National Insurance increase could trigger rate hike

Struggling families and businesses could suffer another double whammy, it has been warned.

The Northern Ireland Local Government Association (Nilga) said the impending increase in National Insurance payments could force councils to pass on the costs in higher rates for landlords.

UUP spokesman and adviser Robert Burgess added: “Residents and businesses will pay twice, both directly from their beneficiary and from the employer, National Insurance and Council taxes before pass the cost burden on to their employer via a rate increase, which is clearly unfair if other UK jurisdictions do not [follow suit].”

Nilga requested a formal review of the matter.

At a recent meeting, Mr Burgess warned Finance Minister Conor Murphy and Communities Minister Deirdre Hargey of growing concern over uncertainty over the issue.

“The UK Government has indicated that it will cover the 1.25% increase in National Insurance for public sector employers as part of its settlement to local government,” he said.

“[We] were disappointed to receive clarification from the Department of Communities that the Assembly did not intend to use the funds to cover additional contributions from local authorities.

“There are significant financial pressures on local governments and this decision will impact councils a 0.6% increase.”

He also warned that a significant reduction in the tariff support subsidy paid to seven of the 11 municipalities would put them under extreme pressure.

The overall amount involved has risen from £15.8m to £11.9m in this financial year.

Ms Hargey said it was difficult to do anything without an executive in place.

She added: “These are important issues that need to be resolved, but with the instability of not having a functioning executive to agree a three-year budget, it is difficult.”

Mr Murphy said a rate freeze and month-long “holiday” for all businesses had already been agreed by the executive.

The finance minister added: “These rates and three-month leave for the tourism, hospitality, leisure and other sectors may be carried over to the new financial year.”

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