How will potential new legislation impact different sectors of the NI economy?

With the appointment of Sinn Féin’s Michelle O’Neill as first minister, Stormont has reconvened after a two-year hiatus in power sharing.

This means that legislative changes that have been on hold during this period may now finally be enacted as the devolved government gets back to work and stability returns in the post-Brexit era.

Here, we will take a look at some of the legislation that may now be brought forward and its potential impact on different sectors as the power-sharing executive works to boost prosperity in Northern Ireland.

How will the Northern Irish housing sector benefit from improved public funding?

The public sector in NI is in urgent need of additional funding if the executive is to meet the vocal demands for increased public sector pay and investment in strained public services.

A £3.3 bn funding package is due to be released by the UK Government to help settle public-sector pay claims and stabilise areas such as healthcare provision, education and public transport.

We are also likely to see the introduction of a new funding model that better reflects the real level of need in Northern Ireland compared to the current model, where 90% of public-sector funding comes from the UK Treasury.

The public housing sector is also likely to benefit from any increased funding and the resumption of power sharing, as the politicians move to address the country’s housing shortage.

How will Northern Ireland’s planning system be reformed in 2024?

In January this year, the Northern Ireland Chamber of Commerce and Industry (NI Chamber) published its recommendations for the reform of the region’s planning system.

These proposed changes could boost economic growth, help accelerate Northern Ireland’s progress towards net zero, and deliver much-needed affordable housing.

Now that Stormont has resumed business, its politicians will be keen to adopt some of the NI Chamber’s proposals to get the country building again, which spells good news for the construction industry.

Will Northern Ireland’s trading conditions improve from the Brexit-related bottleneck?

The UK Government’s Command Paper setting out the power-sharing agreement restores the UK internal market between Great Britain and Northern Ireland, thereby removing many of the barriers to trade between GB and NI

Routine checks and customs paperwork on goods passing through a renamed green channel (now the UK Internal Market channel) will be discontinued, thereby facilitating the seamless flow of goods from GB to NI.

This will all be music to the ears of importers and other businesses that have found themselves severely hamstrung in the wake of Brexit-related trading restrictions and bottlenecks.

Will Northern Ireland see progress on climate action thanks to the new government?

The return of power sharing will hopefully mean that Northern Ireland can get back on track with meeting its legal obligations to tackle climate change as enshrined in the Climate Change Act (Northern Ireland) 2022.

Among other things, this Act sets ambitious emission reduction targets for the years 2050, 2040 and 2030, and legally requires that all Northern Ireland government departments contribute to delivering the Act’s targets, carbon budgets and climate action plans.

We are also likely to see progress on the implementation of the commitments outlined in the Energy Strategy Action Plan 2022. This includes the introduction of a Renewable Electricity Support Scheme following a consultation period that ended in April 2023 and is now likely to go live in the course of 2024.

How can tax breaks help Northern Ireland businesses in 2024?

In 2021, the Department for the Economy published its 10x Economy plan to transform the country’s economic landscape over the next decade.

In addition to making the country’s economy more sustainable, the aims of this ambitious plan included increasing total R&D expenditure by 55%, increasing the number of R&D-performing businesses by 450, increasing the number of innovation-active firms to 55% of NI businesses, and increasing the proportion of individuals leaving NI HE institutions with first degrees and postgraduate qualifications in narrow STEM subjects from 24% to 27%.

The plan will now need to be reviewed following the long hiatus of ineffective government in NI, but could still lead to fundamental changes if its proposals are enacted.

Businesses that perform R&D can, therefore, expect tax breaks and other incentives to boost their activities.

Final thoughts: the opportunities for businesses operating in Northern Ireland in 2024 and beyond

As we have seen, there are several areas of NI’s economy and public life that may potentially be transformed in the wake of political and legislative change following the resumption of power-sharing.

However, it is still early days, and some commentators fear that the instability that led to the two-year suspension of power-sharing hasn’t gone away, meaning that the new executive will be exercising its political power on thin ice.

So it remains to be seen whether Stormont will be able to affect the sorely-needed changes to boost productivity and prosperity in Northern Ireland.

But this still represents a unique opportunity to revitalise the country’s business landscape. Through collaborative legislative efforts, the executive could create an environment more conducive to business growth, innovation, and economic prosperity.

As Northern Ireland navigates this new chapter, businesses will be hoping to see the emergence of a more supportive and dynamic ecosystem that positions them for success in an ever-evolving global marketplace.

Our corporate team specialises in advising entrepreneurs and businesses, if you’re looking for support in navigating doing business in Northern Ireland, get in touch with our team today.