Executive Committee Business – in the Northern Ireland Assembly at 12:30 pm on 27th June 2011.
Now we come to the Final Stage of the Budget (No. 2) Bill.
I beg to move
That the Budget (No. 2) Bill [NIA 1/11-15] do now pass.
I will not replay the tape so far but will instead take up where I left off.
I do not wish to repeat the remarks that have been made in the previous debates. Suffice it to say that the provision in the Bill represents the first year of Budget 2011-15, as agreed by the previous Assembly in March. However, Members will recall that the Budget included provision for an assistance package for the Presbyterian Mutual Society (PMS) savers. The Executive’s and the Treasury’s contributions were held at the centre awaiting the Department of Enterprise, Trade and Investment’s (DETI) confirmation that details of the rescue package had been agreed. I understand that the administrator will be in a position to start to make payments over the summer, subject to the satisfactory completion of the final legal and contractual issues. Therefore, I considered it vital to anticipate the June monitoring transfer to DETI and to include the PMS expenditure in the DETI Main Estimate and the Bill to provide DETI with the legal authority for the expenditure. To await the spring Supplementary Estimates and the related Budget Bill in February 2012 would delay the statutory provision for the PMS expenditure and hold up payments to investors and savers, for which they would not have forgiven either me or the Executive, especially as a final resolution of the saga is so tantalisingly close.
I now want to return to an issue that is related to the expenditure plans that we are approving today in the Bill and that I have brought to the attention of the House in previous debates: the long overdue review of our financial process that the previous Executive commissioned in February. The current financial process has existed for many years and is based on the Westminster model. The review is an opportunity for the Assembly to reform the process and publications in line with its requirements.
As recently as last Wednesday, my officials held a useful session with the Committee for Finance and Personnel to discuss the review and to explore some of the areas that merit consideration. I have also asked my officials to present the issues to Members at a consultation event in the Long Gallery in the autumn. I encourage all Members to attend that event and to avail themselves of the opportunity to propose the areas that, in their view, merit reform. The review presents Members with a golden opportunity to reform the current process and publications that we inherited from direct rule. Therefore, over the coming months, I urge Members to consider the weaknesses in the current process and to make a considered contribution to the review.
My officials have also opened communication with Departments and the Northern Ireland Audit Office on the review. Over the coming months, the dialogue will continue, and I look forward, following a robust discussion of the issues with all key stakeholders — I consider the Assembly to be the main stakeholder — to bringing recommendations to the Executive and the House before the end of the financial year.
I will now speak about the remainder of this financial year and the challenges that lie ahead. As the recent June monitoring round demonstrated, the demand for additional resources always outstrips the funding that is available to the Executive for allocation. Therefore, Ministers and their Departments must continue to manage prudently the resources that are available to them throughout the remainder of the year. In particular, I call on Departments to surrender any reduced requirements in the next monitoring round rather than hold on to them until too near the end of the financial year, by which time it is too late for other Departments to spend the resources. We must act corporately and astutely as an Administration, particularly in the light of the proposed new budget exchange scheme and the efforts that will be required by all concerned to avoid surrendering any of our invaluable resources to the Treasury. With that appeal, I bring my remarks to a close, and I ask Members to support the Bill’s Final Stage.
Go raibh maith agat, a Cheann Comhairle. As I stated at Second Stage, the Committee for Finance and Personnel is aware of the potential consequences for departmental spending should the Bill not progress through the Assembly before the summer recess. In that regard, the Committee was content for the Bill to proceed by accelerated passage.
The Minister will be aware that departmental officials informally briefed the Committee last week on the review of the financial process that the Department of Finance and Personnel (DFP) is taking forward on behalf of the Executive. Indeed, he referred to that meeting. The officials outlined a number of problems with the current process and publications that relate to Budgets, Estimates and Accounts. Committee members heard that there are a number of misalignments in the current process that may not be immediately evident, including the fact that, although it is set out in the Executive’s Budget, capital spend is not voted on in the Budget Bills that come before the House. Indeed, it may surprise Members to learn that up to one quarter of all government spend is not voted on. There are also issues with the complexity of the Estimates; with the differing boundaries and controls for the Budgets and the Estimates; with the differing ways in which information is presented in the various associated publications; and with repetition in the process.
(Mr Deputy Speaker [Mr Molloy] in the Chair)
Immediately after the informal session with departmental officials, the Committee received a briefing from the Assembly’s Research and Information Service on considerations for improving the wider Budget process in the context of the Executive’s review of the financial process. The related research paper considered international best practice guidance and reports from the previous Committee for Finance and Personnel, and it set out key recommendations for the future Budget process. The recommendations include the establishment of a calendar in advance of future Budget processes that must be adhered to and that includes adequate time for consultation; the inclusion of a strategic phase before the production of the draft Budget to allow the Assembly to debate revenue measures and spending priorities; and the inclusion of a formal review stage in the process to allow for reconsideration of the Budget in the light of emerging spending pressures or policy reorientation. The Committee asked that those recommendations be taken forward by DFP in parallel with the Executive’s review. In particular, as I mentioned during the previous debate, the Committee will be keen to ensure that formal engagement is incorporated into the process at an early stage. We believe that that will facilitate the streamlining of the latter stages of the process.
It is clear that there is much work to be done to address those issues and create a Budget process here that is more transparent, provides greater accountability and meets the needs of the Assembly. Improved Budget and financial processes will underpin the important scrutiny role of the Assembly and, in turn, help to drive improvements in public services and ensure that the Executive’s priorities are delivered and that government in general remains effective and accountable. My Committee looks forward to working closely with the Department in progressing this important work in the coming session. In the meantime, I support the motion.
I, too, speak in favour of the Bill. I welcome the opportunity to reiterate what the Minister said about the PMS. The process of accelerated passage will help the people who have suffered greatly over the past number of years due to the problems associated with the PMS. The Bill’s passing will allow movement on that. I also welcome the review and reform of financial processes and how we set and debate Budgets. That will help to streamline the process.
We have debated the Budget Bill quite a bit in the past two weeks. I will not regurgitate everything that everyone else has already said. I support the Bill, as presented, to allow us to move forward. I do not wish to take any more time. I appreciate that some funds had to be allocated to the Department of Enterprise, Trade and Investment to allow a move forward on the PMS issue. It is important that we, as an Assembly, deliver on the Executive’s agreed process and the Budget as presented.
When this process resumed two weeks ago, I expressed my opinion that it was cumbersome, convoluted and repetitive. It lacks clarity and transparency and is not fit for purpose. Budgets, Estimates and accounts serve different purposes and have gone their own ways over the years. That makes it extremely difficult to understand, manage and scrutinise. Only about 60% of government spend is aligned across all the frameworks, so inefficient and burdensome reconciliations are required. However, work has begun on a new model that will better serve the Assembly. We have heard from the Minister and the Chairman of the Committee about that this afternoon.
The new process must draw together all the various parts of the Budget process, including the rates income stream and non-departmental bodies. Unfortunately, that has not helped us this year, and we are resigned to the circus that we call the Budget process. Fortunately, however, we also have a ringmaster to take centre stage and provide some light relief. Earlier this year, the Ulster Unionist Party did not support the Budget for several reasons that I have repeated in the House. We still have those concerns, but the DUP and Sinn Féin have approved the Budget and will endorse it again today. Therefore, it would be illogical for us to vote against it at Final Stage.
I will make a few brief comments. I will avoid repeating some of the earlier comments and leave it to others to discuss the technical details. I will focus on the economic opportunities and the potential in the Budget to create economic development and opportunity.
I do not think that I am letting out any state secrets by saying that we are in difficult economic times. We need to be very careful that we avoid eating the seedcorn, as it were. However, in our Budget efforts, we need to ensure that we put aside some amount of money, no matter how small, to invest for the future and create and develop opportunities.
Our economic outlook is challenging, to put it mildly, and the full impact of Government spending cuts of some £4 billion between 2011 and 2015 has yet to fully hit our economy. Output appears to be stagnant and growth is barely detectable. However, although we can focus on the negatives, I prefer to focus on the opportunities arising in the current context and ensure that we take the necessary steps through the Budget to deliver a creative and successful economic recovery strategy. If slippage money becomes available as we go through the year, I urge the Minister to invest it in creating opportunities, some of which I will refer to.
We want to ensure that the Northern Ireland economy is in a strong and vibrant position, able to meet future opportunities and business and commercial needs. The Budget goes some way towards facilitating an economic recovery strategy, but there are key areas that I want to highlight and urge the Minister to pay a little bit more attention to as we go forward. R&D is the big one, the key opportunity, because even in good economic times, our efficiency and effectiveness was only at some 85% or 87% of GB’s. There is some dullness or bluntness in our economic activity when we lag significantly behind Britain — Scotland, Wales and England — in our efforts — [Interruption.] Sorry. Pardon me. That was not planned.
R&D has to add value, and, if we are to compete with Third World countries and the Far East, we have to sharpen up our industry and how we do things in order to get a commercial edge and work to our strengths. We have many strengths.
Excellent research has been done in our universities and hospitals. Perhaps we fall down in supporting the full commercialisation and taking full advantage of some of the excellent brainpower we have. One of the things I think of immediately is the Belfast cancer centre. I urge the Minister to find ways and means of investing further in the next phase of the centre. We now have in Belfast a world-class, globally recognised cancer centre, to which we can recruit people from across the world for their manpower, expertise and specialist skills. However, we are one stage short of turning that round and selling those skills back to the rest of the world. In recent developments, I was fascinated to see on television that Belfast City Hospital researchers had managed to extract a cancer-curing product from the saliva of a Brazilian tree frog. That may sound very abstract, but that is the level we are at: the cutting edge of world cancer research. We should look at ways to find some money, no matter how small the amount, to recognise that we have potential in that area. If we invest in it, Belfast City Hospital, through its research, has the potential to become an economic engine for the twenty-first century, just as Harland and Wolff, Shorts, Mackie’s and other firms were the engines of the nineteenth century. That is one example of how we might unlock potential.
I do not want to discuss the EU’s seventh framework programme or the potential that lies there, but we have to find ways and means of encouraging our companies to open up their R&D and do things better, more efficiently and more effectively.
I also want to draw the Minister’s attention to the fact that food production is a sunrise industry. For the past 30 or 40 years, the European Union has had a surplus of food, but it is recognised that, by 2015, shortfalls will begin. The economies of China are now eating everything they can get. People in China now want better quality food and so on. In a few years’ time, we will be unable to procure food from Australia or New Zealand. Similarly, we will be unable to procure it from the likes of Argentina. Food will have to be produced. I was fascinated to watch a brief documentary on television last night that stated that Britain, although it imports meat, exports its high-quality Aberdeen Angus beef to China. That is a position that we have to get into. We have to find ways of investing in food production, because we fall between two stools. We do not have a brand. Irish beef is highly branded and recognised across Europe, but British beef, and not just British beef but subdivisions—
I remind the Member to return to the subject of the Budget.
I am on the Budget. This is what the Budget has to invest in, Mr Deputy Speaker. There is a lot of opportunity in the food industry.
The other area that I want to draw the Minister’s attention to is that of renewable energy. We have got to put more resources in. Our resources going into energy are far too limited. We need a stronger energy division. If I had my way, I would have a junior Minister for energy and a separate energy Department, and I would bolster the energy division in DETI. However, there are a number of issues, Minister, and although we have recognised some of the challenges, I feel that if we are to brace ourselves to become independent, with a high financial return, and to be successful in the future with a prosperous economy, there has to be a sharper focus in the Budget on developing sunrise industries. Those industries have the potential to return much more than we invest in them.
Thank you, Mr Deputy Speaker. I apologise for the fact that my telephone rang. I thought that I had switched it off.
The Alliance Party will support the Final Stage of the Budget (No. 2) Bill for the same reasons that we gave in support of the Supply resolution and the Bill’s Second Stage. However, I will take this opportunity to raise a few key points.
As we progress into the first year of the budgetary period of 2011-15, it must be acknowledged that, with inflation now well in excess of the level on which the Budget was originally premised, Departments must work harder than ever to live within budget. They need to focus on making efficiencies wherever possible and on producing additional capital receipts as well as realising those already identified. I appreciate that that will not be easy for Departments and that many difficult decisions will have to be made if we are to be able to maintain spend on front line services.
We need to continue to focus on rebuilding the economy, creating jobs and preparing future generations and those out of work for the years ahead. We need to capitalise on tourism, which offers long-term benefits, as tourists spend money and contribute to our economy, and we need to ensure that situations such as what happened in east Belfast last week do not hinder that development. Just a matter of hours after the riots, and less than a mile from the scene, the Crown Princess cruise ship docked, with 3,100 tourists on board. Scores of coaches lined up to take avid travellers to various sites around Northern Ireland to spend money and take home stories of our beautiful country. So easily, the petrol-bombings, shootings and so on can send out the wrong message and wreck our chances of continuing to attract those vital visitors.
That brings me to my key point, which is that the only way in which we can deal with such issues and drive our economy forward is through greater collaboration among Departments. For example, DETI needs to generate investment, and that investment needs to be linked to the Department of Education and the Department for Employment and Learning to invest in skills. Indeed, in his Budget statement in March, the Finance Minister spoke about the importance of such collaboration, but we need not just to talk; the emphasis must be on delivery.
We already have technology in place that allows sharing of information across Departments, yet we appear to choose not to use it to its full capacity. Around four years ago, Departments implemented Total Records and Information Management (TRIM) software. That can and should be much more than a document repository. It has a multitude of configuration options that allow Departments to have access to one another’s information in a secure manner. Perhaps sharing such information could more effectively assist Departments in coming up with efficiency options, as well as solutions to address the financial costs of our divided society. At a time when finances are so tight, and when we are trying to grow our economy, the resources wasted on managing division continue to be a massive millstone around our necks.
The Alliance Party will continue to promote more shared services on a North/South basis. This need not be about politics but about good finance and good economics. We welcome the scoping of the potential for that through the North/South Ministerial Council. As a member of the North/South Parliamentary Forum working group, I can see the benefits of working together across neighbouring jurisdictions. The forum could be another opportunity to benchmark in order to assist us in deciding how much should be spent in certain areas and assessing where inefficiencies exist and where we can improve. This is not about political grandstanding but about practical issues.
As a member of the Committee for Finance and Personnel, I have been involved in discussions about the level of detail provided during the budgetary process and whether it is available in sufficient time for adequate scrutiny. That has been highlighted by the Chair of the Committee and others. I look forward to the outcome of the review of the financial process, which, hopefully, will streamline the Budget and Estimates process and enhance scrutiny by, and accountability to, the Assembly.
I support the motion.
Go raibh maith agat, a LeasCheann Comhairle. I will be very brief. I think that the Minister outlined in sufficient detail, without bearing any repetition, the salient and important elements of the Budget.
I would like to make a few remarks about the process. I very much welcome the review. The Finance Committee has been campaigning on this issue virtually since the beginning of the previous mandate, so it is long overdue but welcome.
The economic circumstances in which we approach the Budget this time challenged the Assembly, respective parties and MLAs to begin to think the process out. It was not just a matter of taking a cake of a particular size and having a discussion, as opposed to a Budget process, about how it should be divided up in the most equitable way. On this occasion parties here were challenged to come up with suggestions for incrementally building on what was a greatly reduced cake in the circumstances of the comprehensive spending review (CSR) settlement. Most parties put in practical ideas.
That and the present campaign to bring fiscal powers back to the Assembly were the beginning of the Assembly’s starting to consider the challenge of how it matches its expectations and ambitions in the delivery of programmes and services with its ability to supplement the block grant. I think that that process should continue. In that context, I also strongly support and welcome the work of the Budget review group, which is an all-party grouping of Executive Ministers who look at the various issues, including the questions of over-bureaucracy and the dismantling of what we might call the ugly scaffolding of direct rule.
Periodic reports on the work of the Budget review process would be very helpful, as perhaps would reminders to the parties to continue to contribute to that festival of ideas. That is because we need to be supportive if we are going to protect not just jobs but, crucially, front line services. On this occasion, the Budget has been complex, and I think that the discussions have been heated at times. However, generally speaking, people are rooted in the reality that we are operating in a deficit Budget situation and that we all have to put our shoulders to the wheel to come up with ideas for new revenues and more efficiencies, as well as to dismantle or strip down some of the overly complex bureaucracy that is slowing the system up.
Go raibh maith agat, a LeasCheann Comhairle. Thank you very much, Mr Deputy Speaker. I recall, going back to the time before the beginning of this Budget period, when we were becoming aware of the magnitude of the cuts that we would be facing, the Finance Minister telling us that bitter medicine was coming from London and that we would have to swallow it. He said there would be no point in us opposing or railing against the cuts. To use his terminology, there was no point in “gurning” — we would have to pinch our noses and swallow the bitter medicine.
The SDLP took a different approach to the Budget settlement, and as early as 2009 we set out to find ways of mitigating its effect. We published our ideas in the paper ‘New Priorities in Difficult Times’.
So anyone who says that the SDLP was negative about the budgetary process has only to look at our record, which clearly shows that we were first off the blocks to help to ensure that everything possible was done to mitigate the effects of the worst ever cuts — 8% to resource and 40% to capital — to face us here in Northern Ireland.
As the Minister knows, our engagement in the budgetary process did not end there. We continued to work on ways of raising revenue, creating jobs, protecting front line services and ensuring the best possible deal for the most vulnerable in society. Our document ‘Partnership and Economic Recovery’ — I know that the Minister has read it many times — is a comprehensive approach to tackling the challenges that our economy and finances face. We were critical where we saw the need for improvements, and we were vociferous when we needed to be. The Minister did not always like what we had to say, but I think that even he realises that we are not nodding dogs that will sit here and hang on his every word.
The Budget is the Minister’s baby, and I understand his desire to nurse it and protect it. The Minister gradually came round to our way of thinking that it was not enough just to sit back, open one’s mouth and take the medicine without complaint. Work began on identifying sources of revenue to replace that taken by the cuts. The extent to which that work has been successful is a moot point. First, there was to be £1Times New Roman'; ">∙6 billion; then there was £862 million; and now, I believe, there is £900 million, according to the Minister’s speech in the Chamber last week. What happened to the remainder of the money is not quite clear.
We are not yet sure whether that £900 million is new money. I asked the Minister to clarify the situation by telling us how much of the £900 million was from the normal government receipts from the sale of Housing Executive properties, land, and so on, and how much of it was new money coming into the Budget. I do not think that he clarified that for us. During a previous debate, the Minister stated that the Budget was the best Christmas present that Northern Ireland could hope for, but, as I said, once you loosen the ribbons and remove the wrapping paper, there is not quite as much in the present as we were first led to believe.
That said, we are where we are. The SDLP is intent on continuing to work on and engage in reshaping and remoulding the Budget.
I am grateful to the Member for giving way. I listened to what the Member said about the document, but I am not so sure that the Minister will have paid much attention to it. During previous debates in the House, the SDLP document was exposed as leaving clear gaps in the finance that it could provide for the Minister and the economy. I ask the Member: given the difficult situation in which we find ourselves in the United Kingdom, had the House voted in the way that the SDLP voted, how would your party have sustained the community and voluntary sector, which was crying out for money at that time?
I thank the Member for his intervention. I do not claim that every proposal in the paper was perfect, but there were many viable proposals, which would and will produce additional revenue. I hope and expect that the Minister will continue to examine those proposals and that the Budget review group will do likewise. As I said, we will continue to engage, through the Committees and at Executive level, to reshape and remould the Budget to ensure that it meets the needs of the greatest possible number of people in Northern Ireland.
I was glad to hear from the Minister, during the Bill’s Second Stage last week, that the First Minister and deputy First Minister had spoken to their counterparts in Scotland about the Scottish Futures Trust. He said that that initiative would be given further consideration. The Minister took the opportunity to score a few political points against the SDLP, but it was more a question of him being willing to wound but afraid to strike. We came out of that skirmish relatively unscathed.
The Minister also responded to the point that I made about the Belfast Harbour Commissioners. I was pleased to hear that the Minister for Regional Development is continuing to work with the commissioners to see how that money can be paid over to the Executive. The Minister said that he is willing to go down the legislative route if necessary. We continue to hold the view that this Budget should have been based on a Programme for Government for 2011-15 and an updated investment strategy, to demonstrate how strategic policies are driving financial allocations rather than vice versa. I will be interested to hear from the Minister what progress has been made on the formulation of a Programme for Government and when we should expect to see it.
I also want to ask the Minister about the £4 billion in capital funding that remains to be paid for the final two years of the investment strategy up to 2017. Will there be continued negotiations on that, or is it his view that that money is now lost to Northern Ireland? I hope that that is not the case, because in this economic climate, with the huge cut to capital, we need that money more than ever.
As we know, the end-year flexibility scheme is being replaced by the Budget exchange scheme. There are some problems with that, especially around the predictions that have to be made in the October round. Departments have said that that will be extremely difficult for them and that money could be lost to Northern Ireland through that model. If the Treasury proposal continues in its present form, it will be tantamount to a further cut. I know that the Minister has entered negotiations with the Treasury in order to shape a better scheme for us. I urge him to continue his efforts in that direction, because it is money that we can ill afford to lose.
I thank the Minister for his representations to the Irish Government on the National Asset Management Agency (NAMA) situation and the possibility of a fire sale. I note that he said that he had discussions with Minister Bruton on the issue and that he has been reassured that such a fire sale will not take place. That is very welcome. If my memory serves me right, I asked the Minister last week whether he agreed that work should be undertaken on North/South health co-operation, given that 40% of budgets North and South are spent in that area. However, I do not recall the Minister responding to that point. Perhaps he will do so today.
One of the other points that I made last week was about the £4 million that was set aside for a childcare strategy. The Minister said that the Office of the First Minister and deputy First Minister (OFMDFM) ministerial subcommittee was working on that issue. A number of childcare organisations, especially those which participated in the Department of Agriculture and Rural Development (DARD) pilot schemes, are now in dire need of resources. I urge the Minister to do all in his power to ensure that those resources become available to those groups as quickly as possible.
In conclusion, I reiterate that the SDLP will continue to engage on the Budget, which, as the Minister said, is not set in stone. Through the Committees and in the Executive, we will continue to ensure that the Budget is fit for purpose and best serves the needs of the people of Northern Ireland. Go raibh míle maith agat, a LeasCheann Comhairle.
Any Budget debate should primarily be about measuring the allocation of resources against a backdrop of trying to match government objectives with the targets and policy initiatives of an agreed Programme for Government. In this type of devolved government — a five-party mandatory coalition — the task of putting together a Budget for an agreed set of priorities and outcomes is difficult. It is even more difficult if the Finance Minister has to balance his party’s priorities with other parties’ objectives. The temptation then is to go for a Budget that lacks coherence and strategy.
We will get no real economic gain from the current Budget proposals. I do not see any stimulus for the local economy, particularly for the construction industry. Unfortunately, it is currently a purely accounting exercise, with no underpinning rationale other than to live within cash limits as delivered by the comprehensive spending review. That begs the question: can we have a meaningful Budget process when we do not have an agreed Programme for Government that includes a four- or five-year policy strategy? Almost every economist, economic commentator and, indeed, political party represented here says that the priority for the region and the Assembly should be to make the economy and economic development the key priority for the future. I accept that.
We all recognise that, in effect, the Assembly is charged with managing a delegated Budget, as delivered by the Treasury’s Barnett formula. In reality, this regional economy is highly dependent on a net resources transfer from central government in London. The annual net subvention currently runs at £8 billion a year or more. That huge inward annual cheque highlights the public sector dependency culture that is now the norm for our regional economy. That affects us all, not just those who are unemployed or on benefits. The challenge, therefore, is to see whether we can do anything with the devolved Budget to correct that imbalance and reconfigure the economy. That is a major task and a challenge for the new Assembly. The harsh economic reality is that the London Treasury will cut back on the annual subvention, making the entire business of government more difficult. We know about the 8% cut in revenue expenditure, and we are very aware of the 40% cut in capital expenditure over the term of the mandate.
On the surface, the welfare state has been very good for and generous to Northern Ireland, in that people have a safety net for a basic standard of living. Many communities and areas in Northern Ireland depend greatly on benefits. However, our public sector dependency of nearly 80% is quite staggering. It means that many private sector supply companies are highly dependent on government supply contracts.
The current debate and general consensus on corporation tax obliquely poses the big economic question: can the region become more economically viable through having a more competitive and productive private sector? That is the challenge. Can the regional economy get to a position of having a more effective and efficient public sector? Now we have a Budget that is just an accounting exercise, simply slicing up the Treasury transfer cake rather than tackling the more difficult challenge of setting out on a course to get better economic performance in the future.
I welcome what the Minister said about having a Budget review group, which is long overdue. Again, I pose the question: how can we have a meaningful budgetary process when we do not have an economic strategy determined by a Programme for Government? This Budget debate could centre on a piecemeal approach, as we all call for specific money for specific projects or services, but that only ignores and avoids the real problem and task ahead. A Budget process must attempt to shape and steer a local economy to a better performance in respect of productive output and general economic activity.
We all come under constant pressure at a local level to lobby for funding for a project or a local service provision or facility. That is the stuff that all of us hear in our constituencies. The bigger challenge for the Department of Finance and Personnel and the Finance Minister is how they formulate a Budget that is fit for purpose. That begs the real question: what is the key purpose and function of the key civil servants in the Department of Finance and Personnel in the entire process? The reality is that custom and practice, underpinned by the historical cost premise, rules the roost. How, therefore, will we get the economic gear change that is needed to reconfigure this local economy and have a more sustainable economic performance in the immediate to long term?
Are the current Budget proposals and the outlines for the rest of this mandate purely an accounting exercise, with no route map based on a Programme for Government or an investment strategy for Northern Ireland? We have had two investment strategies for Northern Ireland, but I have not heard much about any recently. Do the Minister and Executive intend to follow custom and practice, or is there a willingness or desire to have a better way, which has, at its core, the twin objectives of building a stronger local economy by having a more productive and expanding private sector and having a more effective and efficient public sector that delivers services to our people?
Do we have an economic modelling unit in the Finance Department? Do we have an economic forecasting and performance unit? For this devolved Assembly to function, it is critical that we have some sort of modelling unit in the Department.
What is the future for the Strategic Investment Board? It was set up about 10 years ago and was lauded; we were told that it would provide the intervention necessary to make capital projects work. I have not heard of the Strategic Investment Board for some time. Is it dead or alive? Is its executive director still on the payroll? Those are crucial questions that we have to ask.
The time is right to have a more radical and focused approach to our future economic planning and management. Do the Minister and the Department of Finance and Personnel (DFP) accept that a different approach is desirable? Is it likely to be embarked on at this time? I welcome what the Minister said earlier.
Go raibh míle maith agat, a LeasCheann Comhairle. I welcome the opportunity to address the House as Chair of the Committee for Health, Social Services and Public Safety. When I spoke last week during the Bill’s Second Stage, I talked about the Committee’s desire to constructively engage with the Department about how it will manage its allocation for 2011-12. To that end, we will hear from departmental officials on that subject at our Committee meeting on Wednesday. We will take that opportunity to drill down into the details of the options that the Minister is considering to make the savings that are required this year if he is to balance the books.
Although savings have to be made, money is available to those who ask. The Committee noted that, under June monitoring, some £29 million of resource was allocated to various Departments. However, the Health Department did not make any bids under June monitoring and, therefore, did not receive any money. The Committee was very disappointed to find out that that was the case given that specific projects that were previously funded by the Department up to March 2011 have now been left stranded because funding is not available.
For example, the Committee wrote recently to the Department to ask whether the decision to no longer fund the Music Therapy Trust could be reversed. It has been receiving central government funding since 2003 and has made a real difference to children and adults with a wide range of conditions. The trust requires only £400,000 per annum. Surely, if the Department had have made a specific bid for funding for the project under the June monitoring round, £400,000 could have been found out of the £29 million that was available. A similar case could be made for Home-Start, which also has had its funding discontinued.
On making savings, last week, the Committee heard at first hand about the innovations that Health Service staff are coming up with and which are beneficial to patient safety and the public purse. Last Wednesday, we visited Altnagelvin Area Hospital and were briefed by staff from the Western Trust on the work that they are doing, particularly in the field of cancer. The Committee learned that radiotherapy, which the new centre at Altnagelvin will provide, is not only a highly effective treatment in curing and extending the lifespan of people with cancer but is more cost-effective than surgery or drugs. By making sure that people receive radiotherapy quickly and appropriately, the Health Service can ensure the best chance of a good outcome for the patient and also for the budget.
Similarly, we heard about the excellent work that is being done at Altnagelvin in the provision of human papilloma virus (HPV) testing in the Western Trust. HPV is the main cause of cervical cancer, but the Western Trust is the only trust that is carrying out that important work. By being able to test for HPV and thereby being able to offer immediate treatment for those who need it, the trust is making massive savings on cervical screening. Under the old cervical screening pathway, a woman with an abnormal result may have to go through 13 screenings over a 12-year period. The new system will require only two screenings in an eight-month period. Given that each smear and screening costs £40, the savings soon add up. We also heard about the screening programme for bowel cancer. Again, if that cancer is caught in the early stages, the prognosis is very good, and costly treatments — in financial and, more importantly, in human terms — can be avoided.
There are great examples of people at the front line finding new ways of working that are yielding massive benefits to patients as well as being an efficient use of resources. Change is possible where there is the will to do it. In our previous meeting with the Department, the Committee was frustrated that, when we suggested that it should make the prescribing of generic drugs mandatory, we were told about the problems with making that happen rather than the solution to it. Therefore, we have asked the Department to produce a paper to detail the obstacles to, and complexities of, introducing a policy to make the prescribing of generic drugs mandatory and to clarify whether that would require a change to legislation. We look forward to discussing that further with the Department, because that is one way in which it could ensure that it lives within the 2011-12 budget.
The Committee recognises that this year will be difficult because of limited resources, but where there is the will to make changes and work differently, savings can be made without impacting on front line services.
I do not propose to speak for too long, because the arguments around the Budget have been well rehearsed by now. In the Chamber and other places, we have been told that the people voted for stability on 5 May. That is true; undoubtedly, people for voted stability, and they are delighted that we are working together in the Assembly and the Executive and laughing at each others’ jokes. However, people will now begin to judge us by a higher standard, and, in four years, they will judge us on what we have delivered.
Unfortunately, I do not think that this Budget will deliver. The arguments on that are clear, and the bottom line is that the Budget will make people’s lives worse not better. Thousands of public sector workers fear for their jobs, and there is no real attempt to buffer the most vulnerable people in society from the real impacts of the benefit cuts that will come from London. There is no strategy for job creation, and school principals will be panicking at the fact that there will be no real attempt to build new schools or to bring about much-needed repairs to others.
We are fearful about higher tuition fees and all that that can do, which the House will debate this afternoon, and about the potential scrapping of the education maintenance allowance. In my constituency in Derry, people are fed up with hearing about the jobs that are being created by the Executive. All the time, we are given examples of the hundreds and thousands of jobs that are coming to Northern Ireland, but we do not see them in Derry. People in my constituency will begin to hold the Executive to a higher standard.
We know all of the arguments and have made them a number of times. As party colleagues have done, I commit to keep working with the Minister and Executive colleagues to ensure that we do our best to make the Budget and the Programme for Government — when we ever see it — fit for purpose. That is all I have to say for now.
Last week, in responding to the Second Stage debate, the Minister described me as the Elijah of the Assembly. If that was meant to be some sort of slight or insult from new DUP, I am afraid that I treat it more as a compliment because I am very happy to be associated with those who have not bowed the knee to terrorist-inclusive government. If, in my time here, I manage to slay — metaphorically, of course — a few prophets of Baal, I will be very happy with the work that that involves.
However, there are issues, whether the Minister likes it or not, that have to be returned to in respect of this Budget. For all the gloss, spin, hyperbole and bluster that the Minister delivers to us, it is quite clear to anyone who analyses the document that it is frayed, tawdry and bereft of detail that would speak to a cogent strategy. The Minister’s colleague Mr Ian Paisley Jnr spoke of this place as not even matching up to a good county council. Would this Budget even match up to a good county council budget, given its lack of vision, cogency, and connection with what should be the pathfinders of policy? It is totally dysfunctional and displaced from any notion of a Programme for Government. It does not at all cross the tramlines of an investment strategy. It is simply a little self-contained allocation of block grant funding to various silo Departments in what passes for government in Northern Ireland. Each Department gets its allocation and each spends it as it pleases, with no coherence or common binding cause to inspire direction. They just spend it as they wish. Some will spend it on promoting a surfeit of all-Ireland connections. Indeed, it illustrates the lack of cogency in this Government that some Departments now have dedicated all-Ireland units.
Where is the economic direction of this Government? Are we seeking to tie ourselves to the fastest sinking economy in Europe: that of the Irish Republic? Or are we seeking to strengthen our ties with the sixth largest economy in the world: that of the UK? This Budget does not give us any direction as to where, economically, we are seeking to go. Therefore, it is a process and a Budget that really amounts to nothing in terms of plotting out and pointing out the economic direction that this part of the United Kingdom should be taking.
Last week and, indeed, the previous one, I asked for some specifics on the content of this Budget. That raised the ire of the Minister. I will take that risk again because I am going to ask again, tedious and tiresome as it may be, just where within this Budget we find the signals or indications of whatever became of the £800 million that was promised in the sales talk about the transfer of responsibility for policing and justice. The Minister, with great gusto, declared that he would answer that question last week. Last Monday, in answer, he said:
“the police budget now has money for a police college, the part-time Reserve gratuity fund and hearing loss claims. That is where the £800 million is.” — [Official Report, Vol 65, No 1, p75, col 2].
Let us examine the point about the police college. On the same day last week — last Monday — the Minister’s colleague Mr Poots told the House that that was a project costing £140 million. So, there is £140 million of the £800 million. The Minister said that the second component was the “part-time Reserve gratuity fund”. We know that that is only £20 million. I must say that the negotiation on the Reserve gratuity fund was totally botched by those who negotiated it, when they failed to get the opt-out on taxation. That now means that that fund will be savaged by the Inland Revenue and is worth about half of what it was meant to be worth to the man or woman who is receiving it. That is down to the failure of those who negotiated it.
So, £140 million and £20 million makes £160 million. Then we have the hearing loss claims. The letter from the Prime Minister in October 2009 said that that was £12 million a year for up to five years, but, of course, it was to be paid for by the Executive handing over sellable assets. In notional terms, it is £60 million. So, £140 million, £20 million and £60 million makes £220 million and leaves us a long, long way short of the £800 million that the Minister likes to pretend was secured as part of the transfer of responsibility for policing and justice. So, where is it, Minister? It is not in the answer that you gave last week. So, let us try again this week and see whether we can get an answer to that.
What about the sellable assets in relation to the hearing loss money? Have any assets been transferred to the Treasury from the Northern Ireland Executive to offset the hearing loss money? Has any of that happened? Is any of it likely to happen? If so, when? Perhaps the Minister could tell us. Speaking of sales and assets, I ask again: what about the four bases that were handed over? What about their running costs? Where are those in this Budget? What was received for them? When are they likely to be realised?
Three debates later, the Minister does not want to answer those sorts of questions because, in truth, this is not a Budget at all in the sense that one understands it. It is, as I have described, a mere collection of budget lines, which are very sparse in detail, that sets in motion a process whereby 11 or 12 Departments do what they please in a totally disjointed fashion. Halfway through, some may well decide to change horses. For example, we might have a sudden redirection on the spend anticipated in the Department for Regional Development (DRD) and Roads Service over the A5. Of course, none of that is foreshadowed, because this Budget sets the broadest possible parameters and allows for all the changes that, according to the exigencies of the political moment, might arise.
I want to return to the issue of the funding that the Budget provides for victims’ groups, because a very sad and difficult situation is unfolding in Northern Ireland for innocent victims’ groups. In this Budget, there is supposed to be match funding on Peace III projects, and there is supposed to be core funding. Yet we are virtually one third of the way through the financial year, and there are groups in this Province that have seen no money since the end of March to keep themselves going.
We have staff who are unpaid and projects that have ground to a halt. Why? It is because of the double whammy of the sheer incompetence of some who administer those funds from the Community Relations Council (CRC) and others, and the bind put upon them by those who insist on audits and accounting processes that are not insisted upon for others. Hitherto, those were not insisted on, and they are beyond what volunteer groups — for many are run by volunteers — could possibly cope with. So we have the situation in which many well-known victims’ groups in the Province are moneyless.
That should concern the Finance Minister. He should be making strenuous efforts, I suggest, with the Office of the First Minister and deputy First Minister to enquire as to why that blockage on funding to those vital victims’ groups exists and why there has been an unfolding and apparently concerted and deliberate attempt to put some of them out of business. Of course, any financial irregularity is utterly to be pursued and utterly to be condemned. Where that has happened, Departments should certainly pursue it. However, that is no excuse for transferring the approach taken to such isolated cases to the generalised treatment of victims’ groups. That, sadly, is what has been happening, particularly within the Protestant victims’ sector, and many well-known victims’ groups are today in desperation.
Yes, the groups will have had meetings with junior Minister Bell and received all sorts of promises, but still no money. Sadly, a lot of this goes back to politics. It goes back to action by the First Minister’s office on 18 February 2010, when, out of a fit of pique over a publication by one of the victims’ groups that critiqued the Hillsborough agreement, an edict was issued to pursue that group. The product of that was the denial of funding. Yet nothing of substance has been found against that group. It cannot go on. It is the sort of thing that any Government worthy of the name would have arrested in its tracks and dealt with a long time ago.
The Budget, sadly for me, not only avoids creating a due vision for our economy and providing cogency on how we move forward, it also underpins the huge, perpetual waste in government. I mentioned it last week, but it bears repetition: the gross, incredible waste in the North/South Executive bodies. Over the four-year Budget period, £400 million is to be poured down that drain with no return. Yet, later today, we will discuss the tuition fee crisis facing families and the education sector. We are told that £40 million a year is required to plug that gap. No one knows where, if anywhere, it will come from. Yet we can find £400 million to pour down the drain of useless North/South bodies.
Unless or until Budgets in the House begin to address those realities, they will, like this one, continue to be documents of non-delivery, dysfunctional in their presentation and tawdry in their content.
I welcome the opportunity to debate the Budget. As a member of the Committee for Culture, Arts and Leisure, I want to voice my concerns about the Budget’s implications in that area. When one examines the proposed Budget, it is evident that we are certainly in difficult financial circumstances. The Department of Culture, Arts and Leisure (DCAL) was allocated £580·4 million in the draft Budget settlement, which breaks down to £438·7 million in resources and £141·7 million in capital. Although a cut in the resource expenditure is significant, though not, perhaps, considered to be severe, the capital expenditure has dropped from £218 million in the three-year comprehensive spending review to £141·7 million for four years, which is severe. However, the people of Northern Ireland want to know how that will impact on their lives and what the Budget will mean for them.
The first thing could be the closure of 10 libraries. That means that people in 10 rural communities will not have access to a library and may no longer have access to the Internet, and, more importantly, people could lose their jobs.
Most Members will be aware that recently there was a fire in Arthur Cottage, which caused severe damage to the ancestral home of the twenty-first American president. Given the difficult financial circumstances that we face, the Minister of Culture, Arts and Leisure stated that the Department could not provide financial assistance for the redevelopment of that historic site.
The Committee for Culture, Arts and Leisure had made progress to improve sporting facilities in Northern Ireland. Three stadiums — Ravenhill, Windsor Park and Casement Park — will receive funds for redevelopment. A Member has already stated that stadium developments with a lower priority should not be given funding. The development of Casement Park, Ravenhill and Windsor Park is timely, with not only the Olympics approaching in 2012 but the Police and Fire Games in 2013 and the Commonwealth Games in 2014. Northern Ireland must have the facilities to encourage people and events to come, and it must continue to provide facilities to encourage our young athletes, so that one day we may have many more Rory McIlroys. The media attention that Rory has brought to Northern Ireland is fantastic, and we need the spotlight to shine on Northern Ireland for positive reasons to promote the economy and tourism.
It is easy to say that investment in culture should take place. However, cultural events are not only an opportunity to promote Northern Ireland, attract business investment and encourage tourism but an opportunity to promote a shared culture. Last week, we again saw rioting on the streets. Surely we should be doing our utmost to invest in the promotion of a shared cultural awareness to promote harmony and peace. We need a shared cultural awareness to establish a shared future for all the people of Northern Ireland. Will the Budget deliver that for the people of Northern Ireland? Mr Deputy Speaker, it is not even close.
I thank Members for their contributions to the Final Stage of the Budget (No. 2) Bill for 2011-12. By necessity, as we have said time and time again during debates on the Budget, there will be some repetition. Some Members repeat what they said previously because they did not like the answer that they got, and they will probably get the same answer again. Some Members repeat what they said because they do not have anything different to say, and they will get the same response. However, I will deal with some points that were raised during the debate.
A common theme throughout the remarks was the need for a new process and the repetitive nature of the present process. Some people said that the weaknesses and the way in which information is presented do not enable them to scrutinise the accounts properly. Some people suggested that we contrived the weakness to ensure that the process is not subject to proper scrutiny. I welcome scrutiny of the Budget. We want proper scrutiny of the Budget, which is one reason why we started the review.
However, I suspect that it will not matter how much information we give to some Members; they will still complain, because, of course, they are not here to find how money is being spent. They are simply here to whinge. I will come to some of the whingers in a moment or two when I get into the substance of the comments.
Since one of the whingers wants me to give way, I will.
I thank the Minister for giving way. Is he happy with the fact that, in all probability, the review will not be completed during this mandate? Does he agree that there is a need to accelerate the review process?
I want to make something clear to the Member: it will be completed during this mandate, and, as I said in previous debates, it will probably be in place after next year’s Budget. By that time, Mr Hamilton will be the one who will have to respond to the new transparent Budget, which will give Members lots more questions to ask and lots more criticism to make, and I will be very happy to hand it over to him at that stage. The process does not allow the review to be done for the next financial year, but it will be completed for the third year of the Budget.
I welcome the fact that the Committee and many Members have already made very useful suggestions. Essentially, it will not be for the Assembly and the Committees alone to make the points; we want to hear suggestions from people outside the institutions as to how they would like to see the information being presented and how we can avoid some of the repetition that is in the process at present. I look forward to that. I know that Mr Cree made that point, as did Mr Bradley, Mr Allister and Mr Murphy.
Mr Girvan referred to the PMS. I am glad that we are close to the end of that process. The money has been allocated. The small savers will be totally protected; they will get the full £20,000, and I hope that the payments will start fairly soon. That will be up to the administrator, but the money is with the Department, and we have not left it to the February process.
I welcome Mr Cree’s conclusion that, having gone through all of the process, his party sees it as illogical to vote against the Budget. I do not know whether that means that we are going to get its fulsome support — somehow, I doubt it. I think that we might see the same action from its Members of going through the two Lobbies to show that they are here but not actually voting for it. It will be a bit of a disappointment if they are not able to endorse the Budget, given that part of the reason why we are facing the current problems with the Budget is the support that his party gave to the Conservatives at the last election and, as a result of that, the £4 billion cut that was imposed for the next four years. I thought that they would at least have had the grace to accept that we have tried to manage the situation that they have created for us as best we could and would have given us some support for that. However, we will see; maybe we will get their support when the time comes.
Mr McDonnell is not in his seat, but may I say that of the contributions from the SDLP, I felt that his were, at least, the most constructive. Comments went quickly downhill after his contribution. They went from constructive to repetition of the past errors, to drivel, which, to be frank, became almost incomprehensible towards the end.
Let me deal with some of the points that Mr McDonnell made. He made the very important point that the Budget should be about creating economic opportunities for the future. We are in the middle of a recession. What is the Budget trying to do, within the limits that have been imposed on us, and what has it done to try to improve economic opportunities? He talked about the need to spend on infrastructure, and he is right. The fact that we moved £256 million from current spending to capital spending, against a 40% cut in our capital budget from central government, was an indication that we sought to try to fill some of that gap.
By the fourth year of this Budget, we will be spending £1·4 billion on infrastructure and capital investment, which is equivalent to the long-term trend that there would have been over the lifetime of this Assembly, the previous Assembly and the Assembly before that. That is recognition in the Budget that, despite what some other Members said about there being no strategic direction, we have understood the importance of infrastructure to building up the economy and making this a place where private sector investors can come knowing that they have the ability to then do business. Whether that infrastructure is roads, railways, factory-building or broadband — whatever it happens to be — we have sought to provide additional resources for that. As well as that, we are, of course, looking at the redundant resources, infrastructure and buildings that government might have, which we no longer have use of or are not fully using. We are looking at how we can realise cash from those, again, to put into capital investment.
He also raised the issue of jobs. If you look at the allocation that has been made to DETI, you will see that Invest Northern Ireland is convinced that, with that allocation, it will be able to create 20,000 jobs over the Budget period 2011-15. Some of those jobs will be created very quickly by the £19 million that has been given for short-term jobs that can be brought online very quickly.
He also spoke about the importance of money spent on research and development. Only this week, we have had two very important examples of that. On Wednesday, I had the opportunity to visit FG Wilson’s in my constituency. It has spent £26 million on an engineering centre of excellence, in which generators can be tested for emissions, noise etc, and problems can be analysed. The centre will look at how generators can be built and run more efficiently, how they can become lower-maintenance, how they can use less fuel, etc. By keeping the research and development in Northern Ireland, that anchors the manufacturing jobs in Northern Ireland. DETI played an important part in ensuring that that research and development facility was developed and, in turn, it will anchor thousands of other jobs.
The other good news last week was about Bombardier. Bombardier has now secured hundreds of millions of pounds worth of orders for its new jet. The carbon fibre was developed here in Northern Ireland and the research and development was done here in Northern Ireland. As a result, we have secured the manufacturing of wings, etc, which will secure thousands of jobs in engineering. Again, that emphasises the importance of being not just a manufacturing base but a place in which products can be researched and developed. Therefore, we get the benefit of then manufacturing that product when it comes onto the market.
I remember Arlene Foster being criticised because of the money that she wanted to give Bombardier to develop the CSeries. At one stage, she got a lot of criticism and was asked why she was giving Bombardier so much money. This illustrates that there was far-sightedness on her part. She saw and believed that the potential that the firm suggested was there could secure jobs in the long-term future.
Mr McDonnell also mentioned food production in Northern Ireland. I am meeting the Northern Ireland food and drink industry within the next week to discuss the potential for new investment in that industry.
I come then to Mrs Cochrane’s contribution. She talked about rebuilding the economy and the need to live within the Budget, about it being important for Committees to make sure that savings delivery plans have been abided by, and about ensuring that Departments spend money as they promised. She talked about the need to rebuild the economy, and especially about the role of tourism. I repeat that I share her views about what happened in east Belfast last week. I was incensed over the weekend at the excuses that were given for the interface violence that marred the news from Northern Ireland last week. People always look for someone to blame rather than look at those who perpetrated the violence.
The Member will know that East Belfast used to be my constituency and that there has been significant investment in the area, such as the new housing around the bottom of the Newtownards Road. In fact, I was recently engaged with other Members in working with Habitat for Humanity on houses in Madrid Street. I remember when Madrid Street and Thistle Court were wastelands; now they are thriving communities, and new investment is going into them.
Some people think that investment only goes to community groups. A lot of money has gone into community activity, but there has been investment in schools and housing, investment by the voluntary sector and investment in the Skainos project at the bottom of the Newtownards Road. For people to say that, somehow or other, these things happen because the Government do not give money to those areas and that there has been no investment in communities is a cop-out. Such things happen because bad people do bad things. As a result, it makes it much more difficult for those of us who want to improve the situation in Northern Ireland.
The Member talked about co-operation across Departments; Mr Allister made a meal of that, as did Mr Bradley. I want to address that issue very forcibly. The idea that allocating money to the Department of Education, the Department of Health, the Department of Enterprise, Trade and Investment and all the other Departments somehow reinforces a silo mentality is, quite honestly, one of the most infantile arguments that I have ever heard perpetrated in this Assembly. We allocate money to Departments because government is organised in Departments. That is the structure of our government, and to say that because we allocate money into all those silos we do not have joined-up government bears no resemblance to the facts.
I could cite plenty of examples, but I will give just one. Take the regeneration of town centres: the Department for Social Development spent money creating a master plan for town centres and picked out a number of vulnerable towns; it put money into key projects in those town centres to regenerate them. In the Budget, I announced that my Department would spend money on giving a small business rates relief. The idea of the small business rates relief was to ensure that small, vulnerable businesses, especially those in town centres, got a reduction in their overheads so that we could make it easier for them to survive.
The Department for Employment and Learning runs training schemes for retailers who work in town centres to ensure that they become more viable and more vibrant. The Department of the Environment does the same. Roads Service looks at schemes in town centres, such as traffic calming, and seeks to spruce them up, by environmental or other schemes.
That is just one example of where money goes into different pots but is not spent in some kind of silo way. There is co-operation between Departments to look at what can be done to make sure that money is spent effectively and individual sums of money are spent in a way that gives greater benefit than the individual sums of money added together. There are lots of other examples across government that we could quote.
We have to get away from this nonsense. It really is juvenile for people to simply poke at what the Administration do, instead of recognising that some good work is done and that good work is a result of innovative ideas from public servants, officials, communities, businesses and politicians. We seek to spend money effectively by looking at those ways of doing so.
Mrs Cochrane also raised the issue of co-operation between Northern Ireland and the Irish Republic and talked about the work of the North/South Ministerial Council. Actually, a lot of that co-operation never takes place at North/South Ministerial Council level at all. In fact — this is a theme that I come back to time and again, and it is one of the areas where I happen to be in some agreement with Mr Allister — I would like to see a reduction in a lot of the unnecessary structures that have been set up to bring about co-operation between Ministers and Departments in Northern Ireland and the Irish Republic. I believe that that can be done much more effectively by Ministers who really want to get value for money in both jurisdictions working together. There is really no need for a lot of the architecture, but we have to live with it.
I have sought to ensure that there are as many efficiencies as possible to try to cut costs, as has the Finance Minister in the Irish Republic. A lot of co-operation takes place at departmental level between Ministers. Actually, there is no provision in the North/South structure for a lot of those things to happen because they are outside its remit. However, that does not mean that they should not be pursued. Indeed, in the margins of those meetings, other Ministers and I often have meetings with our counterparts from the Republic to ensure that we get value for money. That in no way comprises my unionism. It does, however, make good economic sense at a time of economic austerity.
I will now deal with Mr McLaughlin’s points. He talked about the approach that challenged the Assembly as far as the Budget was concerned and the need to supplement the block grant by looking for new revenue and efficiencies. I say that all the time as well, and, when you say it like that, it seems to roll off the tongue very easily. However, the truth of the matter is that new revenues and more efficient ways of delivering government in Northern Ireland will represent tough political decisions. As soon as we start to talk about raising new revenue, there will be some group who will be affected by that and will not want to pay, so it will lobby against it. As soon as we start to talk about more efficient ways of delivering government in Northern Ireland, we will hear about the implications for employment or whatever, and people will lobby against it. We must seek those opportunities, but they will not be penalty kicks and will not be easy to deliver on all of the time.
(Mr Speaker in the Chair)
As I said, the SDLP contribution started to go downhill after Mr McDonnell made his contribution. Mr Bradley started off in the normal way by complaining about the whole process. I could have written and, in fact, delivered his speech for him, for goodness’ sake. However, there was one interesting thing at the very start of his speech, when he talked about how the SDLP had engaged fully in the Budget process and had brought forward ideas. Indeed, he even suggested that we had accepted some of those ideas. The constant theme of SDLP Members during the earlier debates on the Budget was that they would vote against it because they were not allowed to play any part in it and were blocked out and ignored. However, Mr Bradley has now told the House that not only did the SDLP engage fully in the process but it had some of its ideas accepted.
Mr Speaker, are you going to intervene on me? I think that you are.
Thank you. I think that we are already finding that, by its own admission, the rationale that the SDLP had for opposing the Budget is beginning to unravel. The SDLP played a part. We could query, as I have, how useful some of its ideas were, but Mr Bradley is right to say that some of those ideas were taken on board and, as he also indicated, his party engaged fully in the process.
Mr Bradley said that he was unclear about what happened to the £1·6 billion of revenue raising. He suggested that we had had only £900 million of that, and he asked what happened to the other £0·7 billion. Of course, the truth of the matter is that some aspirational forms of revenue raising were included in that figure. Indeed, he will know all about aspirational revenue raising: his party’s document was full of them, and some of the ideas were not very practical at all. Many ideas amounting to issues worth between £1·6 billion and £1·8 billion were brought to the Budget review group. Many of those ideas were rejected because they were not workable; some were put on the back-burner to see whether they were workable; and others are still being pursued to see how practical they are. However, a total of £900 million was raised.
Mr Bradley reverted to asking whether that money was new money. I am not too sure what he means by that. If he is asking whether it is money that we would not have had, had we not put those recommendations into the Budget, it is all new money. It may come from traditional sources, such as selling assets. However, those are not assets that were sold before or belong to someone else, unlike some of the ideas in the SDLP’s document. The assets concerned are ones that we have and that we decided that we were going to dispose of because we could put the money from them to better use by furthering some of the objectives that we have set for ourselves. Some of it is new money in so far as it is additional money that we are collecting from rates, and some of it was previously unavailable to us because we are taking it from sources, such as the Belfast Harbour Commissioners, from whom we have not collected before. However, it is all new money, albeit from some of the sources that we have drawn on in the past to raise that kind of revenue.
Mr Bradley also raised the issue of progress on the Programme for Government. That is something for OFMDFM, and I think that that will be coming forward. He also raised the issue of the £4 billion that should be available for investment in Northern Ireland in years 5 and 6 of the Budget. That has now been referred to the joint ministerial council as a dispute that we have with the Government. They are likely to say that they have provided Budget allocations only for the next four years, but it has been fed into that dispute mechanism.
Finally, Mr Bradley raised the issues of EYF and NAMA. I will meet the Treasury Minister tomorrow to discuss proposals for EYF, and, later this afternoon, I will meet representatives of NAMA to discuss the issues that he raised about the way that it treats things in Northern Ireland.
I will now move on to the points that Joe Byrne raised, and, as I said, the contributions from SDLP Members started to slip down the hill after Dr McDonnell’s. That started with a statement from Mr Byrne, which I wrote down so that I did not get it wrong. He said that the Budget created no “stimulus for the local economy”. I know that he was not here in the last mandate, but I would have thought that, before coming off with what I can only describe advisedly as drivel, he would at least have sought to acquaint himself with the facts of the Budget.
Over the next four years, albeit against a background of a 40% reduction, we have a considerable investment programme, culminating in £1·4 billion being spent in year 4, which will bring us back to the long-term trend. In the Budget, we have allocated money to DETI to create 20,000 jobs. We have the small business rate relief. We are seeking to help the manufacturing industry by keeping the cap on manufacturing rates at 30%. We are putting money into building new schools. We are putting money into the capital programme for health. It is absolute nonsense that there is no stimulus for the local economy in this Budget, and the Member knows it. He should have thought about it. I am not too sure what he meant, but he then went on to criticise the size of the subvention that we get from London. Maybe he wanted even more cuts, but it was certainly not clear. He complained about the subvention that we get from London but said that we were too dependent on the public sector. Does he want more cuts? Perhaps he will tell me now.
I was not criticising the fact that we get £8 billion; I was actually showing some gratitude for that. The reality is that the regional economy has to be reshaped and reconfigured. Most economic commentators would expect us to say that we want to make the private sector more productive and become less dependent on the public sector. That is the gist of what I was saying.
Again, I am not clear. If he wants us to be less dependent on the public sector, does he want more public sector spending cuts? Is that what he is saying? It is totally unclear what he means.
All I can say is that this Budget seeks to rebalance the economy. It seeks to ensure that we put in place money to spend on infrastructure to encourage private sector investment. It puts money in place to create jobs, especially in the private sector and not the public sector, to try to change the balance. It tries to use what limited tax powers we have to encourage the private sector of the economy. The Member talked about wanting a better way and about rebalancing the economy, but all we got were the words. There were no suggestions for how it might be done.
Michelle Gildernew talked about the June monitoring round and deplored the fact that no application had been made for specific projects such as —
Yes, music therapy. Sorry. That was below the de minimis level. Therefore, the Health Department would have had the ability to move the money around and would not have had to make a bid for it. However, as I said, there was not a great deal of money available during the June monitoring round.
Mr Eastwood gave a list of things that he wanted money to be spent on. He said that the Budget will not deliver and does not protect public sector jobs. He did not recognise the fact that we froze public sector wages to try to save about 1,800 public sector jobs. He said that the Budget makes no real attempt to buffer the economy against the recession. He said that there is no strategic job creation or money for new schools. He went on and on and on about things that we should spend money on but gave no ideas about where the money should come from. I suppose that that is the type of bankruptcy that we have come to expect from some in the SDLP.
I now turn to the Elijah of the Assembly, who has not bowed the knee to Baal and wishes to slay the prophets of Baal during his term here. I have to say that the sword that he uses to do the slaying is becoming more and more blunt every time he wields it. We get the same old arguments, and he hits the same old wall with them. He will not get anywhere with those arguments, because, of course, they are simply a repetition of things that do not have any substance.
I have dealt with the issue of each Department getting its allocation and this Budget being based on a silo mentality. I hope that I have dealt with that through the example that I have given, and, if Members wish, I can give other examples.
Mr Allister said that he was going to be tedious and tiresome; he will do tedium and tiresomeness with great relish. We will all get very tired, very soon, of some of his arguments. For the third time, he asks, “Where is Gordon Brown’s £800 million?”. I have said to Mr Allister and I repeat that he is looking for some kind of Mr Bean accountancy that shows that, on 15 June, Gordon Brown gave Peter Robinson £800 million and, on 16 June, Peter Robinson did that, that, that and that with it. If he is looking for that kind of transparency in the accounts, I must tell him that that is not the way in which government accounts are done. However, let me repeat it, so that he knows.
Mr Allister talks about botched negotiations. At least the DUP got into negotiations, rather than standing on the sidelines throwing tantrums. We got involved in seeking additional money for policing and justice in Northern Ireland so that, when those powers were devolved, we did not hit an economic crisis. The money is allocated: it is for the police college, the part-time gratuity and the hearing loss settlement. Incidentally, in presenting the sums to the Assembly, Mr Allister could not even get it right. The Department of Justice had to find the first £12 million each year. Anything after that — the bill is likely to be £400 million — was to be provided by the Treasury. If Mr Allister is querying the sums, he should at least get the facts right.
The Department of Justice has also been able to draw down money to deal with terrorism over the next four or five years. Rather than having to make an application on a year-on-year basis, that £200 million has now been made available to the Department. If Mr Allister wants to know where the money is, I can tell him that it has been allocated for pensions, equal pay, the hearing loss settlement, the police college and dealing with terrorism. That money makes policing more effective. Furthermore — this will be joy to his ears — money has been allocated for the legal aid bill in Northern Ireland. The money is all there, that is how it is allocated, and that is how I prefer the information to be presented, according to how it is spent and the impact that it will have.
At the third attempt, the Minister has added new budget lines to his explanation of the £800 million, but they still come nowhere near £800 million. One hundred million pounds is to be spent on the police college, £20 million on the Reserve gratuity, and a figure will be spent on the hearing loss settlement. The Minister must not have read the Prime Minister’s letter: it clearly states that anything above the £60 million — that is, above £12 million per annum for five years — is met through access to the reserve. Access to the reserve was never spun as part of the £800 million. The Minister has still not told the House where the £800 million is. He may have added a few lines today, but he is well short of the £800 million. He knows that the £800 million was a con on the community, and he cannot tabulate it. He cannot give it, which is why he tries to bluster his way out of it.
I am not going to bluster my way out of it. To make his figures add up, Mr Allister has already changed his mind. When he spoke not so long ago, he had £140 million for the college. Now it is down to £100 million, in a period of about 10 minutes. If anyone needs to get his head round the figures, it is Mr Allister, not me. I have given a list and examples of where the money has gone.
The important point is that, had we used the strategy that Mr Allister and his friends wanted, which was to stand and yap on the sidelines without getting involved in negotiations, we would not have had one penny of that £800 million. [Interruption.]
That £800 million is now available to be spent on security in Northern Ireland —
At the risk of being tedious and tiresome, he asks, “Where?”. I will go through again where the money has gone: the police college, the hearing loss claims, the part-time Reserve, dealing with terrorism and pay equality.
He also raised the issue of victims’ groups. I find it odd that anyone would want public money to be spent in a way that is not accountable. He spoke about transparency in the accounts of the Assembly. However, when we seek to make victims’ groups accountable and transparent, Mr Allister seems not to like the kind of scrutiny to which one or two of those groups, which happen to be closely allied to him, are subjected.
No. He asked that question from a sedentary position. First, they are not being victimised. Secondly, the groups were selected not by the Office of the First Minister and deputy First Minister or the Executive but on the basis of a risk analysis exercise conducted by CRC. That exercise was carried out on all victims’ groups that are in receipt of funding.
I thank the Finance Minister for giving way on that specific point. I have met a number of victims’ groups and compared their funding from last year with the funding allocated for this year. In all the cases that I considered, this year’s funding is substantially greater than it was last year, and, in some cases, it is tens of thousands of pounds greater. Will the Minister reflect that, under direct rule, the money allocated to victims was less than £5 million, whereas this year, under the House’s Budget, it is in the region of £12 million?
I appreciate what the junior Minister said, although I suspect that it will not make one whit of difference to the arguments that we will hear time and time again in the House. The arguments that Mr Allister will put forward will simply be ones that he happens to think justify his opposition to anything done by the Administration. Often, they will be arguments that he just happens to make up. He has made it clear that his raison d’être is to level criticism, justified or not, time and time again. I am happy to take criticism when we have done something wrong.
First, we have a four-year Budget, which is something that no other Administration in any part of the United Kingdom, apart from the Westminster Government, has. Scotland and Wales did not get it, but we did. That Budget seeks to grow the economy in the face of a world recession and to rebalance that economy to try to improve the private sector. We have a Budget that seeks to protect public services, even in the face of swingeing £4,000 million cuts. It seeks to be innovative in raising new money to try to fill some of the gaps created by the reductions that came from Westminster. We have a Budget that is a result of listening to interest groups who told us what needs to be done to regenerate town centres, to stimulate employment, to get training going, to get research and development going and to help the construction industry. We have sought to tailor the Budget to those ends. That is an achievement, especially given that it had to be done in a mandatory five-party coalition and against the economic background that we had.
Those in the SDLP and the smaller parties can criticise because they do not have to take any responsibility. The larger, responsible parties in the Assembly could not leave Northern Ireland without a Budget. Public services would have collapsed had we done that. Those who, I suspect, will indulge themselves by going through the “No” Lobby at the end of the debate will do so in the sure knowledge that others will take the responsible decisions to take Northern Ireland forward. The irresponsible can traipse through the “No” Lobby. I hope that they hang their heads in shame as they do. They pass on the responsibility of keeping public services and public finances going, keeping the economy running and looking at a vision for the economy in Northern Ireland to others who will take the flak. Some things in the Budget are unpopular; that is the nature of a Budget that has less money than in previous years.
There is a stark choice between those prepared to be responsible politicians in Northern Ireland and those who simply want always to say the populist thing or use situations such as this to score cheap political points against their opponents. Of course you will do that in debate; that is what debate is about. However, when making a decision as important as how money is allocated, we have to recognise that the best possible job was done in difficult circumstances. For that reason I commend the Budget Bill to the House and look forward to Royal Assent.
As we come to Question Time at 2.30 pm, I suggest that the House take its ease until that time. After Question Time, we will put the Question on the Budget.
The debate stood suspended.