New £45m fund launched to help address regional imbalance in north’s economy

A new economic strategy to tackle regional imbalance in the north will see the creation of a new £45 million fund for councils, the economy minister has said.

Conor Murphy has also confirmed Invest NI’s staff headcount within its regional office network will be increased by 40%.

Pledging to oversee “profound change” within the economic support agency, the minister said it will in future, direct 65% of its investments outside the greater Belfast area.

Presenting his new sub-regional economic plan to the Assembly on Tuesday, the minister said the north’s 11 councils will be asked to establish local economic partnerships, which he said will link with businesses, universities, colleges, local enterprise agencies and civil society.

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Mr Murphy said the partnerships will “identify the main barriers to economic development and the priority interventions that will build the region’s value proposition”.

The £45m fund is set to be split between the 11 local authorities over three years.

The Department for the Economy (DfE) has ranked the 11 councils on the basis of: Labour productivity, median wage, employment rate and greenhouse gas emissions.

Derry City and Strabane is ranked bottom in terms of productivity and employment rate, while Causeway Coast and Glens is in the bottom three for all four areas.

While Belfast City Council will take share in the funding, it’s understood the money will not be split evenly between the local authorities.

Belfast is ranked number one in three areas, but tenth in terms of employment rate.

DfE said labour productivity in Belfast is 31% higher than in Derry and Strabane, while the median wage in Belfast is 44% higher than in Ards and North Down.

It’s understood each council will be left to determine the make-up of the new partnerships and how the funding should be allocated.

But Conor Murphy said Invest NI will have a hands-on approach in the new sub-regional strategy.

The 40% increase in staffing levels within Invest NI’s offices outside Belfast will in practice involve an additional 21 full-time equivalent (FTE) posts from 54 to 75 FTE jobs.

Some of the roles are expected to be re-deployed from within the Invest NI operation.

Invest NI’s four regional offices outside Belfast are based in Omagh, Derry, Ballymena and Newry.

The economy minister said the Lyons report concluded Invest NI’s decision making was “centralised in Belfast”, while its regional offices were “underutilised”, not “integrated” into the organisation, and “too modestly resourced”.

He said: “These offices will assume responsibility for managing local clusters and businesses with a turnover of up to £2m.

“Property specialists will be recruited to develop land and property for business use.”

He said Invest NI will draw up a new regional property strategy, with Belfast offering “specialist advice and expertise”.

Conor Murphy said the new approach will involve “profound change” in Invest NI’s approach, with targets set to monitor performance.

“Consequently, the whole of Invest NI, not just regional offices, will be reoriented towards developing local economies.”

The new strategy comes less than eight months after Conor Murphy announced his ‘economic vision’ for the Northern Ireland economy.

Regional balance was one of four strands to the new strategy, alongside addressing productivity, creating ‘good jobs’ and reaching net zero by 2050.

Commenting on the publication of the sub-regional economic plan, Invest NI’s chief executive Kieran Donoghue said: “We are committed to working in partnership with the Department for the Economy and other key stakeholders to support the achievement of the Minister’s policy priority of increased regional balance.

“Our forthcoming new three-year business strategy has made regional development a key objective and will provide further detail on our overall approach.”