Spend Local scheme should have excluded supermarkets, study says

Spend Local scheme should have excluded supermarkets, study says

Stormont’s Spend Local scheme should have been excluded supermarkets, economists from Queen’s University Belfast (QUB) have suggested.

The QUB study says the £136m High Street scheme, designed to boost businesses affected by coronavirus lockdowns, should have targeted businesses forced to close during the Covid-19 pandemic.

It allowed everyone over the age of 18 in Northern Ireland to apply for a £100 pre-paid card.

The QUB study also said the scheme should have been designed to help pensioners and those on income support as those measures “would have had a greater economic effect”.

Official figures by the Northern Ireland Statistics and Research Agency (Nisra) found that one third of the high street vouchers were spent in businesses that did not have to close during the pandemic.

The Department for the Economy has not yet conducted its final analysis into the scheme.

In an article published in The Economics Observatory, Prof John Turner and Dr David Jordan said: “Given the high proportion spent in supermarkets, it is very likely that a substantial proportion of extra expenditure by consumers leaked out of the local economy.

They criticised the “poor timing” of the scheme, suggesting it should have operated from late August to October, months which have lower retail footfall.

It found the busiest month for transactions on the pre-paid cards was November, a month when retail spending is traditionally high before Christmas.

They suggested these factors meant an increase in spending in Northern Ireland was “much lower than was originally intended or would have been hoped for”.

“A post-scheme evaluation needs to happen to determine whether this policy experimentation was cost-effective and worth repeating,” the assessment concluded.