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Are Northern Ireland’s ambitions a pipedream?
13 May 2008
Northern Ireland has been given a tax boost to attract financial services firms up from the Republic, but how many will actually move?
Last month, Brian Cowen, incoming Prime Minister of Ireland, announced that the Irish Government would look favourably on financial services firms setting up shop in Belfast.
Satellite operations in the north would be offered the 12.5% tax rate of firms in the Republic, rather than the 28% UK corporate tax rate.
This cross-border scheme could create up to 5,000 jobs in the sector, reckons PricewaterhouseCoopers.
Currently, Bank of Ireland Securities Services (BOISS) has an operation in Belfast, Citigroup has a tech centre there, financial IT vendor Fidessa has recently opened an office, and insurers Liberty Mutual and Allstate Corporation both have software development arms in the Northern Ireland capital.
What’s more, Wombat Financial Software – a subsidiary of NYSE Euronext – has announced plans for 75 more jobs in Belfast.
Pat Wall, tax partner at PricewaterhouseCoopers, says there’s more to come: “There are others in the pipeline. Invest Northern Ireland is talking to firms and there definitely is an interest.”
However, BOISS, which intends eventually to employ 149 in Belfast, has so far recruited just five since opening the office in July 2007.
Liam Manahan, managing director of BOISS, tells us that the current economic climate has slowed progress, but it remains committed to the original target: “Around 10% of Bank of Ireland’s employees are from the north, and many are keen to return. The hires in Belfast so far have been for senior posts. We will be taking on local graduates to supplement these key people.”
In order to capitalise on this new-found interest, the University of Ulster has just launched a postgraduate course in financial services aimed at increasing the talent pool north of the border.
So far, however, no new firms have bitten the bullet and said they’ll be opening a Northern Irish office.
Manahan thinks it’s just a matter of time: “There’s still turmoil in the global markets, so many firms will take their time before committing to any new ventures, which wouldn’t have been the case a year ago.”
