compared to 41 per cent in the previous survey.

On a further positive note, 87 per cent of entrepreneurs surveyed said they felt positive about the current economic climate for entrepreneurial business throughout Ireland.

The survey also shows that over half of the entrepreneurs surveyed (55 per cent) have conducted business with other members of the EOY community, demonstrating the importance of professional networks in creating a supportive climate for doing business in Ireland. Furthermore, a skilled and educated workforce, low corporation tax rates and government support were listed as the biggest enablers to doing business across Ireland.

www.businessfirstonline.co.uk

21

NORTHERN IRELAND ECONOMIC OUTLOOK 2016

screw it LET'S JUST DO IT!

by Judith Totten, Upstream

22 www.businessfirstonline.co.uk

We definitely did not want to lose our reputation for empathy and understanding and we wanted something which would eloquently describe our story so far and our vision for the future. Judith Totten his is one of Richard Branson's favourite sentiments in business and he is quoted as using it regularly.

It is perhaps a bit flippant but I like it, because it sums up an attitude of positivity, innovation and entrepreneurial spirit which if any business can harness even a small percentage of, will serve it very well.

Mix that Branson ‘devil may care’ approach with great products, services and people and a respected brand with a reputation for professionalism and delivery and well … it simply works.

Keys Commercial Finance or KCF has served us very well as a brand since June 2011 when we embarked on our ambitious journey, but when I bought out my business partner earlier this year in a very amicable MBO, we knew we had to step change the business and upscale our footprint in the alternative finance market space.

And so began the exciting journey of developing new brand images, looking at colour schemes, identifying new premises and working with a team of truly awesome specialists to relaunch and rescale our business for the future.

We have had a few twists and turns, many speed bumps and moments of, "Can we ...?" along with quite a few of Branson's, "Screw it" moments .

But we have had so much fun and laughter too and honestly if we had gone with some of the more left field ideas, I think the market might quite rightly have questioned our sanity!

We wanted something new and different to reflect our position as the only truly independent funder in a landscape of institutional financiers in Northern Ireland and the challenges this has at times presented.

We definitely did not want to lose our reputation for empathy and understanding and we wanted something which would eloquently describe our story so far and our vision for the future.

We wanted to maintain our sense of fun and our energy whilst embracing something fresh and innovative - again an attitude we have tried to engender from day one.

Like many business owners in Northern Ireland we have had to raise money, bring investors on board, diversify our business

T

and grow our staff numbers while upskilling our existing team - so again the new brand had to mirror these issues and us striving for goals.

Above all though, we want to build a brand that our clients and partners recognise for its professionalism and corporate approach without losing the very essence of what has made Keys Commercial Finance successful thus far - honesty, integrity, flexibility and collaboration. We have always tried to act as partners in support of our clients and this absolutely will not change.

So with great excitement and some trepidation, we invite you to join us at: "UPSTREAM" Positive Working Capital Our motto is that we always have been and always will be: 100% Half Full ­ optimistic, positive and energetic.

We are here to support “Fearless Growth”, to enable you to access the funding structures that give you the confidence to exploit new opportunities, markets and products or services, without fear And finally, we are: Upstream ... Never Mainstream!

After much soul searching we have also decided that Belfast City Centre is the best central location for new beginnings. So, from January 18 2016 we will be relocating to new ground floor Grade A premises at: Suite B, 40 Linenhall Street, Belfast.

The offices are being completely upgraded and kitted out in our new corporate colours of turquoise and magenta with a fun and funky layout and soft furnishings to reflect our fresh, innovative and professional approach to what is often perceived as the dull finance sector.

This new office has lots of meeting space and we plan to use this space often and to great effect. We want to invite our colleagues, clients and partners to spend time with us, getting to know the team even better and becoming even more familiar with our

service ethic and customer focus.

The fabulous team at Upstream remains unchanged in terms of the quality and commitment of our people and their passion to deliver the top quality service that you have all come to expect.

We will be adding new and exciting complementary funding streams to our business in the very near future to ensure that businesses of all sizes and in all sectors across Northern Ireland can access what we now prefer to call Appropriate Finance.

We plan to introduce Supply Chain and Trade finance to Northern Ireland through our new brand, which will add a new dimension to the already dynamic suite of Invoice Finance and Receivable products we have.

We are an SME just like many of our clients and therefore we understand the challenges facing young and growing businesses in a post-recession economy. So we plan to add structure to our advisory function by partnering with key experts and specialists to bring a range of added value services to the market.

In summary?

We are no longer Alternative Finance providers. Collectively, Upstream and the many funders across Northern Ireland are now part of an overall packaged solution for business owners.

We are fortunate to have a wide range of both independent and Invest NI backed funds across the spectrum of new start, growing, import and export business in NI and within all sectors alongside a mature Banking sector.

We are most assuredly seeing a culture change across our portfolio with business owners and advisors alike seeking a cocktail of solutions to spread risk and reduce dependency.

This is not just healthy but essential as we rebuild Northern Ireland PLC. This is the new landscape - and the new normal - for Northern Ireland business.

Welcome to Upstream – and Fearless Growth in 2016 and beyond!

Please contact Upstream at www.upstreampositive.co.uk or 9099 9450

www.businessfirstonline.co.uk

23

NORTHERN IRELAND ECONOMIC OUTLOOK 2016

Tourism is food and drink to Northern Ireland economy in 2016 A with John McGrillen Chief Executive, Tourism NI fter a successful year which saw an overall increase of two per cent in trips generating £4.5 million, the tourism industry is gearing up for an even more exciting 2016 which has ben designated as Northern Ireland’s Year of Food and Drink.

With three new airlines serving Northern Ireland - KLM, Vueling and Wizz Air extending our reach into the growing European markets, and the restoration of the economy in 2016, the year will see a United Airlines service to New York, foreign continued investment in tourism visitors in 2016 should rise even further. infrastructure.

New and improved facilities continue to “Investment in tourism infrastructure provide a unique visitor experience with the extends to every corner of Northern Ireland,” newly restored Gobbins dramatic cliff-face John said. “From the renovation and path offering another jewel on the famous extension of the Apprentice Boys Memorial Causeway Coastal Route and the three year, Hall which contains a new Siege Museum to £7.5 million investment in the restoration of the opening of Window on Wildlife in Belfast, Mount Stewart completed to acclaim. visitors now have more new experiences to During the year, John McGrillen was add to their itinerary.” appointed chief executive and and along with And the product enhancement story will a new Board, has welcomed the Hunter continue into 2016 with improvements to the Review.

Museum of Free Derry, a Heritage Gateway to “The Review contains 33 recommendations Fermanagh and the completion of the HMS with broad themes around strategy and Caroline project to transform the First World leadership, policy, competitive positioning of War's last surviving battleship into a floating Northern Irelnd, effective partnership museum. working, business support to the tourism “The extended Belfast Waterfront is set to industry, and delivering a more client open at the end of April 2016. This centered approach,” John explained. development will add huge value to the “Using the Review as the starting point, business tourism mix and very much enhance work has begun on a new tourism strategy to Belfast’s, and indeed Northern Ireland’s, set the future direction for the industry, and capacity to stage major conferences and we look forward to working more closely conventions,” John said. “In fact, Belfast with Invest NI and the 11 new councils in Waterfront is already reaping rewards with Northern Ireland.” nine hotel projects in the pipeline and 25 events in the diary for the next three years With the scene set for a leap forward in the bringing 70,000 delegates and bring in over value of tourism to the Northern Ireland

The Gobbins Cliff Walk

24 www.businessfirstonline.co.uk

£34 million for the city.

“Numbers like this prove the value of tourism to Northern Ireland plc, and we know there is so much more to that can be achieved. For example, we’ve seen the incredible growth of value of film in Northern Ireland we are continuing to work with NI Screen, Tourism Ireland and the hospitality industry to capitalise on the film and TV productions being produced across Northern Ireland and promoting those locations that are accessible to visitors.”

Year of Food and Drink The centrepiece of tourism in 2016 is the Year of Food and Drink. “Tourism NI wants to raise the profile of food and drink with local people, visitors and global markets by developing branding, marketing and promotional activities in Northern Ireland and across key markets,” John explained.

The project also aims to support a wider agri-food objective to grow export food sales.

Success in this area should also support the tourism agenda by building on Northern Ireland’s destination reputation.

“Food and drink experiences have become increasingly important to tourism as they offer destinations an opportunity to differentiate and celebrate indigenous foods.

“While food and drink is a vehicle through which our visitors can learn about our heritage, landscape and culture as well as meet our people, it also accounts for a significant proportion of visitor spend,” John added.

In 2014 overnight visitors to Northern Ireland from all markets spent an estimated £751 million of which, approximately one third was spent on food and drink. In addition, £282million was spent by Northern Ireland residents on tourism day trips, of which, approximately 40 per cent was on eating out.

“This is another fantastic opportunity for Northern Ireland to work collaboratively to reach a common goal. We will endeavour to ensure that both existing and new events play a key role in the success of the Year of Food and Drink 2016,” John concluded.

NORTHERN IRELAND ECONOMIC OUTLOOK 2016

Northern Ireland economy can enjoy continued momentum in 2016

by David Gavaghan, chair, CBI Northern Ireland he Northern Ireland economy continues to recover from a deep downturn and we expect growth to continue through 2016. But I believe the year ahead can see us build the momentum to transform towards an enterprise led and more sustainable economy, providing more, and better, opportunities for all. This will require leadership, co-operation and partnerships – by working together we can make a difference.

Businesses have worked hard to grow and do their part to help rebalance the economy and there have been some notable successes.

We have secured record levels of international investment, records levels of investment in innovation and R&D by our SMEs, growth in our tourism sector which sets us on a path to doubling tourism revenues to £1billion by 2020 and a range of world-class events, helping promote Northern Ireland as a vibrant and outward looking place to live, work and invest.

We must develop a longer term vision for the economy in which opportunity and prosperity are shared by all, recognising that we are competing globally for talent and capital. There is a great deal more to do to create a sustainable and balanced economy focused on enterprise, investment, innovation and exports. That journey is underway.

The Executive’s commitment to a 12.5 per cent Corporation tax rate in 2018 is a key element to achieving this goal, with the potential to transform the Northern Ireland economy, creating tens of thousands of additional jobs. We must get behind Invest NI and Executive Ministers in helping market this opportunity internationally.

Elections in May will be a key focus in 2016 – and much of CBI’s work during the first half of the year will be focused on influencing the next Programme for Government.

A strategic, outcome focused and ambitious Programme for Government is needed. The CBI set out its priorities in ‘Punching above our weight – 12 steps to create a more prosperous Northern Ireland’ last October and we have been engaging with our political representatives since. This will remain a framework to judge our success in influencing the political parties in the coming month.

T

Public expenditure constraints will continue, so transformation within public services to deliver better outcomes for users must be matched by investment and growth in the private sector.

Companies and wealth creators across the region will contribute to creating that prosperity.

I believe that central to a successful economy is a successful Belfast – ambitious, outward looking and attracting international capital, talent and tourists to the city.

The focus in Britain on the future growth of cities outside London is a key part of the UK Government’s strategy in tackling disparity and urban deprivation – we need the same degree of focus here and create more linkages to major international markets.

Northern Ireland’s record of poor economic productivity must be reversed – the drivers will come from delivering a significantly improved education and skills system aligned with our economic needs. And the business community needs to step up their efforts in this area too.

We must also continue to invest in innovation, building on our increasing investment in this area and also ensuring we invest in our universities and colleges, ensuring they have sustainable funding.

We must put Higher Education on a sound financial footing by taking the necessary, even if unwelcome, step to increase tuition fees to compensate for the constraints in public

The Executive’s commitment to a 12.5 per cent Corporation tax rate in 2018 is a key element to achieving a sustained economy. We must get behind Invest NI and Executive Ministers in helping market this opportunity internationally. David Gavaghan 26 www.businessfirstonline.co.uk

funding which are supporting our universities and colleges.

We also must ensure our infrastructure provides the necessary connectivity internally and internationally, while ensuring it can facilitate the industrial, commercial and residential investment we need, giving businesses the confidence to grow and invest.

A major challenge is the need to increase our capital investment from its current levels of around £1billion per annum. We need a serious debate around the need and benefits of investing in our infrastructure and how this can be best funded, looking at a range of potential revenue-raising measures.

2016 is also likely to be the year when we face an EU referendum – that has major implications for Northern Ireland. We need considerably more debate and discussion around this.

The majority of CBI members favour staying in a reformed Europe with a market of over 520 million consumers. While recognising the EU is not perfect the alternatives do not stack up.

The economy must remain the top Executive priority, but with a greater strategic focus, fewer priorities and greater attention to delivery. Achieving our goals of a more balanced, sustainable and enterprise led economy will need all of us to work together. The prize is significant.

I look forward to working with the full spectrum of key stakeholders to deliver the benefits and opportunities our young people deserve.

NORTHERN IRELAND ECONOMIC OUTLOOK 2016

A new landscape brings new opportunities N orthern Ireland’s capital city continues to reap the benefits of having pumped over a billion pounds into its infrastructure during the last decade. The emergence of new attractions, hotels and flight routes has helped transform Belfast into a vibrant and happening city.

Today it is making a name for itself on the world stage as a leading business tourism destination. A recent addition to its long list of deserved accolades is "trendiest" city for business travel in Europe, which saw the city beat off competition from Valencia in Spain and Reykjavik in Iceland. And the invaluable addition of Belfast Waterfront’s new 7,000m2 conference centre to the city landscape in May this year will bring even more new opportunities.

Flexibility Business tourism is big business for destinations. In 2015 the city enjoyed an outstanding 198 per cent increase in growth and its upward spiral is set to continue with a further increase of 28 per cent forecasted this year.

Recognising the valuable contribution events make to the local economy Belfast City Council, Tourism Northern Ireland and European Regional Development Fund together invested £29.5m in the new Waterfront development to further enhance the city’s ability to accommodate conferences on a larger scale.

Over 60 per cent of centres across the world are planning extensions to accommodate larger events, whilst at home the team at Belfast Waterfront are just months away from opening the doors to the city’s largest conference and exhibition facility. Doubling its event space to 7,000m2 has already attracted new events as well as facilitated the return of many, specifically, from associations which had previously outgrown the existing facilities.

Lucy Davies, Association Manager, Association of Breast Surgery at The Royal College of Surgeons comments: “The Association of Breast Surgery is looking forward to holding its Conference and AGM in the new Waterfront facilities in 2017. The ABS Conference & AGM is held around the UK and the expanded facilities will enable the Association to use Belfast for the first time.”

However having more event space isn’t the only critical factor in winning new business.

Trends for 2016 reveal that flexibility is more important than ever. Venues must be versatile to accommodate creativity and boast technical resources that will bring live events to a worldwide audience.

At the Waterfront, a major plus for event organisers will be the addition of two multi-

functional halls spanning over 2,500m2.

Depending on the requirements, Hall 1 can be used as one large 1,805m2 area, or subdivided via retractable walls into four smaller spaces. This stylish space can also be transformed into a stunning gala venue for up to 1,000 dinner guests. And with a ceiling height of 9m, clients are sure to be dazzled by the spectacular set up, superb food and service that’s second to none. Alternatively, this multipurpose space can accommodate 2,000 theatre style.

Likewise Hall 2 can also be divided into two separate spaces or used as one 700m2 exhibition and conference area.

Mike Kimmons CB, Chief Executive Officer of British Orthopaedic Association, comments: “...Belfast Waterfront offers room flexibility that has been well thought out and caters exceptionally well for our Congress needs. The new space fully integrates with the existing features offering more choice and transforms the Waterfront into a top international Congress venue. We are looking forward to taking full advantage of the new development when we hold the BOA Annual Congress in Belfast in 2016.”

A better all round experience When it comes to the new venue there is no shortage of multipurpose space. The new development will be on a par in space terms with UK and European rivals, but it will also be on a par technically, offering the kind of flexible space and facilities that today’s event organisers demand.

Today delegates are ditching their laptops in favour of mobile devices, seeking digital content over paper handouts and are more reliant than ever on real-time data to effectively engage with their peers.

Event organisers demand a sophisticated solution that will both engage and excite delegates – delivering a better all round experience.

Belfast Waterfront’s intuitive design meets these changing needs. Located in the heart of one of the UK’s super connected cities, this stunning riverside venue will empower clients to reach and engage with a worldwide audience – bringing a world of knowledge to an event.

Harnessing the power of new technologies will see Belfast Waterfront host many more live demonstrations and interactive exhibitions, allowing delegates to become active participants in events.

Technology will not only bring a brand new dimension to traditional meetings or events but rich data analytics captured via mobile devices will fundamentally change how events are organised and make them outstanding and truly unique.

The new Waterfront development will boast the flexibility and support services to wow up to 4,600 guests with a brand new event experience today and in the future.

For more information contact the sales team at Belfast Waterfront on 028 90 33 4400 or email conference@waterfront.co.uk

www.businessfirstonline.co.uk

27

NORTHERN IRELAND ECONOMIC OUTLOOK 2016

What can we expect to see in recruitment & employment in 2016?

by Tina McKenzie, Managing Director (Staffline Ireland) and Regional Director (Recruitment and Employment Confederation) permanent placements at the end of 2015, with this trend likely to continue into 2016.

Employers are competing for the talent available at a higher pace than our local higher education institutions can keep up.

The demand for suitably skilled and qualified IT staff is particularly of note this year. In 2014, demand was highest for Nursing/Medical/Care staff in the UK whilst demand for IT staff only ranked as fourth. In comparison this year we have seen a complete reversal – permanent placements

hroughout 2015, we have seen unemployment in Northern Ireland continue to drop, with November’s unemployment figures at 5.9 per cent, down from a peak of 8.1 per cent in March 2013. The REC/KPMG’s monthly Report on Jobs data also shows that jobs placements through recruitment agencies across the UK have now increased for 37 consecutive months. We are even ending 2015 on a high note, with permanent placements in November increasing at the fastest pace in seven months.

This is obviously great news for the UK economy as a whole, and it presents exciting opportunities for job seekers as they find themselves choosing the best employer from a market that has shifted in their favour. The REC are also predicting further growth in 2016, with 80 per cent of surveyed employers in the UK planning to hire more staff over the next three months, according to the REC’s latest JobsOutlook report.

However, this does pose some new challenges for local employers as this improving labour market has led to increased competition for talent. In line with placements increasing, candidate availability fell at sharp and accelerated rates in November according to the Report on Jobs.

The labour market is tightening.

As employers find it more difficult to fill the jobs that are available, the increased competition for staff has seen marked growth in pay for successful candidates in the last year. This demand for staff has also seen hourly pay rates for contract staff grow at the fastest pace in three months.

While these pressures are likely to be felt across sectors, IT and Accountancy/Finance are the sectors with the strongest growth in

T

28 www.businessfirstonline.co.uk

“For 2016 and beyond, Northern Ireland must work on using the information at our fingertips to help inform future generations of the opportunities available in the local market.”

Tina McKenzie for medical staff was fourth whilst placements for IT staff took the top spot.

It is no surprise then that among the key staff skills in short supply across the UK according to the Report on Jobs were skills in computing and finance, two areas of growth in Northern Ireland. Among IT skills in demand were automation, IT security and web development, all areas where jobs available outstrip available staff and in which employers locally compete to find the best talent.

Staffline Ireland’s specialist professional recruitment agency, Diamond Recruitment, have sought to address this challenge head on – by identifying and working closely with Northern Ireland’s leading IT professionals year round, Diamond are able to access the best talent in Northern Ireland before the search is necessary. By building these relationships early, we are able to quickly match candidates with opportunities as they arise. This has led to us building the largest database of IT professionals in the region, giving us immediate access to talented and skilled candidates as soon as a vacancy is created.

As we move into 2016, Diamond Recruitment is preparing for the annual influx of job hunters. January is usually when we see an increase in candidates entering the market, hungry for their next opportunity. So, we will be registering new candidates to our database around the clock to ensure any vacancies we are given are matched to the right people with the right skills.

While this influx of candidates in the New Year will help to reinvigorate the labour market with fresh talent, employers will still need to be well placed in order to entice the talented staff their businesses rely on. This year saw an increasingly tightening labour market, and while the New Year will help increase candidate availability, this offers no guarantees for the rest of 2016 and it is best to be prepared with a strategic recruitment plan that attracts the best people with the right skills.

For 2016 and beyond, Northern Ireland must work on using the information at our fingertips to help inform future generations of the opportunities available in the local market. For those of us with children in third form, we know how difficult it is for young people to decide the best career path! Luckily, as recruiters we are able to see the ebbs and flows in the labour market based on the jobs we receive, and we have become increasingly adept at pre-empting future skills needs.

Reports from bodies such as the REC and DETI’s Economic and Labour Market Statistics unit also give a glimpse into what skills will be critical for a growing economy in Northern Ireland.

Jobs transform lives, which is why the recruitment industry is committed to helping more people develop awareness and clarity with regards to work opportunities in the market. For business leaders, familiarising ourselves with the information available will help us with our businesses looking ahead to 2016, but for long-term impact the recruitment and employment industry’s engagement with policy makers, employers and education experts to promote this knowledge will do much to benefit the Northern Ireland economy and build the best jobs market possible.

a Staffline Ireland company

NORTHERN IRELAND ECONOMIC OUTLOOK 2016

Small business remains the backbone of Northern Ireland economy in 2016 New research from Ulster University infroms the FSB Northern Ireland Assembly Election Manifesto 2016 orthern Ireland has the highest concentration of SMEs in the UK, producing the highest contributions to turnover, employment and GVA in the private sector.

Paramount to economic recovery and growth in the local economy, is the small business, micro-business and self-employed.

Furthermore, with 80 per cent of local, small businesses, intending on growth, there are tangible, future returns to the Northern Ireland economy to be realised.

In launching the FSB Northern Ireland Assembly Manifesto 2016, entitled Realising the Potential of Small Businesses, the recommendations advanced were directly based upon the calls of small businesses throughout Northern Ireland.

At the foundation of the manifesto, was the recently published research report, commissioned by FSB Northern Ireland from the Ulster Business School, The Contribution of Small Businesses to Northern Ireland.

One of the primary concerns of SMEs was the lack of political stability in Northern Ireland that directly impacted upon economic stability. With the agreement of A Fresh Start: The Stormont Agreement and Implementation Plan incorporating confirmation of a date and rate for corporation tax of 12.5 per cent from April 2018, there has been positive developments which will enable increased business confidence.

FSB Northern Ireland has been at the forefront of campaigning for the devolution of corporation tax, to encourage inward investment and enable indigenous businesses to reinvest and grow. fficial UK Government figures have revealed that with the lowering of the rate from the UK figure of 20 per cent, 34,000 businesses in Northern Ireland will directly benefit, including 26,000 small businesses.

The decision to lower the corporation tax rate demonstrates that the Northern Ireland Executive has accepted that it is a means of boosting growth.

However, FSB Northern Ireland is concerned that the delay of the implementation until 2018 does challenge opportunities for growth in the next two and a half years.

The Economic Policy Centre (EPC) at Ulster Business School has projected that 22,000 net jobs will be created between 2014 and 2018

N

in Northern Ireland.

Of this figure, 19,500 will be within SMEs. With unemployment figures in Northern Ireland consistently topping the UK average, there is a need for the business environment for SMEs to be as conducive to job creation in Northern Ireland as it is in the rest of the UK. Employment costs, the threat of legal disputes and challenges and onerous regulations all are factors in deterring SMEs from taking on employees, consequently deterring business growth.

Unlike larger companies, 95 per cent of small businesses state that they will not leave their local area, thus providing stable, longterm employment and investment in a particular area.

This is particularly evident following the devastating losses resulting from relocation

by JTI Gallahers followed by the closure of the Michelin factory, both in Ballymena.

However, over a third of small businesses find employment costs and regulations to be a major barrier to their growth. Support is required through reducing the amount of employment regulations and paperwork required from employers. More concerning, is the fact that those small businesses that are ready to take on staff, are not being able to find the appropriately skilled candidates that are required.

The Contribution of Small Businesses to Northern Ireland research found that 61 per cent of SME employers in Northern Ireland are not confident that they will find the candidate with the right skills for the job that is being advertised. Forty six per cent of respondents stated that they feel that this is due to education provision in Northern Ireland not preparing young people to a sufficient standard for employment.

The development of education and skills is integral to establishing the Northern Ireland economy. Last year, there were a large number of cuts made to further and higher education places and there remain continued budgetary pressures.

FSB urges the Northern Ireland Executive to protect investment in further and higher education and apprenticeship schemes, as well as increasing interest in practical, vocational education and STEM topics.

In determining the skills that are required, pathway options should be developed with SME guidance so that skills that will ensure long-term employability and career success are captured.

In terms of the future, there is a need to capture the potential, talent and creativity evident within Northern Ireland, by encouraging new start-up businesses.

Since 2009, Northern Ireland has persistently been below the UK average in terms of the net change in the number of business registrations, with consecutive annual decline in the total number of businesses that are registered.

This is all the more concerning given that in 2005, Northern Ireland had the highest startup rate in the UK. To redress this situation while encouraging the wealth of local talent and creativity, business skills and alternative routes to employment should be focussed on in both curriculums and career guidance at secondary level education.

www.businessfirstonline.co.uk

29

NORTHERN IRELAND ECONOMIC OUTLOOK 2016

Count energy into your budget Have you set your budgets yet for 2016? Have you factored in your energy? ````````````````````` asks Stewart Curtis of The Energy Desk (TED)

hilst a lot of companies have set their budgets and departments are now haggling over, it may be worthwhile looking at your Energy Costs and budget and look to way reduce. Consumption and costs.

It is worth noting that recently I spoke with a group of Finance Directors and my question “ What is the third largest expense in your company and the one you know least how to deal with “ Yes it was Energy.

Right now is the best time to contact an industry specialist who can come into your business and work with you to understand your current energy position and how to enhance this through reduction of consumption and reduce cost of bills. A energy management company not a brokerage company will understand your needs and work with you put your company in the best position in the market.

At TED we would look at the whole picture as a Full End to End Energy Management Company and produce solutions to would best fit your business? A lot of companies would have gone through this for ESOS if you have more than 250 employees or a turnover more than £40Mil but probably not acted on the saving opportunities found, as compliance was just to be in ESOS. Take the advice it was

W

30 www.businessfirstonline.co.uk

save costs and reduce your energy and more to the point put your business in front of the market as the next phase will be what have you done to act on ESOS solutions and if not completed fines will be issued as the extension time has passed!!! If you are the size of ESOS and nor registered please contact The Energy Desk but be prepared you may be fined.

Solutions to energy budgets will be different for every company but can be simple from: • New Procurement • Change to LED • Biomass • CHPs • Live Energy Management System – with automated bill validation and full bureau of reporting suites These are just a few ways that you can budget for your energy and save costs in the

company and these budgets can be set for periods of years and managed by your energy management team.

As an energy management company we would look at all of the above and for multi site operations and manufactures we would also look to drill down on intensive user programs to save more on energy cost, DSU to supply back to the grid, and Thermal Reaction waste to energy, the last to options would not only save money and costs but would earn your company a revenue that can be factored into the budgets and bottom line.

A prosperous New Year Businesses have plenty of reasons to be optimistic about 2016, provided they have a strategy for addressing trading risk, explains Coface’s Roslyn Keogh. onfirmation of a cut in corporation tax from 2018 was an early Christmas present for businesses in Northern Ireland. Not only will the new rate of 12.5 per cent help attract foreign investment, it should mean that companies have more funds to invest in growth and development.

The director of the CBI in Northern Ireland recently reflected that “there is a great deal more to do to create a sustainable and balanced economy focused on enterprise, investment, innovation and exports”1.

According to one study2, there are currently 67,000 enterprises in Northern Ireland, 12 per cent higher than in 2014 but the number achieving high growth has fallen. And although Northern Ireland saw an increase in exports in the year to September 2015 this only represents two per cent of the total3.

Alongside effective political leadership and Government investment, Northern Ireland’s economic prosperity now depends on businesses achieving sustainable growth. This is often a tricky balancing act because the need for companies to offer credit exposes them to the risk of a bad debt. However, the most successful businesses have a strategy to monitor their exposure and mitigate potential losses.

As a credit insurer, Coface regularly evaluates trading risk on behalf of our customers. These are some of the risks to take into account in 2016:

C

Company risks Company insolvencies have fallen in Northern Ireland4 but it is dangerous to assume that you are safe from the threat of bad debt, even if you are on good terms with your customers. Every failed company leaves suppliers in the lurch and reeling from a potentially fatal blow to their cash flow. And in Coface’s experience, businesses are at particular risk of bad debt during an economic recovery when they can succumb to the temptation to overtrade and make up for lost time.

Rather than take chances, offering credit terms should always be an informed decision based on an objective assessment of a customer’s financial health and trading behaviour. It is also essential to monitor account customers so that you can act on a sudden change in their credit status before it is too late. Companies with a credit insurance policy should find it easier to keep track of credit risk and focus on their most financially healthy customers, while being protected from the impact of a bad debt.

Sector­specific risks While individual companies can still be profitable trading partners, it pays to take account of the overall risk profile of a customer’s business sector which can be affected by factors such as global demand and commodity prices. Coface’s reports on sector non-payment risk provide a useful insight and are freely available from the economic studies section of our website (www.cofaceuk.com/Economic­studies).

For example our latest report5 highlights the improving picture in information technology, an expanding sector in Northern Ireland.

Sector risk is assessed as moderate in Western Europe where demand has been buoyed by private consumption of online streaming and cloud services. By contrast the automotive, construction, energy and metals sectors continue to cause concern.

Country risks It also makes sense for exporters to be aware of the trading risk in traditional and emerging markets. Coface’s country risk assessments (From A1 to D) indicate the chances of payment default based on a range of macro-economic data (again, these are freely available on our site). Our current assessments for Northern Ireland’s top five trading partners are: Republic of Ireland – A3 (satisfactory) USA – A1 (very low risk) Canada – A1, but negative watchlisted since June 2015 Germany – A1 France – A3

Global risks In his Autumn Statement last November, the Chancellor announced that expectations for world growth and world trade have been revised down6. Among the foremost global threats to trade are the escalating conflict in the Middle East; tensions between NATO members and Russia over Ukraine and the Syria crisis, while terrorism and cybercrime have become a real and present danger for ordinary citizens and businesses.

While businesses cannot influence global

events, it is important to be aware of developments and take steps to minimise their potential impact.

For example, Coface’s single risk cover protects companies from losses arising from political upheavals overseas, including conflict or acts of terror. Both geopolitical risk and cyber security will be on the agenda at Coface’s Country Risk Conference London, in June 2016. To register your interest, email crc_uk@coface.com

Trading safely Despite the risks outlined above, there is reason to be optimistic about 2016 following the ‘fresh start’ deal. After such prolonged political stalemate, Northern Ireland’s businesses have an opportunity to shine.

Coface is ready to help them trade safely and grow.

For more information about Coface in Northern Ireland, contact Roslyn Keogh, Country Manager - Ireland on +353 1230 4669

References 1 Punching above our weight, CBI Northern Ireland, October 2015 2 The Barclays and BGF Entrepreneurs Index Volume 7, November 2015 wealth.barclays.com/en_gb/home/wealthmanagement/who-we-help/entrepreneurs/entrepr eneurs-index.html 3 Regional Trade Statistics Third 2015, HMRC, 3 December 2015 www.uktradeinfo.com/Statistics/RTS/Pages/defaul t.aspx 4 Insolvency Statistics – July to September 2015, The Insolvency Service, 29 October 2015 www.gov.uk/government/uploads/system/upload s/attachment_data/file/471934/Q3_2015_statistics _release_-_web.pdf 5 Panorama: Sector barometer, Coface, October 2015 www.cofaceuk.com/NewsPublications/Publications/Barometer-sector-risks-i n-the-world-October-2015 6 Spending Review and Autumn Statement 2015, HM Treasury, 25 November 2015 www.gov.uk/government/speeches/chancellorgeorge-osbornes-spending-review-and-autumn-stat ement-2015-speech

www.businessfirstonline.co.uk

31

Planning is on the move in 2016 Richard Bowman, Strategic Planning reviews the result of moving the planning process from central to local government and what developments 2016 might bring. his is the third year that I have written a planning forecast for the Economic Outlook and it’s always interesting to look back over the previous year and see if things panned out as predicted.

We were looking forward to the move of planning powers to the Councils this time last year and eight months on we are all starting to get used to the new regime which in many cases is still suffering from teething problems.

The legacy left by Department of the Environment of under-resourced planning teams is going to have to be addressed by the Councils if they are to deliver the more efficient, fit for purpose planning system which the new legislation promised, especially since many are hoping to produce the first part of their Local Development Plans during 2016.

The Strategic Planning Policy Statement was finally published in September 2015 and had an immediate effect by throwing a number of retail applications and appeals into disarray. The new policy document introduces a few refinements from the old PPSs which present potential opportunities, such as a slight relaxation on the redevelopment of zoned industrial land for alternative uses.

The outcome of the DUP challenge on BMAP is still unknown and this is having an unsettling effect on residential development.

It’s impossible to predict how the courts will deal with this, but from an economic perspective, a decision which results in a quashing of the plan will have a significant negative effect on investment in residential development in the greater Belfast area, something that we can all do without.

The Environment Minister finally ended the debate as to the need for a new £240 million EfW plant at Hightown with the refusal of planning permission, which ARC21 is planning to appeal. In a similar vein, the Omagh Minerals underground proposal was approved in July 2015, but local objectors have predictably sought leave for judicial review. Meanwhile Dalradian are developing their plans for a not dissimilar proposal near Gortin in County Tyrone, submission of which is expected in early 2016.

In general, the optimism around the economy in 2014, waned slightly in early part of 2015, partly due to likely cooling off following a rally of activity in the previous year, but more probably due to the impasse regarding the budget and other matters at Stormont. The latter part of 2015 has certainly been busier for us, not least because of the new requirement to carry out public consultation for major planning applications

T

32 www.businessfirstonline.co.uk

kicked in on 1st July resulting in a few key pieces of work.

Student housing proposals have dominated the planning scene in Belfast over the past two to three years, but there is now the perception that there is a potential oversupply, yet there is still interest from a number of providers and 2016 could see a few more proposals around the city centre.

If student housing is on its way out (in planning terms), then office proposals are certainly on their way in, with developers such as Stargime, Kilmona and McAleer & Rushe responding to the demand with a planned 880,000sqft of grade A all of which should be approved in 2016.

The main residential developers are still focusing on sites within a 20 mile radius of Belfast, although, Belfast City Centre is still bereft of any significant residential development. Increased popularity of the city centre for other land uses will eventually create an environment which will attract more permanent city centre dwellers and it is highly likely that we will see residential being part of larger masterplan type schemes over the next year or two.

The talk of a formalised developer contributions policy relating to residential developments has not raised its head again during 2015, but it is doubtful that we will get through 2016 without such policy being put in place. Developer contributions for city centre developments are starting to become the norm, with the recent approval of the All State project at Maysfield netting around £100k for a range of projects which will benefit the local community.

The renewables sector saw many of us through the worst of the recession. However with re-election in May, the Conservatives brought forward the closure of the ROCs scheme from March 2017 to March 2016. This has come like a bolt out of the blue for the wind industry which has led to a legal challenge against DETI. The industry is not dead yet but as far as major advancements and expansion of this sector is concerned, that is a thing of the past.

A number of new players have come into the Northern Ireland retail market in 2015 and are likely to be making their presence felt during 2016. These include retailer/ baker Greggs who have plans for up to 50 stores throughout Northern Ireland and they already have 10 sites identified in Belfast. Oak Furniture Land is soon to open their first store in Shane Retail Park and while not a new entrant, Sports Direct is making a big play about plans for more stores around Northern Ireland.

Public spending on development projects all but ceased during 2015 with a number of key projects, such as Magilligan Prison redevelopment being suspended pending the outcome of debates on Welfare Reform. Now that there appears to be a resolution of sorts to that, I would expect to see Magilligan and other similar projects being reenergised during 2016.

Despite some unwelcome press during the summer, Cerberus has been doing its part in reintroducing some liquidity to the property market with the sales of a number of portfolios of land and buildings which have been snapped up by some of Northern Ireland key property developers and hopefully in due course translated into projects.

Overall, optimism is increasing and while 2015 was not exactly a bumper year, the deals that have been done over the past twelve months and the decisions taken on public sector spending, will hopefully pave the way for a more prosperous year ahead.

NORTHERN IRELAND ECONOMIC OUTLOOK 2016

Social Media for business in 2016 “If you’re not using mobile marketing to attract new customers to your business, don’t worry – your competitors are already using it and are getting those customers instead, says Bill McCartney, Bill McCartney Social Media as he looks forward to the challenges and opportunities of 2016 ne Billion people logged onto Facebook in just one day a few weeks ago. That is one in seven people on the planet. Your businesses can significantly benefit from tapping into this huge phenomenon social media.

O

“We don’t have a choice on whether we do social media, the question is how well we do it” – Erik Qualman Social media challenges you to think differently. You may be still paralysed by focusing more on the risks than the opportunities social media offers your business. Quality training through an accredited social media course can help show you and your employees how to limit the risks and enhance your opportunities.

Challenges Privacy is a concern and you may not be aware of the different privacy settings available to you across a range of social media platforms. People for example object to LinkedIn members viewing their profile anonymously. However they leave their public LinkedIn profile fully viewable by search engines.

Security is often overlooked. Double sign on using a password and a unique pin sent to your mobile helps reduce the chance of being hacked. Correctly set page roles as in your Facebook business page are essential.

Negative comments where your customer satisfaction is clearly visible and not totally within your concern is a challenge.

“Social media doesn’t create negativity, it uncovers it” – Jay Baer Remember whether you have a social media presence or not people will still discuss your products and services online. It’s better to be aware of customer comments than hide your head in the sand.

New Opportunities Social Selling is in essence when people buy from people. It is a commonly used phrase that has stood the test of time. LinkedIn with over 400 million members and the world’s largest online network is made for social selling.

“The richest people in the world look for and build networks, everyone else looks for work”­ Robert Kiyosaki, author of Rich Dad Poor Dad

LinkedIn allows social selling at scale with a global reach at the touch of your mobile smartphone or tablet. It’s important you value and listen to people, stop broadcasting and engage in conversations. It builds trusted relationships to grow sales and buy from people you know, like and trust.

Mobile Marketing has opened the world of social media to a huge Global audience and potential customers. It is part of our everyday lives. When you leave the house you now take a smart phone, car keys and money.

“If you’re not using mobile marketing to attract new customers to your business, don’t worry – your competitors are already using it and are getting those customers instead.”

Jamie Turner Periscope uses your mobile to provide live interactivity. Its co founder Kayvon Beykpour favourite Periscope broadcast is Rodger Federer who started a Periscope broadcast walking onto court at Wimbledon this year.

Roger Federer was able to interact live with his audience. That live interaction according to Kayvon Beykpour is what makes Periscope so compelling.

Mobile Platforms Instagram the photo and video sharing app and SnapChat real time picture chatting are growing in importance.

They should be on your radar.

Mobile Designer Apps like Word Swag are incredible simple and effective ways to quickly design promotional material.

Video Advertising using Facebook allows you to tell a story in your Facebook advert.

They are excellent for brand awareness, product lunches and customer stories. The Facebook advertising platform is easy to use and adverts can be laser targeted.

“I think video advertising is a hugely compelling medium” ­ Susan Wojcicki Facebook enables you to build unique custom audiences for you to advertise too.

These could be customers on your email list, or who have visited your website or activity in your app. Facebook adverts offer incredible value for money with a huge targeted reach.

Training I am delighted to be delivering fully accredited Social Media courses in 2016.

The assessment process to accreditation is very thorough and demanding as is to be expected from an accreditation body. We value your time and work to ensure our courses are of the highest standards. They will be delivered in partnership with Business First and the International Academy of Digital Marketing.

Your buyers are using social media to find, evaluate, compare and decide their best buys.

Our training will help you reach your target audience, grow sales and leave your competitors behind.

Are you and your employees ready to invest in the skills necessary to succeed on social media?

www.businessfirstonline.co.uk

33

NORTHERN IRELAND ECONOMIC OUTLOOK 2016

What are the challenges facing Northern Ireland’s CIOs in 2016?

At eir Business NI’s most recent CIO Club in Belfast, there was little disagreement on the challenges that 2016 will bring for Northern Ireland’s CIOs and where their role is headed. No matter the industry, CIOs share the same concerns and challenges, but they are at different points in their journey on finding the best way to tackle them. Chair for the event, Andy O’Kelly, Chief Architect at eir Business, outlines what’s preoccupying Northern Ireland’s CIOs. n November, eir Business NI hosted a dinner with some of Northern Ireland’s top CIOs. The discussions centred around the key challenges for 2016 and Northern Ireland’s readiness to tackle them. While the CIOs around the table represented different verticals, each and every one shared a common challenge: how to better align IT with the business.

I

Embrace IT as an enabler and not just a caretaker Whilst some companies across Northern Ireland have shifted budgetary weight & resource from traditional ‘lights on’ activity to transformation, most have not broken free from the day-to-day demands on their IT department. Most companies are struggling to get to 40 per cent transformation, and in the worst case the figure was lower than 20 per cent. In this particular case, the lack of focus on transformation has led to the bulk of work being centred on cost-reduction measures, and the profile of IT being visible only in the context of service failures.

Industry analysts and commentators are clear: in the 21st century every company is an information technology company. The role of technology has never been more important, yet, according to a survey conducted by BPI Network, there is a clear disconnect across organisations between the recognised need to adopt new technologies and actually achieving that goal.

The survey highlighted the top five obstacles: gaining consensus and support for new technology investments 44 per cent, determining needs and optimal solution available 41 per cent, minimising information security risk, vulnerability and threats 34 per cent, successfully implementing and gaining organisational adoption 31 per cent, and ageing IT infrastructures that need updating and modernisation 28 per cent.

Get to know your CIO If CIOs are to devote time to driving that business change they need to avoid getting bogged down in their daily responsibilities running corporate IT. This is the challenge faced by most.

Shifting focus and budget to more impactful innovation was seen as a primary responsibility of the CIO role: selling - and delivering - the value of IT to the CEO and senior management team peers and building

34 www.businessfirstonline.co.uk

support for change and investment. This clearly makes the CIO role challenging, but also personally satisfying and rewarding.

In many organisations, CIOs don’t report directly to the CEO. According to Jacob Morgan, author of the book Future of Work: Attract New Talent, Build Better Leaders, and Create a Competitive Organization, IT gains much better visibility into the key imperatives for the company with a CIO who reports to the CEO. These conversations between IT and business aren’t happening nearly enough, according to Morgan, who suggests that a CIO who reports to the CEO will give the business stakeholders a greater opportunity to learn about what’s happening within IT. A typical CIO and their IT team can add value to a business in many ways, including: enhancing business processes, developing software to aid customer acquisition and retention, and identifying or developing applications that drive efficiencies in functions like finance or sales.

But to do this effectively they need to be free from day to day ‘keeping the lights on’ tasks like ensuring the organisation’s infrastructure is operating at peak efficiency.

So he made the decision to tackle the historically problematic network first, moving to a managed service that dramatically improved the quality of overall IT service delivery.

As the consumerisation of IT, the rise of mobile, the automation of processes through machine-to-machine communication and the shift to the cloud become mainstream, whole industries are being transformed. In the middle of this technological revolution sits the network, the main super highway on which millions of terabytes of data from billions of devices flow.

At eir Business NI we’ve seen some of Northern Ireland’s most successful indigenous enterprises realise the value in outsourcing their network; handing the management of this utility to experts who can make sure it runs at peak performance. By taking this step, they’ve been able to return to the high-value tasks of using technological developments to achieve their business’ strategic goals.

Not only that, they are confident that their network is being monitored 24/7 by experts whose job it is to make sure it is running at peak performance, at all times.

Can your network handle the pressure?

Are you in the cloud yet?

The company with the highest ratio of transformation projects compared to ‘lights on’ spend observed that the network is a foundation layer for any IT delivery. If that layer is unreliable or restrictive, all services depending on it are impacted.

While cloud has become a ubiquitous topic and is impacting the role of the CIO, it is just a method of delivery, not an end in itself. For the CIOs attending our event there was some frustration with the disjoint between marketing messages and effective and practical solutions to business problems,

Each business solution needs to be considered on its own merits, not in any dogmatic way, and in the short to medium term a hybrid of in-house and public cloud looks the most advantageous and effective approach. Andy O’Kelly represented at its worst by sales cold callers asking the question ‘Are you in the cloud yet?’, with little or no consideration of what such a question can really mean.

Each business solution needs to be considered on its own merits, not in any dogmatic way, and in the short to medium term a hybrid of in-house and public cloud looks the most advantageous and effective approach.

Before jumping headlong into the cloud, we would caution organisations to understand why they are considering a move to the cloud.

Investigate which applications or processes could be migrated to the cloud, and the benefits that would deliver.

Are you thinking about adopting a remote working policy? Do you want to reduce your hardware costs? Will your legacy applications even run in a cloud environment? Every business is different, and will have different requirements and reasons for making the move to the cloud.

At eir Business NI, we take a tailored approach, which ensures we are designing a solution that meets the specific needs of our customers, rather than implementing a ‘onesize-fits-all’ solution.

At a macro-level, while there has been a deficit in the availability of high quality data centre services in Northern Ireland, this market deficit has had little or no impact on IT services in the private or public sector.

Many customers have worked around the issue by retaining in-house data centre rooms for their virtualised server farms, as well as leveraging cloud. But with the availability of high quality data centre services across the border, CIO’s in Northern Ireland should not feel limited in options.

At eir Business NI, we have connected a number of Northern Ireland businesses to our state-of-the art ISO27001 data centre in Dublin. We ensure highly resilient, scalable network connectivity to the data centre across an all-Island IP Virtual Private Network.

Coupled with our on-premise data centre capabilities, we are able to develop and deliver Hybrid solutions which combine the benefits of Cloud with the surety of premisebased data centres where needed.

Challenge your staff to keep them interested There was also consensus that foreign investment and State support is impacting on

availability and cost of IT and software skills, pulling candidates away from indigenous business. Retaining expert staff interest and skill-level is difficult in expert areas – challenges and projects are key to keeping the best in best condition. All agreed that this made managed services a no-brainer in many critical areas, including networking.

By outsourcing fundamental, ‘keeping the lights on’ tasks to third party experts, organisations can free up IT staff to work on projects that will make a real difference to business strategy.

A survey by CIO.com of IT recruiters and executives showed that, along with flexible working hours, IT staff were motivated by being included in decision making, provided a certain degree of independence, offered training, and given opportunities to work with new technologies.

Hiring top tech talent to simply monitor and maintain critical IT infrastructure will likely result in unmotivated employees and an increase in staff turnover.

The role of the CIO is no doubt becoming

more challenging. A lot of the sentiment is endorsed in Gartner’s 2016 CIO Agenda survey about what they enjoy most and least about their role. CIOs are excited by the opportunity and the imperative to lead and drive change; finding how to manage this within their current constraints is what keeps them awake. Complexity is still a challenge, finding a way to reduce it is the key.

If you’d like to discuss any of these areas in more detail, please contact our sales director Matt McCloskey uk.linkedin.com/in/mattmccloskey. We’re keen to discuss how we can help your business reduce complexity and meet the challenges that lie ahead. www.eir.co.uk or twitter.com/eirbusinessni

www.businessfirstonline.co.uk

35

NORTHERN IRELAND ECONOMIC OUTLOOK 2016

Year ahead is one for recovery for commercial property

by Brian Lavery, Managing Director, CBRE Northern Ireland

015 was another busy year for the commercial property market in Northern Ireland following a particularly strong performance in 2014. As is usually the case in Northern Ireland, the largest proportion of activity in most sectors was recorded in the second half of the year.

As a result of a shortage of Grade A accommodation, take-up in the office sector in Belfast was slightly down on the previous year, reaching almost 27,881m2 (300,000 sq. ft.) during 2015. Much of this activity occurred in the second half of the year with several transactions completed just before year-end.

There were encouraging signs with some speculative development of office accommodation commencing in the last 12 months. Planning powers were also transferred to local councils, hopefully speeding up the process and bringing a more commercial focus to decisions.

Last year also saw some increased appetite from retail occupiers with this activity particularly evident in Belfast and larger towns across the region, where we saw several new entrants commence trading in Northern Ireland. The rates revaluation, which took place last April, benefitted many retailers across Northern Ireland leading to significantly reduced rates bills in a number of instances.

Take-up in the industrial sector was compromised by a lack of modern buildings in prime locations, which in turn saw prime industrial rents rising for the first time in several years.

Following a very strong year in 2014, there was continued activity in the investment sector of the market last year with

2

36 www.businessfirstonline.co.uk

transactional activity reaching approximately £400 million.

Investors were particularly encouraged by the relative affordability of real estate in Northern Ireland compared with regional UK cities. The bulk of investment activity in the region during the year emanated from private equity buyers and institutional investors with the vast majority of transactions comprising shopping centres and retail parks.

Availability of debt funding was more readily available over the last 12 months which is encouraging.

However, funding for speculative development remained elusive and is likely to do so for some time yet other than where prelettings are secured.

Tourist activity increased year-on-year, which in turn benefitted the hotel & leisure sector of the economy leading to an improvement in hotel performance figures across Northern Ireland. There was a notable improvement in transactional activity in this sector.

Towards the end of the year, the Stormont Assembly announced details of the ‘Fresh Start’ programme, which bodes well for continued activity in the commercial property sector over the next couple of years.

Outlook 2016 2016 will see the commercial property market in Northern Ireland moving to the next stage of recovery with an escalation in development activity becoming increasingly evident, most notably in the office, hotels and student accommodation sectors in Belfast.

The office sector is progressing more quickly and we expect to see an increase in the number of office projects entering the planning process during 2016. A small volume of new office stock is to be delivered this year but many larger schemes won’t be completed until 2017 at the earliest.

This will continue to put upward pressure on rental values in this sector until there is a meaningful improvement in supply, as a result we expect to see prime office rents in Belfast increasing from £16 per sq. ft. £18 per sq. ft. over the course of the next 12 months.

The biggest challenge in the retail sector

this year will be securing stores for retailers in many of the most highly-sought-after schemes and high streets, most of which are close to, or at, full occupancy.

We therefore expect to see some further growth in retail rents in prime shopping centres and high streets this year and expect to see more lease re-gears in the retail sector of the economy.

We also expect to see some further upward pressure on prime industrial rents in 2016 to approximately £4.50 per sq. ft.

However, rents will not rise to the point where speculative development is viable and so aside from one speculative scheme we are not expecting to see new industrial accommodation emerging other than specific expansion and ‘design and build’ projects.

We expect to see strong volumes of activity in the investment sector again in 2016. As deleveraging efforts wind down, it is inevitable that a greater proportion of transactional activity will emanate from secondary trading, as private equity firms continue to implement their exit strategies and many of the assets and portfolios purchased over the last number of years are re-traded or re-financed.

Investors will now also broaden their focus to maximise income generation from existing assets and concentrate on potential development opportunities. Prime yields are for the most part expected to remain stable this year.

Tourist numbers are expected to reach two million visitors during 2016, which will bring benefits for the hotel and leisure sector of the market and encourage more hotel operators and investors to consider opportunities in the Northern Ireland market.

There is also a need for caution as there is potential for oversupply if all hotel schemes in the planning process materialise; this is also a concern in the student accommodation sector.

The announcement that the Northern Ireland Executive intend to lower the rate of corporation tax in Northern Ireland to 12.5 per cent in April 2018, is hugely significant.

The change to corporation tax has the potential to be a game changer for the Northern Ireland economy and in turn its property market.

We expect to see some further improvement in the availability of debt funding over the course of the next 12 months both from local banks and new entrants to that sector.

Improve wellbeing and save money

overnment-led salary sacrifice schemes have for years allowed companies nation-wide to contribute what they normally pay in tax towards pensions, childcare vouchers, or bicycles to use to cycle to work. Thanks to a government-led initiative for all UK businesses, both employers and employees can also benefit from this tax benefit scheme that allows individuals to invest in their health and wellbeing.

This ability to simultaneously improve wellbeing and save money is exactly what Randox Health is delivering through their Workplace Wellbeing programme.

By taking what you would usually pay as tax and investing it in your health instead, employees can save up to 62 per cent on their income tax and National Insurance Contributions and employers can save 13.8 per cent on their National Insurance Contributions.

Jason Webster Business Manager of Randox Health, says the significance of the Randox Health Workplace Wellbeing initiative is that by taking a simple blood test, employees not only benefit financially, but also gain personal insight to prevent ill health and disease at a stage when corrective action can be taken.

“The health benefits of the Workplace Wellbeing scheme are endless. Many of us pay money into an ‘insurance pot’ which can take care of us if we fall ill in the future. But at Randox Health we believe in going one step further – actually preventing illness before it happens.”

The payment plan for the scheme operates

G

on a monthly basis, which means that the cost is spread over 12 months. No need for cash or card transactions, monthly payments come out at source – no remuneration required, effectively saving up to 62 per cent of the cost of a Randox Health preventative programme.

“The Randox Health Workplace Wellbeing Programme is the most advanced diagnostic service in the world. Both employers and employees can have access to a premium healthcare service at a fraction of the cost, and as a completely tax-free initiative at no extra cost to the business. It makes great business sense to get on board with such a scheme. In addition to this, taking care of the health and wellbeing of your employees will reduce absenteeism, costs and improve productivity making this a win-win programme,” says Jason.

The scheme is managed entirely by Randox Health who organises a 100% confidential indepth health check. A simple blood test, which can take place within the workplace, can comprehensively identify the health and function of your organs, cancer surveillance, nutritional health, sexual health and fertility, amongst a wide range of 150+ disease indicators. This is followed up with a scientific report, personalised health plan, consultation with a GP and ongoing retesting for each employee.

The Randox Health team can provide a bespoke service tailored specifically to your business requirements at no extra cost, with no obligation for employees to sign up. Those who do choose to benefit from the Randox Health services will also have access to a

network of experienced specialists who promise to deliver a unique service at the best possible price.

“We are also delighted to offer family members of corporates 10 per cent savings through the Randox Health Workplace Wellbeing, meaning that you, your colleagues and your family, can all benefit from a personalised health screen tailored to either male or female health,” says Jason.

This holistic style of testing ensures that the patient understands their full body health in great detail in order to prevent as many problems as possible in the future. This has added benefits for your private medical cover – Randox Health patients can optimise their health insurance by understanding their personal health profile and knowing what action to take now to prevent ill health in the future.

The Randox Health Workplace Wellbeing programme can save you from potential illness and disease in the future. Empower your employees to find out how healthy they are and how they can continually improve their wellbeing. Don’t leave the health of your workforce to chance. Let Randox Health Workplace Wellbeing take control of your future business health.

For more information contact the team at Randox Health now.

Tel: 0800 2545 130 Email: wellbeing@randoxhealth.com Website: www.randoxhealth.com

www.businessfirstonline.co.uk

37

NORTHERN IRELAND ECONOMIC OUTLOOK 2016

Manufacturing starts the year on the backfoot - but pledges to fight back asks Stephen Kelly, chief executive, Manufacturing Northern Ireland t was a difficult end to 2015 for our manufacturing base. Job losses in a number of businesses and the impending closure of the Michelin factory, calling time on almost 50 years of production locally, and a bitter blow for the 860 skilled, productive and committed workers in their Broughshane plant.

As we enter into 2016, we’ll sadly see the planned closure of JTI Gallahers starting with the first batch of workers leaving to be followed by full closure planned for May. A pretty depressing start to the New Year for the economy but particularly for those families dependent on a manufacturing wage.

What all this does is remind us how brittle manufacturing remains and confirms the need for a strategy. A cross cutting, reported on by a Minister, plan which sets out a route and commits to actions which will attract, sustain and grow industry.

I

But, why is that important?

Despite high profile losses, manufacturing has sales approaching £19b, represents 24 per cent of non-financial GVA and with 83,000 people employed, the third largest employment sector with 12 per cent of jobs.

These are in constituencies across Northern Ireland, particularly outside of Belfast. 16 per cent of jobs are in manufacturing in the new Armagh, Banbridge and Craigavon Council, 21 per cent in Mid and East Antrim and in Mid Ulster an incredible 28 per cent of jobs.

Well paid jobs, averaging over £500 per week, in communities where people want to work, set up home and contribute to their local community. The economic multiplier is huge with these businesses and jobs supporting retail, leisure, professional and service jobs.

These are in largely home-grown businesses. Great products, made by great people in great companies. But we can’t rely on home-grown loyalty.

We owe it to them to ensure the conditions are great for them to do business. If we have the right conditions for them, then we have the right conditions for multi-national, Foreign Direct Investmen manufacturers too.

Invest NI and DEL do a good job in supporting investment in training and R&D, supporting exporting capability and resource efficiency. But a manufacturing strategy, at the heart of a new Programme for Government, will ensure every corner of government will commit to actions to support and grow of manufacturing base.

The commitment to a “date and rate” for

38 www.businessfirstonline.co.uk

the introduction of a lower rate of Corporation Tax will give InvestNI a new sharp marketing tool but the opportunity must be seen as having wider significance.

Many of our FDI manufacturers are cost rather than profit centres. The Corporation Tax opportunity allows us to begin discussions to bring greater investment, sales to new territories and support services here.

For home grown businesses, it will release capital to invest skills, R&D and machinery – the latter being critical as where the machinery is located, the jobs are sustained for the medium to long term.

But, our own Corporation Tax rate is not enough. Our Programme for Government needs to commit to investment in skills and infrastructure. DEL’s recently released Skills Barometer signals the need for 14,000 more people in manufacturing by 2025. We need to begin investing now in order for these jobs to be filled. And, key roads infrastructure projects – particularly the A6, York Street and the A5 needs a committed and funded project timeline.

We also need to finally deal with the perpetual problem of power prices “Our energy bill in Northern Ireland last year was £9m – it has been an Achilles heel for us”. These words from Wayne Culbertson, CEO Michelin UK should be final warning shot for policymakers, regulators and indeed the energy industry itself.

The most recent price comparison report from the Utility Regulator was depressing reading. Almost all categories of business consumers are now enduring the 2nd or 3rd most expensive power bills in Europe.

24,000 businesses, clearly not all manufacturers, including the critical SME sector should not be asked to suffer these prices whilst the energy industry is guaranteed huge profit.

A commitment that ALL customers – domestic, small and large energy users – should enjoy prices competitive within Europe will direct actions by those departments, the Regulator and how the redesigned all-island generation market will work.

Energy may seem complicated but we can be reassured that ALL the levers needs to ensure competitive prices are within the gift of the Department (policy costs and levies) and the Regulator (Price Controls and market design).

Manufacturers across Northern Ireland have been reassured by the commitment of,

then, Finance minister Arlene Foster to ensure the continuation of the 30 per cent cap on industrial rates as part of the Review of Business Rates. Given the large spaces required, much of which can’t be commercialised, manufacturers already pay the second largest amount per business.

Uncertainty of the long-term commitment had led to holding back plans for expansion.

Finally, whilst it may appear unpopular, our employment laws are out of step resulting in uncertainty and a reluctance to take on permanent employees. The Living Wage, pensions and the new Apprenticeship Levy are increasing costs, but unlike GB, balance is not being provided through a contemporary and relevant employment law regime.

Manufacturing is big and important but particularly sensitive to costs. We can’t do anything about currencies, commodity prices nor global demand but it is within our gift to deal with rates, energy and the labour environment.

Manufacturing Northern Ireland members will not be found wanting in creating wealth and work, filling the 14,000 spaces forecasted. They just need the Executive and its agencies to create the conditions for them to thrive.

NORTHERN IRELAND ECONOMIC OUTLOOK 2016

Political and Economic Outlook 2016

by Chris Brown, director, MCE Public Relations lections will take place in both Northern Ireland and the Republic of Ireland this year, both predicted to be within months of each other. Locally this will mean a political business hiatus for up to 6-8 weeks during purdah and also an extended period of organisation after the election when parties pick departments and ministers are set.

We also have to contend with the fact that the number of the government departments here will be reduced to nine after the election. Later in the year we are going to see the formation of the likes of the Department for the Economy, the Department for Infrastructure and the Department for Communities which will assume the roles of previous departments and amalgamate the functions of others.

E

Northern Ireland Investment fund The minister for Finance, Arlene Foster MLA, has said that significant progress has been made towards establishing a Northern Ireland Investment Fund. A feasibility study

by Deloitte has now concluded and further market testing has been carried out to determine the potential structure and scope of the Fund.

However, a significant amount of technically complex work remains before the Fund can become operational and DFP officials continue to engage with the European Investment Bank. The outstanding work includes, amongst other things, development of a Fund Investment Strategy, determination of the appropriate governance structure, development of the fund manager procurement strategy and completion of the fund manager procurement process.

Defamation Law The Finance minister has also indicated that an independent review is being carried out on Northern Ireland defamation law at present and has told the Assembly that she hopes to receive the report by early 2016.

Export strategy action plan The Enterprise, Trade and Investment minister, Jonathan Bell MLA, outlined in the Assembly in December that the DETI draft export strategy action plan and final action plan is expected to be published in the next few months.

PEACE IV The European Commission has now formally adopted the EU Programme for Peace and Reconciliation, PEACE IV. The cross border cooperation programme will deliver around €269million to projects

working to support peace and reconciliation in Northern Ireland and the border region of Ireland. This is expected to provide a welcome boost to certain organisations in the Voluntary and Community Sector throughout 2016.

2016­2021 Programme for Government In preparation for the next Programme for Government, DETI and its bodies are, as part of their corporate planning process, setting out to consult and engage with local stakeholders and businesses to communicate high level strategic priorities for the period 2016-2021.

Year of Food and Drink This year has been designated the special year of Food and Drink in Northern Ireland.

The idea behind it is to boost Northern Ireland’s reputation by putting food and drink at the heart of the tourism experience.

The objective of the year is to grow trade and visitor spend.

Review of Business Rates In October last year Finance minister Arlene Foster MLA, launched a consultation on a Review of Business Rates in Northern Ireland during which stakeholders have been invited to provide input on the future direction of business rates in Northern Ireland. The review will also seek views on alternative forms of taxation as either replacements or supplements to the existing rating system. The consultation is expected

to close on 25 January.

Dormant bank accounts As part of the 2015-16 Budget, the Northern Ireland Executive has agreed that £6.4m is available for Northern Ireland expenditure under the “Dormant Accounts and Building Society Accounts Act 2008” and is to be opened in Northern Ireland under the Social Innovation Fund.

A consultation is expected inviting views on, amongst other issues, the spending priority and the distribution mechanism for the Social Innovation Fund.

Autumn Statement and Budget 2016 In November, the chancellor of the Exchequer outlined that the Northern Ireland Executive block grant will be over £11 billion by 2019-20. In with the range of issues he touched on, he announced that from April 2016, new rates of Stamp Duty Land Tax will be introduced that will be three per cent higher on the purchase of additional properties like buy-to-lets and second homes. He also announced that a new £7 million Regional Air Connectivity Fund will support new air routes, including those from Belfast to Carlisle and from Derry to Dublin.

The next Budget is expected to take place on Wednesday 16 March 2016.

Connect with Chris Twitter: @CB_PRandPA Email: chrisbrown@mcepublicrelations.com

www.businessfirstonline.co.uk

39

NORTHERN IRELAND ECONOMIC OUTLOOK 2016

This time we really do need a proper Fresh Start

by Paul Terrington, chairman, Institute of Directors Northern Ireland eflecting on the old year past and the New Year yet to come, your mind tends towards an authoritative quote, so a couple of lines from Seamus Heaney seem appropriate. Looking back on 2015, Heaney’s encouragement that, “…even if the hopes you started out with are dashed, hope has to be maintained,” seems to fit the bill.

But looking to the future and Heaney’s warning that, “… anyone born and bred in Northern Ireland can't be too optimistic,” is sufficiently pithy that it might be engraved over the doors of Stormont.

I’m growing rather tired of writing economic reviews and fiscal commentary about Northern Ireland. I spend enough time with economists to know that, while Northern Ireland may be recovering, the economy is recovering more slowly than the other 11 UK regions and there is no evidence whatever that the prosperity gap is closing.

And I spend enough time with politicians to know that there is neither the political will nor the consensus for the kind of radical public sector reform that will make any material difference.

Nevertheless, like most of the business community, I am a fan of devolution. I see consensus in Scotland – a desire amongst nationalist and unionist alike to make it a better place, to use the enhanced Scotland Act to create wealth, attract investment and build a prosperous economy.

I see devolution working in the English regions, flowing from the City Growth Commission report, which concluded that devolving powers from Whitehall to city regions could boost economic output in the UK’s 15 largest metropolitan areas by £79bn per year - around five per cent of GDP – with one of those metropolitan areas being Belfast.

I want us to embrace devolution with the same zeal and enthusiasm that is evident elsewhere in the UK. I don’t want Northern Ireland left as the only region in the UK where devolution has delivered nothing – and that is not as unlikely as it sounds.

R

The Fresh Start The Fresh Start agreement has set the date and the rate for the reduction of Corporation Tax, but ‘switching-on’ the powers remains reliant on the provisions contained in the Stormont House Agreement, include putting the Assembly finances on a sustainable footing and there is no clear consensus amongst political and trade unions stakeholders that the price is ‘affordable.’

But if we have a Fresh Start agreement where the issues of welfare reform are resolved and where the Northern Ireland budget now balances, this is the time to have a fresh start around the issues of public sector reform.

A programme that looks to the best of the English city deals and combined authorities, that looks to the best of devolution in Scotland and Wales, and that lets the Executive focus on public sector outcomes and not public sector ownership.

A fresh start should let us look to review after review of the local economy, all of which have pointed to the problems and none of which have been implemented.

A fresh start should let us look to review after review of the local economy, all of which have pointed to the problems and none of which have been implemented.

Paul Terrington

40 www.businessfirstonline.co.uk

A fresh start that seeks to create a Northern Ireland plc with a vision and investment strategy that delivers real return; and a fresh start that does much more than prevent the Assembly collapsing and maintaining Executive Ministers in role.

The Executive cannot achieve this alone. I have said in the past that if Northern Ireland was a business that had come so close to collapse, some measure of control might be achieved through the appointment of independent non-executive Directors and that the Secretary of State and the Executive should invite Robert Chote of and the Office of Budget Responsibility to actively extend its remit to Northern Ireland.

Inviting the OBR to examine and report on the public finances, to consider the costs and implications of the new budget and help determine how best to put Northern Ireland’s finances on a sustainable footing; that alone would bring confidence to investors and stakeholders and would help challenge the tit-for-tat policies, petitions of concern and belittling of anyone who offers constructive criticism of a better way to manage the finances.

It’s tempting to look to Heaney and agree that anyone born and bred in Northern Ireland can't be too optimistic.

But it’s equally important to remember that to even if the hopes you started out with are dashed, hope has to be maintained.

If the Fresh Start is to work it needs hope and it needs to be a fresh start in a lot more than name.

It’s true - life does begin at 40

by Michael Blaney, MD, Autoline Insurance Group hey say life begins at 40, but at Autoline Insurance Group, which ‘turned 40’ in 2015, we’ve always sought to be on top of our game.

Over the past four decades Autoline has worked hard to become one of Northern Ireland’s leading brokers, offering independent, tailored solutions for our customers. At the core of that vision, and something which has helped keep the business fresh since 1975, is innovation.

That desire to innovate – and to offer products which are as good as anything available from global insurance brands – is probably best exemplified by the pioneering services Autoline has developed in the world of telematics (insurance products that use technology to reflect individual behaviours).

In 2012 Autoline made history as the first company in Europe to launch a phone App linked to an insurance policy, and in 2015 we unveiled ChilliDrive – the most sophisticated telematics smartphone app available in the UK. Aimed primarily at younger drivers, ChilliDrive turns smartphones into ‘in-car mentors’, measuring driving skills by analysing speed, acceleration, braking and cornering. Not only will the app drive down insurance premiums, it will also, ultimately, help improve road safety.

Armed with this ever more advanced telematics technology, and the accolade of Broker Innovation of the Year at the recent Insurance Times Awards, 2016 will mark an exciting new stage in Autoline’s history as we take the product beyond our home market to Great Britain. ChilliDrive will be offered to over 200 brokers in GB and marketed directly to consumers.

Beyond telematics, an ever growing part of Autoline’s business has been Northern Ireland’s SME sector. In recent years we’ve grown strongly, doubling in size between 2006 and 2008. Much of that has come increasingly from areas such as commercial insurance and – through our Ashtree brand - financial services.

Autoline now offers a full range of products covering both business and personal clients.

Commercial customers can avail of insurance products in areas such as commercial let property, motor trade, commercial vehicle and farm, to name but a few.

Northern Ireland’s agri-food sector, which continues to be a backbone of the local economy, has been a particularly strong growth area. As with all products, customers are guaranteed a local account manager who understands local conditions, but with access to the UK’s leading farm insurers who operate in the broker market.

This combines all the advantages of local service, but with a global perspective.

Be it farm vehicles, machinery, buildings – or

T

Armed with this ever more advanced telematics technology, and the accolade of Broker Innovation of the Year at the recent Insurance Times Awards, 2016 will mark an exciting new stage in Autoline’s history as we take the product beyond our home market to Great Britain.

Michael Blaney

even the specific needs of small holders Autoline has it covered. Indeed, such has been the success of our agri-insurance products in Northern Ireland that we will be expanding into the Republic of Ireland market in early 2016.

As someone who has developed Autoline from a small business into one that now employs 200 across five different locations in Northern Ireland, I – and my management team – know only too well the trials and tribulations which running a SME brings.

With that perspective we have developed a range of SME products to provide cover for those unplanned events which can threaten a company’s future. Running a small business is a time consuming, if not all-consuming, passion.

It’s all too easy for owners to overlook how much protection they need.

Owners are understandably focused on looking after clients’ day-to-day needs, but sometimes this comes at the cost of failing to ensure that the inherent value of the business, built up over years of hard work, is adequately protected against potential threats.

Through our local office network and handson account managers, we can help business owners take a step back and refocus, providing bespoke solutions that fully protect the company in circumstances such as death or illness of key staff.

Through Ashtree Financial Services we can also provide advice on all aspects of financial planning.

While we are first and foremost a business, part of what has made Autoline such a success is the company’s strong community ethos. This includes a very successful partnership with the road safety charity ‘Brake’, running ‘2 Young 2 Die’ workshops which over 2,000 pupils have benefitted from. In the last few months we’ve introduced a new car crash simulator – one of only a handful in use across the UK – to really drive home the road safety message.

During our 40th anniversary celebrations we also ran a campaign to raise over £40,000 for 40 local charities, an exacting target, but one which our staff and our customers more than exceeded.

So whether it’s in business or in the community, Autoline’s ethos is to set a challenge, to innovate and to improve. In 2016 that ethos will help shape Autoline’s reputation as a onestop shop for commercial and personal customers across Northern Ireland (and further afield!).

The insurance industry has undergone a revolution in the past decade and Autoline has grown as we have sought to meet our customers’ changing needs. At our core, however, we will remain a company built around personable and accessible experts who will give our customers the best advice and products on the market.

www.businessfirstonline.co.uk

41