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South Belfast, Fermanagh and the Azores

Mark Devenport | 15:36 UK time, Tuesday, 20 April 2010

Alec Maskey's act of unilateral disarmament in South Belfast is a clever turning of the screw by Sinn Fein. His vote would probably have been severely squeezed in any case. But this will improve Alasdair McDonnell's chances, given that the two main unionist parties appear to be too late to seal a Fermanagh deal.

The move ostensibly increases the pressure on Fearghal McKinney to pull out of the Fermanagh race. But with nominations closed at 4pm this now looks more about accusing the SDLP of being vote splitters than achieving a last minute deal.

Oh, and the Azores? Nothing to do with nationalist pacts or stranded air passengers, but a reference to the European court ruling on adopting different rates of corporation tax in a region within a European state. UCUNF sources are arguing that the DUP manifesto's support for lower corporation tax without any compensating cut in the NI bloc grant would be illegal under what is known as the Azores ruling, which set the rules for permissible state aid to any region.

UCUNF say the bloc grant would have to be reduced to comply with the ruling, but DUP sources say the grant could be increased, then cut by a matching amount - thus making no change in the cash we get from Westminster. Whether a government of any complexion would actually increase the grant in these times of budget deficits, though, is very much open to question. A hung parliament may help, but it would have to be hung by a very narrow margin indeed to provide local politicians with the leverage necessary for an increase in our subvention.

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