Budget Review Group

Finance and Personnel – in the Northern Ireland Assembly at 2:30 pm on 14 June 2011.

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Photo of Michaela Boyle Michaela Boyle Sinn Féin 2:30, 14 June 2011

1. asked the Minister of Finance and Personnel what issues he has raised at meetings of the Budget review group to date.       (AQO 105/11-15)

Photo of Sean Lynch Sean Lynch Sinn Féin

8. asked the Minister of Finance and Personnel whether the Budget review group is considering the opportunities that exist to apply for European Union funding to help raise revenue.     (AQO 112/11-15)

Photo of Karen McKevitt Karen McKevitt Social Democratic and Labour Party

14. asked the Minister of Finance and Personnel how much has been realised to date through the implementation of revenue-raising measures that have been recommended by the Budget review group.       (AQO 118/11-15)

Photo of Arlene Foster Arlene Foster DUP

I want to group this question with questions 8 and 14.

The first meeting of the newly constituted Budget review group under this mandate will take place on 15 June. At that meeting, Ministers will need to take stock of the Budget review group commitments made by the previous mandate and the specific projects that need to be addressed as a matter of urgency. The Minister of Finance and Personnel will be anxious to see how those Departments with explicit Budget review group commitments incorporate within their Budget settlements the work that they have been asked to take forward. There is some £900 million of additional revenue-raising measures to be delivered over the coming four-year period, which include the plastic bag levy, capital receipts from the sale and disposal of assets and contributions from the Port of Belfast and housing associations.

At the meeting, the Minister will also raise the need to pursue those other revenue-raising proposals advanced but not sufficiently robust enough to reflect in the Budget settlement. An important element of that will undoubtedly be an exploration of all options to maximise the drawdown of European Union funding streams that are open to the Executive to exploit. There is much merit in some of those proposals, and the Budget review group needs to examine them thoroughly.

Photo of Michaela Boyle Michaela Boyle Sinn Féin

Go raibh maith agat, a LeasCheann Comhairle. I thank the Minister for her answer. Did the Minister of Finance and Personnel raise the issue of asset disposals with his Southern counterpart at last Friday’s North/South Ministerial Council (NSMC) plenary meeting, particularly in relation to the National Asset Management Agency (NAMA)?

Photo of Arlene Foster Arlene Foster DUP

As the Member knows, the Finance Minister has had a good working relationship with his counterpart in the Republic of Ireland on NAMA issues. In that respect, it is appropriate to pay tribute to Brian Lenihan’s work with our Finance Minister on NAMA. He allowed Sammy to have access to some issues to which officials originally would not allow him access. It is right and timely that I should pay tribute to Brian Lenihan.

I am not aware whether the Finance Minister raised issues with his counterpart at the North/South Ministerial Council. The issue was certainly not on the agenda, so it probably was not raised at the meeting. However, the Finance Minister will want to see how assets will be realised in Northern Ireland because they are part of the £900 million Budget commitment. We will want to explore those matters at tomorrow afternoon’s Budget review group meeting.

Photo of Karen McKevitt Karen McKevitt Social Democratic and Labour Party

What is the current outlook for raising revenue from the Port of Belfast?

Photo of Arlene Foster Arlene Foster DUP

The Member will be aware that the contribution that is being asked of the Port of Belfast is some £40 million. Negotiations are still ongoing between the Port of Belfast and the Department. The Finance Minister is leading on the issue, and he will continue to push the Port of Belfast for its share of the Budget settlement. We believe that the assets are there, and the Minister will continue the negotiations and will no doubt advise his colleagues who sit on the Budget review group of their progress.

Photo of Sean Lynch Sean Lynch Sinn Féin

Go raibh maith agat, a LeasCheann Comhairle. Will the Minister indicate when the Assembly can expect results from the review of arm’s-length bodies?

Photo of Arlene Foster Arlene Foster DUP

That is an agenda item for tomorrow’s meeting. From my experience, I know that the Office of the First Minister and deputy First Minister has tasked every Department to supply information on their arm’s-length bodies. Questions were asked as to the effectiveness of those arm’s-length bodies and whether there was a statutory need for all of them. All that information has been collated, as I understand it, and sent to the Office of the First Minister and deputy First Minister, and that matter is on the agenda for tomorrow’s meeting.

Photo of Sydney Anderson Sydney Anderson DUP

The Minister referred in her initial response to housing associations. How do the Executive propose to access the housing associations’ reserves?

Photo of Arlene Foster Arlene Foster DUP

That matter caused much discussion at the time. I well recall listening to the housing associations say that that was something that could not be done, that we did not have legal grounds to do it, and all manner of claims. However, as the Member will know, the Budget review group (BRG) in the previous mandate very much identified the possibility of deploying the housing associations’ financial reserves, which are quite considerable, and we believed there was a need to look at ways of using that more effectively.

I think that there was a misunderstanding at the time that we would come along and dip into the bank accounts of housing associations. That certainly was not the way in which we saw this going forward. It is not a question of directly accessing the reserves. Rather, the way in which it is happening is that the grant paid to housing associations has been set at £20 million per annum lower than it would otherwise have been set. That, we hope, will encourage housing associations to use their reserves to make up the shortfall in moneys coming from the Government. That is how the Department of Finance and Personnel is dealing with the issue of housing associations and their reserves.

Photo of Danny Kinahan Danny Kinahan UUP

I thank the Minister for her answer. She mentioned earlier that there were robust options that did not make it into the Budget. Will she give us examples of additional revenue-raising options that have been identified by the BRG?

Photo of Arlene Foster Arlene Foster DUP

Many other options, some robust and some not so robust, were considered by the Budget review group and Finance Minister. At the meeting tomorrow, as I understand it, the group will look at the latest position on, for example, the review of the Northern Ireland Housing Executive, which is one of the options that it wishes to look at. It will also look at work in relation to the Odyssey Trust Company to take forward suggestions that were made there.

Of course, different political parties raised other issues, be they mobile phone mast charges or levying a charge on non-exempt ATMs. However, all those matters have to be subject to rigorous examination and, in some cases, possibly legal opinion to see whether the matter can be taken forward. So, they will be robustly challenged. They are not in the Budget at present because the Finance Minister did not feel at that time that they were robust enough. So, they will be looking at all those options again tomorrow afternoon.

Photo of Roy Beggs Roy Beggs UUP

Before moving on to our next question, I advise Members that questions 3, 4 and 10 have been withdrawn and will require written answers.