§ Mr BrazierTo ask the Secretary of State for Northern Ireland if he will make a statement on the reduction in domestic rate bills in Northern Ireland as a result of the Budget.
§ Dr. MawhinneyThe reduction announced in the Budget is a good outcome for the Province's domestic ratepayers. As a result, they will contribute, on average, 36 per cent. less towards the cost of local authority-type services. This is in line with the switch to central funding of 36 per cent. of the amount charge payers contribute to local authority expenditure in Great Britain.
Although it should be noted that there is no precise analogy between the community charge which is a per capita charge and the Province's domestic rates which are property based, given that the associated Budget increase in VAT applies fully in Northern Ireland, it is entirely appropriate that ratepayers in Northern Ireland should receive this benefit. Northern Ireland receives its share of all United Kingdom taxation including VAT which, as an unhypothecated tax, is applied towards balancing the Northern Ireland Exchequer rather than being applied to 170W particular purposes. Furthermore, the reduction, when seen in the light of the higher level of exchequer support for the rates in Northern Ireland, represents a very good settlement for domestic ratepayers in the Province.