21 March 2012 Last updated at 14:20 ET

Mixed NI reaction to budget plans

The chancellor said the top rate of income tax would be cut to 45p

There has been a mixed reaction in Northern Ireland to the chancellor's Budget.

Finance Minister Sammy Wilson expressed anger that there had not been more help for low income families.

The SDLP Foyle MP Mark Durkan said it was a "slap in the face to the worst off in society". Sinn Fein's Conor Murphy said there was "little relief for those on benefits and low pay".

However, NI Secretary of State Owen Paterson welcomed the Budget.

He said the measures provided "significant help" to hard working families in Northern Ireland.

"The increase in income tax personal allowances by a further £1,100 in April 2013 - the largest in 30 years - will benefit 605,000 people in Northern Ireland, and lift 25,000 out of income tax," he said.

"In addition, raising the individual threshold for the withdrawal of child benefit to £50,000 will benefit 16,000 households in Northern Ireland.

"This is also a budget for jobs and business growth, which are key objectives shared by both the UK Government and the Northern Ireland Executive."

He said the reduction in Corporation Tax to 22% by 2014 would encourage investment.

Budget: Key points

• 50p top rate of income tax will be cut to 45p from 2013
• Tax free personal allowance will be raised to £9,205
• Child benefit will gradually be removed for those earning more than £50,000
• 37p on packet of cigarettes
• Price of pint to rise by more than 5p
• 3p per litre rise in fuel from 1 August

But Northern Ireland's Finance Minister expressed concern over the announcement on greater regionalisation of public sector pay.

The minister pointed out that public sector pay in Northern Ireland is already 3.5 % below the UK average.

Mr Wilson said: "The size of the public sector in Northern Ireland is similar to many other UK regions. The problem we face is that our private sector is too small.

"Therefore seeking to suppress the public sector pay here - something that is a key stimulus in local economic activity - will only impose greater differences in economic growth rates across the UK.

"I am also outraged that the chancellor has not done more to provide assistance to those on low incomes and bring families out of poverty including a reduction in fuel duty."

Sammy Wilson is concerned about public sector pay

He did, however, welcome the additional assistance for high-end television production and the confirmation of additional investment in ultra-fast broadband for Belfast.

SDLP Foyle MP Mark Durkan also expressed concern.

"The tax cut of the high rate of 50% is a very telling signal of the government's real priorities," he said.

"The justification that it will make little difference is, of course, based on the fact that many people who were liable for the tax were able to avoid it because it had been signalled in advance; therefore judging it on one year is not a valid impact measure.

"It is also the case that this also facilitates a calendar-managed avoidance.

"Moves to increase personal allowances for the lower paid are, of course, welcome, and this is something that the SDLP had argued for in the last parliament."

Alliance MP Naomi Long said there was little to be positive about in the Budget.

"I was disappointed that there was no mention of efforts to combat high fuel prices here. We have traditionally had fuel prices that were higher than other regions in the UK, with fuel laundering being a contributing factor," she said.

"The decision to reduce corporation tax to 24% now and 22% by 2014 will not affect a lot of our businesses as most pay the lower limit of 20%.

Naomi Long said there was little to be positive about in the budget

"I am disappointed that the chancellor could not commit more efforts to devolving corporation tax rates to the Northern Ireland Assembly as we face the competition of a 14% rate in the Republic of Ireland. If we are to reach that level at the current rates of the lowering of corporation tax then it would take a decade to do so."

Sinn Fein MP Conor Murphy said: "It would seem that once more with the increase in consumer taxes and spending reductions more finance will be taken out of the north's economy.

"The British Chancellor has demonstrated once more that his government takes no particular account of the impact of their financial decisions on economy of the north of Ireland.

"This Budget as with every other is fashioned to address the British government's perception of what is required to rebalance the economy of the island of Britain with no regard to its effects here."

However, Angela McGowan, chief economist at Northern Bank said it was "not a bad Budget at all".

"Low and middle income households have not borne the brunt of tax changes and although the wealthiest were also given a tax reduction from next year, this was offset by the introduction of anti tax avoidance measures and a cap on income tax relief for high earners.

"Some of the initiatives to make the UK more competitive , such as gradually lowering corporation tax and investing in broadband infrastructure, will be welcomed by the business community and in particular, Northern Ireland's extensive base of small firms will welcome the government's commitment to simplifying the tax system.

"But Northern Ireland was not singled out for any special change in corporation tax and the longer we wait for that equivalent reduction to Republic of Ireland levels, the less hopeful we get. "

Colin Neill, chief executive of Pubs of Ulster said the announcement that there will be no change to alcohol duty was, on the surface, good news for the industry.

"However, a closer look reveals that the move is nothing more than smoke and mirrors, as the Chancellor failed to mention that the beer duty escalator- originally introduced to the Budget by the previous Labour government in 2008 - will remain in place," he said.

"This news will come as no surprise to many in the industry as the government has often viewed the industry as a lucrative cash cow.

"By continuing to apply the duty escalator, the industry now, in fact, faces an increase in duty of 2% above the rate of inflation.

"This equates to an overall duty increase of 5.7% which in real terms will add approximately 10p to the price of a pint.

"Most worryingly however, this duty will now mean that publicans are in fact losing approximately 2p on a standard £3 pint of beer."

Analysis

Jim Fitzpatrick Economics and business editor

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First impressions of George Osborne's 2012 Budget are of one that has a lot of good stuff in it for Northern Ireland - with more detail needed on the potential pitfalls.

The reduction next year in the 50p tax rate to 45p for the highest earners (those over £150,000) may have grabbed the headlines in recent days. But it will only affect 4,000 people in Northern Ireland.

Likewise the hike in stamp duty paid on sales of luxury homes over £2m to 7% will hurt few people here. A trawl of two popular websites suggests just two houses on the market in Northern Ireland that will be affected.

However, the increase in the personal allowance - which is the point beyond which you start paying tax - will benefit hundreds of thousands here. From next April the allowance rises to £9,205 - that will take thousands out of the tax system altogether, and benefit a further 650,000 plus to the tune of £220 a year.

The chancellor announced a cut in corporation tax for big business to 24%, falling to 22% by 2014. This will have limited impact in Northern Ireland where more than 99% of businesses are small. Their tax rate remains unchanged at 20%.

However he announced proposals for the smallest businesses that will allow them to move to a cash-based tax calculation. This simplification of the process should help many of the 126,000 small businesses here.

Smokers are hit with a 37p hike in the price of a packet of cigarettes from midnight. Drinkers are spared any large increases, but alcohol duty is not frozen, which will put 3p on a pint of beer, 11p on a bottle of wine and 41p on a bottle of spirits. And motorists still face the 3p extra on a litre of petrol or diesel from this August.

The Chancellor also announced a further £10 billion in benefits cuts - on top of the £18bn already underway. There are no details as yet, but in this highly benefit-dependent region that could have a deep impact.

More detail is needed on the chancellor's statement that "some departments" may move to local pay. It appears to be a limited move at this stage. But if the principle of regional pay in the public sector is established it will have far-reaching consequences for Northern Ireland's 220,000 state employees and those that rely on their pay packets.

The reference to an enterprise zone for Northern Ireland appears to be only a reference at this stage. It is up to the Northern Ireland Executive to move on that, and it has so far shown little enthusiasm for the idea, preferring instead to focus all its efforts on securing the ability to lower corporation tax in this region.