North faces two more years of financial crisis

The financial crisis in the North will continue for another two years, a leading accountants' organisation said today.

Collapsing confidence in the local economy has left the outlook bleak.

The Ulster Society of Chartered Accountants (USCA) called for the fast-tracking of major infrastructure projects and the loosening of credit restrictions by banks to alleviate a slump expected to continue until late 2010.

Senior economist Maureen O’Reilly analysed the society’s survey of accountants.

“The severity of the current downturn presents a unique set of challenges to consumers, business and government,” she said. “The impact is likely to be deeper and more widespread than anything previously experienced here for quite some time.”

She said pessimism among exporters, with the weak value of the sterling, was not as pronounced.

“The prospects for loosening of credit restrictions look unlikely in the short term despite the unprecedented actions taken by both the (British) government and Bank of England.

“Bank finance will remain difficult to avail of while economic conditions continue to deteriorate.”

The accountants said global economic conditions were at the heart of the current problems but 60% of the 433 people asked in the annual Financial Confidence Survey said the Executive could make a difference.

Most felt prospects were poor if not worse for the year ahead. Half were pessimistic about the prospects for their own businesses, most large companies in the financial sector.

Less than one in 10 of those surveyed said ministers had made a significant impact on the financial difficulties.

The North's Executive held its first meeting for five months on Thursday.

USCA chairman Kevin MacAllister said: “One of the major concerns of our members was deadlock in the political process which thankfully has now been addressed.

“We welcome the return of the Executive and the acknowledgement that the economy will be the number one priority going forward. We look forward to our politicians and the business community pulling together to protect our local economy and local jobs.”

Ministers have made addressing the effects of the credit crunch, particularly on the most vulnerable, a priority as they return to regular cabinet meetings.

Efforts to tackle fuel poverty will be stepped up and attention will be paid to a construction industry which has shed thousands of jobs.