Debate resumed on motion:
That this Assembly approves that resources, not exceeding £7,444,446.68 be authorised for use by the Department of Education and the Department of Health, Social Services and Public Safety, for the year ending 31 March 2014, as summarised for each Department in Part II of the 2013-14 Statement of Excesses that was laid before the Assembly on 8 June 2015. — [Mrs Foster (The Minister of Finance and Personnel).]
The following motion stood in the Order Paper:
That this Assembly approves that a sum, not exceeding £8,336,067,000, be granted out of the Consolidated Fund, for or towards defraying the charges for Northern Ireland Departments, the Northern Ireland Assembly Commission, the Assembly Ombudsman for Northern Ireland and the Northern Ireland Commissioner for Complaints, the Food Standards Agency, the Northern Ireland Audit Office, the Northern Ireland Authority for Utility Regulation and the Public Prosecution Service for Northern Ireland for the year ending 31 March 2016 and that resources, not exceeding £9,004,299,000, be authorised for use by Northern Ireland Departments, the Northern Ireland Assembly Commission, the Assembly Ombudsman for Northern Ireland and the Northern Ireland Commissioner for Complaints, the Food Standards Agency, the Northern Ireland Audit Office, the Northern Ireland Authority for Utility Regulation and the Public Prosecution Service for Northern Ireland for the year ending 31 March 2016 as summarised for each Department or other public body in columns 3(b) and 3(a) of table 1·3 in the volume of the Northern Ireland Estimates 2015-16 that was laid before the Assembly on 8 June 2015. — [Mrs Foster (The Minister of Finance and Personnel).]
The following amendment stood on the Marshalled List:
In the second motion leave out all after "exceeding" and insert: "£7,732,067,000, be granted out of the Consolidated Fund, for or towards defraying the charges for Northern Ireland Departments, the Northern Ireland Assembly Commission, the Assembly Ombudsman for Northern Ireland and the Northern Ireland Commissioner for Complaints, the Food Standards Agency, the Northern Ireland Audit Office, the Northern Ireland Authority for Utility Regulation and the Public Prosecution Service for Northern Ireland for the year ending 31 March 2016 and that resources, not exceeding £8,400,299,000, be authorised for use by Northern Ireland Departments, the Northern Ireland Assembly Commission, the Assembly Ombudsman for Northern Ireland and the Northern Ireland Commissioner for Complaints, the Food Standards Agency, the Northern Ireland Audit Office, the Northern Ireland Authority for Utility Regulation and the Public Prosecution Service for Northern Ireland for the year ending 31 March 2016 as summarised for each Department or other public body in columns 3(b) and 3(a) of table 1·3 in the volume of the Northern Ireland Estimates 2015-16 that was laid before the Assembly on 8 June 2015, subject to a proportionate reduction for each Department, with the exception of the Department of Health Social Services and Public Safety, and each other public body referred to in columns 3(b) and 3(a) of table 1·3 of the aforesaid Estimates, so as to reflect the £604,000,000 shortfall resulting from the failure to implement the Stormont House Agreement." — [Mr Allister.]
Go raibh maith agat, a LeasCheann Comhairle. I will give our friends time to move across.
I want to return to some of the topics that we tackled earlier today. In brief, and in summary, our belief is that we need to have a more robust attitude and challenge to the cuts juggernaut that is coming at us from London. It disappoints those of us on this side of the Chamber that our colleagues on the other side of the Chamber are willing to accept, willy-nilly, the nature and severity of those cuts. They take it as read that there should be no resistance, protest, demand to, or explanation from, the British that it is the wrong way forward, that it will not benefit anyone in this community and that it will not help our economy. We are divided on the approach; I understand that. Despite that, the evidence shows that the ideology of austerity has not been the springboard for the improvement of our economy, and will not be in the time ahead.
The amount of money that has been taken from our block grant has been well rehearsed in the Chamber. At times, some of our colleagues across the Chamber are more critical of the British Government with regard to the £1·5 billion that has been taken out of our Budget since 2011. They have the attitude that it is done and that there is no merit in saying to the British that it needs to be reversed. That is not my attitude. It is my view that the £1·5 billion that has been taken out is equivalent to 0·002% of the British Budget, yet, of course, it has been a hammer blow to our budgets and has meant real hardship for ordinary people. If we want to continue the progress that we have made in the last two decades, we need to have that grant restored. We need to be able to provide the services that our people are crying out for.
Of course, we are at this crisis point because our friends in London are back in power. I was going to refer to the Lib Dem/Conservative coalition, but the Conservatives are back, on their own, in power, and have wasted no time in telling the public and us that further cuts will be our lot in the time ahead. We were fresh out of the election when we were told that cuts in the region of £30 million would come immediately, in-year. We also know that the £25 billion reduction that is being talked about will mean swingeing cuts to our budgets.
At some point, all of this will become unsustainable. Is it our role as politicians, civic leaders — people who have a stake in this land, in this community, and who are fighting for our neighbours, families and society — to go back to our community, time out of number, especially in the years ahead, and say that we have less money, that we will have to continue to cut back, and that we will have to continue to make a detrimental impact on public services because that is what the British are insisting on? If that is our entire role in politics, it places a huge question mark over why we should continue in that matter. I am not here to carry water for English Ministers. I believe that, if we are masters of our own destiny and have the ability to raise from our own people the resources needed to pay for public services, we should be allowed to do that. However, the British want it both ways. They do not want to allow us that right, except in very restrained circumstances, where they say that we can have corporation tax powers, but, at the same time, the income tax, the PAYE revenue, raised through the extra jobs, would go to London only. And so it is with all the other fiscal levers.
In the time ahead, our objective must be to have a response from the entire community right across the board. Last week, as part of a Sinn Féin delegation, I met the Institute of Directors (IOD) and the CBI. It heartened me to find that their attitude is not that of the Tory Government; they do not agree with the Tory Government when they say, "It is our way or the highway.". They believe that there is a strong and special case to be made for our community as to why we cannot continue to suffer this blizzard of cutbacks. I am particularly heartened by the CBI's insistence that, to inflict further cuts on this society will make it even more difficult for us to do the essential things if we are to build the economy, not least provide jobs to our young people and make sure that our universities have the ability to turn out the many talented and qualified graduates that industry calls for.
My call today is that, as we look to the future, we have a vision for a society that is fair and prosperous. I do not believe that that is impossible. I believe that we are united, right across the Chamber, in the belief that a fair and prosperous economy is good for everyone. That is one of the visions that unites us.
At this stage, we are divided because some of us are willing to accept the agenda from London and some of us are not. It is my feeling that continuing to slash public services and to accept, without protest, the continued cuts to our Budget is not the way forward. We will not be thanked for that, either by the electorate or the community.
I hope that, in the time ahead, as negotiations continue with the Treasury on the way forward and the austerity ideologues sit down and take out their pencil and decide what budgets to cut, our representatives on the Executive will bring to them a united voice and insist that we need the resources to build this society and to provide first-class public services to our people. We will continue to work in the interests of ordinary people to create jobs for all and to build the economy. It is my hope that, as we emerge from discussions in this Chamber and outside it, we can get a united approach from us all around the Chamber to the British Government in the time ahead.
I am someone who likes to say yes, but, if we are to say no to anything, now is the time to say no to the austerity ideologues and English Ministers and say that we will not accept their mission or plan to make our institutions untenable and unsustainable. Be sure of this: if they continue to cut as they plan — taking another £800 million out of our Budgets between now and 2018 — they will have dealt a hammer blow and a death knell to the institutions that we are all fighting to keep up and sustain in this part of the world.
Go raibh maith agat, a LeasCheann Comhairle. I welcome the opportunity to speak on behalf of the Committee for Enterprise, Trade and Investment on the Main Estimates. The former Minister briefed the Committee on 10 February 2015 on the draft Budget proposals.
DETI’s baseline position consisted of an overall 15·1% reduction distributed pro rata across the Department and its arm's-length bodies. The Committee noted that the assessment provided little indication of any prioritisation of expenditure in DETI. The Committee would like to have seen further analysis to ensure that the impact of reductions is lessened on areas of strategic priority for the Executive. Unfortunately, that does not seem to have occurred.
More than 90% of Invest NI's budget for 2015-16 was already committed when the Committee was briefed in February. DETI officials informed the Committee that that meant that Invest NI would be unable to support its current level of activity, resulting in fewer jobs being promoted, and presumably leading to fewer jobs being created. On a future Programme for Government (PFG) and economic strategy, officials stated that Invest NI would have to scale back its targets. That is of considerable concern to the Committee, especially at a time when Invest NI is performing very well against most of its PFG targets. The growth of Northern Ireland's export base is the one key area in which Invest NI has not met its targets, yet there seems to be no provision in the Budget to address it. Northern Ireland has a small internal market; therefore, the growth in exports is essential to economic growth.
Assurance provided previously that no worthwhile inward investment for job creation will be rejected owing to budgetary constraints remains in place. The Committee sought and received an assurance from the former Minister of Finance and Personnel that that remains the case. However, reduced activity by Invest NI will undoubtedly result in fewer opportunities being identified, leading to fewer worthwhile proposals for inward investment and, as such, fewer jobs being created. At a time when we are looking to reduce corporation tax and promote the North as a place to do business, that has to be a concern for the Executive.
DETI officials briefed the Committee on the June monitoring round on 2 June 2015. The Department outlined key monitoring round bids of £4 million to Invest NI for the Bombardier nacelles project and £1 million to Tourism NI for feasibility studies around maximising current tourism initiatives. The economy is the Executive’s number one priority, and the Committee has always believed that it is important that Invest NI be resourced to meet current commitments, and to deliver for future opportunities that present themselves. The Bombardier nacelles project is a high-value research and development project. That DETI's GB counterparts are also topping up the £110 million project shows its significance, with an estimated 115 R&D jobs, 168 production jobs and the potential for subsequent work to emanate from the project.
Invest NI bid for £4·3 million in capital for Seagate Technology (Ireland) for R&D assistance into leading-edge technology. That will be an important project for the site in Derry, with the company itself spending £34·7 million on it.
The Committee welcomes the initiatives in the June monitoring round that aim to maximise on money already spent by the Department. A bid of £1 million by Tourism NI for feasibility studies includes exploring the potential for future spin-offs from the high-profile 'Game of Thrones' and further footfall opportunities for the Gobbins path. The Committee looks forward to reviewing the results of the feasibility studies and any future work on the projects. It will continue to scrutinise the benefits, and whether they outweigh any spending.
There is slippage on the Waterfront convention centre, the Railway Preservation Society of Ireland and the SS Nomadic. The £1 million for that will be met by reallocation of funds. The Committee recognises the importance of those projects, not least the benefits of the Waterfront convention centre to visitor numbers and to putting Belfast on the map as a major conference destination.
The Committee is awaiting further information from the Department on the voluntary exit scheme for the Health and Safety Executive for Northern Ireland (HSENI). DETI core has registered £2·4 million and HSENI £0·5 million of requirements for the voluntary exit scheme. Those were considered in the first tranche of bids under the scheme. The Health and Safety Executive plays an extremely important role in ensuring and promoting health and safety in the workplace, not least with its recent advertising campaign for farm safety, which resonates very sadly and soundly with us all.
The Committee asked what impact the voluntary exit scheme will have on the most vital HSENI services — including, of course, farm safety — considering that, just over 18 months ago, the Health and Safety Executive appointed eight trainee inspectors to address a shortage in staff and bring the organisation up to full complement. The Committee has noted a reduction of half a million pounds owing to construction work not commencing on the gas extension project to the west and north-west until later in 2015. Again, that is an important construction project that will bring jobs in itself but also provide long-term economic benefits.
I will now speak for a moment in my capacity as a member of the SDLP. I wish to discuss the processes around the Northern Ireland Executive Budget. The most recent Assembly Budget Bill debate was only four months ago. I will reiterate a point that my SDLP colleagues have made many times.
An annual budgetary process used in other jurisdictions causes participation and robust process and brings ideas to the forefront. We in the Northern Ireland Assembly should and could have a significant budgetary process to discuss, but this is simply a financial management process — or mismanagement, as some might argue. There are so many things that we could be discussing, as well as legislation and allocation of funds that we could be bringing forward.
I have been out and about quite a bit in the last while, and a key issue that has been raised with me by members of the community, particularly young families, is childcare. I know that my colleague Seán Rogers has raised that on a number of occasions. The costs of childcare are exorbitant, and it is essential that I put this on the record. Aviva did a survey at the tail end of last year into childcare costs for parents of children up to five years of age. Many of them are working for less than £100 a month after childcare costs are paid. That is the situation that many people are facing. Indeed, many of them, mostly but not exclusively young mums, are having to face choices about whether they should or should not work. Those exorbitant costs are providing a barrier to employment, especially for young mums, and that deprives the labour market of key and very well-educated people with skills, who are being forced because of those pressures and the costs of childcare to remove themselves from the labour market. Childcare is also ultimately a key element in the development of the academic and intellectual skills of the child. We need to identify early on whether there are any shortcomings or problems that might need to be addressed in the development of the child. It has huge, huge social and economic value.
We have had a debate in the last while on welfare reform. I think that it is time we moved the focus. It needs to be on people who face difficulty. We need to move the focus of our debate from welfare reform to welfare and work reform, especially when those high childcare costs mean that one in five parents are considering either reducing their hours or giving up work altogether, thereby depriving the labour market of key people at a time when we are talking about investing in skills for our young people and reskilling people of a more advanced age. As a consequence of lack of proper investment in childcare, that key element of the skills sector is being withdrawn from the labour market. We talked about corporation tax. I think that a big attraction for any FDI coming here — yes, reduced taxation levels helps — is to come to a society that is caring and supportive towards its employees.
As my colleague Fearghal McKinney mentioned, we in the SDLP welcome the Supply resolution for 2013-14 Excess Vote, which provides further funding for the Department of Education and the Department of Health. The Main Estimates for DFP state that it will be unable to quantify the liability faced due the voluntary exit scheme and that it will become clear only in-year. I am concerned that that will affect the ability of not only the Department of Finance and Personnel but other Departments to work effectively. It appears that the Departments have not yet been able to forward plan to deal with that. I know that many civil servants are looking ahead, trying to plan ahead and trying to work their way through this, so it is important that they, too, have clarity on what their circumstances will be. <BR/>I will conclude at that, Mr Deputy Speaker. Thank you very much for the opportunity to put that on record.
I welcome the opportunity to outline the Committee for Employment and Learning's consideration and views on the Supply resolution Main Estimates 2015-16. As it is one of the Executive's largest spenders, scrutiny of the DEL budget is taken very seriously by the Committee, and, to that extent, Minister Farry briefed it on the budget on 26 November, 10 December, 3 February and 18 March to provide details of the changing situation with his Department's budget.
During his briefing on 3 February, the Minister informed the Committee that the original total for the reductions that he had to find was £82 million. However, due to a reallocation of £20 million from the Executive, the total reductions to be found fell to £62 million.
I also welcome the fact that the Executive have listened to Committee and others' warnings about the Department for Employment and Learning's spending and provided £13·2 million of change fund money to bring the Department's opening baseline budget cut to £48·3 million.
In dealing with the pressures, the Employment and Learning Minister outlined his way forward to the Committee. The Minister provided detail of £33·2 million reductions made up of £18 million of cuts rolling forward from the 2014-15 budget and £3·5 million of efficiency savings from the employment service.
The main issue that exercised the minds of the Committee during the Minister's briefings was the impact on student places in our universities and colleges and the knock-on impact on the Northern Ireland economy. In detailing what the impact will be, the Minister outlined that the remaining £30·1 million pressure on the budget will be managed by a reduction to the universities of £16 million, a reduction to the further education (FE) colleges of £12 million and further departmental efficiencies of £4·1 million. The Minister accepted that the remaining £6 million of savings to be found by the universities will most likely result in a cut in university places and jobs. This is at a time when the Minister has warned that even no reduction in jobs or places is not a positive option and that an increase in places is needed for the sake of the future of Northern Ireland as a growing economy. On that issue, the Committee welcomed the commitment by the universities that there will be a protection of the narrow STEM subjects, given their importance to the economy.
The Committee welcomed the allocation of £7·5 million from the change fund to enable the Department to proceed with piloting the new apprenticeship strategy and the youth training strategy, but it is concerned that those new initiatives may not cover the shortfall found elsewhere. The Committee has also noted with concern that the Minister has been unable to guarantee committing extra funding to vocational skills and apprenticeship programmes to meet the demand that will result from a shortfall in places at colleges and universities.
The Committee welcomed the fact that the Minister is not cutting the further education and higher education support that it gives to students with disabilities, and also that it is not cutting its disability employment programme. The Committee was also content to note that the Department is also protecting the hobby and leisure provision for people who have learning disabilities.
At its meeting on 20 May 2015, the Committee was briefed on the June monitoring round by departmental officials and welcomed the fact that the Department is making four non-ring-fenced bids.
The first bid is in relation to £6 million end-year flexibility to ensure that inescapable pressures are met across the further education sector. Departmental officials advised the Committee that it is absolutely critical that the Department receives that money, as failure to do so would mean that the money would have to be found elsewhere in the Department and create further pressures in the Department.
The second bid is for £5·5 million to meet inescapable contractual obligations or residual costs after the pausing of the youth employment scheme in December 2014 and the costs of the remodelled employer subsidy for 18- to 24-year-olds: £4 million of this bid relates to the youth employment scheme and the remaining £1·5 million relates to the remodelled element. Again, the bid for the youth employment scheme is a committed amount, and, if the bid is unsuccessful, the money will have to be found elsewhere in the Department.
The third bid is for £2·6 million of match funding for the European social fund to meet the match funding requirements of that programme. This is required to bridge the gap in the departmental match funding element, and, if not met, the money would have to be found elsewhere as it is already committed.
The fourth bid is for £1 million for the economic inactivity strategy to develop a range of pilots to see what works best to tackle economic inactivity. However, the Committee noted that this bid is not inescapable and could be delayed. The Committee has already expressed concern regarding the timelines for some of the projects that would not commence until 2016 or 2017, and even some as detailed as 2019. Therefore, if the strategy is delayed now, some projects may not commence until well into the new mandate in 2021.
The Committee also noted that the Department has submitted two capital bids — one for the further education colleges of £5·9 million, which is to ensure that colleges meet their legal and statutory obligations on health and safety and disability.
The Committee for Employment and Learning will continue its scrutiny of the Department for Employment and Learning's budget and especially the Minister's efforts to mitigate the impact of the cuts.
I now wish to make a few comments as a member of the Ulster Unionist Party and as a Member of the House. With regard to the Employment and Learning budget, I believe that the removal of the education maintenance allowance for the Pathways to Success programme has caused severe problems to many young people. The latest position from the Minister was that it was still on his desk. I hope that the Minister makes a positive decision and makes it soon. The Include Youth Give and Take online video that was posted recently will explain the importance of that funding.
With regard to the European social fund and the match funding, many organisations are still in limbo over the current programme and are waiting for money to be delivered from the Department so that they can finish off the last programme.
As chair of the all-party group on congenital heart disease, I will seek the confirmation of the allocation of moneys to provide the promised cardiac centre of excellence for children in Belfast, as recommended in the international working group report. I want to express my disappointment that the moneys — namely £1 million — promised a number of years ago by John Compton during the review of cardiac surgery in Belfast was utilised by the Minister of Health to send children across to England to have their surgery done there. The £1 million that was promised to revitalise the centre in Belfast was utilised elsewhere. So, I would like the financial commitment that that money will be promised in the incoming Budget.
I am speaking today as Chairperson of the Committee for Agriculture and Rural Development and will represent the views of that Committee.
The Committee received material and documentation from DARD on the Main Estimates and took oral evidence from officials on 2 June 2015. In carrying out its scrutiny of the Main Estimates, the Committee noted the following issues and concerns. First, and most importantly, the Department is the paying agency for EU grants to farmers. The Main Estimates that DARD presented to us on 2 June show a figure of just over £245 million for CAP. The administration and payment of CAP funds is DARD's single biggest task and responsibility. It is no surprise, therefore, that when we examined the Main Estimates, that is where the Committee focused its attention.
The Committee is adamant that the main priority for DARD should be its front-line services to farmers and the wider rural communities and, specifically, the payment of the EU grant. The Committee recently received a separate written briefing on the numbers applying for the EU grant through the single application form. We are aware that this year is a time of great change and flux for DARD. The system has changed, and, instead of a single payment of an EU grant to a farmer, there are now up to five separate areas where the farmer can claim payments. All those new areas need to be checked, inspected and verified, and some of those inspections are new and different from what went before. For example, all applicants to the fund now need to meet a new criterion called the active farmer. All applicants need to provide proof that they are an active farmer, and that proof needs to be checked and verified by DARD.
In the past, the Committee has received assurances from the Minister and DARD officials that the basic payment system is the number one priority for the Minister and the Department. The Committee acknowledges that the system has changed and is more complex to administer, but there has also been a fall in the number of applications. This year, we have seen an increase in the number of applications made online, which makes the administration easier. Those two factors — the falling number of applications and more applications made online — plus the additional support that DARD has requested for IT systems in the June monitoring round should counter any proposed increase in complexity. We, therefore, fully expect that DARD will be able to meet the same payment timetable as last year.
There has also been some speculation in the media regarding the legalities around the payment of the EU grant in the event that no Budget can be agreed and the permanent secretary of DFP takes over the Budget for Northern Ireland. This is the issue of accruing of resources. I was, therefore, pleased to note that the Minister of Finance and Personnel stated during Question Time on 9 June that she was taking steps and was confident that the basic farm payment would be paid, even if it is not through the normal processes. Northern Ireland farmers will take some assurances from that.
In its further scrutiny of the Main Estimates, members of the Committee questioned officials on the voluntary exit scheme. The Committee is aware that DARD is expected to make savings in salaries of £5·9 million from the exit of staff. The Committee was interested to explore the firmed-up figures and any assessment the Department has made regarding the figure of £5·9 million. The Committee was interested in DARD's assessment of whether it would make that saving and what impact it would have on its Main Estimates if it did not. Unfortunately, the officials were unable to tell us very much, other than that DARD staff who had applied had received letters that morning. That was 2 June.
The Committee also questioned DARD on the budget provision for TB compensation. As the Assembly and Members are aware, TB compensation has been very costly to the public purse. As a result, the Committee keeps a very close eye on the costs of TB, including not just compensation paid to farmers but the costs associated with testing and research.
(Mr Deputy Speaker [Mr Beggs] in the Chair)
This year, for the first time, we see the full costs for TB built into the Main Estimates. Previously, there had been a structural deficit in the Main Estimates in that only around £5 million was allowed for TB. That meant that the Department had to constantly seek additional funding for TB in the monitoring rounds. Our Deputy Chairperson, Joe Byrne, referred to the Department’s reliance on the monitoring round for TB compensation as being like relying on a slush fund. He was not too far wrong.
This year, for the first time, we saw a baseline of £12·5 million in the Main Estimates for TB. You can imagine the Committee's disappointment when it was informed that that line in the Estimates was incorrect and that an additional £4·5 million bid was being made in the June monitoring round.
Testing for TB in cattle and the payment of compensation are statutory responsibilities: they must be done. Given the uncertainties over the Budget process, we, as a Committee, had to ask the "What if?" question. Mr Poots directly asked the DARD officials:
"What happens when you do not get the money?"
The answer was not reassuring. The Department basically told us that it was exploring contingencies, that none of them were palatable and that difficult decisions would have to be made. A final point to make on the issue of TB compensation is that the additional bid is due to a spike in TB incidence. That is something that we are not happy with, and we have called for additional information.
The final issue that I want to cover, which was raised at the Committee, is the upward trend in departmental administration costs. Those costs have risen from £54 million in 2013-14 to nearly £58 million in 2014-15, and the Main Estimates show a further increase to just over £60 million in 2015-16. On top of that, programme costs over that same period have dropped considerably. We, as a Committee, cannot understand that, and we are not happy with the explanation that we have been provided with. We questioned DARD officials on 2 June, and we will be keeping a very close eye on administration expenditure in the future.
That concludes my remarks as Chairperson of the Committee for Agriculture and Rural Development.
All in good time.
At this stage, it is important that we understand and recognise what we are doing today and what we are being asked to do today and over the next couple of weeks, namely to pass a Supply resolution to authorise the supply of resource and pass a Budget Bill to give legal authority to Departments to spend that money. That should be the normal course of action during any financial year. The Executive and Assembly take policy decisions in terms of the Budget resolution, and then there is a responsibility on the Assembly to ensure that that money flows.
As people know, my party opposed the Budget in the Executive for a host of reasons, including a lack of strategic thinking for the future and difficult decisions not being taken, including a fair and balanced approach to revenue-raising issues and issues around the cost of division. Those are all issues that are big structural difficulties within our Budget. Once that debate happened this year and a democratic agreement was made, we all had a duty to ensure that we follow through with the supply of the necessary resource. So, as we find ourselves in June, our duty is to ensure that we follow through with that Budget, albeit one that we believe was flawed in a number of respects. That is our responsibility as legislators in this context.
As we meet today, that context takes on a certain air of unreality, because we all know that there are some major financial challenges facing Northern Ireland, most of which are self-inflicted wounds due to our lack of ability to agree on the politics of the way forward. Northern Ireland is in a bad place financially and politically, in the sense that we do not have a sustainable framework of public finances. The immediate issue, above and beyond those wider structural difficulties that I have alluded to, lies in the non-implementation of the Stormont Castle agreement and the Stormont House Agreement, including the thorny and difficult but inescapable issue of welfare reform.
Obviously, we would not wish to start from this place, but the least irresponsible thing to do is to proceed and ensure that we have some sort of legal framework in place around money. We have a duty to ensure that the money does not run out, and anyone who is thinking of voting against the Supply resolution this evening needs to think very long and hard about what the consequences would be of a no vote and, indeed, if the Assembly were to follow suit and endorse their perspective on a no vote. That would mean that, in the absence of an intervention from the DFP permanent secretary, the money would run out. In that eventuality, there would be not only a political problem but a financial problem, in that we would be facing much deeper cuts even than those that we wrestle with at present, with all of the pain that has been articulated not just by MLAs but by people across society over the past number of weeks and months.
At the very best, agreeing the motion does not in itself resolve any of those political and financial issues, but it buys us a little time. I have to confess that I have a slight reservation about proceeding on this basis because, true to form, there is a danger of people sitting back and becoming complacent: somehow, having got over one hurdle, money can be spent regardless. We have to use the time that we buy wisely, and time is not a luxury that we have. We have to act quickly to resolve the outstanding issues because, if we keep putting off their resolution until the late summer and into the autumn, when we finally reach a conclusion on the way forward, we may well face even steeper cuts than those that we have had to face so far. Much less time will be available to deliver those cuts, meaning that the options available to Ministers and Departments will be much more constrained and the pain across society even deeper. We have a duty to give those whom we serve a degree of financial certainty as early as we possibly can.
There was a degree of unreality in some of the remarks that I heard from Members from all Benches, particularly from the two nationalist parties. I know that the Green Party will join in later. The two nationalist parties articulated concerns about the cuts and talked about how terrible it is that this is happening, that that is happening and that we are missing out on opportunities. If they had any sense of joining the dots, they would recognise that the failure to deliver the agreements at Stormont House and Stormont Castle and the failure to face up to the realities of welfare reform are plunging Northern Ireland into financial uncertainty, and that is making the pressures on public services and on the economic levers that transform our economy even more acute. Every time individuals stand up and talk about cuts, they need to look at themselves in the mirror and ask what they are doing to help or hinder that particular situation. Are they part of the problem or part of the solution?
If we drill even more deeply, we find troubling issues that need to be teased out. I appreciate that a lot of people have very deep concerns about the cuts made to the Northern Ireland block grant over the past number of years. Also, there is uncertainty about the future, with the very real prospect of cuts to welfare payments and the Northern Ireland block grant in the immediate years to come. If we are to fight that process and join forces with Scotland and Wales to present a common front, surely our position will be strengthened if we are able to show that we are capable of acting in a responsible manner through having resolved the financial pressures facing us this year. By contrast, if we go into that process with those issues unresolved, our credibility will be so much weaker. I do not see how having an understanding of this year's financial framework will, in any way, shape or form, prejudice our ability to argue our case — our special case and our special circumstances — in any process of dialogue with the Treasury over the years to come. Those who are deliberately holding out on providing financial certainty because of their stated concerns about what may happen in the future need fundamentally to reassess their position.
Perhaps even more fundamental political and constitutional questions are being raised. We hear talk, particularly from Sinn Féin but echoed implicitly by the SDLP, that they want to be masters of their destiny in Northern Ireland and that they are not here to administer cuts on behalf of the UK Government.
That is not what they were elected into politics for. Certainly, I do not want to be in a situation in which I am cutting budgets; I find it incredibly difficult, and it pains me every time that I am forced to make a cut. However, we have to recognise the wider constitutional reality: we are part of a UK framework, and that is where our public spending comes from. We do not have the resources to go it alone and have a free-standing situation. Insofar as tax-varying powers can be considered, it has to be in a framework in which we are still dependent to a very large extent on the Treasury. Indeed, if we were to imagine a future united Ireland, unless there were a major change of circumstances, Northern Ireland or a devolved Administration in the northern part of the island would be very heavily dependent on a fiscal transfer from the Irish Government as a whole, which themselves have gone through a process of austerity and spending cuts. They could then put a lot of pressure on public spending in Northern Ireland, and the same arguments would be voiced again.
The approach also does a great disservice to the creativity and innovation that has been shown under devolution. We are not simply here to dole out money on behalf of others. We are here to add value and make a difference, not always by spending money in different ways but by showing creativity in policy and the type of projects we put in place and ensuring that those projects are much more in keeping with our set of affairs.
Most troublingly, if you join the dots in what Conor Murphy said implicitly on 'The Stephen Nolan Show' last week, Sinn Féin not only insists that it be immune from what happens in the UK as a whole, bypassing entirely the principle of consent, but believes that Northern Ireland must have the ability to determine its own future and that, because in itself Northern Ireland is not sustainable, there needs to be an all-Ireland framework. If Sinn Féin is essentially linking delivery of a united Ireland in the short run and as a precondition to progress on all these issues, it is obviously erecting a bar that is —
— beyond anyone's reach, not least because we have to respect the democratic wishes of the people of Northern Ireland. There are a lot of not only political and constitutional but financial and economic issues that we have to square if we are to make progress over the coming days.
None of us wants to be in the situation we are in today of the Finance Minister bringing forward this proposal. It is not an ideal situation, but it is the only solution available if Departments are to have the authority to keep on spending after July to deliver all the services people expect in Northern Ireland, to pay public-sector wages and to pay grants to groups that depend on government. This Supply resolution has to be passed today, and Stephen Farry is right: those who wish to vote against it ought to consider the consequences, which will be that every one of their constituents will be affected when, after July, the ability to spend money is no longer there.
As was pointed out, the Finance Minister is asking us to authorise the expenditure of more money than we know will be available. Eventually, Departments, if they keep spending at the rate this Supply resolution would authorise, will be overspent, and there will be consequences. I suspect that the Treasury will not permit it. The Treasury will certainly not want that to happen in Northern Ireland, because it would have implications for Scotland, Wales and other parts of GB as a whole. Nevertheless, we have to move forward and have certainty that Departments will be able to spend.
There have been three reactions. One was from Mr Allister, who said, "Let us not have the black hole in the Budget; let us cut £600 million from these Supply resolutions". I have two issues with that. It ignores the fact that the Finance Minister is trying to get the Assembly and the parties that have buried their heads in the sand to address the whole issue of the Stormont House Agreement. It ignores that issue. The one way of either getting the parties here to focus on the problem or to get the Government at Westminster to focus on the problem is to have a Supply resolution that clearly leaves the problem unresolved and forces people to pay attention to it.
I suggest that the Member is proposing a course that kicks the can down the road and gives Sinn Féin more time to play the games it loves to play, instead of facing reality. My amendment would pull everyone up short and cause the parties to face reality, rather than kicking the can even further down the road to the point where the Minister inevitably breaks Treasury controls and we are in an absolutely irreparable crisis.
Of course, it does not. First of all, although I suspect his amendment will not be carried by the Assembly, we would immediately be in the situation, not where we have a black hole, but where we would be throwing ourselves over the cliff, because there would not be any spending power available for Departments after the end of July. The second issue, of course, is that the reductions are unspecified. He will argue, of course, that he has covered them in his amendment, but all that does is give general terms. It actually works, in effect, on a 15% annual reduction in the budgets of all other Departments apart from the Department of Health. I would have thought that, if he wanted the Assembly to make that decision, we would have had at least some indications as to what that means for schools, housing, roads and all of the other budgets. Of course, that is not specified.
At least there was some construction in his amendment. SDLP Members have taken a totally different view. They have simply buried their heads. Listen to them. They have prattled on today about the need for annual Budgets, the need for more money on childcare and the need for more money on health, as Mr McKinney told us, as if there was not a problem and we did not have a shortfall — a shortfall caused by their party and the fact that it joined Sinn Féin in the blocking mechanism of the Stormont House Agreement and welfare reform. They cannot pretend that they have not caused a problem. They certainly cannot then go and blame the Government at Westminster, as Alex Attwood tried to do, and say, "Well, we were promised the final Budget".
The Budget that I voted on at Westminster earlier in the year was the final Budget for this year, but, as the Conservative Government won a majority, they are now going to revise that Budget. It is the right of a Government to do that. They have decided to revise the Budget for the whole of the United Kingdom, with financial implications for here. We cannot just run away and say, "Well, it's the Government's fault". It is the parties in this House that have refused to implement the agreement that they made in December, which would have given the Finance Minister the resources to do all the things she wants to do over the next year. It is their fault that we have not got it. We cannot bury our heads in the sand and then just prattle on about what we want to spend money on. I noticed, of course, that, although SDLP Members talked about those extra things, they did not suggest one way in which we could get the money.
If we come to the other end of the spectrum — total irresponsibility — then of course we have Sinn Féin's attitude to it. "We simply resist it all." How they resist it is unspecified. "The cuts juggernaut should be resisted. We will stand in front of it." Well, you are going to get run over. "We will not carry water for British Ministers, though we will pour cold water all over economic recovery in Northern Ireland by our irresponsible behaviour." Of course, the ultimate threat that we got from Mr Ó Muilleoir at the very end of his speech was that, if the Government insist that Northern Ireland, as part of the United Kingdom, bears its part of the United Kingdom budgetary cuts, that will be the death knell of the Assembly.
Now, that is really constructive. Of course, if it spells the death knell for the Assembly, will the juggernaut stop? No. Will the cold water of austerity not affect Northern Ireland? No. It will simply be done by Westminster. That is Sinn Féin's solution: resist it in some unspecified manner and, if not successful, close the Assembly down. I take it that that is what Mr Ó Muilleoir meant when he talked about the death knell for the Assembly: "We will walk out and let those evil Ministers from Westminster do the job anyway".
It is significant that no other part of the United Kingdom has adopted that immature attitude. Despite all their rhetoric, the Scottish nationalists have still introduced budgets commensurate with the reductions that have come from Westminster. Despite the opposition in Wales, the Welsh Labour Government, with all their rhetoric against austerity, have introduced a budget that reflects the cuts that have come from Westminster. It appears that only in Northern Ireland is there a group of politicians who are so immature that they cannot see that, as part of the United Kingdom, there are considerable benefits for us — £10,000 million worth of benefits each year for us. They simply ignore reality and, first, cause uncertainty for those who want the economy to work and, secondly, bring disrepute upon politics. That side of the House has been almost entirely responsible for that.
The Finance Minister, in the absence of any construction from other parties in the House, has done the best job she can. Yes, there are implications for it and it may lead to intervention from the Treasury, but —
— the important thing is this: we have it, and it will keep public services running in Northern Ireland after July. Therefore, I believe that the Supply resolution that she has tabled should command the support of the House.
I welcome the motion today and the opportunity to speak on it.
The Supply resolution for the Northern Ireland Main Estimates 2015-16 provides us with another opportunity to assess the areas of greatest need in the education sector. I have consistently argued that the main priority for the Assembly in its approach to education should be delivery in the classroom. Northern Ireland must consistently raise standards in the proper provision of education and, in order to do that, there must be a consistent strategy and balanced funding for all levels of a child's development.
Let me say to begin with that I fully appreciate and welcome the additional £6 million being provided to the Department. I recognise that not all Departments have been so lucky. I note, however, that this was a wise move, as, ultimately, the proper provision of education for the region will have a lasting impact for generations to come. Education forms the building blocks of our society and economy. It is primarily through education that children and young people will develop their attitudes and their views of the world. Education remains essential for gaining the tools necessary to build a fulfilling future. I call on the Minister to use the money wisely and effectively. When I say "wisely", I mean through sound financial management that empowers schools and other institutions to meet the educational needs of all young people.
The term "subsidiarity" comes to mind. The Oxford dictionary's definition of the term is that it is the idea that:
"a central authority should have a subsidiary function, performing only those tasks which cannot be performed at a more local level".
Through the local management of schools (LMS), the large majority of schools have demonstrated that they are capable of sound financial management. I have no doubt that, if other aspects of their budgets were delegated, they could do a very good job and ensure value for money. I have spoken many times about the procurement process for general maintenance. I have no doubt that schools could save thousands of pounds and redirect this to where the need is in the classroom.
With less money tied up in education administration in the Department and at authority level, primary schools could deploy resources in areas of curricular need. Science, in The World Around Us, is the birthplace of STEM. The SDLP believes there must be a more robust focus on attainment in STEM subjects and degrees to provide our young people and, as a consequence, our businesses with the necessary skills base to excel in this era of global competition.
Education funding must make proper provision for young people in order to help them reach the highest possible standards of educational achievement and, as outlined by the Estimates, to grant them a secure foundation not only for lifelong learning and employment but to develop their values and attitudes so that they may help bring new prosperity into Northern Ireland.
To allow our children to grow and develop in the most beneficial way, it is crucial that there be investment in a long-term early years strategy, as it remains essential if we are to create the building blocks for our children's educational future. Underinvestment and the lack of a long-term strategy in education not only fails our children and young people but is detrimental to our economy and to social justice. Early years funding now stands at £26·9 million, representing a noticeable drop from last year. I am once again dismayed that even the most critical years of a child's development are underfunded. The proposed reduction of £1·7 million in the early years fund creates a serious risk to 170 jobs and up to 2,500 early childhood places. Particularly worrying is the effect that such proposals will have on 620 special needs children who rely heavily on such funding to help meet their specific learning needs. The early years fund has proved vital to the development of children across Northern Ireland, by sustaining high-quality services in areas of greatest need and supporting initiatives across the region. Not only is an effective early years plan right for the development of our young people but it will help improve our local economy in the long term.
As I noted earlier, a well-educated population can bring innovation, creativity and ingenuity to the local economy. Therefore, the SDLP recognises that a child's development hinges on high-quality early childhood education. I urge the Minister to use excess resources to fund early years learning. It is at that base level that increasing investment is essential to addressing poor rates of literacy and numeracy.
I took the advice of the Speaker earlier that I do not get an extra minute.
I wish to make a couple of points on literacy and numeracy. In 2010-11, 9,000 pupils left full-time education having failed to reach the required standards in literacy and numeracy. An Audit Office report in February 2013 stated that thousands of Northern Ireland's young people leave school unable to read and write. Northern Ireland's global education position for literacy and numeracy has been on the decline since 2006. Although we need emergency measures to address the issue in late primary and early secondary school, we need to adopt a strategic approach that gets to grips with it early in a child's education — in primary school.
Youth services are another critical aspect of the personal development of young people, with the issues of proper provision and funding needing to be addressed. The Estimates state that the primary goals for youth services should be:
"Promoting ... the personal and social development of children and young people and assisting them to gain knowledge ... and, through community relations measures for young people, encouraging the development of mutual understanding and promoting recognition of, and respect for, cultural diversity".
To that end, it is crucial that youth services, from voluntary and community organisations to our very libraries, be properly and consistently funded.
When reviewing the figures, I made particular note of the almost £27,000 provided to the Department of Education by the European Union Programme for Peace and Reconciliation. I ask Members to recognise how EU membership benefits Northern Ireland, especially given the uncertain future that lies ahead. I listened carefully to the Chair of the Agriculture Committee and thought, "What would the farming community do without EU funding?".
If we are to see our economic outlook improve, we need to address the skill imbalances that characterise our island economy. Critically, those imbalances lead to lacklustre productivity and stifle levels of foreign direct investment and business start-up. Skill gaps act as an impediment to productivity and, as such, can generate lags in growth. Skills shortages refer to an imbalance between demand and supply in our labour market. Labour demands may not be fully met if the labour supply does not possess the skills to meet those needs.
We also need to address the imbalance in employment opportunities. All Departments have the opportunity to decentralise public-sector jobs. I understand the pressure that the Invest NI budget is under, but smaller, indigenous business needs a greater share of the cake.
The SDLP is only too aware of the finite nature of the resources that are available for education services and of the ongoing impasse in welfare reform. However, increased budgetary restrictions and severe Tory cuts in schools will result only in more expensive problems in school maintenance and future provision.
I have said this before and will today reiterate that sound financial planning and balanced funding are intrinsic to improving our education system. I urge the Minister of Education to allocate funding to strengthen the educational prospects of all our young children.
I will begin with a few remarks in my capacity as Chair of the Education Committee. The two votes on the Supply resolution for the Excess Votes for 2013-14 and the Supply resolution for the Main Estimates for 2015-16 are obviously interlinked.
I will first address the Excess Vote. Most of the excess — £6·28 million — is associated with the Department of Education and refers to a larger than expected cash drawdown in 2013-14. As the House is aware, the Public Accounts Committee has produced a useful summary report of all the excesses. The Education Committee questioned the Department on that in September 2014. The problem in question occurred in the education and library boards, and the Department has subsequently instituted an enhanced control framework to prevent reoccurrence. I understand that the new controls are operating well. We are obviously now also into a new scenario with the Education Authority.
Although £6·28 million is a very small amount when compared with the overall Budget or even with the £2 billion budget for Education, it is nonetheless very important that excesses of that type are avoided. I believe that the Education Committee is generally content that matters are now appropriately under control and that it will support the relevant Supply resolution.
Turning to the Main Estimates for 2015-16, the Committee has studied the budget for Education and appreciates the difficult choices that the Minister has had to make. While the Committee welcomes support for schools, it is concerned about a number of significant funding cutbacks, including, as mentioned by the Member who spoke previously, the early years fund, as well as the Sentinus STEM promotion programmes, the primary-school modern languages programme, the Book Trust Bookstart scheme and the community education initiatives. In addition, there are other challenges to the Education budget in 2015-16 and beyond.
The Committee expects that the level of uptake for teaching and non-teaching voluntary exit will be considerably lower than the target. The Department recently helpfully clarified that it never actually had a target for voluntary exit and that it was, in fact, simply "an extrapolation", as it called it. Notwithstanding the unusual semantics of redundancy, suppression and voluntary exit schemes, it appears that the failure to meet the imaginary target, or the "extrapolation" as the Department would call it, will lead to real pressures on school budgets. Indeed, the failure to meet that extrapolation is by a considerable margin; it is not something that is relatively minor.
The Department has prudently planned to make additional savings in other areas. However, it is not clear what will happen to individual schools if they do not take proper advantage of the exit scheme — indeed, if they are not given the opportunity — and consequently significantly overspend their budget. It is also not clear what the implications for school transport, school meals and other issues might be if the planned salary savings are not achieved.
The Committee was also surprised to learn of possible additional voluntary exits from the Education Authority. The Department has yet to clarify how many of those posts will be non-school based. I mention that, as the business case for the Education Authority indicated that the resource and staffing depletion had been such that the predecessor organisations, the education and library boards, had been operating at "the extremities of corporate risk". It therefore seems strange that we seem to be contemplating reducing non-school-based staffing at all. From that point of view, I suppose the issue is also whether the figures were got right by the education and library boards in the first place.
In these times of constrained budgets, an important consideration will be the impact not only on services but on risk. It is, therefore, important that spending is planned and scrutinised and that, perhaps, mitigation measures are included against inevitable additional challenges. At the risk of understatement, I suspect that this may be a very difficult year for budgets, even in the best case scenario. By that I mean that there are a few unwelcome surprises, followed by unpopular revisions. We can all agree that what will be required by schools and the education-related public sector is the minimisation of risk to services.
Having made those remarks as Chair of the Committee for Education, I will move on to some remarks in my capacity as a DUP Member, but I will concentrate on the broader level of education. We have heard, particularly from the previous contributor, about a number of areas where there should be a shift in spending in the education sector. Although I would not share his concerns over Europe, I would broadly share a lot of his concerns about education. There has been, for instance, a lack of strategic direction in early years provision to ensure that there is that level of intervention.
The only problem with that is that while we agree on all those things, unless we get the broader picture right — there are certain parties here that would take us down a different road — dealing with the margins in education will be very much dwarfed by the £600 million black hole that potentially is there in the Budget. Are we to take the advice of Mr Allister, who has, at least, indicated that these are illustrative figures? The Department of Finance and Personnel has already produced illustrative figures, so, quite frankly, why he has a desire to act as a sort of catch-up with the Minister a month later is slightly beyond me. The cynic might say that, as he is not advocating £600 million in cuts, he put down his amendment simply to gain additional speaking time.
I thank the Member for the additional speaking time. The reason for the amendment is to focus attention on the fact that we need to face reality. We cannot keep kicking the can down the road because that will just be exploited by those who love to do that. I wish to remind the House that what the Minister is doing today is precisely what, for weeks, she said she would not and could not do, which was to put her hand to a Budget with a £600 million hole in it. Yet today, that is exactly what she is doing.
That is not what the Minister is doing. She will be able to respond to that in greater detail. This did not need to be illustrated because it has already been fairly heavily illustrated. In the Department of Education, the implications of a failure to grasp this issue will, pro rata, be about £114 million. Before and since I became Chair of the Committee for Education, I have met representatives of a wide range of groups who put forward very good cases for a lot of the good work that is being done in education. I do not doubt that for a moment, and I want to see that work supported. The implication, if we ignore the elephant in the room of the £600 million, will be devastating to education.
A year ago, when we had the draft Budget, changes were made by the Department of Education and the Department of Finance and Personnel. We were staring at a reduction in the aggregated schools budget of something in the region of £78 million. The reality is that if there is an in-year gap of £114 million, that will, largely speaking, be faced directly by schools. Sixty per cent of the expenditure goes directly to schools and a lot of other areas are things that, in a very short-term context, cannot be adjusted. This will be an in-year cut. We are not debating next year's Budget today; we are debating the Supply resolution for money going directly into this year's Budget. We are going to be left with a situation where, if we do not get this correct, or people do not allow us to get it correct, instead of the nightmare scenario that was painted a year ago of the implications for teachers of redundancies and the failure to provide levels of education, it will be greater than double that, because that is £114 million in-year. That is the abyss into which we are staring.
I believe in the positive value of education. I believe that it provides opportunities to be a life changer or game changer for many individuals. However, if some people in the House get their way, that game will be changed for people massively to their detriment. We will have a meltdown of the education system and that is the stark reality that needs to be faced up to in the wider context.
This is not some long-term issue that is going to be faced, as the situation in 2016-17 is going to be; it is about what is happening now and what is going to happen in the next couple of months if things are not got right. It will have real impact on the vulnerable in our society. It will destroy life chances. It will destroy schools. It will destroy children's lives. That is what we are faced with. The Minister has brought this forward to try to protect front-line services and do what she can to bring the matter to a head in a sensible fashion. That is why I support the proposal that has been put forward by the Minister and reject the proposal that Mr Allister put forward to cut £600 million from the Budget.
In relation to the 2014-15 provisional out-turn, the Department's non-ring-fenced resource DEL underspend of £18·3 million represents 1·7% of the budget, or 0·9 % if PSNI underspend is excluded. The capital underspend of £4·9 million represents 7·8% of the budget.
The Committee discussed the underspends with Department officials, particularly the PSNI underspend of £14·9 million, given the very clear budgetary pressures that the Police Service is facing, as were articulated not so long ago by the Chief Constable on a number of occasions. Whilst there are a number of explanations for the underspend, including legal aid challenges, the cost of which did not materialise during the 2014-15 financial year, and the actions that the PSNI has taken to reduce costs, which focus on planning for the longer term, it is disappointing that such underspends occur and were not identified and declared earlier to enable the money to be used, if not by the PSNI then elsewhere, particularly when there are clear budgetary pressures on front-line services in other parts of the Department.
The Committee fully expects the Department to work more closely with the PSNI during this financial year to ensure that there is transparency and adequate information around its budget, which accounts for over 60% of the overall Justice budget, and spending plans to identify any emerging pressures or easements so that action can be taken to quickly address those issues. The Committee has also advised officials that the Department must proactively identify and manage all emerging underspends to ensure that the budget allocated is fully utilised to support the delivery of its objectives and priorities.
The Committee was also very concerned to learn from officials that Treasury has indicated that the £53 million that was intended to be carried over, under end-year flexibility, for the Desertcreat community safety training college is not available and that, assuming that the college goes ahead, the entire funding will have to come from the block grant. The Committee is of the view that, the sooner a decision is made on how and, indeed, whether it should proceed, the better for all concerned.
In respect of the 2015-16 Budget and some of the key pressures that the Department of Justice is facing, the Minister has had to prioritise funding allocations to protect the delivery of front-line services. The result is severely reduced budgets in many areas of the Department. I previously highlighted the Committee's concerns regarding an approach to cutting spending that does not include a cost-benefit analysis or an analysis of the impact on and cost to other areas of the criminal justice system or other Departments, such as Health. The Committee still has concerns that, by reducing funding to projects that aim to prevent offending and rehabilitate offenders, such as those provided by NIACRO and other voluntary organisations, it will increase costs in the longer term for not just the police but the Courts and Tribunals Service and, ultimately, the Prison Service, thus negating, at least in some part, any savings that may be made in the short term.
Whilst it is clearly difficult to live within reducing budgets, the Finance Minister will know from her previous role that, much in the same way that the private sector used the financial downturn to make its businesses more efficient and look for innovative ways in which to do things so that they are in better shape coming out the other end, reductions in public spending should be used by government as a springboard for change. We should look at how we do things and whether new, innovative approaches could be brought forward to save money and improve outcomes for service users.
That is why I instigated a series of Justice Committee seminars that looked at approaches that could be adopted here in Northern Ireland. The first three seminars that we hosted focused on youth justice issues. Three more will take place in the autumn, covering early intervention projects and other initiatives that we believe could be implemented here in Northern Ireland. The seminars bring together key representatives in the justice system — the judiciary, the PSNI, the Department, the Probation Board, the Youth Justice Agency, the legal professions and, of course, voluntary organisations — to discuss areas for improvement and new initiatives. We, as a Committee, intend to assess the information gathered and identify ideas and new ways of working that could be implemented in the justice system here to deliver more efficient services whilst maintaining the standards that we require.
The Committee is also considering initiatives being taken forward in other jurisdictions and will undertake a visit to London before summer recess to meet the Lord Chief Justice, the Centre for Justice Innovation, the Civil Justice Council and Sir Brian Leveson, who has completed a review of efficiency in criminal proceedings in England and Wales. The purpose of the visit is to explore innovative ways to speed up the justice system and make it more efficient through increased use of digitisation in areas such as court listings, online courts and online dispute resolution. The Lord Chief Justice in Northern Ireland has welcomed the approach that the Committee has taken in these areas.
While the Committee will carefully scrutinise the Department’s budget and spending plans, as I have outlined, we also intend to identify possible new approaches that, if adopted, could assist in delivering efficiencies in both the short term and, crucially, the longer term.
Specific in-year pressures that have already been identified by the Department include a range of potential pressures in relation to pensions, including increased employer contribution rates for the main unfunded public service pension schemes from April 2015, for which the Department intends to bid for £7·4 million in the June monitoring round. The creation of the Legal Services Agency and the associated transfer of staff from the Northern Ireland Local Government Officers' Superannuation Committee (NILGOSC) to the Principal Civil Service Pension Scheme (PCSPS), and the costs associated with the transfer of Youth Justice Agency staff to those two schemes, are also creating pressures, although the extent is not yet clear. There is also the potential for a very significant pressure in relation to fine default imprisonment, depending on the outcome of test cases which the Department has indicated it cannot fund within existing resources.
Unfortunately, yet again, the main pressure faced by the Department, even at this early stage of the financial year, centres on the cost of legal aid. Despite the fact that the Department increased the baseline for the Legal Services Agency by using some of the Executive's 2015-16 allocation and implementing larger-scale reductions to other budget allocations, a legal aid pressure of approximately £20 million is already being forecast. The Minister of Justice, when he appeared at the Justice Committee meeting on 28 January, indicated that the key risk to the Department being able to live within its budget is legal aid spend. At that time, he stated that he would be proposing a range of further reforms to manage the pressures on an in-year basis, and it is clear that action is required to address the cost of legal aid on both a short-term and, crucially, a longer-term basis. A failure to find resolution to the legal aid issue will result in impacts on the funding for front-line areas such as the Prison Service, the Court Service and the Probation Board.
Turning very briefly to the Department's savings delivery plans, it is clear that a wide range of savings have had to be made, many of which will impact on the service provided to the public. One example is the relocation of the tribunal hearing centre to the Royal Courts of Justice. Given that the dedicated tribunal centre provided an informal environment for appellants who are often unrepresented and vulnerable and that the Royal Courts of Justice presents a very formal setting that is not in keeping with the original ethos of tribunals, this is far from ideal.
Other examples include reductions in staff in youth justice services, and the operational capacity of the Probation Board is being affected, which will have a direct impact on its delivery of front-line services including the supervision and monitoring of offenders.
The Justice Department is facing substantial budgetary pressures during 2015-16 that will have to be carefully managed to ensure that key priorities and targets continue to be delivered to the required standard. As I said earlier, this does, however, provide a driver and a challenge to look at doing things differently and more innovatively. The Committee intends to play a key role in doing just that.
I now want to speak very briefly as Chairman of the Ad Hoc Joint Committee on the Mental Capacity Bill and highlight the cost that will need to be met if this Bill becomes law. We will have the Second Stage of that Bill tomorrow, and I hope that Members will significantly interrogate the costings that would be required if we were to pass it.
The Department of Health, Social Services and Public Safety and the Department of Justice have estimated that somewhere between £75 million and £129 million will be required in the first year to implement the legislation, with the associated annual costs estimated at between £68 million and £102 million. These are substantial costs that are currently not budgeted for and that will, even at the lower end of the estimates, represent a significant pressure on the budgets of both Departments, both in the first year of implementation and then on a recurring basis. In my view, the magnitude of the cost is concerning, particularly given the pressures already being faced by both Health and Justice and the other competing priorities that they face. It would be remiss of me not to highlight that at this stage.
I welcome the opportunity to contribute to the debate on the Supply resolution and Main Estimates 2015-16. The Environment Committee was first briefed on the draft Budget by officials from the Department of the Environment in November 2014. That was followed by a further briefing from officials in February 2015. In March, the Minister also agreed to attend the Committee to brief it on the final Budget and the consequences that it will have on the Department and the services that it provides. There is no doubt that, as a result of the parties opposite deciding to hold each other's hand in the economic wilderness, we face not just a tsunami of financial consequences and penalties but a threat to the very institutions of government. Departments now find themselves in the almost impossible position of delivering services whilst barely knowing from one week to the next what further cuts they will be asked to make or what further penalties might be imposed on them.
Perhaps, when the members of Sinn Féin next travel to America with their fundraising begging bowl, they might consider telling their audience about the millions of pounds of taxpayers' money they throw away every week back at home. Their economic strategy, it appears, leaves much to be desired.
The Environment Minister can turn to his colleagues around him, and to his partners in denial in Sinn Féin, and thank them for allowing his Department to suffer the hardest budget hit of any Department, a headline reduction of 10·7%.
As the Chair and Committee members acknowledged, there are existing obligations that the Department is statutorily obliged to pay, such as the derating grant to councils. The Department received an additional £2 million in the draft Budget and £1·9 million in the final Budget to restore that grant to its opening baseline position, but there remains a £1·3 million shortfall, which the Department is bidding for in the June monitoring round. That, coupled with the fact that 60% of the DOE's budget covers salaries, means that other areas in the Department will receive a larger percentage reduction.
Of particular concern to me is the uncertainty now felt by the Environment Department's NGO sector. Those organisations consist of thousands of people who are passionately committed to every aspect of our environment and carry out such valuable work on behalf of us all. If the DOE is taking its responsibilities seriously, those organisations and the work that they do should be described as vital. I welcome the fact that the Minister has finally seen sense and engaged with them, leading to the creation of the £1·25 million natural environment fund. My fear is that whilst that fund may provide some easement, it does not go nearly far enough. Once the groups cease to exist, their expertise will be lost, and we may never get them back. The consequences for the environment in that scenario do not bear thinking about. The loss of valuable services may lead to EU infraction fines and the loss of valuable research into our biodiversity and historic environment. I am aware that the Department has bid for an additional £2 million for environmental programmes in June monitoring and that that is one of its preferred bids.
I have further concerns about the impact of budget reductions in other areas, such as road safety. In recent weeks, our country has witnessed absolute carnage on our roads, with horrendous loss of life and many lives subsequently destroyed through the suffering of the families left behind after a tragedy. It is an absolute travesty to say that we can no longer afford to raise awareness or take preventative action. Those in the Chamber who fail to support Budget reform will, no doubt, be called to explain their reasons to the heartbroken victims of road tragedies. With the number of road fatalities rising, the Department's bid for £1 million in June monitoring to restore the level of funding for road safety communications in line with 2014-15 levels is particularly important. It is also important that the Department of the Environment looks carefully at how it plans to deal with the ever-increasing road fatalities and injuries in Northern Ireland and at more effective and creative ways of delivering road safety messages.
With such a large proportion of DOE's budget relating to salaries, I am pleased that the Committee has pressed the Department, at every opportunity, to determine the exact saving should money become available from the voluntary exit scheme. The Department has a target to reduce its staff by around 400 posts, which will go some way to addressing the other pressures. The Committee is keen that the Department act swiftly and strategically to reallocate savings to priority areas, if and when that money becomes available. I ask the parties opposite to consider how they plan to reform public services should the voluntary exit scheme not have sufficient funding to proceed.
Finally, I turn to the £58 million of capital allocated to the Department. Some £50·5 million is for financial transactions capital funding for the Arc21 development in my constituency. I seek assurance from the Finance Minister that, should the Arc21 planning application for Mallusk not be granted, that loan money can be handed back and allocated, if need be, to another project or even to another project in another Department. It is worth pointing out the fact that here is mass public opposition to the project in Mallusk and more viable and non-controversial options exist.
I could join colleagues by getting up and completely ignoring the countless elephants in the room. I wonder about the sheer credibility gap, as it used to be known in American politics, between the politics of what we are discussing and the realities of where we actually are.
I look at and listen to colleagues with great respect. I must say that, for many months, those sitting on the SDLP and Sinn Féin Benches clung to the great hope that Labour was going to win the election. I must say to them that I have some upsetting news: last time I looked, the Tories won. If you do not like it, that is too bad; the Tories won, and they are the elected Government of the United Kingdom.
(Mr Principal Deputy Speaker [Mr Newton] in the Chair)
Those who thought that, under Labour, it would all have been so different should perhaps read the interview given by the shadow Secretary of State for Northern Ireland in 'The Irish Times'. I will quote a couple of highlights. He makes it emphatically clear that neither Sinn Féin nor the SDLP would have had an ally in the battle to compel the British Government to row back on welfare reform in Northern Ireland. He makes that quite clear:
"All the parties, including Sinn Féin and the SDLP, have to demonstrate a willingness to make responsible, tough choices and not to look at the Westminster government and expect blank cheques".
He goes on to ask why there should be in Northern Ireland:
"'a far more generous scheme' than was available to his own Bury South constituents in England"
— and so on and so forth. It is quite clear that Labour policy would have been no different, or would have differed very little, from that of the Tories. During the election campaign, the First Minister estimated that the difference between the future plans of a Conservative Government and a Labour one was as little as £1 million.
Look across the water to our colleagues in Scotland and listen to them on welfare. They are held up as a great example of fighting the Tories. Alex Neil, the SNP Cabinet Secretary for Social Justice, talked about three things he would change about welfare: the bedroom tax, fortnightly payments and housing benefit to be paid directly to landlords. Does any of that sound familiar? It would suggest that we have done or were about to do exactly what our Scottish friends would like to do.
However, we are in the process of driving the Northern Ireland Assembly and the Executive into crisis. As was pointed out by Dr Farry and Mr Wilson, the Scots and the Welsh are talking about taking on the majority Conservative Government, but they are not plunging their institutions into crisis. No one is talking about taking powers away from Cardiff Bay or Holyrood; they are talking about increasing the powers of those institutions. We have Sinn Féin talking about getting more powers over tax and saying, "If only we had control of this, we could change it". In broad terms, I am a supporter of more tax-raising powers being devolved to this Assembly and Executive but only in the context of a reformed Assembly that has a functioning Executive arm, which could make some of this work.
We seem to have completely closed down the debate and the realities on welfare. We have moved so far away from the broad principle that work should pay that many families who have people in work are worse off than those on benefits, and that situation should not be sustainable.
I listened to Mr Rogers talk about early years and I agree entirely. During one of the welfare debates, I spoke at length, saying that the idea that we are spending £564 million over the next six years, and cutting early years intervention to pay for it, is absolute madness. Yet that is exactly what we are doing by not dealing with welfare. We are neither fish nor fowl, effectively: we are not doing welfare and we have no budget. So, how are we going to pay for any of this? A key part of any Government is delivering Supply and a Budget. In normal parliamentary democracies, if a Government cannot do that, that Government fall and you have an election. Our difficulty is that we do not know what an election would solve. Would it bring back the same people with the same problems, with no alternative and no viable opposition in place as an alternative Government?
I agree with colleagues who point out that it is incumbent upon all members of the Executive to vote for this, because they are bound into the Executive. In some of the previous Budget debates I quoted from John Fitzgerald Kennedy. I am going to quote, now, from another Kennedy, but this one is from Bessbrook. I want to quote Minister Danny Kennedy from last week:
"More than ever, the debate highlights the fact that our current system allows those in government to behave as though they are absolutely removed from it and as though they are in opposition ... Sadly, for people in Northern Ireland, some here today seem much more comfortable with the character of opposition — a harum-scarum opposition — rather than the responsibility of government." [Official Report, Vol 105, No 5, p16, col 2].
The parties that are in the Government should step up and act like they are in the Government. Those of us who are in opposition are free to make those choices, because we do not bear the responsibility of government, and do not get extra speaking rights, ministerial cars and the perks of being members of the Executive.
The real tragedy is the impact that all of this is having on Northern Ireland. We look like we are lurching from crisis to crisis: and we are. During recent weeks, I attended an Invest NI event in South Down — at the very successful Irish Open — and I was away with the Assembly and Business Trust at Mr Ó Muilleoir's conference, New York-New Belfast. The one message we got, in all of those places, was about stability, and yet we are expecting Invest NI to go out and sell Northern Ireland on stability and corporation tax, neither of which this Minister, nor the economy Minister can guarantee. None of that can be made to happen. There is a disconnect from the realities of finance and welfare here, all bogged down in the idea of a Dáil election and what would happen with that.
As I pointed out before, if this place were a sovereign government, the IMF would be running it, not anyone else. We are in the fortunate position that we get a huge fiscal transfer from Westminster. The Greeks were held up by Sinn Féin as a model, as comrades and as an example, but now they are finding it increasingly difficult. They are trapped in a monetary union with no fiscal transfer from the Germans to help them out. We are very fortunate that we are in a political, monetary and fiscal union in the United Kingdom and that we enjoy a £10 billion a year subvention that props this place up.
Meanwhile, we put off all the difficult decisions. We have delayed on public-sector reform. If we had implemented recruitment freezes four years ago, we would not have needed to borrow £700 million to deal with that. We could have borrowed £700 million and made the case for infrastructure. There are many things in the Stormont House Agreement, and, when the Minister responds to the debate, she might want to comment on who all she thinks still supports the Stormont House Agreement. Where does this leave the £700 million for the voluntary exit scheme? If she did get that over the line, would it be enough to ease her financial problems? Where does it leave the £350 million of borrowing for other infrastructure problems? Where does it leave the asset sales? Have we commenced with any asset sales?
I welcome the opportunity to outline the Committee for the Environment's views on the Supply resolution Main Estimates 2015-16. The Committee was first briefed by officials from the Department of the Environment in November 2014 on the draft Budget, followed by a further briefing in February outlining changes. The Minister briefed the Committee, at its request, in March on the final Budget and the impact that it will have on the protection of the environment.
The Committee is aware that DOE has been the hardest-hit Department, with a headline reduction of 10·7%; therefore, it is particularly important that the Committee scrutinise and challenge the Minister on his priorities and budget allocation. Committee members challenged the Minister on his allocation to necessary expenditure. The Committee acknowledges that the Department is obliged to pay the derating grant to councils. Having received an additional £2 million in the draft Budget and £1·9 million in the final Budget to restore that grant to its opening baseline position, there remains a £1·3 million shortfall, which the Department is bidding for in the June monitoring round. That, coupled with the fact that 60% of DOE's budget covers salaries, means that other areas in the Department will receive a larger percentage reduction.
That has certainly been felt by the Department's NGO sector, many of whom now face an uncertain future. Towards the end of March, many organisations received letters from the Department advising that their funding will cease in June. Indeed, some were given notice that funding would not be available after March. The Minister has, late in the process, engaged with those organisations and has created a new natural environment fund of £1·25 million, replacing the well-established natural heritage grant programme. While that may alleviate some of the pressure, it does not go nearly far enough, and concerns remain for the longer-term stability of the sector.
An unrealistic budget for environment programmes will ultimately have implications on the protection of the environment, the retention of skills, and the sector's ability to leverage other funding. It might lead to EU infraction fines and a loss of valuable research into our biodiversity and historic environment. The Committee is aware that the Department has bid for an additional £2 million for environmental programmes in June monitoring and that that is one of the Department's priority bids. The Committee will keep a watchful brief on that matter.
The Committee also raised concerns regarding the impact of budget reductions in other areas. Members encouraged the Minister to look at alternative and innovative ways of communicating messages on road safety more effectively to a targeted audience to make a bigger impact. With the number of road fatalities rising, the Department's bid of £1 million in June monitoring to restore the level of funding for road safety communications in line with 2014-15 levels is particularly important.
Mr Principal Deputy Speaker, 1 April saw the implementation of a significant change to how Northern Ireland is governed, following the transfer of many functions to local councils. The Committee had previously expressed concerns that a reduction in the rate support grant for less well-off councils would lead to a reduction in service delivery or an increase in rates. The Department's largest resource bid in June monitoring, £2·8 million, will bring the grant back in line with previous levels of funding.
With such a large proportion of DOE's budget relating to salaries, the Committee has pressed the Department at every opportunity to determine exact savings should money become available for voluntary exit. The Department has a target to reduce its staff by around 400 posts, which will go some way to addressing its other pressures. The Committee is keen that the Department act strategically to reallocate savings to priority areas if and when that money becomes available.
I will now speak about capital. Of the £58 million allocated to the Department, £50·5 million is for financial transactions capital funding for the Arc21 development. Committee members expressed reservations about the allocation of that money, particularly as planning permission has not yet been granted for the development. The Committee sought reassurances that funding would not influence the outcome of the planning decision.
The Committee is aware that the Department is bidding for a total of £3·41 million of capital and £12·65 million of resource in the June monitoring round. Much of the resource bid is either to restore funding to previous levels or to cover unfunded commitments. The Committee will continue its scrutiny role to ensure that the Minister allocates any additional funding that he might receive to priority areas.
Patently, there is a major crisis in the public finances of Northern Ireland and in the governmental institutional arrangements in Northern Ireland. Else we would not have reached the ridiculous level of proposals being brought for public spending, where those who bring them know that the money that they are voting to spend, they do not have and will not have, because of the logjam created over welfare reform. It is clear that there is a crisis, but it is equally clear that this is a crisis made in Stormont. It is not anyone else's fault: it is made in Stormont. It is a crisis made because of the inevitable consequences of the form of government that we have. It is a crisis epitomising the failure of mandatory coalition in this Province, and it has come to the point at which it looks as though it could well perish on the rock of financial issues. Whether it is now or later, that is the reality because, at the heart of government, there is a party that does not want to make Northern Ireland work; that is quite happy to bankrupt Northern Ireland; and that has no interest in fiscal probity or in making sure that we pay our way, that we have the money to pay our bills or that we meet our national obligations. Now that it has the ball at its toe, it is taking full advantage of the situation. Today, we are giving an opportunity for more of the same. Kick the can down the road rather than face the reality and the fact that the system is grinding to that inevitable halt. Of course, the kicking of the can down the road gives those best experienced in exploiting every situation more opportunity to twist and turn and to do all the things that they do best.
From this fantasy Budget discussion, I suppose it is no great surprise that we have had fantasy-plus in the debate, most particularly from Sinn Féin Members, who talked in wild, extravagant, crazy terms about what needs to be done. When you strip it down, you find that the sophistication of the Sinn Féin message to the British Government was this: "Butt out, but leave your chequebook." That really is the lamentable sum and substance of Sinn Féin's approach to our governmental finances. Little wonder, with a veto —
Will he accept that no chequebook will be left when the Government know that they have people who will continue to write cheques ad nauseam in the irresponsible way that Sinn Féin will, even though they cannot even stick by the agreements that they made?
Sinn Féin is very happy to spend other people's money, and if it is the British Government's money, so much the happier it will be. That is the situation we have got to.
This really brings to a crystallising point the failure of these institutions. In a way, it is indicative of the oblivion that these institutions deserve if we have got to the point of playing pretend with the public finances. That game of pretence speaks of a dismal, failed Executive deserving only of oblivion. In fact, it reminds me of some well-known words from Shakespeare that might be the epitaph of this Executive:
"Last scene of all, that ends this strange eventful history, is second childishness and mere oblivion".
Of this Executive it could be said, "sans Budget, sans credibility, sans legitimacy, sans everything".
There you are — 52 minutes. Excellent. The debate has covered many aspects relating to public expenditure, as well as many aspects not relating to public expenditure, it has to be said. Nevertheless, I will endeavour to address as many points raised as I possibly can in the time very generously allocated to me.
There are three categories of people who have spoken today in the debate. The first is those who are imbued with a sense of realism. They have spoken to support the motion with varying levels of enthusiasm. I accept that, and I understand it. This is certainly not the set of circumstances that I would have chosen for my first substantive debate on the Supply resolutions, but, of course, that is not of my making. It was not my party that reneged on the welfare Bill at the very last stage, thereby causing the difficulties that we find ourselves in today.
However, just to be clear, especially for Mr Allister, this Budget is predicated on welfare being dealt with. His argument that I have in some way moved my position is a fallacy, as I am consistent with what I have said all along, which is that we in my party would certainly not put our hand to a cut of the kind that he is advocating today. The only way that this Budget works is if welfare reform is enacted. I cannot be clearer than that, and, as far as I am concerned, the sooner the better.
The second category of people —
The Minister is on record many times in the public media saying that, if welfare reform is not addressed, we would be in a situation where we could not produce a Budget because we could not balance the books and she would bring only a balanced Budget. Today, she is bringing what is effectively an unbalanced Budget. It is in that respect that she has done the U-turn in kicking the can further down the road.
I have not — I wish the Member would listen to what I have said: it is predicated on welfare reform being enacted, and therefore it is a balanced Budget. The second category is his category, namely those who know that they can put forward proposals safe in the knowledge that they will not pass. Mr Allister can put forward a 15% year-on-year cut to the Budget safely knowing that it will not happen. We have not heard from Mr Allister today — he has had ample opportunity to tell us — on where he would cut in the Department of Education in terms of schools or the Health Department in terms of nurses. We have not heard any of that today from the Member, who is looking straight at me and wants to get in.
Thank you very much. I have made it very clear that the purpose of the amendment is to bring the issue to a head. The Minister thinks that by kicking it down the road some day we will pull in the Secretary of State and she will have to do something. I am saying — it is patently obvious — that there has been more than enough time to sort this failure of the Executive. Bring it to a head now by demonstrating that the Budget is unworkable and force the hand of the Secretary of State to do the things that the Minister really wants her to do.
I notice that the Member did not take the opportunity to tell us where the 15% cuts would be enacted.
Anyway, I move on to the third category of people who have spoken today: what I call the "you couldn't-make-it-up group". That group has two subsections. First of all, we have the SDLP, who continue to ask ad nauseum for more money without any indication as to where it is coming from. Of course, the second subsection of that group is Sinn Féin, who have absolutely no sense of irony when they seek to lecture the Westminster Government on their "economic incompetence". The party that advocated clearing people's credit cards as a policy platform at the Westminster election is lecturing others about economic incompetence.
According to Mr Ó Muilleoir, he is not here to carry water for English Ministers, but frankly, if Sinn Féin and the SDLP get their way, that is exactly what we will be doing — if even that — in the utopia that they are driving us towards. Neither the SDLP nor Sinn Féin has given us any indication as to how we pay for what they are advocating. I am not surprised by that, because throughout this process we have asked for alternatives and different ways of doing things, but no solutions have been brought forward. It is my party that has to always come forward with solutions to the problems that we find ourselves in.
I want to move on to the particular issues that have been raised by Members. Mr Allister took the time to read the DFP Estimates manual. I am not sure that there are too many other Members who have taken the time to read the Estimates manual and quote from it. He highlighted that the manual explains that the Supply Estimates are a critical part of public spending control, which is absolutely right. The key point is that the Assembly can only vote on spending plans agreed by the Executive and brought forward by me, as Finance Minister. The Assembly cannot propose new figures, as the Member suggested. That does not make this vote any less important: it is vital. However, only I, as Finance Minister acting on behalf of the Executive, can bring forward the figures.
Mr Allister also made the point —
On a point of order, Mr Principal Deputy Speaker. If what the Minister just said is correct, would it not be so that the Speaker, in permitting this amendment to be on the Marshalled List, is failing? I believe that the Minister is wrong and that this Assembly has the power, and indeed the requirement, to approve the Estimates in the manner in which it wishes to approve them.
It is my belief that only the spending that comes from the Executive can be voted on. That is not just my belief; it is the legal opinion of my departmental solicitors.
Mr Allister also made the point that the Estimates that are being taken through now are too high and that any changes must be agreed by the Executive after today. I am acutely aware that we need to have, as I have indicated, the implementation of welfare reform to ensure that the Budget is sustainable, not just this year but into the future. The alternative is completely unpalatable, with significant reductions required in-year. It is certainly not about kicking the can down the road. The SDLP and Sinn Féin need to sign up to welfare reform, as agreed at Stormont House, or Westminster needs to act. Either of those two elements need to be dealt with sooner rather than later.
It is not unusual to take through Main Estimates that need to be amended through the financial year; the Finance Minister brings proposals to the Executive through the monitoring rounds, and, once agreement has been reached, these changes will ultimately be reflected in the spring Supplementary Estimates for endorsement by the Assembly. This year is no different in that respect, although I do accept that the uncertainties are more severe.
Mr McKay mentioned the welfare reform study that has been conducted. The report is helpful in understanding the context of welfare reform, and it is my intention to release it to the Committee for its perusal in the next few days. Mr McKay also raised the legal position of the use of accruing resources, and I am confident that the legal advice that I have received is robust. I have taken into account the position taken by the Committee, but hopefully the progression of this Budget Bill will ensure that neither legal position needs to be tested.
The expected quantum and spread of savings across Departments from the voluntary exit scheme is being calculated by the working group under the direction of the head of the Civil Service, and hopefully those figures will be available shortly as well. However, before those figures can have any meaning at all, the Stormont House Agreement needs to be implemented in full because, of course, all of those things are part of the same agreement.
Paul Girvan mentioned the Excess Vote for the Department of Education. I entirely agree with the Member that arm's-length bodies need to be accountable for their expenditure and that they need to deliver value for money for the taxpayer. To be clear, the Excess Votes relate to the 2013-14 financial year, when the Department of Education breached its Vote's amount. I note that steps have been taken by the Department that there will not be a repeat of this situation, and that has been confirmed by the Public Accounts Committee's recommendation.
I am sure that my colleague the Minister of Health will have been interested to hear what Mr McKinney said. He indicated that welfare reform had no impact on the Department of Health. I find this amazing. As Finance Minister, I completely refute that claim. The failure to implement welfare reform has resulted in substantial financial losses for Northern Ireland. For example, this year alone, the block will lose some £114 million in welfare reform penalties. The House will know only too well the financial pressures that our health service faces. Undoubtedly, the Health Minister could have made significant use of an additional £114 million. I have no doubt about that at all. When you listen to people saying that they are protecting the vulnerable, think of the use that that £114 million could have been put to. Think of what it could have been used for. Think of the difference that we could have made to people's lives by £114 million going into the health budget.
I thank the Minister for giving way. Of that £114 million, the Department of Health's allocation is well over 40%, equating to roughly £1 million each week that the health service is being starved of. That is money that should be spent on increasing nurses' wages and increasing midwives' wages. It is money that should be spent on people's hip operations and knee operations. It should be spent on domiciliary care for the elderly, but, as a result of the actions of the parties opposite, we are in a situation where those people are being denied that service and the health service is being starved of money as a consequence of their grossly bad behaviour.
I thank the Member for his comments. I do not know whether he was in the House when Mr McKinney made comments about Transforming Your Care (TYC), which I know that the Member has a particular interest in. Mr McKinney indicated that implementing TYC is about implementing a new model of care. That is right. It will see the home as the hub of care, and, to achieve that, it is important that we build the right services to achieve the vision and that services are sustainable. I do welcome the progress that has been made to date. That progress has seen the creation of 17 new integrated care partnerships across Northern Ireland, which are working to improve the coordination of care and support in key areas such as the care of the elderly and the treatment of chronic conditions, such as diabetes, stroke and respiratory conditions.
Clearly, more has to be done. More will be done, but the Member should note that transition to the new model of care is a long-term process. It will not happen overnight. It takes time to change a health service to deal with a new model of care. I welcome the savings that the Department of Health has made to date. This year alone, the Minister has committed to delivering savings of some £164 million.
Mr McKinney also raised the issue of the Chancellor's in-year reductions. I can confirm that the Executive's Budget will be reduced by £33 million in resource DEL and £5 million in capital DEL. Her Majesty's Treasury has given us some flexibility in the timing of the reductions, and I will bring proposals to the Executive as part of June monitoring and will, of course, report the outcome of June monitoring to the House in due course.
Michaela Boyle raised the issue of more powers to manage the economy and criticised the United Kingdom Government. The Member conveniently failed to mention that the fiscal deficit is in the region of £9·6 billion, and she did not provide any strategy to reduce it. She did, however, give a knighthood to George Osborne, which I found very interesting, referring to him as "Sir George Osborne". Sinn Féin is now in the business of giving people knighthoods. Moreover, reneging on the Stormont House Agreement has put the devolution of corporation tax in the balance, and we heard the comments made by her colleagues over the weekend in that regard.
Mr McGlone, speaking about the DETI budget allocation for 2015-16 in his capacity as Chair of the Committee for Enterprise, Trade and Investment, referenced the 15·1% reduction in DETI's baseline and expressed concerns about the impact on Invest Northern Ireland's activities. I reassure the Member that the final Budget settlement agreed by the House in January resulted in a net increase of £18·6 million in the 2015-16 DETI resource budget, enabling Invest NI to create legally binding commitments that have resulted in unprecedented success, as we have seen from their recently published results. We know that that will continue under the leadership of the new Minister and Alastair Hamilton in Invest NI. We have allowed them to promote new jobs, drive investment in research and development and support companies to grow export sales.
Mr Irvine — Irwin, rather; I nearly gave him a new name. Mr William Irwin gave the view of the ARD Committee and mentioned bovine TB as one of the key challenges facing the sector. I am aware that, whilst the most recent figures report a reduction in the number of TB herd breakdowns, there has been an increase in the number of reactor animals. While we cannot lose sight of the negative impact of bovine TB on our local farmers, we must also be cognisant of the cost to the taxpayer, particularly given our current budgetary position. The total cost of TB compensation payments in 2014-15 was £14 million. As the Member highlighted, the Agriculture Minister has already flagged up the need for additional funding in this financial year. There is, therefore, a clear need to explore all means of eradicating bovine TB, including the modernisation of our compensation regime.
(Mr Speaker in the Chair)
Mr Irwin also, along with a number of other Members, raised concerns about the use of accruing resources. The accruing resources that a Department may use are subject to a limit set by the Budget Act. As I said in response to the Chair of the Finance Committee, I have received legal advice from the Departmental Solicitor's Office that accruing resources cannot be used in the absence of a Budget Bill, because the limit has not been set. If there is no limit, we cannot use the accruing resources. That would have serious consequences for items such as the single farm payment, and that is why I very much want to progress the Budget Bill to avoid such a situation. I encourage Members to think carefully about how they vote today, bearing in mind the huge issues out there, particularly, in this case, for our farmers.
I declare an interest as a recipient of single farm payment, Mr Speaker. Will that not be hugely worrying to a sector and an industry that you are trying to promote through the agrifood strategy? Adding to very poor trading prices — particularly in the milk sector but also for beef and lamb — difficulties or uncertainty about whether single farm payments will be paid either on time or in full is a hugely detrimental place to be.
I understand the Member's concern, not just from a personal point of view but as someone representing his constituents. It is one of the reasons why I have already looked into whether there are other ways in which we could deal with that matter. I hope that we do not have to go down that road. I hope that the Budget Bill will be passed and that we will, therefore, have access to accruing resources, but we have looked at whether we can put the money through the Rural Payments Agency, for example, instead of it going to DARD. I am hopeful that we will not get to that point.
Mr Hilditch, speaking on behalf of the Audit Committee, raised the issues of Audit Office savings and voluntary exit. I welcome the commitment of the Audit Office and, indeed, the Audit Committee to find efficiency savings to ensure that the Audit Office remains within its agreed budgetary settlement. I can confirm that the transformation fund will be open to bids from the Audit Office. However, it must be recognised that the Audit Office is not alone in seeking transformation funding and that all applications to the fund must be strictly assessed on merit. The Member must also be aware that, as Finance Minister, I cannot give a commitment that any funding bids received during in-year monitoring will be met. Such decisions are, ultimately, a matter for the Executive and are dependent on the financial pressures faced and the funding that may or may not become available.
Mr Cree raised a number of issues around the 2014-15 financial year. Whilst the provisional out-turn is not strictly related to the Supply resolution before us today, I confirm that I will report it to the House with the conclusion of the June monitoring round. However, I can reassure the Member that I expect the out-turn to come within the Budget exchange scheme limits set out by the Treasury, so there will be no money returned.
Mr Cree also raised the review of financial processes. I share his concern that that has not been progressed. The Member asked for an update on the Northern Ireland investment fund. I confirm that the fund is still at the formative stage, but I hope that it will lever in additional funding that will help to boost investment and promote economic growth in Northern Ireland. As a first step, the Executive have agreed to commission a feasibility study that will help to determine the optimal structure, scale and investment strategy of the fund. I am pleased that the consultants, Deloitte, have been appointed to advance the study, which I expect to conclude in the next few weeks. The feasibility study will also inform the ideal scale of the fund, but, in the interim, the Executive have decided to set aside an initial £40·9 million of financial transactions capital. We can further review the funding requirements once the feasibility study has concluded.
The social innovation fund has been established to utilise dormant account moneys in Northern Ireland. It was announced as part of the final Budget in 2015-16. There is some £6·4 million available to us. Those funds are in addition to our public expenditure. There has been significant interest in the fund from public representatives since the final Budget announcement, and a public consultation will be launched as soon as possible to seek views on the proposed spending priority of social investment. In addition, the consultation will test options for utilising the fund that will ensure that the fund can be recycled into other social investment schemes. That will include the consideration of match funding.
Mr Clarke, on behalf of the Regional Development Committee, mentioned the Coleraine to Londonderry railway line. I, too, am very pleased that work on phase 2 of the line is going ahead and that it will facilitate hourly services. Like him, I was concerned about the escalation of the costs of the project, which resulted in the Minister for Regional Development having to make a statement to the Assembly back in November acknowledging the errors that had been made with the cost estimates. The project is proceeding at a cost of £46·4 million, and, given the history of the project, the onus is very much on the Regional Development Minister to ensure that the costs are kept under review.
I agree entirely that, in the current financial climate, it is only right that an organisation such as Translink, which receives a substantial subsidy from the taxpayer every year, shares the burden of public expenditure pressures. I understand that, while Translink's results for 2014-15 have not been finalised, its reserves will be reduced considerably compared with previous years.
As far as the current year is concerned, I understand that the company is being required to work to an increased deficit of around £15 million, which is being funded from its reserves. That can reflect DRD's assessment of what Translink can contribute.
Mr Clarke also commented on the funding that the Executive have secured from the European Union, particularly for investment in road infrastructure. One such road project that has benefited from such funding is the A8 Belfast to Larne dual carriageway scheme. That work is almost complete and is expected to be open to traffic shortly. We are looking forward to DRD, hopefully — I think that it is confident — securing up to 40% EU funding for the proposed York Street interchange scheme, which, of course, is also vital.
Pam Cameron mentioned Arc21 and asked what will happen to the financial transactions capital that was allocated to it if the project does not proceed, because, as we know, it does not yet have planning permission. If that is the case, that money can be transferred into the proposed Northern Ireland investment fund. It will not be lost, and we hope that it can be used for further investment.
Mrs Cameron and Anna Lo also praised the work of the voluntary and community sector organisations that are involved in environmental work. Both mentioned the recently launched natural environment fund, which will allocate £1·2 million to environmental groups to help them to deliver on key environmental outcomes. It is worth highlighting the role that the carrier bag levy has had in that fund, thanks to the agreement that my Department secured from the UK Government to retain the income from that levy for use in funding. It has provided a secure income stream that is forecast to be £4·75 million this year, which can be used by the Department of the Environment to fund the sort of organisations and programmes that the Chair and Mrs Cameron spoke about.
Finally, I want to mention Mr Ó Muilleoir, who again talked about fiscal levers and wanted fiscal autonomy. Mr McCallister's point about the credibility gap was very well made. How can we possibly argue for more fiscal powers to come to Northern Ireland when we cannot deal with the powers that are already devolved? We all share a vision of our economy supporting our people, but you cannot simply ignore the fiscal deficit of £9·6 billion. We have to acknowledge the reality of where we are, what that means for the economy and Budget rather than pretending that that simply does not exist.
I thank the Minister for giving way. She refers to the £9·6 billion. Indeed, other members of her party referred to a £10 billion deficit. That figure comes from a report by her Department and her predecessor. Obviously, we have a great deal of difficulty accepting it as a credible report. The London Government and their Office for National Statistics clearly do not accept that it is credible either.
I will tell you what is not credible: the current Sinn Féin economic policy. I listened with incredulity to some Sinn Féin Members' comments, whether Mr Hazzard or Mr Murphy, who is back in the House. I listened to them and cannot believe what is coming out of their mouths. How can they possibly argue for further fiscal powers to be devolved here when we cannot even deal with the powers that we have in front of us? It is just an incredible situation. There is no credibility to go and argue that point. They seem to think that the British people got it wrong in the general election. The arrogance of telling the British people whom they should have put into Westminster is quite incredible.
I do not know what is being said across the way. I cannot hear because I am still talking. It is just incredible to think of the arrogance of Sinn Féin that it will tell the British people whom to put into our national Parliament. Even if that party had got its way and Labour was now in power at Westminster — Mr McCallister made the point — Ivan Lewis was very clear in 'The Irish Times' over the weekend about where he thinks the problems are coming from at present.
He said that Sinn Féin and the SDLP should accept the current political realities and agree an accommodation on welfare reform. He said that what was being offered in Northern Ireland was a far more generous scheme than was available to his own constituents and that no extra money was coming from Westminster.
Mr McCallister made reference to the voluntary exit scheme, and I hope I answered the point in relation to the £700 million. That is all tied in with the Stormont House Agreement and, therefore, if welfare reform does not happen, none of the other parts of the Stormont House Agreement happens either. That was indicated by the Secretary of State on many occasions.
Mr Speaker, I will draw my remarks to a close. I thank you for your patience. Assembly approval of the Supply motion, and the associated departmental expenditure plans laid out in the 2015-16 Main Estimates, is a crucial stage of the public expenditure cycle. Failure to pass the 2015-16 Supply resolution at this juncture would put at risk the smooth continuation of public services into the remainder of this financial year. Equally, as I have repeatedly outlined, failure of the Executive and the Assembly to find a way forward on welfare reform would put our spending plans at risk and present Ministers and the Assembly with the unenviable task of imposing further spending reductions on our already hard-pressed departmental budgets. That is something that we as a party have already indicated that we are not prepared to do to the people of Northern Ireland.
So, it is in that context that I commend the motion to the House.
Thank you, Minister. Before we proceed to the Question, I remind Members that the motion requires cross-community support.
Question put and agreed to. Resolved (with cross-community support):
That this Assembly approves that resources, not exceeding £7,444,446.68 be authorised for use by the Department of Education and the Department of Health, Social Services and Public Safety, for the year ending 31 March 2014, as summarised for each Department in Part II of the 2013-14 Statement of Excesses that was laid before the Assembly on 8 June 2015.
As there are Ayes from all sides of the House and no dissenting voices, I am satisfied that cross-community support has been demonstrated.
I now move to the motion on the Main Estimates, which has already been debated.
That this Assembly approves that a sum, not exceeding £8,336,067,000, be granted out of the Consolidated Fund, for or towards defraying the charges for Northern Ireland Departments, the Northern Ireland Assembly Commission, the Assembly Ombudsman for Northern Ireland and the Northern Ireland Commissioner for Complaints, the Food Standards Agency, the Northern Ireland Audit Office, the Northern Ireland Authority for Utility Regulation and the Public Prosecution Service for Northern Ireland for the year ending 31 March 2016 and that resources, not exceeding £9,004,299,000, be authorised for use by Northern Ireland Departments, the Northern Ireland Assembly Commission, the Assembly Ombudsman for Northern Ireland and the Northern Ireland Commissioner for Complaints, the Food Standards Agency, the Northern Ireland Audit Office, the Northern Ireland Authority for Utility Regulation and the Public Prosecution Service for Northern Ireland for the year ending 31 March 2016 as summarised for each Department or other public body in columns 3(b) and 3(a) of table 1·3 in the volume of the Northern Ireland Estimates 2015-16 that was laid before the Assembly on 8 June 2015. — [Mrs Foster (The Minister of Finance and Personnel).]
Leave out all after "exceeding" and insert: "£7,732,067,000, be granted out of the Consolidated Fund, for or towards defraying the charges for Northern Ireland Departments, the Northern Ireland Assembly Commission, the Assembly Ombudsman for Northern Ireland and the Northern Ireland Commissioner for Complaints, the Food Standards Agency, the Northern Ireland Audit Office, the Northern Ireland Authority for Utility Regulation and the Public Prosecution Service for Northern Ireland for the year ending 31 March 2016 and that resources, not exceeding £8,400,299,000, be authorised for use by Northern Ireland Departments, the Northern Ireland Assembly Commission, the Assembly Ombudsman for Northern Ireland and the Northern Ireland Commissioner for Complaints, the Food Standards Agency, the Northern Ireland Audit Office, the Northern Ireland Authority for Utility Regulation and the Public Prosecution Service for Northern Ireland for the year ending 31 March 2016 as summarised for each Department or other public body in columns 3(b) and 3(a) of table 1·3 in the volume of the Northern Ireland Estimates 2015-16 that was laid before the Assembly on 8 June 2015, subject to a proportionate reduction for each Department, with the exception of the Department of Health Social Services and Public Safety, and each other public body referred to in columns 3(b) and 3(a) of table 1·3 of the aforesaid Estimates, so as to reflect the £604,000,000 shortfall resulting from the failure to implement the Stormont House Agreement." — [Mr Allister.]
Before we proceed to the Question, I remind Members that the vote on the motion, whether or not amended, requires cross-community support. The vote in relation to the amendment will be on a simple majority basis.
Question, That the amendment be made, put and negatived.
Main Question put and agreed to. Resolved (with cross-community support):
That this Assembly approves that a sum, not exceeding £8,336,067,000, be granted out of the Consolidated Fund, for or towards defraying the charges for Northern Ireland Departments, the Northern Ireland Assembly Commission, the Assembly Ombudsman for Northern Ireland and the Northern Ireland Commissioner for Complaints, the Food Standards Agency, the Northern Ireland Audit Office, the Northern Ireland Authority for Utility Regulation and the Public Prosecution Service for Northern Ireland for the year ending 31 March 2016 and that resources, not exceeding £9,004,299,000, be authorised for use by Northern Ireland Departments, the Northern Ireland Assembly Commission, the Assembly Ombudsman for Northern Ireland and the Northern Ireland Commissioner for Complaints, the Food Standards Agency, the Northern Ireland Audit Office, the Northern Ireland Authority for Utility Regulation and the Public Prosecution Service for Northern Ireland for the year ending 31 March 2016 as summarised for each Department or other public body in columns 3(b) and 3(a) of table 1·3 in the volume of the Northern Ireland Estimates 2015-16 that was laid before the Assembly on 8 June 2015.
As there are Ayes from all sides of the House, I am satisfied that cross-community support has been demonstrated. I have clearly identified the No vote, so the motion is carried.