Budget (No.2) Bill 2015: Second Stage

Executive Committee Business – in the Northern Ireland Assembly at 4:00 pm on 22nd June 2015.

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Photo of John Dallat John Dallat Social Democratic and Labour Party 4:00 pm, 22nd June 2015

Before we proceed, I can inform Members that I have received confirmation from the Committee for Finance and Personnel, in accordance with Standing Order 42(2), that the Committee is satisfied that there has been appropriate consultation with it on the public expenditure proposals contained in the Bill and that the Bill can therefore proceed under the accelerated passage procedure.

Photo of Arlene Foster Arlene Foster DUP

I beg to move

That the Second Stage of the Budget (No.2) Bill 2015 [NIA 53/11-16] be agreed.

The Second Stage of the Budget Bill follows the Assembly’s approval of the Supply resolutions this time last week. That endorsed the departmental spending plans set out in the 2015-16 Main Estimates.

As Members will be aware, accelerated passage of the Bill is critically important to ensure Royal Assent before the end of July. I said last week that I would attend the Finance and Personnel Committee meeting on 17 June to seek the Committee’s agreement. Following that meeting, I am pleased to report that the Committee has now endorsed accelerated passage. The critical issue in arriving at that decision is that the Committee for Finance and Personnel is satisfied that there has been appropriate consultation with it on the public expenditure proposals in the Bill. I am grateful to the Committee for its work in agreeing accelerated passage. That was possible only due to the work of the Committee leading up to agreement of the 2015-16 Budget earlier this year.

The Committee carries out much work on scrutinising the Executive’s draft Budget proposals and also plays an important role in coordinating scrutiny across Committees on budgetary matters. I thank the Committee for its ongoing work in that respect and welcome its continuing support in discharging that important role.

I now turn to the Bill itself. The main purpose of the Bill is to provide a further balance of cash and resources in addition to the amounts already authorised through the Vote on Account in February. That balance amounts to over £8·3 billion of cash and more than £9 billion of resources. There is also provision for Departments to utilise £2·4 billion of accruing resources, which are basically resource and capital receipts. When the amount in the Vote on Account of £7·1 billion is included, the total cash provided for in the 2015-16 financial year is £15·4 billion. Likewise, the total amount of resources will be more than £16·7 billion, including the Vote on Account of £7·7 billion. On top of that, as I have said, the Departments will also be authorised to utilise £2·4 billion of accruing resources, taking the total amount of resources available in this financial year to some £19·1 billion.

Those are significant amounts of cash and resources, and we need to ensure that we deliver the best value for the people of Northern Ireland. Those amounts reflect the Executive’s 2015-16 Budget, which was approved by the Assembly earlier this year. Also incorporated into the total figures is the demand-led annually managed expenditure (AME) required by our Departments to support public services and to pay benefits and pensions.

As I have already made clear to the Assembly, the Executive’s 2015-16 Budget was predicated on agreement to implement welfare reform and the Budget flexibilities secured as part of the Stormont House Agreement. Without those flexibilities, there will need to be significant adjustments to the existing Budget position this year. The issue therefore needs to be dealt with as a matter of urgency.

Turning now to the other aspects of the Bill, clause 2 authorises my Department to borrow up to £4·2 billion in this financial year. It is important to stress that that facility does not provide for additional cash out of the Consolidated Fund or convey additional spending power; it is simply required to allow the Department flexibility to manage cash flows effectively and to minimise drawdown of the Northern Ireland block grant on a daily basis. It is therefore a very important provision to allow cash to flow effectively between the Consolidated Fund and our Departments.

Clause 5 authorises additional resources totalling some £7·4 million for the Department of Health, Social Services and Public Safety and the Department of Education for the 2013-14 financial year, when those Departments registered an Excess Vote.

The Public Accounts Committee has considered the circumstances of these Excess Votes and has recommended that the Assembly approves the additional resources that are now recommended in the Bill.

The figures included in the Budget Bill are substantial. I am sure that Members will agree that it is not always easy to translate them into the delivery of public services on the ground. Nevertheless, the Budget Bill underpins all the public services that Ministers and Departments are tasked with delivering. Whether it be the construction of a new road, hospital or school or the salaries of police officers, nurses, doctors and teachers, this legislation is critical to allow those services to operate and public investment to proceed. Without an agreed Budget Bill, Departments would not have the legal authority to incur expenditure in the delivery of key public services. That is what makes this legislation absolutely essential.

Photo of Daithí McKay Daithí McKay Sinn Féin

Go raibh maith agat, a LeasCheann Comhairle. As already outlined by the Minister, the Bill makes provision for the balance of cash and resources that are required to reflect the departmental spending plans in the 2015-16 Main Estimates. These are based on the Executive's one-year Budget for 2015-16 which was approved by the Assembly in January.

As outlined, the Bill also includes provision for excess cash and resource requirements by the Department of Health, Social Services and Public Safety; the Department of Education, and the Public Prosecution Service which were not anticipated in the spring Supplementary Estimates. The Committee noted that this matter has been considered by the Comptroller and Auditor General and reported on by the Public Accounts Committee, which recommended that the necessary sums be provided by Excess Votes by the Assembly.

As on previous occasions, DFP has highlighted the need for the Bill to progress through the Assembly before the summer recess. In this regard the Committee, at its meeting last week, agreed to grant accelerated passage to the Bill under Standing Order 42(2) on the basis of having been consulted appropriately on the expenditure provisions in the Bill. I wrote to the Speaker's Office to confirm this decision.

I believe there was positive engagement with the Minister during her first appearance before the Committee last week and I hope that that sets the tone for further meetings. I think that there was a collective sense that ways need to be found to work constructively in moving things forward. Notwithstanding the obvious sticking points, I noted some key issues upon which I think there is some common ground. Not least amongst them is the need to consider the regional economic impact of the British Government's austerity, or deficit-reduction, policy. I think that we all share the view that local needs and circumstances have to be taken into account and respected. I think that there was also recognition of the importance of having a mature debate on budgetary pressures and revenue-raising options, which will also serve to increase the wider public understanding.

A further issue which the Committee has been pressing, and which, I think, the Department also recognises, is the need to maximise the use of financial transactions capital, which is becoming an increasingly important source of investment in infrastructure.

During last week's Supply resolution debate, I highlighted that the Committee had been advised that the voluntary exit scheme estimated a Civil Service pay bill reduction of £26 million for the second half of this financial year and a total saving of £70 million across the wider public sector. During recent briefings from the head of the Civil Service and various senior DFP officials, the Committee sought to establish a precise breakdown of the projected savings within the budgets for each Department for 2015-16. To date, however, the detail on this has not been forthcoming.

I can fully understand that these are projections and are, of course, subject to change. Surely, however, there are specific calculations for the pay bill savings within the administration cost figures in the Estimates that were considered last week and, in more global terms, within the Bill before us today. Given its central coordinating and monitoring role, I would expect that DFP has a handle on this already. I would therefore welcome clarification from the Minister today on the pay bill savings figures that have been factored into each departmental budget and which also cover the arm's-length bodies. The provision of that information is important for the Finance Committee's cross-cutting scrutiny and for the other Statutory Committees in monitoring progress at a departmental level. More generally, the role of the Committees in scrutinising spend and in monitoring savings and service delivery will continue to increase in importance, given the budgetary challenges that are before us.

On a related issue, which is again connected to the implications of the voluntary exit scheme, the head of the Civil Service advised the Committee that, in downsizing the Civil Service by 10%, it will have to do things differently, including using:

"more cutting-edge technology to deal with citizens and to make our services interact with them in a different way".

That is a welcome acknowledgement, because in its inquiry into flexible working, the Committee found that the local public sector appears to lag behind other jurisdictions in adopting new technology. On a recent visit by some of the Committee members to Edinburgh, it was clear that we still have some lessons to learn about public-sector efficiencies. One example was the Smarter Workplaces initiative that the Scottish Government are driving forward to reduce the Government estate by 25% and to achieve significant savings. While I accept that some efforts have been made by our Departments in that area, the Committee's conclusion was that a more strategic and joined-up approach is needed to maximise savings.

I firmly believe that there are areas where more efficiencies and savings can be achieved, including in the current financial year. The scrutiny by the Assembly and its Committees can add real value to the Budget process in that regard. However, for that to occur, the Committees need to be provided with the information and afforded the time to enable them to undertake constructive scrutiny and to exercise influence at the most appropriate stages in the process. <BR/>In the context of the immediate business before us today, however, on behalf of the Finance and Personnel Committee, I support the general principles of the Bill.

Photo of Alastair Ross Alastair Ross DUP 4:15 pm, 22nd June 2015

Thank you, Mr Deputy Speaker. I certainly did not expect to be called quite so early; nevertheless, it gets it out of the way, I suppose.

I have been a Member now since 2007, and I have found that Budget debates often prove to be little more than Members standing up and providing a wish list of spending priorities for their constituencies or issues that they are involved in. Indeed, I have perhaps been guilty of that in the past, although given that the A2 and A8 road projects are now near completion, I could be forgiven for it. If the Supply resolution debate is anything to go by, I think that some Members used it as an opportunity to do little more than ask the Minister to spend more money on this, that and the other without ever actually providing the House with any information on how they would find the money to do that.

I think that today's debate on the Budget must take a different tone if it is to be of any value and if the public are to take us seriously on the issues that we discuss. Over the last five years, the national Government have been reducing public spending at a significant rate. We have seen that the amount of money that we have in our block grant for public spending has also been reduced.

I think that anybody with any insight at all would recognise that, over the next five years, the budgetary situation is going to get more difficult for the local spend here in Northern Ireland and that the national Government will continue to reduce the levels of public spending right across the United Kingdom. Therefore, I think that we have to ensure that, in our discussions today, we recognise that and have our debate in that context. Whilst we would love to have loads more money thrown our way in the block grant, thereby providing us with the opportunity to spend on things that we may wish to, that is just not based on reality. I must say that, having listened to the debate last week, particularly to Members across the way, it did not strike me that they had grasped the economic reality that we are living in.

Therefore, I think that what we need to do, and what would be useful in the debate, is get new thinking and have brave politicians who come up with new proposals. Ultimately, we need smarter solutions to the issues that we have to deal with.

The last time I spoke in a Budget debate, Mr Alban Maginness, who is not in the House, expressed his disappointment that I had such a conservative approach to the Budget and was not being radical enough. Given that I took over as the Chairman of the Justice Committee in December, I hope that he will see that the approach that I have taken in that Committee is quite innovative, looks to deal with issues differently than we have done in the past and could, at times, be seen as fairly radical. That approach seeks to find reform, do things better and reduce the cost to the public purse. Through the justice seminar series, we have focused on greater collaboration between ourselves and stakeholders, greater innovation within justice and, most importantly, a focus on outcomes. Quite often we have a debate, particularly around justice, on what is seen as being soft on crime or tough on crime, rather than on what works and what does not work. We need to have a focus on outcomes and a smarter justice system.

I am keen to continue the work we are doing on that. Later on this week, members of the Justice Committee will travel to London to meet the Civil Justice Council and the Centre for Justice Innovation, and visit the Supreme Court. I and the Deputy Chair of the Committee will travel to the Netherlands during recess to look at the idea of digital courts, legal aid and how we can speed up the system in that way.

Since I have taken over, and for a much longer time, much of the focus when it comes to budgetary matters within justice has, of course, been around legal aid. There needs to be a recognition that resources are not infinite. We have difficulties in resourcing legal aid, therefore there must be savings found — and savings that have the least impact on access to justice, to ensure that people who need legal aid are still able to get it.

There are other priorities that I am keen to focus on. There is the idea of speeding up justice, getting better outcomes for victims, reducing reoffending and, of course, reducing costs in the system. The reduction in budgets for the Department of Justice — for all Departments — should provide the springboard that is needed for reform. I have said it before, and the Minister will be well aware of this from her previous role, but the private sector had to become far more efficient in what it did when there was a global downturn. When it embraced that efficiency and cut out the fat in its systems, it was in a better place coming out of that recession to capitalise on it. Governments, too, should be looking to use the constraints on public finances to make ourselves leaner and more efficient and to look at doing things differently, ultimately to improve outcomes.

Photo of Stephen Farry Stephen Farry Alliance

I thank the Member for giving way. Does he agree that, while I accept the point he is making, it is easier for Governments to go through a process of public-sector reform and find efficiencies when Budget savings are being found over longer periods? In the situation that we find ourselves in today, where we have an unstable Budget and the potential for in-year cuts, the scope for Departments to engage in that type of activity, through no fault of their own, is badly constrained by the wider political context.

Photo of Alastair Ross Alastair Ross DUP

I totally accept that point. I know from when I was on the Employment and Learning Committee that Ministers often found themselves with reductions in-year when money was already committed or spent, and they found that incredibly difficult. I want to move on to the current position later on, because it does produce particular difficulties for Ministers. The lack of stability that the Member mentioned is very real, but I want to ensure that, at least in our contributions today, we keep our eye on the longer term. We do need to do things differently. There is an opportunity for savings and reform. We must at least get agreement on how we get to that point, even though I accept that in the shorter term it is difficult to do that. Indeed, it is sometimes difficult to shift of focus of funding in the short term, even though in the longer term that is something that people want to do.

When I talk about reform and saving money in the Justice Department, which is something that we are doing at present, it does not mean that we are compromising on outcomes. That is the important point to make. We had a focus in the last three or four months on youth justice. We have to recognise as a House — and I think the figures are publicly available — that it is more expensive to send a young person to a youth justice centre than to Eton. Yet the outcomes are not particularly good, because once a person enters a criminal justice system, it is more likely that they will enter the revolving door of going in and out of prison and the criminal justice system. Unfortunately, that is the way that their life will continue to be. That is not something that we support. It is not cost-effective, and it is not good outcomes.

Prison is, of course, important for repeat or dangerous offenders, sexual predators, terrorists and people like that. For lower-level criminals and first-time offenders, there are alternatives to prison that we must look at, not just from an outcomes-based perspective, because it improves outcomes and lessens the reoffending rate, but because it makes sense economically. For the taxpayer to have to fund people in prison and then fund them when they exit and go on welfare is not a particularly good use of public finance. It would be far better to have some sort of restorative system for low-level offenders so that they enter into community work programmes and pay their debt back to society in a more productive way. Of course, that will help them to move on to find gainful employment after they have repaid their debt. During debate on the Justice Bill, I tabled an amendment that ensured that anybody who was released from prison early had to go into some sort of community work and repay their debt to society in that better way. It makes economic sense, as well as sense if we want to improve outcomes.

We also have to look at areas such as court listings and the delays in the system. Can we move to digital or online courts for the resolution of certain low-level cases, as is happening in the Netherlands and Canada? Let us look at those things and see if we can do them in Northern Ireland. There should also be a greater use of mediation when it is appropriate.

At times, we also need to be innovative and radical in what we do. As a Government as a whole, we need to identify how we deliver services to the public, particularly at times of reduced budgets. The public's expectation of government is incredibly high, and it is perhaps growing at the same time as the amount of money that we have available to spend on public services is reducing. Therefore, we need to look at delivering services differently and perhaps pushing the delivery of certain services out to the community and voluntary sector or even the independent sector.

I know that the whole concept and idea of the big society is language that has now exited the political discourse in the UK since Steve Hilton left 10 Downing Street. Nevertheless, the big society concept is something that we in Northern Ireland have been doing for a long time and actually do very well. We have a very vibrant community and voluntary sector that is developing services in the community. Very often, it delivers services that have better outcomes than government could provide, and also at significantly less cost. Therefore, we need to look at how we spend money and judge that against the outcomes.

From my experience in the Justice Committee over the last number of months, I have looked at the work of organisations such as NIACRO, which is very involved with ex-offenders and their families and in finding them work programmes or employers when they are released so that they are less likely to reoffend. That type of work is invaluable and it is work that, in many cases, the Government could not do. If the Government tried to do it, it would inevitably go wrong and be much more costly than the way in which some of the voluntary sector organisations are able to do it. Therefore, it is important that we ensure that those organisations are able to sustain their work in the longer term.

As with NIACRO, there are many other organisations out there that we provide a modest amount of funding to that have really good outcomes. Many of them are involved in early intervention. I listened to Mr Farry's comments, and we have difficulty in shifting money away from dealing with the problem and moving it towards early intervention. In health, we say all the time that it is better to spend money on prevention than cure, but it is very difficult to shift that focus to early years. It is much the same in justice.

Time after time, we see examples. It is heartbreaking to see it, but you can identify a young person below the age of 10 and say that that person is more likely than anybody else to enter the criminal justice system and live a life of crime because of their surroundings, their family circumstances and where they grow up. If we allow voluntary organisations out there in the community greater access to early interventions, it could save us money in the longer term by ensuring that those young people do not end up in juvenile centres or in our prisons and do not end up taking up police time or the work of the Probation Board. Early intervention is absolutely key and some of the community and voluntary groups are best placed to deliver that.

It does not always find agreement from everybody, particularly those on the opposite side of the House, but, likewise, we need to look at other services to see how we can get best value for money. Not so long ago, I visited 3fivetwo Healthcare's facilities in Belfast. When you compare the cost of an operation that it provides with one provided by the NHS and the number of operations that it can do in a day compared with the NHS, serious questions need to asked about why it is that the private sector is so much more efficient in delivering operations than the NHS. That is a real question that we need to focus on.

I know that there are those with an ideological difficulty with the independent sector delivering healthcare, but, if it is able to do it in a more efficient and cost-effective way, we need to give it serious consideration. Not only would it wipe out the waiting lists but it would save the public purse money. That is a challenge to some Members who have difficulties with private healthcare to examine the issue and explain why they are so opposed to it.

Now that we have had devolution for some time, we also need to examine seriously the role of government in society, not just the public's expectation of us but what we should be delivering to the public and the role that we have in people's lives. If we are pushing stuff out to the voluntary and community sector, the role of government could shrink. Who delivers services? I go back to healthcare. The public do not really care who delivers the service. I will use the example of a bin. Most people like to put their bin out on a Monday, a Tuesday or whenever it is, and, as long as the bin is picked up, emptied and left back to them, they do not care who delivers that service. All they care about is that the service is good, happens routinely, weekly or fortnightly, and they do not have to pay through the nose to get it done. We need to be pragmatic on the issue and look at who delivers services and whether the public really cares who does that. That is something that we need to do.

We also need to be braver about reductions in the size of government here. We have an agreement to reduce the size of the Executive, which is a positive step, but we also need to make real progress on reducing the size of the Assembly and the number of Members. I know that we are talking about fairly modest sums of money in savings, but, when we are making the point that we want to reduce the size of the Civil Service, we should be looking to reduce the size of the Assembly. The public would support that. If we wanted to be really radical, we could examine whether we need to sit all year round. Perhaps we should just concentrate on legislation and meet twice a year. That is really radical; I listened to Members who challenged me previously to be more radical in my suggestions, and that is something that we could do. It seems to work OK in Texas and in other US states that have much greater economies than ours and, perhaps, a better success rate. Do we need to spend so much time on private Member's motions? Perhaps that is also a challenge.

We also need to examine some of the work that we do and some of the legislation that we pass in the Assembly, particularly legislation that has a high price tag attached to it. Earlier today, I chaired a meeting of the Ad Hoc Committee on the Mental Capacity Bill, and I have no doubt that, if we do the Bill right, it will have better outcomes for people who live in Northern Ireland and provide better safeguards, particularly for our older population. However, when we hear some of the figures that are attached to the cost of implementing that legislation or of creating new public bodies, we have to ask ourselves whether that is the best use of money. We have to ask whether it will be implemented at all, given the current constraints on our Budget. We need to be smarter about the types of legislation that we propose and pass in the House.

Mr Farry mentioned the situation that we find ourselves in over the impasse on welfare reform and public finances. Listening to the debate last week, I was frustrated, particularly by SDLP Members, who seemed to make suggestions only about increasing spending in different areas. I have no doubt that their motivation is right, in that there should be more spending for here, there and somewhere else. We could all find projects if that is the case, but it is detached from reality. We do not have more money to spend. If the SDLP is going to suggest that more money should be spent in one area, at least it needs to say where it is taking money away from or where it is getting money to pay for it.

I listened to the Sinn Féin contributions last week and continually, in that debate and in press and media coverage, it talked about wanting to get more powers for the Assembly. It wants to have more fiscal levers available at Stormont and the full suite of economic powers, but the public will quite rightly ask: if you cannot be responsible with the powers that you have at present, why on earth would anybody support getting additional powers? It is a very real question. How can the public take seriously a party that said — seriously — that it thinks that a way of helping out in austere times is to pay off people's credit card bills? It is absolute madness. If it wants to build up its economic credibility to get public support for devolving more economic powers, I suggest that that is not the best way to go about it.

There needs to be recognition of the level of subvention that we have here at the Assembly. We get £10 billion a year from Treasury and central government because we run at a deficit. There needs to be an economic realisation that the more economic powers we get devolved to the Assembly, the higher the cost to Northern Ireland. Either it comes off, and there is more public spending, or we get tax-raising powers and tax the public more to meet the cost.

Photo of Steven Agnew Steven Agnew Green 4:30 pm, 22nd June 2015

I thank the Member for giving way. Of course, his party supports the devolution of corporation tax and its reduction to 12·5% or 10%. Will he outline how his party would pay for that and where the cuts would be made?

Photo of Alastair Ross Alastair Ross DUP

Absolutely. It is not just corporation tax; we also advocated air passenger duty being devolved to the Assembly in order to keep our New York flight, which is good for business and tourism. We were able to pay for that. It is not just our party that advocates a cut in corporation tax; all the main parties, although a few individuals oppose it, are in agreement. Part of the Stormont House Agreement would allow us to pay for that. If we get the loan from Treasury, that would facilitate the Civil Service voluntary exit scheme. We would then make the cost reductions to allow us to afford corporation tax over the next number of years. In doing so, we would attract companies from overseas. It is not just government saying that; independent evaluators are saying that we have the potential to create tens of thousands of jobs in Northern Ireland. That is why corporation tax is something that we should keep our eye on. Looking to get it devolved is still worthwhile.

I am not opposed to devolving individual fiscal levers if they are to our benefit, but we have to be responsible. When you hear parties saying, "We need all of the fiscal levers at the Assembly", they do not tell us how they would use or pay for them. It does not appear that, if they were to pay for them through tax increases, for example, Members opposite would support that either. Even when we talk about the modest rise in prescription fees that would allow us to pay for a cancer drugs fund or an innovative drugs fund, there does not appear to be any support for that. Are they honestly being fiscally responsible in some of the rhetoric that they come out with?

Photo of Roy Beggs Roy Beggs UUP

Will the Member give way?

Photo of Roy Beggs Roy Beggs UUP

Does the Member agree that raising the issue of corporation tax in terms of this Budget is a bit of a red herring? I am not aware of any funds being taken out of this specific Budget for corporation tax. We can determine the rate of corporation tax in the future, if the ability to do so is granted to us, but this Budget is not taking out funds to be spent on reducing corporation tax. If it is approved, along with the Stormont House Agreement, the ability to decide that in future would exist.

Photo of Alastair Ross Alastair Ross DUP

This Budget is predicated on the fact that welfare reform goes through as agreed in the Stormont House Agreement. If agreement is not achieved on the Stormont House Agreement, we lose, by my reckoning, the opportunity to have the Civil Service exit scheme. We will get increased fines from Treasury, if it does not take over the power itself. All that puts at risk the opportunity to lower the level of corporation tax. It is very real in terms of the Budget that we are discussing today, and certainly in the actions that have to be taken by certain parties in the next number of months. Otherwise, we will not have any certainty over corporation tax, and we will certainly not be able to reduce it.

Photo of Basil McCrea Basil McCrea NI21

Will the Member give way?

Photo of Basil McCrea Basil McCrea NI21

This follows on from Mr Beggs's point about corporation tax not being directly relevant to the debate: you mentioned air passenger duty (APD) earlier and asked whether we should be looking at that. I am not sure whether the Member's position is that we are for devolving air passenger duty. I understand that there is quite an expensive price ticket on the block grant for that and that we may be rethinking our position.

Photo of Alastair Ross Alastair Ross DUP

There are two types of air passenger duty, of course: one on long-haul flights, which we devolved to keep the flight to New York, and the short-haul air passenger duty. I think that it should be scrapped altogether. It is preferable, of course, to do that UK-wide because we need to have a cost-benefit analysis of whether the increased travel to Northern Ireland would be worth the amount that it would cost the Executive to get short-haul APD, so we would have to keep an eye on that.

As I said, the preference is certainly for that to be done on a UK-wide basis.

In the wider debate on corporation tax issues, we really have to consider what not just the public but the business community in Northern Ireland believe is happening in the Assembly. For the last decade, the business community has worked alongside not just the Enterprise Minister and the Finance Minister but the First Minister and deputy First Minister on moving towards a position where we can get corporation tax powers devolved to the Assembly and then lower that rate. Our party would like to see it at 10%, but 12·5% might be more realistic to get a consensus. If we are unable to do that and we lose the support of the business community in Northern Ireland, that would do our credibility a huge amount of damage, not just locally but with the global business community. We need to make sure that we keep a focus on that.

If the Sinn Féin position around welfare is that they want to protect the most vulnerable and they think that that will help their position in the Irish Republic, I really must suggest that voters in the Irish Republic will look at the position of Sinn Féin in Northern Ireland and ask themselves whether they would really want Sinn Féin to be part of a Government in the Republic of Ireland when they cannot take tough decisions, will not take fiscally responsible decisions and could jeopardise some of the progress that we have made here.

I am always keen to finish on a positive. I am also aware that what I am going to say is about spending priorities and areas of spend, but it is somewhere where we could spend a modest amount of money to get a much larger return. It is around our ability to host major events here in Northern Ireland. Not so long ago, we had the announcement that the Open Championship will return to Royal Portrush. We had the successful Irish Open in Royal County Down recently and two years ago in Portrush. Last year, we had the Giro d'Italia, which was a phenomenal success right across Northern Ireland. Yesterday, we had the Gran Fondo, which saw 3,000 riders, including me, take part in a big family event that, again, was a massive opportunity for positive PR about Northern Ireland. This all started back when the current Finance Minister went into DETI. There was the MTV Europe Music Awards, and we will now get the BBC Sports Personality of the Year. The list goes on and on and on.

As I said, it is a modest investment for a major return. It helps us to change global perceptions of what Northern Ireland is all about. It helps to get a positive image out there of what Northern Ireland is and what we are capable of doing. That inevitably helps people who would consider investing in Northern Ireland to see that we are a credible proposition for them. We really need to capitalise on our ability to host big events. We need to capitalise on the ability of our different agencies — the PSNI, our tourism agencies and the Executive — to come together and make those events happen. We need to capitalise on the success that we have had in sport and other areas such as 'Game of Thrones', which gives us recognition across the globe. Changing global perceptions, positive PR images and encouraging investors and tourism in Northern Ireland is hugely important. Our Budget should definitely look to ensure that we continue to be able to host those major events.

Photo of Alasdair McDonnell Alasdair McDonnell Social Democratic and Labour Party

While I welcome the opportunity to speak in this debate, I must say that I do not welcome the situation that we have arrived at. I take no joy in telling the House that I cannot, at this stage, envisage a situation where we could support this Bill. However, let me be clear — this should not come as any surprise to the Chamber — that the SDLP has consistently opposed austerity Budgets. We voted against this Bill's predecessor last February. We challenged previous Budgets where they fell short.

I and my colleagues in the SDLP are well aware that this is a crucial time in the public expenditure cycle. We do not want to put public services at risk, but we must ensure that public services continue to be funded through 2015-16. We cannot afford to let the public down with inadequate or dysfunctional services. The public have already lost trust in us as politicians. In part, they have also lost trust in public services such as the health service.

We have been, and continue to be, extremely concerned at the budgetary pressure faced by the Executive and the impact that that has had on front-line services. The Budget settlement is without a doubt the most severe that we have faced in recent times, and the prospect of more in-year cuts will further affect departmental allocations and impact even more severely on our front-line services. There are very significant financial challenges facing every Department. Budgetary restraints all too often cause severe problems, ultimately at the coalface, where front-line services are delivered. We believe that best practice should always be considered and that the focus should be on ensuring genuine efficiency savings are made rather than on simply making red-marker cuts in areas that can, and often do, adversely impact on priority services.

We have a long-standing viewpoint on the 2015-16 Budget. Others — the DUP, Alliance and Sinn Féin — voted for that Budget. We voted against it at its Final Stage in February, and, given that we learnt of £38 million of cuts in the Chancellor's in-year announcement a few weeks ago, as well as further cuts that are expected on 8 July, no one could reasonably expect us to support such a Budget now that the position has been made so much worse. We are not into knee-jerk changes of position. We are not the ones who said that the previous Budget was the best deal possible. We know now that those who did got it wrong.

The SDLP agrees with many out there who believe that brutal and severe austerity measures are not the only way in which to stimulate our economy, an economy that is only just emerging from recession. We strongly believe that, in parallel, and as a belated peace dividend, a prosperity programme is needed. We need a comprehensive analysis of our spending priorities, and, in many cases, a re-engineering of those priorities to ensure that our money is spent in the best way possible and that higher priorities are given the priority that they deserve, with other priorities down the chain.

We also believe that there should be a much greater focus on third-level education and training to take advantage of opportunities that may arise from inward investment. We feel genuinely that —

Photo of Alasdair McDonnell Alasdair McDonnell Social Democratic and Labour Party

In a moment.

Although we want to work on the corporation tax issue and support it broadly, we feel that it is futile to cut the corporation tax if we are going to cut the supply of graduates and trained operatives to work on those projects.

Photo of Stephen Farry Stephen Farry Alliance

I am grateful to the Member for giving way. Like a lot of Members, I have been careful not to let frustrations boil over at the comments that he is making, given the clear lack of an alternative being set out. If people vote no, the course that we will be on is one of even steeper cuts that will occur in July. Does the Member recognise that it is my judgement, as the person with direct responsibility for further and higher education, and that of those with whom I work, that the course of action that the Member and other parties are taking is doing more to undermine the points that he is advocating than anything else that is happening in society?

Photo of Alasdair McDonnell Alasdair McDonnell Social Democratic and Labour Party

I welcome the intervention from the Member. I respect his position as Minister, but it will come as no surprise that I do not entirely agree with him.

Photo of Arlene Foster Arlene Foster DUP

Will the Member give way?

Photo of Arlene Foster Arlene Foster DUP

Before the intervention, the Member made comments about corporation tax. Can he indicate whether the SDLP position on corporation tax has changed? The full cut in the block grant for corporation tax comes only in year 3 of the operation of corporation tax. Given that we have not yet set a date for the devolution of corporation tax, that will be beyond 2020-21. Is the Member saying that the SDLP has changed its position on the devolution of corporation tax?

Photo of Alasdair McDonnell Alasdair McDonnell Social Democratic and Labour Party

Thank you, Minister, for the intervention. I am sorry, but I do not know how you could have interpreted that from what I said. I said that it made no sense. I emphasised that we still believed in corporation tax reduction. It does not make sense to reduce corporation tax and, at the same time, choke off the stream of potential employees. We need to get things joined up; that is really what the battle and argument is. We believe that we can work with the money that we have and could create a much more efficient and effective process. I have discussed it with the Minister and others, and I raised the issue a number of times. It would require all five parties getting together and coming up with a genuine, coherent response on a number of issues.

Photo of Basil McCrea Basil McCrea NI21

Will the Member give way?

Photo of Alasdair McDonnell Alasdair McDonnell Social Democratic and Labour Party

Am I going to get speaking? Am I going to get finished?

Photo of Basil McCrea Basil McCrea NI21

The Member is leading with an argument but has not yet responded to the challenge that has been put forward. On the one hand, you want to cut corporation tax, but you also want to increase spending on skills. The real issue is that it is a liquidity crisis: where will you get the cash from to balance the Budget? It is all spend, spend, spend and no income. You call upon people to have a credible Budget, but I would like to hear a credible proposal from you, sir.

Photo of Alasdair McDonnell Alasdair McDonnell Social Democratic and Labour Party

Thank you very much for your intervention. I will make the point again that I made earlier: we want to see a comprehensive review and a re-engineering of our spending priorities to ensure that the focus is on the highest priorities. We would like to think that, in that process, third-level education or training would perhaps get a priority. We have not been very good over the years at creating or following through on apprenticeships. My figures tell me that we have only about 60,000 apprentices, and if you calculate that over 40 years — I am talking about people who have come through with proper apprentice qualifications — we produce about 1,500 per year. That is totally inadequate for the opportunities that are out there. We have to take advantage of the opportunities. The point that I want to make is that deep cuts in public spending run the danger of slowing down or reversing whatever small growth or potential growth there is in our economy.

Photo of Paul Girvan Paul Girvan DUP

Will the Member give way?

Photo of Alasdair McDonnell Alasdair McDonnell Social Democratic and Labour Party

No, I am going to try to make some progress at this stage. I have given way to a number of people.

Northern Ireland cannot afford to accept the fact that our economy will shrink or that the permanent politics of austerity that come with it will be allowed free rein. We must develop more aggressive, more robust proposals to tackle our economic difficulties on the revenue side by seeking considered political intervention to deal with the structural weaknesses in our economy and to generate meaningful growth. Our private sector is tiny and, to be truthful, not very private since much of it depends indirectly on public contracts anyway. We have over 70,000 registered businesses, but they generate only about £650 million a year in corporation tax. That is falling year after year. It was £924 million in 2007-08.

Most of our devolved politics has revolved around how to spend the Treasury subvention, and recent signals from London are very clear that the fiscal imbalance will be tackled by cutting the expenditure side of the balance sheet. It is clear that the decisions that we make over the next weeks will have profound implications in Northern Ireland. The current impasse did not arise from nothing but, rather, is the result of secretive and exclusive politics, which the SDLP has long tried to open up and break down. We have consistently warned that, to find a solution to these problems, there would have to be a genuine all-party approach. The problems have arisen —

Photo of Alasdair McDonnell Alasdair McDonnell Social Democratic and Labour Party

Sorry, I am trying to make some progress.

Photo of Ian McCrea Ian McCrea DUP

He is not making sense.

Photo of Alasdair McDonnell Alasdair McDonnell Social Democratic and Labour Party

OK. Yes, I will give way here first, right, seeing as he is first in the queue.

Photo of Paul Girvan Paul Girvan DUP

I thank the Member for giving way. He made comments earlier about spending. Public spending is being cut because of the lack of implementation of the Stormont House Agreement; it is costing us over £2 million a week. You mentioned earlier that £38 million is being removed from our Budget this year.

Within a few weeks, we will have already passed that £38 million cut for the current year, and we paid back penalties of £87 million last year. So, that is where we stand on it.

Photo of Alasdair McDonnell Alasdair McDonnell Social Democratic and Labour Party

Sammy, do you want to come in there, and then I will get —

Photo of Sammy Wilson Sammy Wilson Shadow DUP Spokesperson (Treasury), Shadow DUP Spokesperson (Work and Pensions), Shadow DUP Spokesperson (Education)

Yes, thank you. I appreciate the Member giving way. He has now tried to make the excuse that, somehow or other, the impasse is due to a secretive process. What was secretive about the Stormont House Agreement? Not only were all the parties involved, but the outcome was published. Yet now he is trying to put this down to the fact that, somehow or other, everyone was excluded and the SDLP had no alternative but to put us into the kind of financial crisis we are now facing with the Budget.

Photo of Alasdair McDonnell Alasdair McDonnell Social Democratic and Labour Party

The Member, as a former Minister, always has a simplistic view of the world. The point is this: for four years, we have argued that there were flaws and weaknesses in our budgetary process. We tried to draw attention to these but we did not get anybody much interested in them. It was inevitable, with the budgetary process we have that if things got tight in Britain, our finances would be squeezed. In fact, the Assembly is on a choke lead vis-à-vis the Chancellor of the Exchequer and has permission to do only what the Chancellor agrees to.

There were secretive talks around Stormont House and there were talks that were exclusive. While the Stormont House Agreement was fairly public, there were a lot of other papers and bits and pieces of goings on, which many of us were not involved in. We have consistently warned that we need an all-party process to find a resolution to the problems. The problems that have arisen have come from side-room deals, and whatever, between the two main parties. We remain committed to negotiating on the issues relating to the Budget and welfare reform. We believe, however, that it needs to be a mature negotiation that is not bound by blind deals, side-room deals, side letters or understandings that most of us are not party to.

It is not in our nature to walk away from the negotiating table. We believe that all problems, no matter how large or difficult, can be solved by mature and constructive dialogue. That is why, even at this stage in the process, and extending back to before the Stormont House negotiations, we have engaged constructively, supporting what was good in the Stormont House Agreement. We would be very happy to get the Stormont House Agreement implemented, and get the Bill with the amendments we made to it.

Photo of Basil McCrea Basil McCrea NI21

The Bill is gone. It is too late.


Photo of Alasdair McDonnell Alasdair McDonnell Social Democratic and Labour Party

If the Member has an intervention, Mr Speaker, I am quite happy to take it, but sedentary —

Photo of John Dallat John Dallat Social Democratic and Labour Party

Order, please. Sorry, Dr McDonnell, resume your seat.

I have been extremely tolerant, and I encourage the flow of interaction, but not to the extent that it has happened. I ask the Member in the corner not to make remarks from a sedentary position.

Photo of Alasdair McDonnell Alasdair McDonnell Social Democratic and Labour Party

We have engaged at every stage of the process, right back to before the Stormont House Agreement. We engaged constructively and supported what was good. We worked to make what was good better, and to salvage and strengthen that which was not so good.

Earlier, I made the point that we cannot offer support to the Bill as it stands, but we urge all the parties involved to re-engage in negotiations aimed at trying to find a responsible and mature way through the current budgetary situation.

Photo of Leslie Cree Leslie Cree UUP

I hope that my voice lasts. I think it is starting to break.

It is good to see that we have made it to the Second Reading of the Budget Bill, although, sitting and listening to the wide-ranging discussions, you tend to forget that we are trying to get behind the detail of the Bill this afternoon. This is an important stage, and it is vital that we explore the detail of the Budget Bill and the rationale that lies behind it. I would therefore like to ask the Minister some questions.

The voluntary exit scheme is predicated on reinvestment and reform initiative (RRI) borrowing to pay for severance over the years, commencing with £200 million in the current year 2015-16. Have the Executive commissioned any economic analysis to assess the likely effect on consumer confidence and the economy in general after large-scale, public-sector job losses, considering that approximately 30% of all Northern Ireland jobs are in the public sector? Have the Executive considered the negative multiplier effect on the economy of public-sector restructuring? Does the Minister think it prudent to fund redundancy in 2015-16 by increasing debt? Northern Ireland's projected level of debt will be £1·7 billion or £948 per capita. That is about twice that of Scotland. <BR/>Treasury rules do not usually permit capital expenditure to be used for resource. A major plank in last year's Budget was the sale of assets. I raised that issue before, but, so far, I have not had a definitive answer. Will the Minister advise how much resource has been released from the sale of assets and how that money will be used?

The last Finance Minister — it is good to see him here this evening — announced a review of public governance. That would be undertaken by the OECD and it would be its first sub-national public governance review. It would be conducted in Northern Ireland. Will the Minister update the House on the current position and whether any lessons have been learned?

(Mr Speaker in the Chair)

We all know that, in these difficult times of austerity, we have to work harder on our economy. A healthy economy will generate the wealth that, in turn, will fund virtually everything else. I was amused when I reread Sinn Féin's Michaela Boyle's treatise on its vision for the local economy. Apparently, it is better than the Tory's, which has no coherent economic plan. Mr Osborne was to be told to leave the economy to the Assembly and the Executive to shape a better economic future using the limited powers that we have. How ridiculous. What about the £10 billion grant provided under Barnett? What about the multimillion consequentials that come from Westminster as a result of their spending on health and education?

Ms Boyle went on to state that we could do so much more if we had full control of our resources and economic decision-making. The vision now is clearly a dream, or perhaps a nightmare. It assumes that Northern Ireland generates more revenue than those areas where fiscal matters are not devolved. Where is the proof of that? Hopefully, we are all working to a point where Northern Ireland will be a net contributor to the United Kingdom, but it is still a long way off. To be constructive, I would welcome the opportunity to study Sinn Féin's detailed economic strategy, if such a thing exists. In the meantime, we need to be realistic.

The purpose of the Bill is to give legal authority to enable Departments to spend certain sums of money, and that will have to be done one way or another. In the meantime, we have the unreality of a Budget with problems. Agreeing the Budget will not resolve all the financial and political issues that remain. That is why we are here. It is the failure of the nationalist parties and, indeed, the Green Party representative, to honour the Stormont House Agreement that has brought us to this point. It is their fault that welfare reform has not been introduced, and we will be fined — as has been referred to already — £2 million a week because of that. That is £114 million this year.

Finally, we were told just before Christmas by the then Finance Minister that £10·7 million in resource DEL and £8 million in capital DEL would be held at the centre for allocation as part of the final Budget. Perhaps the Minister will update us on how that money will be allocated. Will it be part of the June monitoring round? If not, how will Departments bid for it and when?

Photo of Judith Cochrane Judith Cochrane Alliance 5:00 pm, 22nd June 2015

I rise on behalf of the Alliance Party to support the Budget Bill passing its Second Stage because it is the least irresponsible thing to do. It is far from ideal, but we believe that it is the only solution available if Departments are to continue to try to deliver some services to people in Northern Ireland and to pay our public-sector wages. However, we are well aware that it does not resolve this latest mess that we find ourselves in. Passing this Bill will, however, buy some more time for those parties that say that they want to protect the vulnerable to come to their senses.

Of course, most of us have very deep concerns about the cuts made to the Northern Ireland block grant over the past number of years and the very real prospect of further cuts in the immediate years to come, but if we are going to fight that process and join forces with Scotland and Wales, as has been suggested, 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 mature and responsible manner now and resolving the financial pressures that we face this year.

The issue is quite simple: failure to deliver on the agreements of Stormont House and Stormont Castle, and the failure to face up to the realities of welfare reform, are plunging us into financial uncertainty. That is making the pressures on our public services even greater and even more acute and, ultimately, it is having a detrimental impact on the most vulnerable.

We have heard over and over from Sinn Féin that it is not here to administer cuts on behalf of the UK Government, and, yes, to some extent it has a point, but it has to recognise the wider constitutional reality. We are part of a UK framework, and that is currently where our finance for public spending comes from. So while I agree that this Assembly is not here to administer cuts, it is because we are not here to simply allocate money in exactly the same way that it is used in other parts of the UK. We are here to add value and make a difference, to make sure that whatever money we have is not being wasted due to duplication of services as a result of division in our society, and to show creativity and innovation in the policies and types of projects that we put in place in order to meet our particular circumstances. It is significant that no other part of the UK has taken the approach of sticking their heads in the sand and deliberately causing further financial uncertainty.

Both the Scottish Parliament and the Welsh Assembly, despite their opposition to austerity measures, have introduced Budgets reflecting the cuts that have been passed on from Westminster. They are making devolution work as best they can in order to grow their economies. By contrast, in Northern Ireland, we have, for instance, Danske Bank's chief economist this morning saying that it is ironic that just as the economy is getting back on its feet, this current political uncertainty is likely to dent any recent progress.

In an ideal world we would spend as much as we like on public services, but in the absence of a magic money tree we can only spend what we are given and what we raise additionally. We have seen before in this House how keen parties are to explore additional revenue-raising. If parties do not like what is being provided to us by the Treasury and they want to spend more, we need to prove that we are able to grow our tax base to become more self-sufficient. The reality is that, in order to do that, we need to grow the private sector. That means investing in and advancing things like the devolution of corporation tax and other economic levers to create jobs, as well as investing in skills to get people into work. It does not mean sticking our heads in the sand and continually taking more of a hit in our block grant, which prevents us from investing in the things that we need to invest in.

Of course we want to protect the most vulnerable, but not by condemning them to a life on benefits. What the SDLP is doing by not supporting the Budget, and what Sinn Féin and the Greens are doing by not progressing on welfare reform and Stormont House, is taking away the ladder that allows people to move out of the benefit trap. With every week that goes past, another £2 million is wasted and another rung is taken off that ladder.

Perhaps we should look a bit more at how exactly parties are protecting the most vulnerable by wasting £2 million per week on penalties. First, we have heard about the cuts to university places. Many students are being forced to travel to England, Scotland, Wales or down South to find a place and will end up with greater levels of student debt than if they had stayed at home. Furthermore, as the competition for Northern Ireland places becomes even greater, it is likely that those from the most deprived backgrounds will be the ones to miss out on places, because patterns show that those who are coming out of grammar schools tend to achieve better A-level grades and, therefore, get the places, even though those who do not necessarily get the A-grade results at A levels at age 18 are often the ones to flourish at university. Again, there is a disproportionate, negative effect on the most vulnerable, and Sinn Féin, SDLP and the Greens seem content for those young people to be denied that opportunity.

Let us consider the impact of the current financial crisis on early years. Because of the budget cuts, we are seeing the Department locked down on protecting school core budgets. That might be acceptable if we were ridding the system of duplication and waste, but we are not. Instead, we are seeing threats to early years provision, despite the evidence that the nought-to-six age group is critical in changing outcomes for future years.

It has been said that, for every £1 invested in early years education, we save the state £17 in remedial action at a later date. Yet, the early years fund could be cut by £2 million this year, which is almost 80% of its whole budget for Northern Ireland.

That £2 million figure might sound familiar. Oh yes, it is the amount that we are wasting every week by delaying on welfare reform. To be clear, the early years programme is predominantly administered to the top 20 disadvantaged wards across Northern Ireland. So, if Sinn Féin, the SDLP and the Greens really want to protect the most vulnerable, I suggest that blocking welfare reform and the Stormont House Agreement is not the right way to go about it.

Photo of Steven Agnew Steven Agnew Green

I thank the Member for giving way. Given that the welfare money that is coming in — the £2 million that was referred to — goes directly to the poorest families and that we have 100,000 children living in absolute poverty, surely giving the money to the families of those children is the right thing to do, rather than taking it away from them.

Photo of Judith Cochrane Judith Cochrane Alliance

I thank the Member for his intervention. He might want to look at some of the figures that show that, if you implemented welfare reform, whilst there may be some families who are worse off, perhaps by £31 a week, more households would be better off by £37 a week, 90,000 households would have no change whatsoever and there would be households that would be able to benefit from having up to 85% of their childcare costs met, rather than 70%. You might want to look at your figures.

Photo of Judith Cochrane Judith Cochrane Alliance

No, I will move on, thank you.

Those are just a few of the examples that show how nonsensical the approach is from some parties. If Sinn Féin, the SDLP and the Greens want to truly protect the vulnerable, they need to focus on protecting services rather than trying to protect votes. Yes, they might have some headline-grabbing lines but, when you drill down to reality, they are the ones who are harming the most vulnerable.

We are in a financial hole, and the progress of this Bill today will not get us out of it. We simply cannot leave this issue to drag on over the summer recess. Nor can Ministers continue to spend without due caution to the uncertainty that we face. Parties need to decide now whether they want to continue to be part of the problem or be part of the solution and work towards a resolution to try to recover financial sustainability and restore some faith in the devolved institutions.

Photo of Nelson McCausland Nelson McCausland DUP

The Committee was briefed by the Minister of Culture, Arts and Leisure as far back as October 2014 on potential budget reductions for 2015-16. Subsequently, the Committee has been briefed a number of times by departmental officials. The Committee has also received briefings from each of the DCAL arm's-length bodies on how the current scale of budget reductions will impact on them.

As Members will be aware, DCAL has an extremely complex structure, part of which is a large number of arm's-length bodies. In many cases, those bodies are the guardians of our collective cultural heritage and the very cultural fabric of Northern Ireland. As a Department, DCAL has a relatively small budget and, by virtue of that, the Department's arm's-length bodies have budgets that are very small in relation to the overall Executive Budget. However, it is these small budgets that are often the most vulnerable when it comes to funding reductions. There is little or no fat and there are few large programme budgets. Therefore, budget reductions hit core functions.

The Committee has already expressed concern to the Minister of the possible impact of budget reductions to Disability Sport NI and the Armagh Observatory, for example. Good work that has been done could be lost forever if funding is cut. The Committee is not naive: members understand that there are extreme budget pressures and that cuts must be made. However, the Committee stresses the need for a clear understanding of what those cuts might mean in the longer term.

The Committee has always stressed the need to ensure that budget reductions are applied as part of a strategy that seeks to protect front-line services to our communities and support the Department's stated objective of promoting equality and tackling poverty and social exclusion. However, the issue is particularly complex and nuanced regarding some of the DCAL arm's-length bodies.

The Committee has previously welcomed the fact that the initial proposed budget reduction was lessened by the Executive funding a further almost £2 million for DCAL, taking the budget reduction from a potential 10% to 8·2%. The Committee has also supported the decision to limit the cut to the Libraries NI budget to 7·5% in the hope that no libraries will have to close. This will, however, mean that the Department and other arm's-length bodies carry a larger cut. With respect to libraries, temporary and relief staff have already gone, and, after a consultation exercise, Libraries NI is examining its options regarding opening hours. The reality is that libraries will be forced to open for fewer hours, and the budget for new stock will see a considerable fall. The Committee is a strong supporter of our libraries; they are at the heart of our communities and offer considerable potential to be developed further as the arts and cultural hubs that help to build community cohesion and offer opportunities for expression to our people.

The Arts Council deserves credit for seeking to take a creative approach to managing budget reductions while still looking forward and innovating. The Committee has heard the rationale behind its funding decisions going forward, and Members appreciate this candour. The council has worked to absorb previous in-year cuts, but budget reductions mean cuts to grants. The Committee remains hopeful that an upcoming Executive arts and culture strategy may see greater cross-departmental funding of the arts and culture, which could see an increase in overall funding for the sector. The reduction in Sport NI’s budget has forced decreases in grants and performance and coaching activities. The Committee is understandably concerned about the possible impact on increasing participation levels in sport, particularly participants from the most disadvantaged communities.

I referred to the budget reductions faced by Armagh Observatory. With such a small budget to start with, it is imperative that the impact of the reduction on the observatory’s budget is carefully monitored and does not have a disproportionate impact. The Committee places considerable value on the work done by the observatory, and Members want to ensure that the continuous work that has been undertaken there for decades, which feeds into international scientific information gathering, will not be jeopardised. This is a significant and important institution. It is an institution of international standing and is the only one of that nature in Northern Ireland, so its future is important.

Budget reductions must be met with creative solutions, and the Committee has long been an advocate of interdepartmental working as well as cooperation with local government. The reform of public administration and the development of super-councils with enhanced powers provide an excellent opportunity for joint working and taking advantage of economies of scale. The Committee is extremely supportive of this. The Committee is a strong advocate of making better use of the funding that can be drawn down from the European Union. Members agree that greater efforts must be made to look at the opportunities presented by EU funding programmes and to learn from the excellent work already being done by some councils. The Executive, however, must be careful to ensure that we can provide the necessary match funding required.

The Committee was further briefed by departmental officials on 2 June regarding the current monitoring round. As with most Departments, DCAL is making bids worth millions of pounds. It is most concerning to the Committee that many of the bids are for inescapable capital pressures for the museums estate, the libraries estate and Armagh Observatory. Members are concerned that, if these are not met, there could be an impact on the ability of those bodies to make their estate available for public use. That brings me back to my original plea to ensure that we fully understand the impact of budget reductions to our cultural fabric and our ability to expand participation in sport. We will continue our responsibility to scrutinise the management of the budget in a proper manner.

I want to say just a few words in a personal capacity. It seems to me that much of the blame in all of this is placed on the Conservative Party at Westminster. Much of the pressure on budgets is directed at being the result of austerity. It is true that we face austerity, but the reality is that the SDLP and Sinn Féin cuts will cause far more damage to Northern Ireland, our institutions, communities and the vulnerable in our communities than any damage that may be caused by the austerity that is right across the United Kingdom.

As I listened to the debate, it seemed, at times, unreal and surreal. It seems to me that there are folk here who have lost touch with reality, with financial realities, with fiscal responsibility and with fiscal reality. Some of the views that emanated from the nationalist and republican parties today beggar belief and are, quite frankly, beyond belief.

Photo of Martin McGuinness Martin McGuinness Sinn Féin 5:15 pm, 22nd June 2015

Debates such as this, as we have seen in the past, usually contain more than a few long-winded speeches, but this will not be one of them. I speak today to give conditional support to the Finance Minister's Budget Bill. The Bill will create the space to resolve outstanding issues so that the Executive have workable and sustainable finances in the time ahead, and to ensure the full implementation of the Stormont House Agreement. Of course, there remains a fundamental challenge for the Executive on welfare protections, but, while we explore a way forward on that, the other important elements of the Stormont House Agreement, including the essential legacy mechanisms, should and must proceed.

The Budget Bill, crucially, does not involve any further reductions to public funding or services. It does not involve any reduction in social security support for the most vulnerable, and it does not contain any in-year reductions as a consequence of the £25 billion of further cuts announced by the Tories. This Budget was agreed by the Assembly in March, despite the enormous challenges and difficulties that the austerity agenda of the previous British Government created for our public finances. The newly elected Tory Government have indicated that the ideologically driven assault on public services will not only continue but will be escalated.

Unlike the Tory millionaires, I live in a working-class community in the heart of the Bogside in Derry. The people whom the Tories are targeting are my friends and neighbours. They are a proud and decent community of fine, hard-working people, just like our people in working-class unionist communities. They are not, as the Tories claim, parasites or spongers. David Cameron's Cabinet of millionaires has no comprehension of life in unionist and nationalist working-class communities. They are oblivious and indifferent to the devastating effect of these cuts, which affect working-class unionist communities every bit as much as working-class nationalist communities.

Austerity is a politically misguided approach, and it does not work. It impedes economic recovery and punishes the working poor, public-sector workers, the disabled and the vulnerable. The ideologically driven cuts agenda has created a political and financial crisis for our Executive and the Assembly, but the crisis is not between the parties in the Chamber. It is a crisis imposed on the Assembly and, indeed, on the Assembly in Wales and the Parliament in Scotland by the Tory Government in Westminster. None of the parties in the Assembly stood on a pro-austerity platform. The Tories stood on a pro-austerity platform and received a derisory vote in May. I think that, in the 16 constituencies that they stood in, they got fewer than 10,000 votes, so they are really a fringe party here in the North of Ireland.

They are also a fringe party in Scotland and Wales. They are a fringe party that is imposing its failed ideology on societies that voted against this approach. That is fundamentally undemocratic.

Our purpose in agreeing this Budget is to create space to resolve the outstanding issues in relation to the Stormont House Agreement. We need to know that the Executive have the resources to continue to build a peaceful, inclusive and tolerant society. The Executive now have nowhere to go in the context of the further eye-watering cuts planned by the Tories. There is no room to manoeuvre. There are no more savings to be made. Any further cut to our Budget will dramatically impact on front-line services, our economy and our society. That is not sustainable. It is a scenario that is not acceptable to Sinn Féin and is not acceptable to me.

Let us try to come at all of this positively. Let us try to find solutions. Let us, as a united Assembly and a united Executive, engage with the two Governments as a matter of urgency in defence of our political process, in defence of our core public services and in defence of the most marginalised and vulnerable in our society.

Photo of Sammy Wilson Sammy Wilson Shadow DUP Spokesperson (Treasury), Shadow DUP Spokesperson (Work and Pensions), Shadow DUP Spokesperson (Education)

I suppose that this is a rerun of the debate that we have had many times in this Assembly in various guises. Still, the air of unreality that pervaded those debates pervades this one today. It does not matter whether we go down the route of the SDLP, which will vote against the Budget, wants more money to be spent on everything and is ignoring the fact that we work within the limits of the money available to us, or indeed that of the last speech that we heard from the deputy First Minister

Photo of Sammy Wilson Sammy Wilson Shadow DUP Spokesperson (Treasury), Shadow DUP Spokesperson (Work and Pensions), Shadow DUP Spokesperson (Education)

Well, he has run away, of course. I think that anyone who had put up such an illogical argument would not have wanted to stay to defend it anyway. He may well have had an easy ride in London at the weekend, when he joined people such as Russell Brand the multimillion-pound hypocrite who thinks he is a comedian when the only laughable thing about him is his grasp of economics and indeed politics. I have to say that, if you look at the logic of the people who he was with on Saturday, you can see why he comes off with the kind of stuff he came off with here today. One of the chief people there, Russell Brand, told people not to vote. The next morning, he said that he was crushed with disappointment at the outcome of the election. What would you expect?

Now, we have the deputy First Minister talking about the need to have a sustainable Budget. He does not even recognise the contradiction in his own objective; on one hand, a sustainable Budget while, on the other hand, doing everything he can to make sure that the Budget is not sustainable and indeed that we pay back money weekly to Westminster, turn our back on the ability to borrow money that could have helped us in the long term to reduce the cost of government in Northern Ireland and refuse the opportunity to have capital expenditure that would of course have benefited his own Education Minister.

By the way, when talking about his own Education Minister, we see once again the hypocrisy of Sinn Féin. It loves to use this headline language and say, "We are against austerity", yet, when it comes to implementing reductions in the education budget, it does not really care too much about the vulnerable. Ms Cochrane is not in the Chamber at the moment. I think that she made an excellent point about the cutting of the early years budget, although she did not point the finger at the Minister responsible. Who is cutting the early years programme, which is the very foundation of the whole education process for many vulnerable youngsters? Who has cut that programme to the tune of £2 million? None other than the Sinn Féin Education Minister. On the one hand, that party comes off with the rhetoric of anti-austerity, but, on the other hand, it knows full well that, when it comes to the reality, this place has to live within its budget.

I could go through an awful lot of areas of expenditure for vulnerable people that he has reduced in the education budget , but I suppose that the real test of whether Sinn Féin is sincere in its rhetoric would be to see whether its Education Minister is prepared to live up to it. For example, those who have learning difficulties and need statements and support are finding that they have less funding from the Department of Education because the Minister, whether he likes it or not, has had to live within his budget. However, globally, Sinn Féin and the SDLP think that we do not need to live within our budget and that we can simply keep on spending money that we do not have and, indeed, turn our back on money that we could have. That is the important thing.

This Budget could be made easier. I know that the Finance Minister has brought forward a Budget that is predicated on the assumption that we will eventually see sense and abide by and implement the Stormont House Agreement. If not, towards the end of this financial year, unless the Treasury turns a blind eye to our overspending, which is very unlikely, we will find that there will be emergency reductions in Departments' budgets that will be much more difficult to implement when squeezed into the last couple of months of the year.

Therefore —

Photo of Jim Allister Jim Allister Traditional Unionist Voice

From the Member's experience, is it not the case that, to make those emergency adjustments, the Minister would need the Executive's approval and that those who are very happy to spend other people's money and money that they do not have are in the position of being able to refuse consent to the emergency adjustments? What happens then?

Photo of Sammy Wilson Sammy Wilson Shadow DUP Spokesperson (Treasury), Shadow DUP Spokesperson (Work and Pensions), Shadow DUP Spokesperson (Education)

That is the kind of fantasy world that some of the people who are taking the stance that they are taking on the Budget are living in. They hope that those things will not materialise, but the reality is that, although there are limits to how much money we can spend, the Budget is predicated on the basis that we will have additional funding, either through loans, money from Westminster or savings that we have made. If we cannot obtain that, people are at some stage going to have to face that reality. As I pointed out, despite how they might try to hide it — they hope that this is not highlighted too often — even Sinn Féin Ministers, when faced with the reality of being told, "That is how much you have in your budget", will still make choices. I do not like some of the choices that they make. Indeed, I believe that some of those choices show that they do not really care about the vulnerable, but they still make the choices. When it comes to the choice between political ideology and protecting the vulnerable, political ideology wins every time with Sinn Féin. We have plenty of examples of that in the budgetary decisions that some of its Ministers have made.

There are consequences to the impasse that we are in. I know that the deputy First Minister said that he is supporting the Budget conditionally in order to give us time to work our way through the difficulties. I do not know how much time he needs, but the one thing that I do know is that, coming up to the Stormont House Agreement, we were asked for time. We got the Stormont House Agreement, which was an agreement that we thought everyone had signed up to. People did sign up to it. Indeed, the SDLP was miffed because Sinn Féin would not even support its petition of concern at one stage, yet suddenly Sinn Féin went back on the agreement. Unless there is a change of heart, all we are going to do is work our way more and more towards that deadline.

The consequences of that are twofold. As has been pointed out, the economic uncertainty is not good for business in Northern Ireland. If business is hit with that uncertainty, we are not going to create the jobs that we hoped to create, we are not going to have the growth that we hoped to have, and we are not going to get the tax revenues that we thought we would get. It has all those bad implications.

The second thing is that the political standing of this place sinks further and further in the eyes of the public. I would not mind if it was simply the esteem of the guilty parties that went down in the eyes of the public. Unfortunately, and this is bad for democracy, it is the whole of the political institutions and everybody involved in them.

I can understand the frustration of the public. We on this side are frustrated as well when we see staring us in the face things that need to be done, should be done and are not being done. I can understand the frustration that the general public has, but we have to bear in mind that the decisions that we make here impact on people's lives; they impact on the vulnerable. People in Northern Ireland will be far more vulnerable if we have a shaky economy that teeters on the edge of low or no economic growth because of bad decisions made in this place. That is the real vulnerability, the real attack on the vulnerable. Let us give people hope, vision and a chance for the future. The way to do that is to behave responsibly and maturely in this place.

Martin McGuinness this weekend joined a lot of other people who were complaining about austerity. Some were in Administrations and local government across England or in regional Assemblies in Scotland and Wales. They may have stood complaining about austerity in London, but they implemented budgets in their own Administrations. That is the difference. They understood their responsibilities as politicians; we should understand ours.

I commend the Minister for bringing forward a Budget and giving the space for public services to continue, but we cannot continue like this, and we have to reach real decisions before too long.

Photo of Michaela Boyle Michaela Boyle Sinn Féin

Go raibh maith agat, a Cheann Comhairle. I welcome the opportunity to speak on the Second Stage of the Budget Bill as Chair of the Public Accounts Committee (PAC).

The PAC strives to work in the public interest to ensure that public money is used in the most efficient way possible so that the greatest value is achieved from every £1 spent. Never has value for money been so important in the stewardship of ever decreasing limited public funds.

This Budget presents real challenges for Departments, given the extent of cuts that they now face. In its efforts to safeguard the public purse, particularly in these austere times, PAC will closely monitor whether Departments achieve value for money.

The Committee strives, with the support of an independent Audit Office, to ensure that high standards of stewardship of public money are achieved, and it adds value by having a bird's-eye view over government spending. Essentially, its role is to consider the accounts and reports on accounts laid in the Assembly. That gives the Committee a scrutiny role over all departmental and public-sector accounts audited by the Audit Office.

Given the critical role that the Audit Office has in this respect, the Committee expressed concerns to the Audit Office in March of this year about the reduced budget, which presents significant challenges to the Audit Office's ability to maintain the current level and quality of services to the PAC and wider Assembly.

While the Committee realises and accepts that budget cuts are severe on all Departments, the PAC considered the Audit Office’s estimate for 2015-16, which set out a reduction in its budget of £514,000, or 6·3%, as unacceptable. The reduction seriously compromises the independence of the Audit Office and its ability to fulfil its statutory obligations and deliver its services fully to the Assembly.

The pressures on the Audit Office budget are further compounded by the uncertainty about whether it, like Departments, will be able to access the voluntary exit scheme. Failure to do so will result in the C&AG being unable to achieve the level of savings required to deliver the Audit Office's services to the Assembly and fulfil its statutory obligations. This is a very serious situation indeed and one that we, as a Committee, will be keeping a close eye on.

It is the role of the PAC, as part of the Assembly’s control framework for government spending, to consider reports by the Comptroller and Auditor General on the resource accounts of Departments that have exceeded the limits of expenditure authorised by the Assembly. The Committee recommends whether the Assembly should approve further resources to the Departments concerned in order to regularise the excess expenditure. In 2013-14, three Departments incurred excess expenditure. The specific cases were as follows: the Department of Health, Social Services and Public Safety incurred a resource excess of £1·17 million as it failed to include cover for all its payment obligations within the Spring Supplementary Estimates; the Department of Education incurred a resource excess of £6·28 million as a result of its arm’s-length bodies exceeding the cash drawn down amounts authorised within the Spring Supplementary Estimates, and the Public Prosecution Service incurred a resource excess of £6·03 million as a result of a fair employment tribunal ruling in March 2014 in favour of a case taken by its staff. On the basis of the Committee's examination of the reasons why those bodies exceeded their voted provisions, it recommended that the Assembly provide the necessary amounts by means of an Excess Vote.

The PAC, however, acknowledges that the Department of Finance and Personnel disseminated lessons learned from the PAC's previous Excess Vote reports to accounting officers and finance directors. The Committee recommends that the Department continues to do so, particularly now, as we face such challenging budgetary times in the forthcoming financial year.

Moving on, Mr Speaker, if you will allow me —

Photo of Alban Maginness Alban Maginness Social Democratic and Labour Party

The Member has raised some very interesting points in relation to the Audit Office and the reduction in funding. The points she raised were really, in a way, constitutional points. Should it be that the Executive can curtail the capacity of the Audit Office? Should it not be that the Audit Office's funding is ring-fenced so that it can carry out its functions to its full capacity?

If I may, the further point I would ask the Member is this: if the PAC is so exercised by the reduction in funding to the Audit Office, will it or its members table an amendment to the Budget (No. 2) Bill to try to remedy the situation that it has rightly highlighted?

Photo of Michaela Boyle Michaela Boyle Sinn Féin

I thank the Member for his intervention. That is not up to me, and I would have to take that back to the PAC. Go raibh maith agat.

A Cheann Comhairle, if you allow me a moment of your time, I would like to speak on behalf of the party. Like my party colleagues, I give conditional support to the Budget (No. 2) Bill. While the Executive attempt to find a way forward, the British Government are pressing ahead with their cuts agenda and are reducing the finances available to the Executive. The British Government, with no mandate from the people of the North, have again increased the difficulties of the Executive. The Bill also means that the Executive Ministers can continue to deliver front-line services, and that has to be welcomed.

The Executive's Budget has been under fierce pressure from year-on-year British Government cuts to the block grant. Despite this, Sinn Féin has continued to support the provision of front-line public services while protecting the most vulnerable. As has been stated by previous contributors, this Budget Bill does not involve any further reductions to public funding or services.

Most of the welfare cuts that the Tories are trying to impose on the North have already been implemented in Britain, with devastating consequences. People are caught in an austerity and poverty trap, particularly the sick, the disabled, single parents, those on low incomes and the working poor.

Photo of Michaela Boyle Michaela Boyle Sinn Féin

No, I will not, with respect.

Poverty levels here have spiralled out of control, along with homelessness levels and suicide rates. Ever-in-demand food banks and other charitable help are now often the safety net that prevents more people from falling into total destitution and despair. Tory policies threaten to destroy the economy through savage cuts to public funding and welfare. As we have seen, the implementation of these measures in England has been a complete disaster and has plunged thousands into poverty and deprivation already.

The North is a society emerging from decades of conflict, and clearly you cannot apply here that which applies to England and Wales. Here, we can collectively take control of our Budget and welfare policy. Our public deserves much, much better and having direct power over our economy means that we can seize the opportunity to do things here much better.

Photo of Pat Ramsey Pat Ramsey Social Democratic and Labour Party

I welcome the opportunity to speak on the Second Stage of the Budget Bill. I want to comment mainly as a member of the Committee for Employment and Learning and to reflect on some of the issues that affect it. I also want to comment on some matters that are relevant to my constituency, particularly economic issues.

I want to make it very clear that the SDLP will not force a Division on the Budget Bill today. We will evaluate and scrutinise the Bill, like other parties, and we hope that the difficulties on a number of the issues can be smoothed over, particularly those that pertain to welfare reform, and that reconciliation can be found. There is absolutely no doubt that the introduction of welfare reform in Northern Ireland will have a hugely detrimental effect on communities that are already struggling.

The SDLP has been extremely concerned about the impact that is already being felt as a result of budget cuts to the Department for Employment and Learning and the further impact that this Budget may have in 2015-16. Judith Cochrane, who has come back to the Chamber, made a valid point about the number of student places that we will not now be able to offer and the effect that that will have on the widening participation strategy, which has been a tremendous success over recent years, enabling people from less-well-off socio-economic areas to participate in third-level education. We are going to lose that, and the young people who may not get the required grades will be subject to selection criteria and they will fall out of the system and perhaps out of education altogether. Investment in third-level education is much higher in the other devolved regions. Investment per student in England, Wales and Scotland is much greater than it is here.

The Bill makes significant reductions in allocations to funding streams, such as education maintenance allowance (EMA) and student support, and to funding for universities and colleges. All the colleges throughout Northern Ireland play a huge role in better preparing young people who do not make it to third-level education for industry, for the job market and for job opportunities that they would not otherwise have.

The extent of the cuts have already been outlined to the Committee for Employment and Learning by the Minister and the Department. A £30·1 million pressure on the Department's budget will be managed by a reduction to universities of almost £16 million and £12 million reduction to colleges. There will be further departmental efficiencies of over £4 million. The Minister is not here, but I am starting to feel sorry for him. I have sympathy for him in trying to provide an opportunity for our young people. He makes a fairly good job of trying to do that in difficult circumstances.

The practical implications of the cuts do not bode well for students or our young people in general. Take the proposed funding slash to Pathways EMA, for example: that allowance is paid to almost 1,700 young people who are not in employment, education or training. We still have over 40,000 people in that awful NEETs category; they are nowhere at present. Those young people, and the organisations that support them, have been thrown into uncertainty through no fault of their own.

I want now to concentrate on making this region work more economically. We must ensure that we have the skilled workforce to match any job opportunities that the Executive and Assembly manage to create. The reality is that, if we cut the number of places available to young people for further study, many will not be able to study here, even if they want to, and, reluctantly, they will leave. Any reduction in places is simply strategically inconsistent with attempts to support our young people to stay here, work here and contribute to the wealth of ideas and employment opportunities available here.

Another area of concern is apprenticeships. I think that most of the House agrees that, alongside university places, we need to provide adequate work experience and apprenticeships for young people so that they may develop their skills and build a career in their chosen industry. The Employment and Learning Minister has brought forward very creative ideas in senior- and higher-level apprenticeships, but we cannot forget about the traditional apprenticeships that are badly needed in Northern Ireland across the board, such as carpenters, electricians, plumbers and bricklayers. What does the Budget mean for those apprenticeships here? We know that the Minister was unable to commit extra funding from his Department for apprenticeships. I hope that he does not cut the budget for those vital schemes. I hope that, in the June monitoring round, he might find a role for that.

I will also make a point as chair of the all-party group on learning disability. Earlier this year, the House debated the Special Educational Needs and Disability Bill. I raised specific concerns relating to the funding for those with special needs who are pursuing further education. I welcome the fact that the Minister has decided to retain the higher education support that the Department currently provides for those with learning disabilities, and the fact that he is not cutting the disability employment programme. It is important in all this to say that young people who leave school with a learning disability are four times less likely to secure employment than even those in the NEET category that I talked about. It is a worrying trend, particularly for parents, when they are trying to create an environment of independence for their son or daughter who may have those difficulties. I urge the Minister today once more to continue to provide that vital service for those with learning disabilities throughout all our higher education institutions and colleges and to consider how to best support them in the current period of financial uncertainty.

I will now speak about the role of the Budget in exacerbating regional imbalance. I welcome the creation of the ministerial subgroup aimed at tackling regional inequalities in the economy here. Initially, we were told, it will focus on the north-west, and there is good reason for doing so. I hope that it can create positive outcomes, not just for my constituency of Derry. I hope that it recognises the level of regional inequality in access to education, transport and work. The present Finance Minister is well aware of the high levels of unemployment and the especially high levels of economic inactivity in the north-west. She has endeavoured to work with the Employment and Learning Minister to try to come to a stage of looking at very innovative and creative ways of trying to make a difference to the quality of life for people who find themselves in those unfortunate positions.

Sammy Wilson talked about apathy. The level of apathy and disillusionment among people in my constituency is very strong, and there are justifiable reasons for it. It was announced last week that the north-west gateway initiative is being reinvigorated in trying to make a difference to the quality of people's lives.

The only way that difference can be made is through economic development, infrastructural changes and increases in third-level education places. An economic package is required in the city.

I name Magee as one example. Here we have the most important economic development project that could ever take place in the north-west. It is not just for Derry; it is for the north-west, and the benefit would be for the student population in Northern Ireland. But, with each passing semester, we are losing our young people and their skills and talents to another region or country further afield. This further contributes to our unemployment deficit in Derry and the north-west and the high number of our young people who leave to seek work in the east of the Province.

Ulster University made announcements this week. It is hugely disappointing to learn that it is now not able to proceed with the purchase of land on the old Foyle and Londonderry site on Northland Road. We all endeavoured, through unity of purpose in the city, to ensure that St Mary's College was facilitated on the old Templemore site. Foyle and Londonderry College was facilitated by a new school in the Waterside. The third part of that tripod was the development and retention of land on Northland Road, the old Foyle and Londonderry site, for future generations in the city. Minister, you may want to examine working collaboratively with the university to find a creative way of ensuring that that land is saved, not for this generation or even the next but for future generations of young people and the economic betterment of not just Derry but the north-west.

We will not be able to attract appropriate investment or stimulate growth until we have better infrastructure in the north-west. The deputy First Minister, in response to my question last week, said that the key elements of the discussions at the North/South Ministerial Council and with the ministerial subgroup were the A5 and A6. As the Minister, who did a fine job as Enterprise Minister, knows fine well, when you are trying to companies to Northern Ireland, the first thing that they look for is adequate infrastructure, but we do not have it. That is the regional imbalance that needs to be resolved once and for all. It is a legacy of so many years of unfairness and wrong decisions taken against the wishes of the people of my area.

I appreciate the immediate difficulties in the finances but we must consider, too, the positive impacts that greater investment in transport links will bring to the city of Derry and the north-west of Ireland in general. Despite continuous hard work carried out over a number of years in the One Plan, the Derry and north-west public still await delivery.

I do not want to sound as though I am whingeing. A lot of good things have happened in the city. The City of Culture year brought a tremendous feeling of self-worth and a greater sense of pride. Everybody was expecting the true legacy of the City of Culture to be a higher level of employment opportunities. However, unfortunately, when the Northern Ireland Statistics and Research Agency (NISRA) team came to give the figures to the Employment and Learning Committee in November of that year, we learned that unemployment rose by 2% in that period. We need to focus our efforts. I do not have the figures here, but I was going over them this afternoon. Derry has almost 8% unemployment. Compared with other parliamentary constituencies, unemployment in the Foyle constituency is twice or three times more or 3%, 4% or 5% higher than in other constituencies. There is something wrong with those figures, and those were for May.

While great efforts are being made to turn things around in a period of recession, unfortunately, the people who I represent do not see them turning around in their context. They do not see the ball bouncing their way at all. I think it is the role of the Finance Minister to ensure that, when funding decisions and the Budget comes around, consideration must be given to those who are already adversely affected are not further marginalised and pushed further away from the centre.

People talk about the welfare reforms. People would not mind the welfare reforms being implemented if there were opportunities for work. I could stand here and defend the position of welfare reform if young people, and not so young people, had access to work, but, in Derry, how many times less likely are you to secure a job than in some other constituencies? Some constituencies have 2% unemployment compared with almost 8% in Foyle.

I am finishing, Mr Speaker, but I want to acknowledge the serious contribution of the blue light services across Northern Ireland — the Fire and Rescue Service and the Northern Ireland Ambulance Service — and the work that they do for us all at the most important times in saving lives. I will include Foyle Search and Rescue, even though it is not officially a blue light service, which is at breaking point. I see the crews and speak to some of the people, and I promised that I would raise its situation.

The Minister for Employment and Learning is not here, although he was present for most of the debate. There was a major protest outside one of our jobs and benefits offices in Derry today. The grim reality of the situation is that, at the same time as we are trying to introduce welfare reforms, we are reducing the number of skilled operators who are there to provide a service to those whom we expect to be taken off benefits and put into work. We are removing them and making them redundant; we are forcing them out of work.

I say this genuinely and in good faith to the Minister: the Budget should put investment, in reasonable balance, towards infrastructure and changing the psyche about access to employment opportunities. Unfortunately, my constituency has been failed.

Photo of Sandra Overend Sandra Overend UUP 6:00 pm, 22nd June 2015

I speak on behalf of the Ulster Unionist Party on the Budget — "provisional", "phantom" or otherwise — primarily in relation to the Departments of Education and the Environment. I welcome the new Finance Minister to her post, and I am sure that she wishes that it had happened in more fortuitous circumstances.

Last Monday, the Finance Minister said:

"The budgetary context that we find ourselves in means that we must take difficult decisions, minimise waste, promote the efficient delivery of public services and seek to protect front-line services. The spending priorities agreed by the Executive in the 2015-16 Budget will allow us to do just that." [Official Report, Vol 105, No 6, p9, col 1].

I agree wholeheartedly with the first part of the Minister's statement, but the second part is much more arguable. The following questions must be asked of the Department of Education. Has the Minister of Education taken difficult decisions? Has he minimised waste, promoted the efficient delivery of public services and sought to protect front-line services?

In terms of taking difficult decisions, area planning has been a piecemeal and sectoral process, and it has had no joined-up planning, as referenced in the Committee report in debate last week. As for minimising waste and promoting efficiency, we know that, over four years, the Minister of Education has made no attempt even to look at the recommendations of the performance and efficiency delivery unit (PEDU). No firm set proposals have emerged from the home-to-school transport report. As for protecting front-line services, tell that to the schools that, because of the head-in-the-sand approach of Sinn Féin and others to welfare reform, live in a state of complete uncertainty about their budgets for the next financial year.

The Ulster Unionist Party voted against the unbalanced 2015-16 Budget agreed by a majority on the Executive in January. It is worth rewinding to the draft Budget, which was consulted on last December. We remember the doomsday scenario, when senior officials told the Committee that an estimated 2,500 teaching and support staff jobs in schools would have to be cut by April 2015. The Ulster Unionist Party, like many others, responded to the consultation. We made the point that the priority must be to protect the aggregated schools budget; the money going to front-line teaching needed to be protected.

In January, post the Stormont House Agreement, the final Budget was agreed, chiefly between Sinn Féin and the DUP. Minister O'Dowd announced that his resource budget for 2015-16 was to be £1·9142 billion. That was a reduction of around £30 million from last year's resource budget, but it is a larger per annum figure than any of the years from 2011 to 2014.

In a press statement issued on 19 January this year, Minister O'Dowd said:

"there is no reduction to schools' delegated budgets."

He expressed satisfaction with the Budget outcome for his Department. However, at the end of March, with less than a month to go to the start of the new financial year, the Minister briefed the Education Committee and dropped a new bombshell about teacher redundancies. He said:

"The approximate number of redundancies will be 500 teachers and 1,000 support staff."

Since the start of the new financial year, we have seen significant funding cutbacks in education: cuts to early years, cuts to the Sentinus STEM promotion programmes, cuts to the primary school modern languages programme, cuts to the Book Trust Bookstart scheme and cuts to community education initiatives. Where do we stand now, with the Stormont House Agreement on ice and a provisional Budget that ignores the reality of the financial stalemate?

The agreement included a capital investment of £500 million in shared and integrated education to be delivered over 10 years, with individual projects to be agreed between the Executive and the Westminster Government. The fact that that is in abeyance will surely have consequences for the entire education budget, unless the shared education process is being abandoned at birth. We need to have clarity on how much money will be saved by the replacement of the five education and library boards with the new single Education Authority. We have not forgotten about the £16 million that was spent in preparation for the Education and Skills Authority (ESA). Anecdotally, I hear that the top management of the education and library boards have been rebadged and retained in the Education Authority but that the lower-ranked officers have been culled, putting those who remain under considerable pressure. It is a disgrace that, on the verge of the school summer holidays, there is such uncertainty in the Department of Education's budget for 2015-16.

I will now make a few brief comments on the budget for the Department of the Environment. The initial settlement for 2015-16 proposed a reduction of 500 staff. In the end, I believe that 459 applied under the voluntary exit scheme, and, of those, only 159 will be made a conditional offer. It is worrying that the Department openly admits that it chose those personnel solely on the basis of a value-for-money calculation, with no regard to the subsequent impact.

I support the voluntary exit scheme, but we need to approach it rationally. There is no point letting someone go if their departure will leave a skills gap that someone else will need to be trained to fill. Given the apparent eagerness to reduce the number of staff, suppress posts and reduce overtime, it was peculiar that the Department sought to make no modification to the Budget to reflect that. Even if staff do not begin to leave the Department until later this year, significant savings could still be made. I believe that, even now, officials in the Department are working towards an in-year saving of approximately £2·2 million.

Following last week's announcement on Exploris, it is essential that the allocation of £700,000 for the current financial year is not squandered. I urge the Department to revisit its engagement with the council to make sure that it can get plans in place to spend that money.

I have a wider concern about the DOE budget, and it is likely a criticism that could be levelled against others as well. I get the impression that the primary consideration in determining where to make reductions is how most quickly to make the most savings, rather than acting with any form of strategic thinking. I fear that, much like the current approach to the voluntary exit scheme, some of the decisions, by showing a disregard to statutory and European obligations, only expose the Department to risk later down the line. We need to be rational about this because a saving from a research fund, for instance, will pale in comparison if we are hit with infraction penalties.

I would like to conclude with a query about my constituency of Mid Ulster, specifically the community safety college at Desertcreat. I hope that the Minister will be able to clarify the current budget position. We heard that Her Majesty's Government at Westminster have withdrawn the £53 million that was earmarked for Desertcreat. I wonder how much is still allocated to the project in the Northern Ireland Budget and whether the £53 million will be allocated elsewhere in Northern Ireland. I look forward to the Minister's response.

Finally, the deputy First Minister referred to the current political stalemate as a problem imposed upon us. He said that it was not the fault of any of the Northern Ireland parties. It was rather big of him to say so, and I think that it was wrong of him to say so. It would be much bigger of him to accept responsibility to resolve the situation in the Northern Ireland Assembly. The people of Northern Ireland will not forgive us if this mess cannot be resolved. It will be a real test of the Northern Ireland Assembly. The First and deputy First Ministers have the responsibility to lead. The ongoing uncertainty serves no one. It serves only Sinn Féin's agenda of breaking down everything that is good about Northern Ireland.

Photo of William Irwin William Irwin DUP

I welcome the opportunity to speak, today, as Chairperson of the Committee for Agriculture and Rural Development. As such, I represent the views of that Committee. The views that I will express today on the Budget Bill will be very similar to those I made last week during the debate on the Main Estimates. The Committee last received an oral briefing from the Department on 2 June 2015, on the Main Estimates. During that briefing, a number of concerns were expressed by Committee members, namely about the payment of grants to farmers, the voluntary exit scheme and TB compensation. I will elaborate on these in more detail as I go through my speech.

As I stated on 15 June, DARD has responsibility for the payment of EU grants to farmers, and we do not underestimate the work involved in that. At the briefing with the Department, a figure of £245 million was quoted for CAP. Given the vast amount of money, the Committee focused on that issue. As a Committee, we want to ensure that the EU money is paid on time to the farmers and rural communities who are eligible to receive it.

This year, the payment of the EU grant is accessed via a system known as the single application form (SAF). The SAF is not new, but the way it is being filled out is. What has complicated the process is that there are now up to five separate sections that a farmer can apply to for payments, each with their own criteria to be met. Given the current impasse with the Budget, Committee members raised concerns that that would have an impact on any payments to farmers, alongside any complexities of the new system. However, the Minister and her officials have given assurances that payments are the number one priority. The Committee was also relieved to hear from the Minister of Finance and Personnel, during Question Time on 9 June, that she would ensure that measures would be in place to safeguard single basic payments to farmers. That will provide some comfort to the payment recipients.

The voluntary exit scheme is expected to make savings of £5·9 million for the Department. Again, the issue of the Budget was raised by Committee members, and questions were asked about the feasibility of the scheme if the Budget were not agreed. What will happen if the money for the scheme is no longer available? How will the Department account for the £5·9 million that it will no longer save if the scheme does not go ahead? Those are questions that we will want to hear answers to. Unfortunately, the officials were unable to provide any further information or clarification on that, other than that letters had been issued to all staff who applied to the scheme.

I now turn to the issue of TB compensation, which is an area that has previously been underfunded, and for which the Department has previously had to seek additional funding in monitoring rounds. TB compensation is a high cost to the public purse and has additional costs associated with it, such as testing and research. It is an ongoing problem, and the Department has a statutory responsibility to test and compensate for TB. At the briefing with DARD officials, we learnt that an additional bid of £4·5 million had been made in the June monitoring round, as the baseline of £12·5 million in the Main Estimates was, in fact, incorrect. The Committee was therefore concerned about what the next steps would be for the Department if the money was not allocated via the monitoring round. We questioned the officials accordingly about what impact it would have on the budget. It came as no surprise to hear that the Department has not yet fully thought it through and is in the process of exploring contingencies, which has left the Committee with very little confidence that the Department is devoting time and effort to finding solutions for major problems.

Finally, there would appear to be a leaning towards rising administrative costs for DARD, from £54 million in 2013-14 to £58 million in 2014-15. Recent estimates show a further increase to just over £60 million for 2015-16. Officials advised that the rise in administrative costs is a result of costs for accommodation and shared services across the Civil Service. The figures quoted are added for completeness. The Committee was not entirely convinced by the explanation and will aim to re-examine it at a future date. The Committee also heard from officials that, if the Department has to operate on a budget of 95%, with a 5% cut, difficult decisions will have to be made. We await the outcome of those decisions and the impact that they will have.

Photo of Máirtín Ó Muilleoir Máirtín Ó Muilleoir Sinn Féin 6:15 pm, 22nd June 2015

Go raibh maith agat, a Cheann Comhairle. I want to add my voice to those who are expressing support for the Budget today, even if our support on this side of the Chamber is conditional.

I will explain some of the reasons why we fear for the future of these institutions and for the future and economic well-being of our people if we do not take strong steps against the economic policies and strategies coming out of London. In my view, the policies being pursued by Mr Osborne and the Tories are the policies of the wasteland. They will lay waste to everything that we hold dear, and, in particular, they will make it more difficult for us to drive forward our society.

Occasionally, Mr Speaker, I go into the Library, where I read the 'Financial Times', you will be pleased to hear. I have some statistics and facts from the 'Financial Times' that are very relevant to us concerning policy. In Britain, debt is at its lowest in 300 years as a percentage of GDP. Less than one in five is in public service, and that is the lowest number since the 1930s. It is the intention, as we know, of the Tories to make sure that four fifths of the deficit reduction comes from cutting services and just one fifth from raising taxes. We understand therefore where the pain goes in that process.

Of course, in response to that wasteland policy of the Tories, some of the greatest defence of ordinary people has come from the Churches. We know the resolute position of Pope Francis. However, in February 2015, in response to the then coalition policies on austerity, the Church of England said:

"the greatest burdens of austerity have not been born [sic] by those with the broadest shoulders."

That means that the pain is not being shared equally. In fact, those who are better off continue to do well, but those who are at the bottom of the economic ladder have to bear the greatest burden. For me, that is unacceptable. I do not believe that that ideology is shared by parties in the Chamber. Despite our divisions on this matter and other matters over recent weeks, it is my contention that the desire for a fair and prosperous economy unites us.

I want to say something as someone who has had some involvement in small business and in growing businesses over 20 years. The policy of cut, cut, cut does not lead to business development. It is even more important that we invest in our businesses to grow them, that we skill up and that we cherish the employees who work for our businesses. Instead of that, unfortunately, the approach of the Tories is akin to insisting that everything must be a cut and that there is no other way in which to drive growth than to cut. In my experience of small business, that is not the case. I argue that we are now in an era of needless austerity, to use the term that the International Monetary Fund (IMF) used recently in its memo on austerity being carried forward by Western Governments. That needless austerity will certainly set back the British economy, but, for us on the margins, it will be, and is, absolutely devastating.

I want to quote — not the 'Financial Times' this time — Madame Lagarde, the head of the IMF. Speaking recently on inequality and austerity, she said:

"In too many countries, economic growth has failed to lift these small boats"

— referring of course to the idiom about a rising tide lifting all boats —

"while the gorgeous yachts have been riding the waves and enjoying the wind in their sails. In too many cases, poor and middle-class households have come to realize that hard work and determination alone may not be enough to keep them afloat."

The sources that I am quoting will not perhaps be seen as those of the left in any manner of speaking, yet they, too, are crying halt to this agenda of austerity.

Anyone who has been listening to the media has heard different party spokespersons disagreeing on the way forward, but, despite the divisions today, I want to talk about what unites us. The Finance Minister, speaking at Question Time on behalf of the First Minister, spoke about her belief that if we do not implement the cuts that are coming down the line from the Tory Government, we will be doomed. She estimated that perhaps another £350 million will targeted at welfare, but it could be broader than that, and there will be additional cuts under Mr Osborne — perhaps as much as another £450 million — which will bring us to up to £800 million in cuts between now and 2018. It is my contention —

Photo of Arlene Foster Arlene Foster DUP

Will the Member give way?

Photo of Arlene Foster Arlene Foster DUP

That is not exactly what I said. If he looks at Hansard, the Member will see that I said that we were doomed if we do not implement the Stormont House Agreement and welfare reform, as it currently stands and not what is coming in the future.

Photo of Máirtín Ó Muilleoir Máirtín Ó Muilleoir Sinn Féin

Thank you for that clarification. Let me put it in a broader sense: what our colleagues in the DUP have been saying is that if we do not accept the agenda from London, if we do not accept that there is no money in the kitty, if we do not accept that there will be no more investment, there could be no future for the institutions. It is my contention that if we accept the agenda from London, the institutions are doomed. If we accept that there has to be another £800 million in cuts between now and 2018, our job becomes unsustainable. What will our purpose be — to deliver those cuts to our constituents and then to come back in 2018 with another raft of cuts? I want to emphasise the common ground in that all of us in the Chamber are united and wish to protect the institutions, but, to save the institutions, I am convinced that we have to stop the austerity agenda from London.

I will finish with this: the message surely has to go to Mr Osborne and his colleagues that they need to invest, that this is a special case, that we have suffered terribly over many years of darkness in this part of the world, that they need to accept that if we want to grow the economy, if they want to see a fair and prosperous society here, they have to invest. That means more expenditure on public services and cannot mean additional cutbacks.

We started with talking about the wasteland politics of the Tory Government. The Minister went over to see the Chief Secretary of the Treasury during the week; she came out with the message that there is no more money there. It is my belief that we need to go back, and we need to fly that flag for all our people again to insist on the investment that we need. If they refuse this week, we will go back next week much stronger, and we will go back united. That has to be the aim of all of us: that we unite around our insistence that we need to invest to grow our economy and to protect our people in the time ahead. None of us will shirk from that obligation.

If we do not do that and if the Tories have their way, I am convinced that the wasteland that they will create here will be more awful than anything that TS Eliot could ever have imagined. Our job is clear. In my view, we need to unite in the time ahead. We need to have a common platform with which to go to London, and we have to insist that they have to find a way to enable us to grow the economy, build our society and build a shared and prosperous future.

Photo of Thomas Buchanan Thomas Buchanan DUP

I support the Minister and the Bill. Most of my remarks will focus on the Department for Employment and Learning, the Committee of which I am Deputy Chair. I heard a number of Sinn Féin Members speak today, and they said that their support for the Bill is conditional, yet none of them has spelt out exactly what they mean by that. What exactly does it mean when they say support for the Bill "is conditional"? Not one of them has spelt out what they actually mean by that statement, but it is not surprising that they make such a statement and then hide behind it.

All Departments must realise that difficult decisions have to be taken but that those decisions should be taken in a way that protects front-line services. It is utterly despicable that Sinn Féin and their shadows in the SDLP are holding our country to ransom by their stubborn resistance and failure to implement welfare reform.

That failure is costing our country dearly and will mean changes being put in place that will undo years upon years of good work in the FE and HE sectors. I am absolutely appalled that we have two parties that are playing with the lives of our future generations and keeping up the facade that they are looking after the needs of the most vulnerable in this country. That is only a smokescreen, because, given the way they are carrying on, the most vulnerable in our society will become worse off. We are really plunging this country into a deep hole.

Sinn Féin and the SDLP are, in effect, flushing £2 million down the drains of Northern Ireland per week. That money could be used to solve budgetary problems and ensure that we were not here today lamenting the future of DEL and other Departments. One of the worst things surrounding this budgetary uncertainty is just that: the uncertainty. It is a logistical nightmare to plan for the future when there is no clarity on budgetary restraints. How are finance departments in FE colleges and HE institutions supposed to plan ahead? Uncertainty hangs over us all like a black cloud looming, and we are never sure when a downpour will occur. It is nigh on impossible to plan for future places and courses if there is such uncertainty regarding budgets.

It is completely irresponsible for the Sinn Féin and SDLP MLAs in the Chamber to continue to stick their heads in the sand rather than hold up their hands, admit that they are wrong and are going in the wrong direction, and honour their commitments in the Stormont House Agreement. I heard Michaela Boyle say in her speech that poverty levels are spiralling out of control. Where does she think they are going to go to if Sinn Féin continues to fail to sign up to welfare reform and we continue to lose £2 million a week?

In my constituency, the South West College campus in Omagh is already facing a detrimental impact in the full-time HE sector. South West College is a grade one college of excellence. To achieve that status, it provided a service to students for a maximum number of hours per annum, in addition to its virtual learning environment. That provision is in place to combat rural isolation in the west of the Province. At present, it will remain, but if there are future cuts in funding, or no allowance for inflation, the standard of our education could be brought down. It is shameful that the growth in the number of degree courses in the HE sector being offered to local students so that they can study for degrees at home will be threatened again by the failure of some parties in the Chamber to sign up to welfare reform.

The potential implications are alarming. In dealing with the pressures on the DEL budget, the Minister provided details of the £33·2 million reductions to the Committee. These reductions are made up of £18 million from 2014-15 and £3·5 million of efficiency savings from the employment services. One of the issues that causes concern was the impact that this would have on student places in universities and colleges and the knock-on effect for our economy. With our universities and FE colleges having to absorb most of the remaining £30·1 million pressure on the DEL budget, there has been uncertainty on how they will manage that whilst seeking to maximise core teaching and research provision.

With all the additional budgetary restraints leaving DEL's opening budget at £48·3 million, we are already witnessing widespread implications, with Queen's and the Ulster University cutting student places and imposing associated job losses. This comes at a time when the Minister has warned that standing still is not an option. For the future of Northern Ireland as a growing economy, we need an increase in places rather than the reduction in jobs and places we are witnessing.

However, it is of some relief that the universities have committed to protecting the narrow STEM subjects, which play a pivotal role in our economy. Yet, while DEL is trying to protect STEM subjects, adverse STEM cuts by the Department of Education are having an impact on STEM in schools. That will have a knock-on effect on our universities and FE colleges, undoing all the good work that has been built up in the area over the years. An example of this is Sentinus, an organisation that provides core STEM programmes to schools throughout Northern Ireland and makes a huge difference to the choices that young people make on STEM subjects. This year, its budget is being reduced by the Education Minister, and, rather than developing more programmes for the incoming year, Sentinus has to look at other ways to try to piece together the money that is has lost to maintain its programme that is already in place.

Is this short-term thinking really for the good of the young people in Northern Ireland? Where is the political outlook from Sinn Féin and the SDLP towards a sustainable economic future in Northern Ireland? Continually stalling on welfare reform will not only affect the most vulnerable but will be detrimental to the future of our people and to economic stability and growth in Northern Ireland. The proposed shortfall in places at colleges and universities will no doubt create a demand for more vocational skills and apprenticeship programmes, for which the Minister, at this time, cannot give a commitment on providing extra funding. Of course, this will create a further skills gap.

While we do welcome the fact that education support for people with a disability and the disability employment support programme are protected from any funding cuts, it is nevertheless disappointing that other Departments such as DRD have cut their front-line services to community transport. In my constituency, Easilink, which is the largest community transport network, is again facing reductions, and the most vulnerable are not being able to access their specialist courses because of the lack of transport. It is impossible for their families to meet that transport need. What is the point of one Department saving places for disabled members of the community who then have no access to their place of learning because another Department has stepped in and made those cuts? There is a real need for a joined-up approach among all the Departments rather than piecemeal hacking at budgets without due care and consideration for the long-term effects.

I appeal to all Departments today: all Departments have to live within their budget, and they all have to look at cuts that have to be made while protecting the front-line services, and therefore it is vital that all Departments work together, one with the other, to ensure that they are working in harmony and that these types of front-line services are not affected. We heard other people say today that the Education Minister is cutting the front-line services in early years. Those are services that will have an impact on the future. We see it in some of the other Departments, and, therefore, there is that need for the Departments to work more closely together.

I have to say, as I draw my remarks to a close, that the sooner Sinn Féin and the SDLP honour their commitment to sign up to welfare reform as agreed in the Stormont House Agreement, the better it will be for the people, the communities and everyone here in Northern Ireland. I make no apology for saying this over and over again because it seems that Sinn Féin do not actually get that there is no more money and that, therefore, we have to live with what we have. If they continue on the way that they are going, with a loss of £2 million a week, it will be no time until we are standing here and the Departments will be saying, "We have no money left to do any work in our Departments throughout the regions of Northern Ireland". I support the Minister and the Bill.

Photo of Stephen Farry Stephen Farry Alliance 6:30 pm, 22nd June 2015

For the record, Mr Speaker, I am speaking from the Back Benches as an ordinary Member, although it is a pleasure to follow Mr Buchanan, the Deputy Chair of the Committee for Employment and Learning. Although I am not speaking as Minister, I may very indirectly refer to some of the comments made by him and also by Pat Ramsey and, earlier on, Alasdair McDonnell that affect those particular issues.

The proposition before us today is a very simple one. It is about keeping the flow of money in Northern Ireland going while we create the space to resolve the deep political and financial issues that we face. In itself, the Bill does not resolve those, but it does create that time. However, that time will be short. The longer we leave the resolution of those issues, the more difficult it is going to be to find a solution and to manage that solution, bearing in mind that a lot of the pressures that are built up in the system are in-year pressures and are not pressures that we have the luxury of planning around over a longer period of time.

When I intervened on Mr Ross earlier, I made the point that, yes, it is normal for Governments to try to find innovative solutions to problems that are faced, to do things more efficiently and to progress a programme of public-sector reform, but it is interesting to note that, as deep and challenging as the cuts have been in Whitehall over the past number of years, those have been phased over a period of four or five years. What we are doing, have done over the past year and will potentially have to do this year — indeed, there may well be more to come — is of a much greater magnitude and over a shorter period of time than has been the case in Whitehall. That brings its own particular challenges to us.

There are also a number of what are, in essence, to a certain extent, red herrings in the process, and a lot of talk about what is happening in Westminster about wider debates and other things that are coming down the line. That is not to diminish the importance of all of those, but the nature, balance and essential outcome of those do not take away from our central requirement and responsibility as an Executive and an Assembly to have a balanced Budget in place for this year, which we do not currently have.

Let me just turn to those ever so briefly. It is right for us to be critical of the approach that the UK Government, particularly the new UK Government, are taking towards welfare reform and public spending. Indeed, a number of political parties were very clear in opposing what was happening on welfare reform in the appropriate place, which is the Westminster Parliament. Indeed, all political parties, with different degrees of emphasis and in their own different ways, have expressed concerns at the rate at which the UK Government are trying to address the UK deficit. I think most of us take the view that there are differences on a regional basis within the UK and that what may well be in the interests of the south-east of England, and London, indeed, is not in the interests of other parts of the UK. That is a legitimate point to make.

There is also a wider point to make about the best way of trying to address a deficit. Is it through making targeted investments in economic drivers and overcoming those deficits through increased growth, or is it through balancing the books? That has been the subject of an ongoing debate and, indeed, there has been a lot of comment from international organisations over the approach that has been adopted by the UK Government, some of it positive and some of it negative.

The point I will make is that it is right for us — and this is where I concede that other parties have made a valid point — to make common cause with others in these islands to make representations around what is happening in the future of welfare and the future of public spending. However, I diverge from that point on a very important aspect. Our credibility would be so much more enhanced if we actually manage to balance our books, because all of those issues — notwithstanding the issue of the £38 million passed on in-year — are down the line for future years. We have an urgent requirement in-year to ensure that we have a balanced Budget and, with respect to the £38 million itself, which is an in-year pressure that has arisen from underspends being collected around Whitehall Departments, we have the option of deferring that until next year. Whether that is the right thing to do or the wrong thing to do is an entirely separate issue, but we still have the right as a devolved region to have that particular pressure deferred and accounted for at a different point.

In essence, if we are to make common cause and say that there are differences in the pattern of economic activity, the nature of population and the dependency on the public sector in different parts of these islands, then we should make common cause, but do it from a position of maturity and responsibility. Frankly, if we go into those discussions without having a balanced Budget in place for this year, our credibility will be so much more diminished. I urge Sinn Féin in particular, which is making that argument, to explain to us why we cannot enter that process while at the same time balancing the books in Northern Ireland, and why we have to insist on wrecking our society in Northern Ireland over the coming months in order to make some sort of political point, which, in truth, will actually be a fairly futile gesture.

It should also be noted that our colleagues in Scotland and Wales have balanced Budgets for this current financial year. When we hear this eulogy for the Scottish National Party, the "in" party of the moment, having overtaken Syriza in Greece — we all know how well it is performing at present — we need to put in context that even the SNP has a balanced Budget, notwithstanding its attempts to stand up to the Tories.

The second point that we need to make about the wider context, which is probably even more challenging for both the SDLP and Sinn Féin, and potentially the Green Party, is about the implications of what we are currently doing to the Good Friday Agreement settlement. First, we seem to be turning the principle of consent on its head. The principle of consent is that we recognise the right of the people of Northern Ireland to determine their own future and that our position remains in the UK until or unless the people of Northern Ireland decide otherwise. There is no fine print that says, "Subject to there being a Government in the UK that is not dominated by the Conservative Party." It is in all circumstances. The UK population as a whole has elected a Conservative Government, albeit on a flawed electoral system. That is the legitimate outcome of the rules as they stand. We in this House may not like that particular outcome — I certainly do not like it — but, nonetheless, that is the outcome of the election.

Photo of Arlene Foster Arlene Foster DUP

Will the Member give way?

Photo of Arlene Foster Arlene Foster DUP

I recognise what the Member has said about the current Conservative Government and I do recognise that, I think, around 36% of people in the United Kingdom voted for that Government, but does he acknowledge that, given the comments that were made by the shadow Secretary of State for Northern Ireland, the current welfare position that we find ourselves in would not change fundamentally even if there were a Labour Administration?

Photo of Stephen Farry Stephen Farry Alliance

Indeed; that is very much the case. I want to make the point as well that, even in some sort of different scenario where there were actually a united Ireland and the northern part of the island had some degree of devolution, it would still be in the context of having to balance the books and we would be subject to transfer payments coming from a national Government. We know that, in the context of what has been happening in Ireland over the past number of years, they have had their own issues with regard to how they would address balancing the Budget. Indeed, parties may well have their own views as to the rights and wrongs of the precise approach that was taken in that regard, but nonetheless that selfsame challenge was there. Frankly, it was there on an even bigger scale in relative proportional terms than has been the case facing the UK Government.

We do not have the luxury of opting out of these big decisions that are taken by national Governments because we are a regional Assembly. If people want to make the case for Northern Ireland going it alone, they can, but bear in mind that the Good Friday Agreement does not make provision for an independent Northern Ireland. The choices are binary: either Northern Ireland is part of the UK or it is part of a united Ireland, albeit with the provision of some degree of autonomy within the context of a united Ireland. Those are the choices that face us. Whatever choice is made, we would be in the situation where we are a devolved Assembly that is dependent on a transfer payment from a national Government — one in London or one in Dublin. That is the fundamental reality and will be the reality for the best part of 10 or 20 years in the best-case scenario while we actually balance our Budgets and create a situation where we have a self-sustaining economy in terms of the level of tax receipts that we have compared with the level of public spending that is required.

In essence, when we hear, from Sinn Féin in particular, comments that the UK Government have no legitimacy in doing what they are doing, they are wrong; not just wrong in a general sense, but actually undermining the principle of consent, which is an integral part of the Good Friday Agreement. We have accepted, for now, subject to the views of the people of Northern Ireland, that we are part of the UK framework, warts and all. That does not mean that we do not challenge what is happening under UK Government policy, in common with Scotland and Wales, but we have to accept, nonetheless, that we are part of a national framework. By implication, if Sinn Féin wants to move away from that and say that they are not prepared to be the people who administer Conservative rule in Northern Ireland, by implication they are saying that they are not prepared to accept the outworkings of the principle of consent. A very big statement is being made. It has not been made explicit but, if you join the dots around all of that, you see that that is the import of what they are saying.

There is a wider issue on the Good Friday Agreement, which relates to the nature of power-sharing itself. Power-sharing works only if parties are prepared to share power and responsibility. If people are determined to dig themselves into holes because of some warped reasoning or, indeed, some extreme ideology, we cannot have functional power-sharing, and Northern Ireland becomes ungovernable. If parties wish to pursue power-sharing, they have to accept that it means working in common with other parties and finding solutions to the issues.

I would like to think that that is what we did, somewhat belatedly, with the Stormont House Agreement. However, that was nonetheless the result that we reached. When we decided basically to abandon the Stormont Castle agreement, which led to the Stormont House Agreement, we set ourselves on a pathway on which power-sharing is being called very seriously into question. To be very clear: if we do not proceed over the coming week or so to pass a Budget, and if we do not follow that up with agreeing a monitoring round that puts in place the balancing of our Budget this year on the back of agreement to continue to deliver the Stormont House Agreement and welfare reform, we are putting these institutions in jeopardy. That means that not only are we abandoning, first and foremost, major planks of the Good Friday Agreement and what some people have fought long and hard for over the past 20 years but we are abandoning devolution and the buffer that it provides by giving some protection against the full force of Conservative Government cuts.

While our options are restricted because we are dependent for our block grant and welfare payments on a transfer payment from the UK Treasury, devolution allows us to put in place different spending profiles and policy innovations. When I hear the deputy First Minister say that we are reduced simply to being the administrators of Tory rule in Northern Ireland, I think that he does not only himself but certainly all the rest of us a huge disservice by not recognising our ability to have policy innovations and to do things differently in line with the particular interests and circumstances we find in Northern Ireland, as well as our ability to spend our money differently.

Amongst the five parties, we have negotiated a different approach to welfare reform. We have put in place flexibilities and modifications that, out of our own resources, will give some protection. All that, of course, comes at an opportunity cost for other investments and schemes that we could put that money into to grow our economy and protect the vulnerable. Those are the choices that we can make, and I thought that we had come to some agreement that that was the route that we were going to go down.

That leads me neatly to make a further point that I think needs to be emphasised. We hear a lot that the approach that we are taking is all about protecting the vulnerable and that we are not going to be party to a process in which the vulnerable in Northern Ireland are hurt. Let me be very clear about this, particularly for the three parties that are responsible for the current phase of our political chaos: Sinn Féin, the SDLP and the Green Party. Their actions are directly hurting the vulnerable, because the fact that we are paying out welfare penalties, are potentially not implementing the Stormont House Agreement, thereby ratcheting up the in-year pressures that we are finding, and have a Budget crisis that will go further and further into the year and is restricting Departments' ability to respond to any in-year pressures in a coherent manner, will all pile more and more pressure on the most vulnerable.

There is more than one way that we can help the vulnerable. It is not purely about transfer payments and the welfare benefits that are paid, important as they may be; it is about what we do to invest in creating opportunities for people and providing them with the ladder to emerge from dependency on welfare. Surely no one in the House wants a situation in which people are dependent on welfare for their entire lifetime.

We know the evidence; this is all sound public policy on the type of interventions that are important to give assistance to people. Those are early years education, which my colleague Judith Cochrane outlined, and public health interventions, because we know about the impact of poverty on public health for one generation after another. It is also about what we do about training, education and employment opportunities to give people the ability and skills to find and sustain a job, as opposed to being dependent on welfare. All those are areas that are now either being cut, are in serious jeopardy of being cut or, indeed, are in jeopardy of being cut ever further because we do not have a balanced Budget. All will go straight to the heart of undermining people's ability to move on.

From Alasdair McDonnell and Pat Ramsey in particular, we heard a lot of rhetoric about the importance of investing in third-level education: in apprenticeships, colleges and universities. I appreciate very much their sentiments, but their actions are seriously undermining our ability to invest in the future of our people and our economy. There is no point whatsoever talking out one side of your mouth about the importance of the economy and how you want the economy in Northern Ireland to be transformed, while your actions on the Budget and welfare are plunging us into an ever-deeper crisis in which the key economic levers are being cut.

When we cut university places, some people have to leave Northern Ireland and access higher education elsewhere. They may not come back to our economy or, if they do, they will come back laden with further debt because of higher tuition fees. Others may not access higher education at all. When places are restricted locally, those from more deprived backgrounds are more likely to miss out. All the evidence shows that that is the case. Those people, of course, would flourish if they got to university, but they will be denied that opportunity. I hope that people are clear about that and have on their conscience that, as a result of the cuts that are going through and the cuts that have been announced so far this year by Queen's and Ulster University, people will be denied opportunities to build a life and career in Northern Ireland. That is a real, tangible impact on those who are vulnerable.

The same applies to further education and apprenticeships. Let me be clear, however, that I am not cutting apprenticeship places and opportunities. That money is ring-fenced, given that they are so critical to transforming our economy. Apprenticeships are such an important and productive intervention, also in line with all the evidence, that we are not seeking to cut them.

There was talk about how all this welfare stuff is terrible and how we cannot do it because there are no job opportunities for people to access. Frankly, our ability to create jobs is being undermined by the approach that is being taken. My Department's ability to invest in people's skills and in employment programmes is being undermined. Those are the means by which we give people the ability to access jobs.

At the same time, the ability of Invest Northern Ireland to go out to the rest of the world to attract jobs and create job opportunities here in Northern Ireland is being constrained. Beyond that, our credibility as an investment location is taking a hit due to the fact that we are unable to secure and sustain a Budget. Frankly, no right-minded business will be looking at Greece in the current climate, and Northern Ireland is not that far behind. We know already that investment trips to Northern Ireland are, at best, being postponed and, at worst, being lost due to the fact that we do not have a secure financial framework in place. Those are the very real costs that we are experiencing on the back of this impasse.

The best way to help someone to escape dependency on welfare is to create a job. The actions of those who are blocking welfare and taking an irresponsible view on the Budget are stopping us from creating jobs. Let us be very clear about what is happening.

There was the notion of how can we invest in economic inactivity. Yes, we have a new strategy for economic inactivity, which will help a lot of people who are in the welfare population. This is our approach to helping welfare in Northern Ireland, one that is shaped under devolution and does not exist in any other part of the UK. It is a clear advertisement of the benefit of devolution. Unless we have the resources to implement that strategy, we will not see any tangible results: there will be no proactive, non-coercive approach to assisting people out of welfare — that is another major loss.

A point was made about regional disparities in the Northern Ireland economy. That is another major cause for concern. If we are not able to resource interventions to address subregional imbalances, that situation will not change. If anything, it will get worse: an ever greater concentration of the limited investment that we do get will go into Belfast. People are being utterly counterproductive in the objectives that they are setting out and the means that they are putting in place.

I want to return to those who may be thinking of opposing this Budget. There is some ambiguity about what is happening in that regard.

From Sinn Féin, we have the position that they are supporting the Budget Bill going through, which is the right thing to do, but hinting that, in some shape or form, that support is conditional.

I think that the SDLP has articulated three different positions. Alasdair McDonnell said that he would oppose the Budget Bill at Second Stage; Pat Ramsey then said that they would not block it; and I have just done a radio interview with Mr Attwood, who said that they would not block it at Second Stage but would consider voting against it at Final Stage. If that indeed is their aspiration, I am not quite sure what will change over the course of a week. We have already agreed the Supply resolution, which identified the amount of money that we are talking about in relation to the Budget legislation, so the only changes that we are likely to see at Consideration Stage and Further Consideration Stage are the moving of money from one Department to another — that is all that we can do at this stage. Unless they are prepared to say that we should cut x amount of money from Department A and give it to Department B, there can be no change.

The logic is that you are either for the Budget process or you are against it. My party is approaching the Budget process with a certain degree of reluctance, because we know that, in and of itself, it does not resolve the issues. Nonetheless, it is the responsible thing to do at this time. At the very least, it creates the space and opportunity for a solution. Whether we get that solution remains to be seen, but at least we have the space and the money will continue to flow. If we go down the line of blocking the Budget — if people are intent on doing that and manage to convince sufficient numbers of others — we will simply cut off the tap. We will not have any authority to spend money and will end up with a situation in which the Civil Service intervenes and even more swingeing cuts will be put in place. Guess what will happen then: it will be those who are most vulnerable in society who will be hurt ever more. The logic of blocking the Budget to protect the vulnerable is utter nonsense. Blocking the Budget means hurting the vulnerable even more; absolutely nailing them to the ground.

It is worth making a comparison between how my party and the SDLP have handled the Budget. Let me be very clear: we have to distinguish between what is Budget policy and what is Supply and authorisation for Departments to spend. My party was very uneasy with the Budget. We did not think that it was sufficiently strategic and felt that there were a lot of missed opportunities. We voted against the Budget at the Executive, and my colleagues in the Assembly voted against it when the Budget resolution was discussed. At that time, there was space for a different Budget resolution to be passed by the Executive. Therefore, that was a responsible response by my colleagues, because there was time to do something different with Budget policy. However, once the Assembly, on a democratic basis, adopts the Budget resolution, we move into a different phase — Budget policy is agreed. The issue then becomes the authorisation of Supply and the granting of the legal authority for Departments to spend that money. That is where we stand today. We are not discussing the grand policy issues of the Budget. Those discussions have happened and the issue has been fought. We fought. We did not win the vote. We will argue that we at least won the argument, although others may choose to differ in that perspective. Nonetheless, we have a duty to proceed in that regard. If people are thinking of voting against the Budget Bill, they are voting for financial chaos. They are not making any productive proposal for an alternative. All that they are doing is punishing the people of Northern Ireland; the people whom we are all here to represent.

If people think that the SDLP is taking some sort of principled stand, let me say that, before the Budget was struck at the Executive, the SDLP Minister came up to me and said, "Um, what are you guys doing in terms of the Budget when it comes to the Executive?". There was not even a clear stance from the party as to what they would do when the Budget came before the Executive. We had a clear view of the approach that we were taking, and that was based on a rational discussion and view of the issue. The SDLP did not. So what is now coming across as some sort of principled opposition was not that principled when the Minister from the SDLP had to get guidance on what others were doing before he could form a view in his own right as to the approach that was going to be taken. That exposes some of the thinking that has been going on behind the scenes in that regard.

Alasdair McDonnell also made the point that he wanted some sort of engagement across all the political parties to resolve the issue. I, for one, am getting a little bit frustrated by the ongoing rhetoric of, "We want to be mature and responsible and to engage in dialogue". We have been doing that for the best part of three years on these issues, and it is now time to face up to our responsibilities and to do what is required to balance the books without compromising the ability to negotiate further and make wider points.

The Stormont House Agreement was a five-party agreement, lest anyone is under any illusion that it was something different. There has been a lot of revisionism going on in that regard. In particular, the Stormont Castle agreement was a five-party agreement, with a set of numbers agreed by all five parties. It was not an agreement in principle, nor was it an agreement to come back and look at the numbers down the line at some stage. It was a firm agreement on those numbers.

We have also had, in principle, the potential to have some sort of wider discussion among the parties on how we further the process of rebalancing our economy and planning for the future. Again, that was something that the SDLP talked about in very general terms, and it fell to others behind closed doors with the UK Government to put some meat on the bones of that proposal. There was a proposal for a prosperity panel that could engage international expertise, build on our existing economic strategy and economic pact, see how we might plan ahead around some of the different changes happening around devolution and plan around the potential for a lower level of corporation tax.

The SDLP's point, albeit a weak one, was listened to, and it was turned into something that was a reality. However, at the same time that that proposal was being respected and turned into some sort of coherent reality, the SDLP was off behind closed doors putting down a petition of concern to block the Welfare Reform Bill. That act was a retreat from the negotiations. A party that says that it is always happy to talk walked away from the table and blocked welfare, further spiralling us over the cliff. I hope that that party will reflect in particular on its actions and to where they have led us today.

In closing, let me be very clear: the only route out of this situation is for us to pass the Budget (No. 2) Bill over the coming days and then to move very quickly to committing to the delivery of the Stormont House Agreement and to accepting that we need to proceed with welfare reform with the local modalities that have been adopted. We then need to put in place a June monitoring round to ensure that we have sustainable finances over the course of this year. Let us be very clear: that will contain some pain. Then, we go with our Scottish and Welsh counterparts and others to argue the case from a position of strength, maturity and responsibility for a better resolution of welfare reform, and what that means for further cuts in Northern Ireland, and public spending, making the point about Northern Ireland's particular circumstances.

If we want to do that without putting in place the building blocks, we will be laughed out of court. We know what happened last time when we went to the UK Government with half-baked proposals. How we were laughed out of court back then. Let us learn the lessons and get it right this time.

Photo of Karen McKevitt Karen McKevitt Social Democratic and Labour Party 7:00 pm, 22nd June 2015

I welcome the opportunity to speak on the Second Stage of the Budget (No. 2) Bill. The current Budget proposes that an overall amount of just over £45 million be allocated to DCAL to allow it to deliver economic growth and enhance the quality of life in Northern Ireland by unlocking the full potential of the culture, arts and leisure sectors. It is unfortunate, then, that current provisions will not be sufficient to support the Department adequately in the achievement of its aims. Instead, current provisions represent an ongoing decline in arts funding and a serious restriction of the sector's ability to grow and develop.

In 2011, the Assembly recognised that the future of a modern Northern Ireland rested with the development of our creative and artistic industries and that their expansion would naturally bring about a boost in jobs for the region. In the past five years, Northern Ireland has seen tremendous success in attracting investment and jobs in the creative industries, securing major blockbusters such as 'Dracula Untold' and renewed television contracts such as the fantasy series 'Game of Thrones'. The former brought an estimated £13·4 million return to the local economy and the latter has brought about a 65% boost to tourism in County Antrim, over £82 million in direct economic benefit and over 900 full-time jobs. If ever there was an industry in Northern Ireland that needed support and nurturing, it is our booming screen industry. I was, therefore, dismayed to see in the Main Estimates that the net total for Northern Ireland Screen has fallen to £1·38 million, which represents a continued decline in resources for the third year running. I am dismayed because the budget for the Department of Culture, Arts and Leisure is already one of the smallest in Northern Ireland, and yet it continues to be hammered by cuts. Current budget cuts aim at trimming the fat of a Department that had very little fat to begin with. The cuts seriously impede the functions of programmes and arm's-length bodies.

In particular, I worry about funding in regard to the Armagh Planetarium and Armagh Observatory, which have continued to suffer cuts under current proposals. In last week's Main Estimates, I noted that, much like Northern Ireland Screen, their overall resource allocations have declined for the third year running. The planetarium and observatory continue as part of an international network of data-gatherers, carrying out significant, long-term scientific research into monitoring the effects of global warming. I fear that current cuts will seriously impede their ability to function in that regard. The end of decades-long research would be a tragic blow to the Northern Ireland scientific community.

It would be wrong of me to focus only on the negatives of the current proposals, and to do so entirely is not constructive. As such, I recognise and welcome the protection of Northern Ireland libraries. The SDLP and I campaigned vigorously on behalf of local libraries, and we welcome the fact that they are not being devastated by cuts. The current approach of a 7·5% reduction, instead of a broad 11·2% reduction, will mean that library closures will be reduced. Libraries still represent the social and educational hub for our communities, including many rural communities, and I am glad to see that they are being assisted.

I recognise that all Departments are feeling the squeeze in regards their budget and as a consequence of current difficulties on welfare reform. However, the fully supported expansion of Northern Ireland's cultural and artistic sectors represents a real opportunity to bring about economic prosperity. The current proposals do not represent the best possible way to achieve that measure of opportunity.

Mr Speaker, I gave you a commitment that I would not speak for any longer than three minutes to allow for a break in this long Assembly session this evening. Thank you for allowing me the time to speak.

Photo of Mitchel McLaughlin Mitchel McLaughlin Speaker

As there are still a number of Members on the list waiting to contribute to the debate, and some Members and the Minister have already been in the Chamber for some time, I propose, by leave of the House, to suspend the sitting for 10 minutes. The first Member to speak when we resume will be Mr Stephen Moutray. We will resume at 7.20 pm.

The sitting was suspended at 7.08 pm and resumed at 7.21 pm.

(Mr Deputy Speaker [Mr Dallat] in the Chair)

Photo of Stephen Moutray Stephen Moutray DUP

The Assembly, in the form of the Stormont House Agreement, had a chance to make history and a chance to do what is right by the electorate and not subject it to the types of front-line cuts that it is currently suffering and will suffer as a result of dishonourable politics on the part of a party that knew exactly what it was signing up to in the Stormont House Agreement. Sinn Féin, backed by the SDLP, has, on this occasion, managed to plunge its electorate into what could be the darkest financial crisis that this country will witness, causing people to end up, without question, on the breadline. That is how stark it is.

I believe that it is important, at this juncture, to take stock of the most recent Westminster and council election results, particularly the results experienced by Sinn Féin. Even in my constituency, we can see very clearly that Sinn Féin is starting to haemorrhage support because of its backward-looking tactics. I say to it today: listen to your electorate. It is sick, sore and tired of your disgraceful politics and your attempts to break this country financially. You need to get real and recognise that your actions are causing financial hardship. Your wrecking-ball tactics for Northern Ireland will leave people vulnerable and financially worse off. As a result of your tactics, we will have less money for health, education, childcare, job creation and the lowering of corporation tax — all issues that you and I are elected to take decisions on. Three years of wrangling has resulted in a financial precipice for the Assembly and for the electorate.

From an OFMDFM perspective, we only have to think of the dire effect on T:BUC. Together: Building a United Community was aimed at building a prosperous, peaceful and safe society that is focused on diversity and is welcoming to all, with a focus also on our children and young people. I think of Upper Bann and the fact that a promised new build for the Southern Regional College at Craigavon via T:BUC may be in jeopardy because of the financial situation. That would deny the young people a facility that would create a more united and shared society and an environment and facility where young and older can continue with lifelong learning and obtain skills and qualifications suitable to their capability and to the needs of the businesses locally. It was also planning to focus on post-19 provision and the need that exists around that.

Many of the capital spends were committed, and the outlook is stark without the agreement of this Budget and the honouring of the Stormont House Agreement. If funding is not to be provided, lead Departments may be unable to meet contractual agreements on the implementation of programmes. The projects therefore cannot proceed beyond preparation of the economic appraisal until capital funding is allocated. So, with the T:BUC commitments hanging in the balance, the work that the Assembly has done to grow the economy, tackle disadvantage and build a shared, inclusive and sustainable community could be a distant pipe dream.

We have only to think of the Delivering Social Change (DSC) fund. Funding of £400,000 is required to fulfil the commitment to co-fund the DSC/Atlantic Philanthropies signature project announced last year: a programme that will attract in excess of £58 million, with some £24 million from Atlantic Philanthropies, £11 million from Departments and £22 million from the Delivering Social Change fund. If it is not funded, OFMDFM will not have honoured their commitment to Atlantic Philanthropies, and they may withdraw funding, impacting on the signature programmes. Lead Departments may be unable to meet contractual commitments associated with the implementation of the programmes. Atlantic Philanthropies have already withheld £400,000 of funding until the bid is met by the Northern Ireland Executive, putting further pressure on the Health budget.

There will also be an impact on the planned services for people with dementia, their families and carers; early intervention services for young people in need of support, with the establishment of 10 family support hubs and the roll-out of the positive parenting programme; expansion of shared education, driving improvements in educational standards with the numeracy and literacy commitments and programme; and the nurture units. I come from the Craigavon area, where we experience high levels of deprivation. Without agreement, those initiatives cannot and will not proceed, and people will be plunged into further deprivation and hardship, with no hope of breaking the trend.

There will also be an impact on the historical abuse inquiry if no agreement is reached. It has done work in my constituency and is aimed at examining whether there were systemic failings by the state or institutions towards children under 18 in care between 1922 and 1995. We are all aware that the inquiry has been extended, with a report expected in January 2017. We believe that the cost of the report will be just under £18 million, with some vital work done and harrowing stories uncovered. If there is no money to complete the process, we will see the victims further traumatised and feeling let down by a Government that pledged to help. That is a harsh reality that lies at the feet of those who are not man enough to honour an agreement.

We are aware of the budgetary requirements for moving on the community-led social investment fund project. We all know the impact for good that the social investment fund can and will have on society. However, it is vital to ensure that work on the ground is not hampered by the grinding to a halt of the Government's financial wheels. The Budget for 2015-16 sets an allocation of £11 million resource and £15 million capital for the social investment fund. That is required.

Childcare is an issue that goes to the heart of our constituents. I listen day and daily to complaints from families about the cost of childcare and the difficulties in obtaining it. We, as a Government, must step up to the mark. Clearly, the Budget for 2011-15 did that, with over £12 million allocated. The 2015-16 Budget seeks to allocate £3 million, which will go to much-needed childcare and will allow for schemes such as Bright Start. Without childcare, our working population may not be able to continue furthering their careers and there will be no chance of using childcare as a catalyst to get people back to work and out of the benefits trap in some of the most disadvantaged areas.

All of those OFMDFM initiatives work towards the Executive's Programme for Government and the need to economically and socially enhance and improve the Northern Ireland economy. A £600 million gap exists. It is time for some politicians to get real, swallow their pride and think about the people they represent. If the Budget does not complete its legislative passage by the end of July, a senior civil servant may take over the control of Stormont's purse strings. It is a move that could trigger the collapse of this institution, stripping us all of a chance to make a real difference to our constituents.

This Budget is based on the Stormont House deal being implemented. Welfare reform has to happen to make the Budget balance. On that basis, I commend the Budget to the House and ask that common sense prevail. I support the Minister.

Photo of Jo-Anne Dobson Jo-Anne Dobson UUP 7:30 pm, 22nd June 2015

I welcome the opportunity to speak on the Budget Bill, and I wish the Minister well in her relatively new role as she tries to get her public finances back under some modicum of control.

Much has been said about the precarious state of our public finances. The Health Minister would probably use a word such as "challenging" to describe the situation in our hospitals, but, from the patients' perspective, it is certainly a lot worse than that. The word "crisis" is used maybe too often in politics in Northern Ireland, especially considering that far too many so-called emergencies are often artificially created, but, in this circumstance, the word is more than pertinent. The spiralling waiting times not only in non-elective surgeries but in key services such as cancer diagnostics and treatments are indicative, and, as every month passes, the situation worsens.

I was working through constituency cases last night and wrote to the Health Minister on behalf of a mother of three children who is waiting for a hip operation. In an emotional letter, she wrote to me about the agonising pain. She told me that, with each step, she can hear the bones in her knee grinding and grating against each other. Her GP cannot prescribe her any more painkillers, as she is already taking the maximum dose. She is the carer of her son and waiting in pain is having an impact on her entire family. She fears that it may be a year before she can get her hip replaced, when, a few years ago, it was a five-month wait. That is just one example of the human impact of budgets failing. I am sure that all Members in the House could recount similar stories. We are sent here to represent those constituents and do our very best for them. Members, the situation is worsening, especially in health. As a leaked document from the Health and Social Care Board recently revealed, increasing waiting times for assessment may result in a delayed diagnosis of a serious or life-threatening condition, with the reduced likelihood of a successful outcome. Those are the words of the board, not mine.

It is shameful that people's lives are now being put at risk simply because of budgets being bungled. There can be no bigger failure of a Health Minister than one who sits idly by for three years knowing full well that the numbers simply do not add up and then only speaking out after it is too late to do anything meaningful about it. That, however, is exactly what happened last summer when the then Minister finally decided to break ranks.

I know that the Budget Bill relates to the remainder of this financial year, but it is important that we do not forget its context. Even before the 2014-15 year, the Health Department ended with a £13 million deficit in 2013-14, despite receiving a further £100 million in monitoring rounds that year. Of course, we all remember that that was an outcome that the current Health Minister, in his previous role as Finance and Personnel Minister, blasted as poor budget management and said that it was hugely disappointing. I wonder whether the new Health Minister will be as keen to accept criticism this year as he was to give it out last year. On that point, I ask the Finance Minister to provide an update to the House on the additional scrutiny of our health expenditure that has recently been introduced. I ask that because I have very strong concerns as to whether this year's Budget will add up either.

Whilst the final 2015-16 settlement included an additional allocation of over £150 million, that was entirely offset by £220 million of pressures being carried forward from 2014-15. In fact, the Health Department is forecasting that its pressures for this year will increase to £317 million, up again from £305 million last year. The Health Department also believes that it has identified saving opportunities and cost reductions of £164 million. Of that, the vast majority — £113 million — will come in the form of cash-releasing efficiencies and productivity gains in trusts.

Considering that Transforming Your Care is still little more than a document in many aspects of the health service, I suspect that some of the savings from the trusts will be attainable. That means that the current £30 million to £40 million funding black hole that officials recently warned the Health Committee about will, quite possibly, be much higher at year end. Given the ridiculous state of our finances, we cannot even consider the Bill in the broader context of June monitoring. The Finance Minister will know that her colleague the Health Minister is bidding for £89 million of additional resources, despite being well aware that it is likely that only a small fraction of that will become available.

In the absence of any new approaches, Transforming Your Care is stalling. A £30 million to £40 million black hole already exists, hundreds of millions of pounds of pressures were carried over from last year and savings that are, quite possibly, undeliverable, are expected from our trusts. I simply cannot see how the health service will get through this year without a major and detrimental impact on the quality of care that patients receive.

Standing here today, I do not see the leadership required to get our health service through its current problems. Having visited hospitals, I can clearly see that staff in all departments, while working to their limits, are totally demoralised. What were previously considered unacceptably dangerous delays are becoming the norm, and, even still, the work of organisations such as the Northern Ireland Fire and Rescue Service is, bizarrely, not even considered front line, a statement that I understand was attributed to the current Health Minister when he was Finance Minister.

Despite the very obvious deterioration in primary and secondary care, the Finance Minister and the Health Minister seem to want to carry on as though it were business as usual. If their attitudes were not so devastating, they would be derisible.

I fully agree that the welfare impasse needs to be resolved, but, equally, last year's welfare penalties accounted for only £87 million of an overall £200 million black hole. Yet, in the likely event of further in-year reductions in October, I have no doubt that some fig leaf will be sought to try to cover the fact that the final 2015-16 Budget was a fundamentally flawed arrangement. The lack of transparency behind the allocations and subsequent savings plans lost whatever little trust people had in the financial accountability of this place.

The Finance Minister may think that her concocted £604 million Budget shortfall would have helped her over the line with the so-called fantasy Budget, but even she should know that it is does nothing but kick the can a little further down the road. The problem that this hypothetical can represents is that more lives are lost as key opportunities are missed, and tens of thousands more are forced to wait in excruciating pain, just like my constituent last night, as procedures are delayed and, ultimately, cancelled.

Photo of Gordon Dunne Gordon Dunne DUP

I, too, welcome the opportunity to speak on the Budget Bill 2015-16 as a member of the Enterprise, Trade and Investment Committee. It is very important that Northern Ireland continues to be positive about being open for business and a place that is welcoming and supportive of new businesses. We recognise the need to support Invest NI, which will continue to target inward investment, promote domestic growth, provide trade support and support private sector investment in research and development.

Invest Northern Ireland's strategy to grow the Northern Ireland economy depends on having a stable political environment underpinned by a strong economy supporting indigenous businesses and inward investors. It must be recognised that Invest NI has had a record year, with record-breaking job support and job creation for Northern Ireland in 2014-15. The House must pay tribute to the chief executive, Alastair Hamilton, and his excellent staff for the work that they have done in promoting Northern Ireland across the world, and to the former Enterprise, Trade and Investment Minister Arlene Foster and current Minister Jonathan Bell for their work.

Research and development must continue to be a priority as we support existing businesses to innovate and develop new products through funding streams such as the European regional development fund. We must encourage a greater drawdown of the Horizon 2020 funding, with greater collaboration and support from our universities.

Last Friday, a number of us saw a prime example of a successful research and development project at Bombardier with the first visit to the UK of the CSeries aircraft. That is a modern aircraft with composite wings, designed and built in Northern Ireland with the support of Invest NI, the European regional development fund and framework programme 7. That is a very real success story, and it shows how Northern Ireland can, with the right support, lead the way in engineering and manufacturing in the 21st century.

As Northern Ireland continues to attract new business, more new skills are required, especially within the IT and software engineering sectors. During a recent ETI Committee evidence session, many organisations and businesses were concerned about the need to develop the STEM subjects from primary school right through to university. There was also a desire for more to be done through more targeted career advice to encourage young people to take careers in engineering, IT and manufacturing: professional careers and well-paid jobs that lead to good career prospects. There is room for greater work between DETI and DEL to support that, and there is a need to develop our telecoms and energy infrastructure.

A recent report in 'The Daily Telegraph' highlighted how successful Northern Ireland is today. The article, published last week, stated that more small firms in Northern Ireland hit the magic milestone of £1 million in revenues within their first three years in business than anywhere else in the UK. The article went on to state that Northern Ireland's 10% average for firms reaching £1 million in three years compares with 7·9% in London and 6·2% in England overall. Those figures confirm that Northern Ireland is a great place to do business and we must build on that momentum. However, we cannot be complacent: we must always seek to grow and develop our economy at every opportunity.

The long campaign to secure the devolution of tax powers was won by local politicians who listened to businesses. It is important that the business community distinguishes between those who want to make it happen and those who are shirking away, are unable to face economic realities and have no ability to think innovatively about growing our economy. The ability to vary the rate of corporation tax would only strengthen our hand as we seek to make this place more attractive for investors. There is no use in representatives from many other parties going to America, giving all the good PR and pretending to be the friends of business and then returning to Northern Ireland and supporting their parties in blocking the very progress that they claim to be champions of. They can work it both ways for a while, but eventually everyone recognises the hollow nature of their arguments.

The recent successes of MoneyConf and EnterConf, which were held in Belfast last week, should not be underestimated and are a reflection of what is being achieved and of how the global perceptions of Northern Ireland are so positive. Those are the reasons why it is essential that agreement is reached on the Budget. Politics can be left behind, as it could become a hindrance to economic progress. If we are doing well now, just think what could be achieved with agreement on corporation tax rates and a more stable political and economic environment.

The Budget rightly places long-term economic growth as its main priority along with a need to build a larger and more export driven private sector, and it rightly recognises the key issues and challenges for the future. Tourism is another growth area for Northern Ireland, and we have seen how we can host top-level international events in recent years. It is important that we keep this positive momentum going and continue to invest in this growing sector.

Photo of Alex Attwood Alex Attwood Social Democratic and Labour Party

First of all, I congratulate the Minister on her appointment, because I have not had the opportunity to do so for various reasons. I acknowledge that Minister Foster is one of those Ministers who, in my view, most demonstrated that she did know the difference between being in government and being in power. That is not something that I would so generously state about all her colleagues, but I will certainly state it about her.

As Minister Foster will know from attending meetings of parties and Governments, the Secretary of State spends quite a lot of time lauding the Alliance Party. That happened only a couple of Tuesdays ago, and it only confirmed to me that the Alliance Party has now gone back to its historical role in Northern Ireland politics, which is to be the spokesperson for the Northern Ireland Office. Time after time after time in our history, that is what the Alliance Party has been. As we can conclude from the contributions of Mrs Cochrane, Mr Dickson and Mr Farry, not only are they the spokespersons for the NIO but they are now the spokespersons for the Tory party. When you analyse what Mr Farry, Mrs Cochrane and Mr Dickson say in the Chamber on issues of the Budget and welfare, you see that the Alliance Party is as close to the Tories as it is to anybody.

Arlene Foster interrupted Mr Farry's contribution to mention what the shadow Secretary of State said in his interview in 'The Irish Times' last week. I stand to be corrected on this, but I think that it was about there being people "threatening the Stormont institutions". When I heard about that contribution, I remembered what then Prime Minister Tony Blair said to the SDLP on not one but two occasions. In quoting that, I urge people to be vigilant about what some in the Labour Party say when it comes to threatening the situation in Northern Ireland. As people know, then Prime Minister Blair said to the SDLP on two occasions:

"the problem with you is you don't have guns."

I am a bit cautious about relying on some analysis that emanates from the Labour Party when it comes to the politics of this place, both now and in the past.

Mr Farry, of course, got into a very muddled place, because he relies on the principle of consent that is in the Good Friday Agreement on the constitutional position of Northern Ireland and elevates that principle of consent so that, somehow, as a consequence of the Good Friday Agreement, we have to consent to every chapter and word that emanates from any British Government and any British Government Minister when it comes to policies, practice and funding in the North. I cannot understand why we entered into so many years of political discourse only for somebody to take the principle of consent, as Mr Farry did in his contribution, mangle it and move it away from the principle of consent when it comes to the constitutional position and somehow make it mean that it is an absolute, and that we have to consent to that which London requires when London insists and imposes its will on us. If I were a supporter of the Alliance Party, when it comes to the issue of consent, I would begin to worry about its politics, because, unfortunately, this Chamber has yet to consent to equal marriage. Based on Mr Farry's understanding of the issue of consent, because we do not agree, we have to not continue the argument for marriage equality. If I were in the Alliance Party's shoes and those of its supporters tonight, I would begin to wonder what precisely its understanding of core concepts and core values is when it comes to the politics of the North and the institutions of government that we share.

He was also really quite missing the wood for the trees when he made the argument that power-sharing could be in jeopardy because of the Budget and welfare situation that we face. That does miss the wood for the trees, because the fundamental problem that we are working through at the moment is that the Good Friday Agreement is an agreement about radical middle politics.

If Northern Ireland, in all its forms, is to prosper in respect of welfare, the economy or any other matter, radical middle politics have to prosper. If there is any risk to our politics — I think that that risk is exaggerated, and I will come back to that later — it is because middle politics are in jeopardy. In my view, they are in jeopardy because the DUP wants Northern Ireland on its terms, and that is not middle politics, and it may be that there are elements in Sinn Féin, perhaps not in this Chamber, who want to prove that Northern Ireland does not work at all. That is the fundamental fault line in our politics, and all the disputes that we have, be it on the past, parades, flags, the Budget or any other significant aspect of political policy, are because there is a middle-ground agreement, now led and populated by two parties, one of which wants Northern Ireland on its own terms, which, too often, are the terms of the past, and elements in Sinn Féin do not want Northern Ireland to work at all and have a project to try to prove that.

If we are to get through all the multiple problems that we have, be it flags, parades, the past or any other significant area of public policy, and if we are to have the transformative politics that a DUP Member referred to earlier, it will be by people coming back to radical middle politics, because that is the way in which we will be able to sustain and change this place in a fundamental way.

It was, frankly, a comment that was as preposterous as it was ludicrous as it was ill-judged when, somehow, Mr Farry compared Northern Ireland to Greece. He said:

"Northern Ireland is not that far behind"

Greece in the international understanding of what was going on.

I wonder whether the Minister has a reply to that. Does the Minister, who seemed to be generous in her praise of what Mr Farry said, believe that Northern Ireland is not far behind Greece when it comes to the politics and the issues that we face?

Photo of Basil McCrea Basil McCrea NI21 7:45 pm, 22nd June 2015

What about you? Do you think that it is?

Photo of Alex Attwood Alex Attwood Social Democratic and Labour Party

No, it certainly is not far behind Greece. We are not, unfortunately —

Photo of John Dallat John Dallat Social Democratic and Labour Party

Order, please. Members have repeatedly been told not to make remarks from a sedentary position. I am sure that, if they want an intervention and they ask Mr Attwood politely, he will agree.

Photo of Alex Attwood Alex Attwood Social Democratic and Labour Party

I hope that, in the fullness of time, one of the grounds on which we might differentiate ourselves from Greece will be that we will not get close to exiting the European Union and that we will get closer to joining the euro in order to —

Photo of Alex Attwood Alex Attwood Social Democratic and Labour Party

Yes, joining the euro. If that comes in the context of the democratic reunification of our country, in which circumstances we may all be part of the euro, I think that it would be to the benefit of our businesses, our farmers, our trade and the growth of our economy.

The fundamental flaw in Mr Farry's contribution was that, somehow, the Budget and welfare are the cause of every child in poverty and every person without a job. That was the essence of Mr Farry's analysis: that, because of the current situation, we face "financial chaos" and "punishing the people". Those are all his words.

As a consequence, in my words, every child in poverty and every person without a job is a consequence of the Budget debate that we are having. What a flawed and false analysis. Go and tell people in the west of the city of Belfast or in the north-west of Northern Ireland that the circumstances that they face in respect of poverty, lack of work, or the fact that Catholic male long-term unemployment is virtually unchanged in 20 or 30 years and that Protestant male long-term unemployment is now beginning to get to the levels experienced by the Catholic male long-term unemployed people. Is that the consequence of this current Budget debate or is it the consequence of the failure of politics to do what is necessary for those who are most in need, whether they are Catholic or Protestant, unionist or nationalist or in west Belfast or the north-west? Do not tell people that somehow the consequences of this Budget debate are the reasons why children are in poverty and people are out of work. That is playing upon people's worst fears, when what is needed is responsible leadership. That is the ultimate indictment of the contribution that was made by Mr Farry in this debate. Could I also just correct him? I remember the meeting we had with our Minister in the moments, and in the hour, before the Executive meeting last November at which the draft Budget, that Mr McGuinness said was the best deal possible, was forced through. I remember the conversation we had with Minister Durkan. Any suggestion that nothing other than opposing that draft Budget was the approach taken by Minister Durkan and the party is inconsistent with that meeting and those facts.

I want, however, to try to map some way through the current difficulty we have. In this regard, I want to go back to, I think, the very first speech after the Minister's, which was from Alastair Ross. There are always moments in debates when a thoughtful contribution is made and when concepts are raised that actually deserve a response and are worth exploring further. He chided Mr Maginness for suggesting that he was conservative in his approach to other matters. Then, he began to talk about new thinking and brave politicians. He said it with regard to the justice system and he mentioned the fact that he and the Deputy Chair of the Committee for Justice will be going to the Netherlands to look at, I presume, models of new thinking and brave politics. I thought it was an interesting contribution, because I think that new thinking and brave politics are required.

This is my question to the Minister: given that it seems to be the DUP's position that the will of London will prevail, that there is worse austerity to come, and that we will just have to pull down the shutters and deal with it the best way we can — part of which is to accept welfare and do the Budget — then I ask the Minister to listen to the new thinking and brave politics to which her colleague Alastair Ross refers. This is where we now have to think outside the box even though we have lost multiple opportunities over the years to scope out all this.

Photo of Ian McCrea Ian McCrea DUP

The Member referred to the new thinking that is required, as cited by my colleague, although maybe not necessarily in the same context. Can the Member give the House and indeed the people of Northern Ireland a reason as to why no thinking whatsoever, never mind new thinking, was given when the Finance Minister asked for amendments or people's views on how we could find our way out of this? No one from any of the other parties came up with any type of thinking to help the Minister out to try to overcome these difficulties.

Photo of Alex Attwood Alex Attwood Social Democratic and Labour Party

I thank the Member for his question, but I think that we must be sitting in different Chambers. I remember the SDLP, the Green Party and the Ulster Unionists proposing a series of amendments at Consideration Stage and Further Consideration Stage of the Welfare Reform Bill in January and February. I remember your party signing a petition of concern — and you would probably have had to sign it, if I could recall that for you — to block all the new thinking. Before they were even debated in the Chamber, or before any of us — Steven Agnew, Dolores Kelly, me or anybody — had opened our mouths, you and your colleagues had signed a petition of concern the previous day to block them all. You asked me this: where is the new thinking? You and your party blocked all the new thinking even before a word was uttered.

Photo of Arlene Foster Arlene Foster DUP

The Member is being very mischievous, if you do not mind me saying so, because he knows full well that, when he was asked the question, it was referring to the Final Stage of the Welfare Reform Bill when proposals were put forward very clearly and the First Minister indicated that he was ready, willing and wanting to deal with any amendments that came forward that were within the financial envelope of the Stormont House Agreement, legally doable and operationally within the remit of the Department for Social Development. Those are the amendments that, as I understand it, my friend is referring to.

Photo of Alex Attwood Alex Attwood Social Democratic and Labour Party

Far from me being mischievous, I think that the Minister is being selective and partial. New thinking does not always require new money. Indeed, in the circumstances that we face, a lot of new thinking might have very little money to follow it. Some of our amendments had no financial consequences, but still that new thinking was blocked by petitions of concern and votes from Sinn Féin on each and all of them. Even as a minimum, that which costs nothing or which is moderate in its cost is new thinking, never mind the broader proposals from the Greens and ourselves.

Without breaking any great confidences, because I do not think that there are any, we have gone back to those. I went back to them last week with Minister Storey to try to narrow the difference on welfare reform. It needs to be narrowed, but it needs to be narrowed around three pillars. Those three pillars are: the best amendments that came out of the Consideration Stage and Further Consideration Stage, honourable implementation of what was agreed before and at Stormont House, and recognising, which I will outline further, that 8 July is a shadow on the Chamber and the lives of people of Northern Ireland that it is negligent to disregard. It seems to be the DUP's intent to disregard it, but I will come back to that.

I have a question for the Minister. She knows that the Irish Government are producing a capital investment plan stretching from, I think, 2016 to 2022, but I will stand corrected on that. The Minister might also be aware that, in a previous version of the capital investment plan, which was then known as the national development plan, Mark Durkan and Brian Cowen negotiated a dedicated chapter on infrastructure development in the North. The consequence of that negotiation between Mark Durkan and Brian Cowen is the road that crosses the border south of Newry and north of Dundalk and over other places. So my question is this: given that Dublin is now, for want of a better phrase, trying to reinvest in its economy and people because of the state of the national finances, is it not time to have the full conversation with it on the national development plan, or the capital investment plan? Minister, it is quite a simple point. If you insist that Mr Hands told you last week, as you advised the House, that there is no more money from London, there is an obligation to scope out all the opportunities that there are or might be for new money. If the Irish Government, in advance of the next election and of the next Irish Government, are beginning to scope out a capital investment plan, do we not learn from the past and draw conclusions from what London is saying and look innovatively and creatively at where that takes us?

I know where Peter Robinson wants to take North/South issues, because he once infamously said that, if he wants to do stuff on a North/South basis, he makes a phone call. Mark Durkan did not make a phone call; he sat down with Brian Cowen and negotiated a dedicated chapter — I think it was chapter 16 — of the national development plan back then.

Photo of Arlene Foster Arlene Foster DUP

Will the Member give way?

Photo of Arlene Foster Arlene Foster DUP

This is just incredible stuff. The national development plan and the road that he is speaking about came about at a time when the finances of the Republic of Ireland were in a completely different place to where they have been over these past couple of years. Need I remind him of the A5 — and the A8, actually, as well?

So, as for all this talk about going and looking for money to the Republic of Ireland, let me assure the Member that we will be looking for our fair share, as Dr Paisley always used to say, out of Europe to make sure that we do get some money back out of Europe given the amount that the United Kingdom Government put into Europe. We will be looking for our fair share out of Europe, but that is nothing to do with this Budget that is in front of the House today.

Photo of Alex Attwood Alex Attwood Social Democratic and Labour Party

To borrow a phrase, I think the Minister is bowling the ball short, because the circumstances in the South are clearly in transition from where they were even a year or two ago to where they might be over the next two or three years. At the same time, London is about to announce on 8 July the scale of the next phase of austerity, and then more of it in the autumn statement. Irrespective of Europe — and I will come back to that in a second — is it not as obvious as the nose on your face that we should now try more and more to tie down the Dublin Government on their commitments? Those are commitments that they had before, that they say they have now, and that will potentially increase in terms of the needs of the island of Ireland in the north-west — in Northern Ireland, Donegal and neighbouring counties.

Surely that should be exhausted as an opportunity and a potential. Otherwise, we are saying that we have to accept what London is doing in respect of budgets, even though we do not know the scale of it and even though it is going to be immense. The consequences of that will be felt over the next three or four years, yet we are not going to exhaust the possibility of what Dublin might do. If I were the Minister, I would be pretty hard-nosed about it.

Photo of Jim Allister Jim Allister Traditional Unionist Voice

The Member seems to fondly think that the Irish Republic is going to bail someone out. It sets one's mind thinking that maybe he should suggest to the Irish Republic that they pay back the £7 billion that the United Kingdom bailed them out with, and then there might be some spare cash within the United Kingdom. Will he make that suggestion to his friends in Dublin?

Photo of Alex Attwood Alex Attwood Social Democratic and Labour Party

It is curious that the Minister relies on someone speaking from the Back Benches in that regard. I will make two points in respect of that.

The first is that you would get no dispute from me that you should be hard-nosed with the Irish Government when it comes to financial commitments to the people of Northern Ireland. That is what Mark Durkan did with Brian Cowen. For the first time ever in a national development plan, he built into its architecture a commitment to capital investment in the North. That was a pretty hard-nosed negotiation, because it had not happened before, and we should have it again now so that it gets tied down and in a positive and constructive way we make it difficult for the South to say no. They are beginning to scope out where they go over the next decade in capital investment. If we do not draw the conclusion from what Mark Durkan did in 2006 or whenever it was, and try to do the same for 2016 and beyond, then we are missing something.

There is an arrangement between Dublin and London in respect of the bailout. I am sure there are contractual and other treaty obligations. Let us remember that one of the reasons why London did it was because their biggest trading partner is the Republic, that our biggest trading partner is the Republic, and that their biggest trading partner is us. If that totality of relationships — where have we heard that phrase before? — does not drive an agenda when we are in this space at the moment, then we are missing something.

I go further: there is a meeting on Thursday, chaired by the two Governments, with the parties to review the Stormont House Agreement. Let us put this on the agenda. I ask the Minister to support the SDLP in putting a specific item on the agenda in respect of the capital investment plan. No more meaningless phrases about North/South being taken forward post-Stormont House review, which was never published, never mind finished. Let us have some hard, concrete outcomes and develop that conversation.

If the Minister is prepared to look at them — I am only suggesting it, because people are asking for remedies — I refer her to some documents. I will send her those documents, because I will not have time to read them into the record now. Those are a series of documents that scoped out North/South. I have read them into the record previously, and they are a 2010 Irish Academy of Engineering study, a 2012 report by John Bradley on cross-border economic renewal, and a document by Michael D'Arcy on significant possibilities for North/South synergy. All those documents are in the public domain, all of them have been published and all are a pathway to shape this island in the context of what London says it will do. I will come back to that. There is fertile ground if we just open up our minds to go there, rather than sticking to the dogma that London has a mandate, which is to do what they will do in the autumn and on 8 July, and that we have to swallow that. If we do not think laterally, irrespective of the issue of London, we are letting our people down.

I want to deal with a second issue, which is to suggest that the context of what is happening on the Budget and welfare has changed even in the last number of days. There were reports over the weekend in anticipation of a document being published by London in respect of child poverty. The Minister is a mother with a young family, and I am an older father with a young family, one of whom was nine yesterday — my older daughter was nine yesterday. The reason why we do all of this is, ultimately, because of our own and other children. That is why we do this. Maybe some others are driven by ambition and careerism or whatever, but I think that, around the Chamber, we do this because of our children and we try to make better or make gentle the life of the world in respect of what they might inherit from us. That is why the issue of children should be front and centre in our consideration of the Budget and welfare and where we are. I say all that because it seems that, on Thursday, London is going to publish its latest child poverty assessment, and some of that started coming out over the weekend.

The Institute for Fiscal Studies is, by and large, pretty well regarded. It is so well regarded that, when it comes to child poverty in Northern Ireland, it is the organisation that OFMDFM rely on to choose its statistics, some of which have suggested, as I have said before, that absolute and relative child poverty in Northern Ireland, far from being down to 10% by 2020, will be 31% and 34% respectively by 2020. The parallel is happening in Britain, where the Child Poverty Action Group and the Institute for Fiscal Studies are agreed that progress in reducing child poverty in Britain is now going into reverse and that the cause of that is the bedroom tax and benefit cuts. That is in advance of what is expected to happen on 8 July and thereafter over the next number of years with welfare, benefits and budgets.

The number of families in Britain whose income is below 60% of the UK average — the definition of relative poverty — has increased between 2013 and last year, and it is because of the bedroom tax and cuts. If that is the case in Britain, there are probably multiples of that in Northern Ireland. Here we are, in a situation in which we are being told that we should do welfare and do a Budget in the context in which it is the children who are beginning to suffer most because of doing a Budget and welfare on Tory terms.

Photo of Basil McCrea Basil McCrea NI21

Will the Member give way?

Photo of Alex Attwood Alex Attwood Social Democratic and Labour Party

In a second. That should require us all to reboot our thinking when it comes to the issues of welfare and the Budget over the next number of days. I will give way.

Photo of Basil McCrea Basil McCrea NI21 8:15 pm, 22nd June 2015

I listened to the Member talk about statistics, but, when he got to relative poverty, I felt that somebody needed to challenge him. Relative poverty is an arithmetic working-out. Were you to talk about absolute poverty or look at the work that has been done on it in this place, you have to say that the general increase in well-being is demonstrable. That is what I worry about when people talk about statistics. They pluck them out of the air without qualifying them.

There is an issue about how you rely on information to reach the correct decisions. I did not intervene when the Member was talking about the improvement in the Irish economy. I have to ask him whether he knows what the absolute level of debt is for the Irish economy. Does he seriously think that there is a bucket of money there, and, because people in Ireland do not know what to do with it, they will give it to Northern Ireland? This is the issue: if you want to fix Northern Ireland, you have a Budget within which you have to work. I would like to hear about how we will work constructively within the fiscal limits to make life better for everybody. Plucking figures out of the air does not do it for me.

Photo of Alex Attwood Alex Attwood Social Democratic and Labour Party

I am not plucking figures out of the air. I am relying on an analysis that was produced by the Institute for Fiscal Studies (IFS), which happens to be the organisation that is employed by the Office of the First Minister and deputy First Minister to do the exact same analysis of child poverty in Northern Ireland. You might think that the IFS plucks figures out of the air. I think that, in the general world, including the insider world of analysing what is going on in the economy, the Institute for Fiscal Studies is well regarded. I would suggest to the Member that, to portray me or the IFS, which I rely on, as plucking figures out of the air, is stretching a point and is bound to be stretching the evidence base that the IFS deals with.

Photo of Basil McCrea Basil McCrea NI21

Will the Member give way?

Photo of Alex Attwood Alex Attwood Social Democratic and Labour Party

I will in a second. Earlier in the debate, someone read into the record how people in Northern Ireland were feeling better; their general well-being — I think that that is the phrase that was used — was better.

Photo of Alex Attwood Alex Attwood Social Democratic and Labour Party

I am sorry; it was the Minister of Finance and Personnel. However, she was curiously silent about the figures that have been produced by the OFMDFM and IFS study about absolute poverty and the fact that absolute poverty in Northern Ireland will be at 30·4% by 2020. That is before George Osborne, the Chancellor of the Exchequer, and Iain Duncan Smith do their worst, as they were advertising in 'The Sunday Times' yesterday in a joint article in which they made up over their recent dispute about the scale, timing and speed of welfare reform. I will come back to that point, but I will give way to Mr McCrea.

Photo of Basil McCrea Basil McCrea NI21

I did not accuse the IFS of plucking figures out of the air. I said that you were using statistics in a way that I found to be incompatible with my understanding of matters. Let me explain and see if you can come back on it.

Photo of John Dallat John Dallat Social Democratic and Labour Party

Order. I remind the Member that interventions should be short and relevant. Mr McCrea, you are down to speak later on, but, in the meantime, please make sure that your intervention is relevant. We do not want to develop a two-way debate between you and Mr Attwood.

Photo of Basil McCrea Basil McCrea NI21

Mr Deputy Speaker, I am, as ever, grateful for your guidance on these matters, but the Member made a point, and I wished to pursue it with him. I am happy to leave it; I can deal with the issue in my speech. The point that I wanted to make is that statistics can be used to try to prove almost anything. Perhaps we need to have a proper debate in Committee or at other stages. I will leave it at that.

Photo of Alex Attwood Alex Attwood Social Democratic and Labour Party

To conclude that matter, let us step back from what Mr McCrea or I say. The director of evidence and impact at the National Children's Bureau said:

"Over the next five years, as austerity bites, we risk creating a country where poverty is so stark that children grow up in parallel worlds where rich and poor families have entirely different lifestyles that are poles apart."

Matthew Reed, the chief executive of the Children's Society, said:

"It is a scandal that by 2020, in one of the richest countries in the world, hundreds of thousands more children are expected to be dragged into poverty, even without further cuts to welfare support."

That is not plucking figures out of the air: those are the comments and narrative of accepted experts. Whether we agree with them or not, we should at least listen to them because they are anticipating the world that is about to dawn after 8 July, and that leads me to the next point that I want to make. I met the Minister for Social Development in the corridor earlier. I do not want to misquote him, so I need to be careful, but, basically, he said, "Well, you called that one right when it came to what the London Government were about to do in respect of austerity". If you check the record, you will find that the SDLP, over a series of debates last year and this year, said that, post-election, the London Government would replay what they did following the May 2010 election, with the emergency Budget in June 2010, which was the first and immediate phase of austerity. We said that that was going to happen again. I think that what Minister Storey was saying was that what we then anticipated happening, as the Hansard record will show, is what has come to pass.

The Minister of Finance and Personnel will remember that, at the last meeting of parties and Governments, when the Secretary of State was asked, on a Tuesday at about 5.00 pm, whether there would be in-year cuts, she said, "I don't know". Less than two days later, when the Chancellor of the Exchequer announced what he was going to do, we did know. Similarly, he is not being coy about what he plans to do in the emergency Budget on 8 July and thereafter.

Photo of Alex Attwood Alex Attwood Social Democratic and Labour Party

I will in a second.

He told the Institute of Directors (IOD) that he would cut early to make it smoother later, and why would he not? This is a man who is now not just Chancellor of the Exchequer but competing to become the next leader and Prime Minister. That was confirmed by what I hear was a very good performance in Prime Minister's Question Time last week. Part of his motivation will be to see through austerity. Then, on the far side of that, when he has done all that harm, when the economy is going to improve and there is a balanced Budget, he can ride into the glory of becoming the next Prime Minister. A personal agenda is informing what the Chancellor of the Exchequer is doing, and it is much more than the dogma of the Tories; it is also about his personal ambition.

Photo of Dolores Kelly Dolores Kelly Social Democratic and Labour Party

I thank the Member for giving way. Bearing in mind his earlier comments and concerns about child poverty, does he share my concern about the recent indications from the Chancellor of the Exchequer that there will be further cuts to child tax credit? In Northern Ireland, that means a potential loss of £2,000 a year for 89,000 families, all of whom are working families.

Photo of Alex Attwood Alex Attwood Social Democratic and Labour Party

That has to be the conclusion from reading the article by George Osborne and Iain Duncan Smith in 'The Sunday Times' yesterday. Remember that, only three weeks ago, 'The Sunday Times' or 'The Observer' said that George Osborne and Iain Duncan Smith were at loggerheads over the scale and speed of austerity in welfare. Yesterday, they came together to say that they had sorted out their differences and:

"This government was elected with a mandate to implement further savings from the £220 billion welfare budget. For a start, we will reduce the benefit cap and have made clear that we believe we need to make significant savings from other working-age benefits."

That is the very point that Mrs Kelly made. They also said:

"We will set out in detail all the steps we will take to bring about savings totalling £12 billion a year in next month's budget and at the spending review in the autumn".

Whatever people might say about the integrity of the Stormont House Agreement, does that not send a warning to us? That is why I have to say to the Minister that, rather than going with the other devolved Administrations, the go-it-alone approach that seems to have been adopted by the DUP is a flawed approach. It begs this question: if —

Photo of Arlene Foster Arlene Foster DUP

Will the Member give way?

Photo of Alex Attwood Alex Attwood Social Democratic and Labour Party

— the DUP is taking a go-it-alone approach in this devolved arrangement compared with those of Scotland and Wales, is there some understanding between Peter Robinson and the Prime Minister arising from the so-called routine meeting that they had in the House of Commons after the election? Rather than going it alone, why would you not want to go together to try to make some impression on the two men who announced yesterday what their ambitions are for 8 July?

Photo of Arlene Foster Arlene Foster DUP

Infamy, infamy, they've all got it in for me. Let me say to the Member that he, like some members of Sinn Féin, is mixing up what happens after 8 July and what happens here in relation to our Budget for 2015-16. The two things are entirely separate. We, as a party, have never said that we are not up for having negotiations and talks. Indeed, I am meeting my Welsh counterpart, Jane Hutt, this Friday. I look forward to meeting John Swinney in August; unfortunately, that is the earliest date that we can meet. It is a nonsense to say that we are not going to work together. We are going to work together, but, unlike Scotland and Wales, we do not have a Budget and we do not have welfare reform. Both those Administrations have dealt with those issues. It is wrong to put the two things together. It is just mischievous. I say again that that is mischievous on that issue.

Photo of Alex Attwood Alex Attwood Social Democratic and Labour Party

On that basis, can I draw the conclusion that the First Minister has now replied to the letter that he received suggesting that the three devolved Administrations should go to London together in respect of their future Budget proposals? It seems that you are prepared to meet John Swinney and the Welsh Government, which is great, but that you are silent or neutral on the three Administrations going to London together now.

Photo of Arlene Foster Arlene Foster DUP

Can I answer that?

Photo of Arlene Foster Arlene Foster DUP

I actually wrote to the Chief Secretary to the Treasury today to invite him to Belfast for the next quadrilateral so that he can see what is happening in Belfast and wider Northern Ireland and is aware of the innovation that is going on and the economy here. The way to do it is to bring all the other Administrations here. I have been to see the Chief Secretary to the Treasury. As I said, I am going to Wales on Friday, and I am looking forward to going to Scotland as well. I am then inviting them all here.

Photo of Alex Attwood Alex Attwood Social Democratic and Labour Party

Is it not a curious point that we are prepared to invite all the Administrations here for a quadrilateral, the Minister is prepared to go to Wales to meet the Welsh Administration and John Swinney is prepared to come here in August to discuss all these matters, but the First Minister has yet to confirm that he is prepared to sit down with the three Administrations and go to London with them? If you are prepared to work with all these people, you should work with all these people in all the necessary configurations.

Photo of Alex Attwood Alex Attwood Social Democratic and Labour Party

Why have you, as DUP Ministers in Government and at First Minister level, not said, "We will go now in advance of 8 July"? Given the scale of what was outlined in the various briefings and in the 'The Sunday Times' article yesterday, why is that the one thing that you do not seem to want to be able to do?

Photo of Arlene Foster Arlene Foster DUP

The Member has asked a question. We need to deal with the elephant in the room. We need to get some credibility. We need to have a Budget. I would have thought that that was perfectly obvious.

Photo of Alex Attwood Alex Attwood Social Democratic and Labour Party

Is it not strange, Mr Deputy Speaker, that we get an invite even though we do not have a Budget for 2015-16 and we say, "Well, we will not deal with that invite until we deal with the Budget issue"?

(Mr Speaker in the Chair)

In any case, the point that we have been making on the issue of credibility is that one of our points of leverage upon London is where we are in respect of Budget and welfare. You cannot divorce the current Budget and welfare situation from what is going to happen on 8 July, just as you could not divorce the current Budget situation from the £38 million of cuts that the Chancellor announced two weeks ago. These things have to be dealt with in all their elements. This stand-alone approach gets in the way of the best and most coherent approach.

Photo of Paul Girvan Paul Girvan DUP 8:30 pm, 22nd June 2015

I thank the Member for giving way. Does he not believe that Wales and Scotland already have their Budget set for 2015-16? As a consequence, that is where we stand. They already have a Budget set, and, when Westminster meets to make those announcements on 8 July, whatever transpires will be automatically implemented in Wales and Scotland.

Photo of Alex Attwood Alex Attwood Social Democratic and Labour Party

The flaw in some of the comments that are coming from the other side of the House is simply this: in the margins of a meeting with the Secretary of State last week, I asked a senior official whether he could give us any guarantees that there were not more in-year cuts coming regarding the Budget and welfare, and he did not give me a very convincing reply. We are being told that 8 July has little immediate relevance for the 2015-16 Budget. That is like saying that the £38 million of cuts two weeks ago has no immediate relevance to the 2015-16 Budget, when clearly it does. The logic of that must be that, come 8 July, anybody who says that there are not going to be in-year cuts as a consequence of the 2015-16 Budget when it comes to welfare and our Budget is taking a leap into the unknown. Experience tells us to be vigilant about that and cautions us against it.

Does anybody conclude that, arising from that article yesterday, George Osborne and Iain Duncan Smith are prepared not to make in-year welfare changes and cuts? That is a conclusion that I would not draw, and I urge people to be a bit more cautious than to say —

Photo of Alex Attwood Alex Attwood Social Democratic and Labour Party

— that 8 July is about future years only, not about this year. I will give way.

Photo of David McNarry David McNarry UKIP

Just for the record and clarity, will the Member confirm that he believes everything that he reads in the newspapers?


Photo of Alex Attwood Alex Attwood Social Democratic and Labour Party

No, but when the evidence and the public statements penned by two Ministers lead you to a certain conclusion, you are justified in drawing it. When we put it to the Secretary of State whether there would be in-year cuts, and she said that she did not know, we said that we thought that there would be. I suggest that the record of the past two weeks corroborates our conclusion.

I will conclude with two final points. Let me make a comment, in passing, about where Sinn Féin is in all this. Mr McGuinness said in London on Saturday:

"Sinn Fein will not do Tory austerity."

It will not do austerity, yet the Budget Bill before us is the worst austerity Budget that we have seen in this jurisdiction since 2011. Although I disagreed with a lot of what Mr Farry said, he did make the point that the austerity Budget, which Mr McGuinness said was the best deal possible in response to the draft Budget last November, was the consequence of mismanagement of the public finances. In that regard, I have some sympathy with Mr Farry's comment. However, to argue that Sinn Féin "will not do Tory austerity" on the back of the worst austerity Budget seems to me to be somewhat problematic. In concluding his point, Mr McGuinness said:

"We said no to the coalition government and we are saying an unambiguous, unqualified and uncompromising 'no' to this new Tory government."

That is what he said on Saturday. Today, he says that there is conditional support for this Budget. I will leave it at that.

My concluding remark is addressed to the Minister. You might say that some of this is mischievous and so on, but I think that you recognise that the Tories are about to do something that will, in year 1 and year 2 of your Budget process, be quite immense, because they have said that they will do it quickly and severely, and, given what they did over four or five years in the lifetime of the previous Parliament, we can only imagine what the scale of that will be in the early years of this one.

It is my sense that this will now get managed not in the short term but over a longer period, and maybe there are reasons for doing it in that way, not least because of the months that are ahead of us. I suggest that there should be an opportunity, between now and Final Stage and in the period thereafter, for everybody, probably including us, to reboot and regroup in an effort to renew what unites us, which is the scale of what will come on 8 July and the effect of the autumn Budget on the lives of our people. Let us not be naive; let us not mislead them: let us be straight and honest with them. The scale of that requires a response from all the parties in the Chamber.

Photo of Roy Beggs Roy Beggs UUP

Let us have no doubt it: budgets are important. They are important to determine how much money will be raised in the first place, how much will be spent and what the priority will be. That is important whether we are talking about an individual household, a community group or a local council. It is interesting that local councils ended up having reduced grants given to them by the Assembly. What did they do? Did they complain and refuse to raise more money or to balance their books, perhaps cut, perhaps raise some more money and balance their budgets? No. Every council in Northern Ireland set its budget.

What if they do not set their budget and live within their means? There are regulations that would cause them to lose their authority to continue to operate if they did not do that. Just as political parties in Northern Ireland have respected their local government budgets, the Westminster Government, which financed the vast majority of expenditure in the Northern Ireland Assembly, gave us our funding. What do you think they think of us when we do not live within our means with all the money that is given to us? I can assure you that we are not well thought of by others in the rest of the United Kingdom who have had to live within their budget, whether it be local councils, other public bodies etc. I suspect that they are saying that we are demonstrating our immaturity.

So, budgets are important to a range of organisations, including non-departmental bodies and the Northern Ireland Executive as well. In the Budget, the Assembly prioritises its expenditure plans. It gives the Executive the legal authority to allow the various Departments and organisations to spend public money. They are not authorised to spend above the legal limit collectively as a Northern Ireland Executive. Individual Departments are to avoid over-expenditure unless there are exceptional circumstances, such as, for example, to protect public safety. That happens on occasion.

If an individual spends beyond their means, what happens to them? They frequently rely on credit cards and get involved in high-interest borrowing, and the issue can frequently spiral and further debts can arise. Maybe they will have several credit cards or get a Wonga loan and pay very high interest rates, but, eventually, the problems have to be faced. If not, there will be sudden cuts to individual households or bankruptcy. The Northern Ireland Executive need to understand that they are no different from rules that we expect individual households in our community to live by. During the recent election, some members of Sinn Féin promised to write off credit card debts and all sorts of things, but there is no money tree and you cannot promise that. Similarly, there is only so much funding for the Northern Ireland Executive, and we have to live within our means in Northern Ireland.

I will turn to the Budget specifically. There are several assumptions built into the Budget. For a start, some £1·7 billion in cumulative borrowing has been amassed over the years. As my colleague Leslie Cree indicated, that is some £948 per citizen, which is a higher level than in other parts of the United Kingdom. That must be of concern to us all, because, ultimately, it has to be paid back with interest. The further we kick issues down the line, the further we are passing debts on to the next generation, whether it is the next Assembly or the young folk who have to follow on from us. We all have to understand, even as politicians, that borrowing must be paid back. It is important that we live within our means.

Another fundamental assumption in the Budget is what has come to be known as the Stormont House Agreement. Those who support the Budget are approving it with the related funding and conditions that were built into the Stormont House Agreement, because that was the basis on which much of the loans, funding and financial assistance was offered to the Northern Ireland Executive. If there is a breach of the conditions, then there is a breach of the funding that has been built into the Budget. What would be the implications of that?

I will go through some of the details of the funding, because I have not heard this mentioned, in particular, so far today. I see that paragraph 3 in the Stormont House Agreement highlights that there is around a £2 billion financial package, much of it in loans offered over many years. It is based on the Assembly legislating for welfare reform, which some have chosen not to approve. They have breached some of the conditions for the funding package. I ask what the implications of that are for the Budget. Some of the financial package on offer is for £150 million, over five years, towards dealing with the past. I ask how much of this has been built into the current Budget. There is £700 million capital borrowing to fund a voluntary exit scheme. Again, £200 million is earmarked for this financial year. Has it been built into the Budget? I assume so. Without meeting the conditions on which the funding was offered, will that money continue to be available, or has there been some subtle change and welfare reform will be implemented. The sooner there are decisions, the better.

Equally important, aside from the round number of £200 million to enable the voluntary redundancy scheme, are the savings that will flow from it. I understand that most Departments have been building in six months of financial resource savings assuming that, from around September, departmental savings would kick in when some of their employees, who have volunteered to take early redundancy, take that up, the wages in each Department reduce, and savings start to manifest themselves. Those savings are important for the financial year 2015-16: the Budget that is being voted on today. Again, I ask whether that is going to happen, or will further debts accumulate in the second part of the year. It is not even just about that. The voluntary redundancies will also bring about financial savings next year; so, by not going forward clearly with what was agreed, we are pushing problems further and further down the line.

I go back to the individual household, which avoids dealing with the reality of its expenditure, takes out large loans, and makes assumptions that do not materialise. What happens to that household? Ultimately, there will be a crisis. The Executive and the Assembly are kidding themselves that they will avoid such a crisis if they do not live within their means and the conditions under which the financial offer was made.

On top of that, there is £500 million for 10-year capital funding for shared and integrated education. Again I ask, how much of that £500 million capital expenditure has been built into our Budget this year. How do we recover that, if the conditions are not met?

Next, there is a further £350 million for borrowing for infrastructure built in and, I understand, £100 million to be available this financial year. I assume that it is built in. Again, I ask whether some Members across the way will fail to meet the conditions in which that borrowing was made. Then there is an additional £50 million towards Peace IV funding, including the United Youth programme. Then there is an extra £100 million for reinvestment and reform initiative borrowing. Has all of that been built in to this Budget, which will have to be clawed back and pulled back if the conditions are not met? I see that many across the way are sitting with their head down. You should have your head down, because you are putting your head in the sand by ignoring the reality of the conditions in which borrowing has been offered to the Assembly and the Executive. At least that perked you up a wee bit.

(Mr Deputy Speaker [Mr Dallat] in the Chair)

The financial package is available on the basis of welfare reform, and, given the failure to implement welfare reform, certainly to date, and on the current rules we cannot go back to it for some time, I ask the Minister to confirm the implications for this Budget without welfare reform being agreed. This needs to be publicly spelled out, and we have not heard it. People are concentrating on welfare reform, but what will happen to the most vulnerable members of our community if welfare reform is not implemented?

Early years was mentioned earlier, and I declare an interest as someone who is a voluntary committee member of Horizon Sure Start. If you really want to solve long-term poverty, education, education, education is the best method to allow people to better themselves, create opportunities for themselves and claw their way out of the poverty that they may find themselves in. I speak from my father's experience of the world many decades ago and that of his family. You cannot spend your way out of poverty. We need to empower people and support early years education so that they can better themselves. We need to create the incentives so that they can better themselves.

Photo of Roy Beggs Roy Beggs UUP

Yes, sure.

Photo of Máirtín Ó Muilleoir Máirtín Ó Muilleoir Sinn Féin

You should never take it for granted that, when we have our heads down, we are not listening, because we may be taking notes.

The fault line in this argument is that you are taking — if I may say so through the Chair — the word of the English Government that they have no money to invest in order to help us to grow, but the evidence is that when money is needed by English Ministers, they find the money; £20 billion was found for fighter jets, so how can they not find the money to allow us to grow this economy and this society? I will finish with this: the Member mentioned his father, and he realises how difficult years were here. For anyone to suggest that there is not a special case to be made to London by the Assembly, both sides, for me beggars belief. We have to make that case.

Photo of Roy Beggs Roy Beggs UUP

My difficulty with that argument is that there were crunch talks just before Christmas. I think that the Prime Minister was across twice. It was a hothouse, and out of it came the Stormont House Agreement and the £2 billion financial package, much of it borrowing, but borrowing that allowed us, if well invested, to sort out our muddled finances. That money was not offered to any other region of the United Kingdom. Take, for example, the north of England, Liverpool, Scotland or Wales, those regions could equally find difficulties in their communities, and we have to recognise who won the election a short time ago. We have to face what we have on our plate today. I understand that we need to look forward to what may happen in the future, but looking forward will not stop the reality of the Budget crisis that we face. The conditions of finance that are attached to the offer that was made to us will still exist.

It is important to recognise that the current Budget did not come suddenly out of the blue, and that is perhaps one of the most damming things about the lack of leadership that has been shown. The general numbers for public expenditure were shown two years ago. Why was there a general lack of preparation? Why did some of the difficult decisions and the downsizing not start some time ago, so that more money can be directed to front-line services?

I am curious that there has been an indication from the deputy First Minister that he will support the Budget to allow for more time, but I have indicated that the numbers have been known for two years, and I asked the Finance Minister to verify that. It has been about two years since the outline figures were shown to the previous Finance Minister. Since then, there have been numerous meetings with different Finance Ministers and the Treasury, and there have been meetings with the Prime Minister. Martin McGuinness had meetings with the Prime Minister. You can only kick the can so far down the road, and then it becomes an incredible argument. That is where I fear Sinn Féin is presently. It is arguing for something that is not credible. It might be easy to argue for it to avoid the difficult decisions —

Photo of Daithí McKay Daithí McKay Sinn Féin

I thank the Member for giving way. We all recall that he and his party stood on a Tory manifesto not so long ago, so it is no surprise that he is defending that particular Government. Of course we knew that if the Tories got into Government again, they would continue with these ideological cuts. These are in no way economical. It is crushing our economy and it is squeezing any opportunity that we have of economic recovery. The Member can criticise us all he wants, but what is his view on what the Tories are doing? Does he or does he not agree with their economic policies?

Photo of Roy Beggs Roy Beggs UUP

The Member seems to be living in the past. Does he not realise that there was an election recently? The Ulster Unionists stood on their own agenda, and we have two Members back on the green Benches, sitting on the Opposition Benches. We are glad that we are back at Westminster, and we will be arguing our case there, unlike the Members opposite in their party, and trying to influence people. I have to say that the attitude of Sinn Féin and its lack of responsibility is not encouraging for anyone or for any mature political debate or argument.

I go back to this financial package that is on offer to us and the condition under which it was added. There is a little paragraph near the end of the document, and it says:

"This financial package is subject to the Welfare Bill being reintroduced in January, progressing through Consideration Stage by the end of February"

— I think that was delayed by a month or two, but, generally, it was met — and:

"full implementation of Executive led measures by 2016-17".

I have not heard any commitment to do that. Without the commitment to do that, we are breaching the financial conditions under which all this money, which, I believe, is built into the current Budget, has been made available. Therefore, I would argue that it is at considerable risk.

Photo of Roy Beggs Roy Beggs UUP

I want to proceed a little bit, please.

(Mr Speaker in the Chair)

If an individual borrows and spends money that they do not meet the qualifying conditions for and might suddenly be required to pay back, they put themselves at risk. All of us would say that they were irresponsible. I pose the question: are we as an Assembly and as an Executive doing a similar thing and taking out a huge Government Wonga-like loan that we have access to but, as of yet, have not met the qualifying conditions for? Will we face clawback, and what will be the payback period? Will it be months? Will it be years? Those are real issues that must be determined, because the British Government finance us by money that is raised in other parts of the United Kingdom. The United Kingdom works collectively together and the more affluent places support those in greater need, so, as I indicated, if we do not meet the conditions of this Wonga-like Government loan, what will happen to our Budget?

Let us remember what happened a relatively short time ago. At the end of last year, it was clear that we were spending beyond our means. Our June monitoring round, for instance, was completed at the end of July and then instructions had to go out to claw back funds. Most Departments were issued with instructions for a clawback of 2·3% with a warning that a further 2·1% would be required later in the year. That, indeed, did happen and, despite all that, we were overcommitted by £100 million. When you claw back money, you do not make good use of money. You do not make your real priority choices because you may well have committed to contracts that would not have been your priority had you known that you did not have the full money that had been allocated to you. By not making appropriate financial decisions on a timely basis, we as an Assembly and Executive are doing a disservice to our community, where, ultimately, sudden changes of direction and expenditure result. We will not get good value from the limited funds that we are given, and that is not a way that anyone should be managing an economy.

We need stability in Northern Ireland, not only political stability in the streets but financial stability. We need to encourage our businesses so that they can plan ahead and know what services are going to be provided. We need to provide them with stability so that they can be encouraged to grow and invest because it is businesses that generate jobs for our people, and we need jobs. <BR/>Not only do we want to encourage the expansion of our existing businesses but we want to encourage inward investment. I have to say that a Government that cannot live within their Budget do not encourage anyone, and nor do a Government that might have to make sudden changes in their expenditure, such as happened last year. I am flagging this issue up because we will be failing doubly if this happens for a second year in a row. The Government need to provide stability to encourage the community and to encourage good expenditure with all of the groups that they support. When we do not do that, we create problems for the entire community.

In my constituency last year, the health trusts had to make sudden cuts because of financial pressures. Without going through the appropriate consultation etc, they decided to close minor injury units. In other areas, they reduced intermediate care beds, again creating a potential pressure in our hospitals when it came to winter pressures. They also were forced to take decisions when the Health Department stopped supporting the independent healthcare sector, which was controlling the growing waiting lists. That is no longer happening, and guess what has happened to that growing waiting list? We need to live within our means. We need to avoid such crisis decisions. We need to prioritise the expenditure that we know we can depend on.

For those who are saying that they are not going to support welfare reform, I pose this question: how are you helping stability in Northern Ireland by creating a huge financial pressure, perhaps within a month or months? Perhaps we might make it as far as October but, ultimately, we have to live within our means. If, by some means, we muddle through, ultimately, the Treasury gives us its money. It has the upper hand and controls and regulates funding. Again, I go back to the point that we need a balanced and planned Budget, not an emergency Budget based on reaction and a failure of some to honour the conditions upon which the Executive may agree to go into financial borrowing. The worst thing that we can do is to create a Budget in which there are holes.

I will go back to the voluntary redundancy scheme. To my mind, it is one of the most important aspects of the Budget because it brings savings to Departments not only this year but in future years.

If we do not have a voluntary redundancy scheme to reduce the level of administration in the Civil Service, the community and voluntary sector and our front-line health and education services will suffer. Whether it comes through the Stormont House Agreement or by other means, we must have a scheme to reduce Civil Service administration, because we are living beyond our means. I want a higher proportion of our funding to go to direct services. I realise that that will cause difficulties and that there are many hard-working civil servants in Departments, but the reality of financial pressures means that that is what we face, and we ignore it at our peril. If we do not implement the voluntary redundancy scheme, we will have plenty of administrative jobs and not enough front-line teachers, doctors, nurses or those in the voluntary and community sector who address the needs of our community.

I ask the Finance Minister to address what happens if there is no voluntary redundancy scheme. I am aware, through the utterances of the head of the Civil Service, that he needs a decision on whether it can be financed by, I think, August. We have to be fair to the individuals who have thought about the scheme and decided to apply for it. They are all hanging out there. If something does not happen, how will they be motivated in their ongoing work? We are not treating our employees — our civil servants — well. We need a scheme, and we need to provide it in a timely fashion.

At this stage, we must remember what was said about the financial package. It is subject to welfare reform being introduced in January, progressing through Consideration Stage at the end of February and full implementation of Executive-led measures by 2016-17. If we are building the financial package into the Budget, and if Members are to approve it, they cannot say that they are not aware of the conditions. Those are the conditions. I ask Members to recognise the difficult decisions that we face. If they are voting for the Budget, at the very least honour the conditions that are built into it and approve welfare reform, which would allow us to access the financial package and get our public finances back into order for the difficult times ahead.

Photo of Ian McCrea Ian McCrea DUP 9:00 pm, 22nd June 2015

As is the case in many debates, the longer they go on, the more things have been said, and it is difficult not to be repetitive. I will try my best not to do that, although one or two points may be worth repeating. As I think about what has been said during the debate, whilst it is not often that I welcome anything from Martin McGuinness, it is a good thing, in a sense, that we will at least get conditional support for the Budget. If things go the way that we hope, there will not even be a vote. Who knows? If people like me and other Members who speak keep it short, maybe we will even finish the debate tonight. We live in hope.

Whilst I accept what Martin McGuinness said on behalf of Sinn Féin, I took issue with his comments that none of the parties in Northern Ireland was to blame for our current difficulties. I suppose that it is the bad old Tories and their austerity agenda. As a number of Members said, there are those who just want to bury their heads in the sand and believe that it will go away and that, if we ask loudly enough and often enough, the Tory Government will just put their hands in their pocket. In a meeting today with the Secretary of State, along with the Minister of Enterprise, Trade and Investment, she suggested that there was no cheque book or cheque ready for us. I am not sure whether there is even a £10 note, never mind a large cheque.

It is unfortunate that we are where we are. Those to blame are those who got us into this position. I spent many hours at Stormont during the talks process, and there was certainly a sigh of relief at the end of it all when we were able to achieve a five-party agreement. It is disappointing that some who signed up to the agreement, which included the implementation of welfare reform, decided at the last stage of the Welfare Reform Bill to sign a petition of concern to ensure that it did not pass.

As a result, if we look at the Department of Enterprise, Trade and Investment — today, I questioned the Finance Minister, who was answering on behalf of the First Minister, about foreign direct investment — we see our lack of credibility when foreign direct investors look at us now. As all Members will know, Northern Ireland has had a very strong record of attracting FDI and outperforming many larger regions. Invest NI announced that 2014-15 was a record year for overall job promotion in Northern Ireland. Of the 13,829 new jobs promoted, 5,661 were with externally owned companies, and just over 1,000 were with 25 companies new to Northern Ireland. Belfast is Europe's leading destination for investment in software development and technical support and the world's top destination for investment in financial services technology.

Given the good work done and the effort put in by Invest NI, many believed that the Budget and the Stormont House Agreement would at least take us through many of the difficulties and get us to the point at which we got the British Government to support the devolution of corporation tax. In that context, our credibility with foreign direct investors has suffered, and they see us as being half in, half out. Most of us want it, but only half of us want to try to deliver it. Others want to use it as a reason to hold things back.

I will move to a constituency perspective for a few minutes. One of my colleagues, Alastair Ross, started the debate. He talked about how we could all have a wish list. I could ask the Finance Minister to allocate many thousands of pounds to things in my constituency, and there is no doubt that others will. I was disappointed that Jo-Anne Dobson took the opportunity to attack the Health Minister, the Finance Minister and everybody else but her party's Minister, yet it is he, the Minister for Regional Development, who has failed to sort out the Budget allocation that he received. He has failed to deal with road maintenance, street lighting and grass cutting. These are issues that each and every one of us, as MLAs, fight day and daily with local roads offices to try to get done, and every conversation goes back to the lack of funding. The Minister, on every occasion that he is questioned in the House, passes the blame. He says that it is about the money that he has been allocated by the Executive and is not his responsibility. Personally, I believe that it is the Minister for Regional Development's responsibility to prioritise his budget. He is allocated a budget, and it is for him to prioritise it. When he does not tackle those important issues in our constituencies, we know where his priorities are not.

Photo of Roy Beggs Roy Beggs UUP

Will the Member give way?

Photo of Roy Beggs Roy Beggs UUP

Would he like to indicate where he thinks that the Minister should make cuts to deal with what he talked about?

Photo of Ian McCrea Ian McCrea DUP

I am glad that the Member asked me that, because, as far as I am concerned, I do not recall being appointed Minister for Regional Development. I would be happy to take it on — well, maybe not happy — but I certainly think that some could do a better job of allocating our Budget. I do not think that it is about where we cut money to do this and that. Whilst budgets are all about that, there are certainly things where I believe party politics are being played. Unfortunately, it is the people in our constituencies who are being impacted by that. The decisions that the Minister is making are, I think, shameful, and he should be ashamed of himself.

I think that it is worth repeating that £2 million per week is being lost to our block grant through welfare fines. As Judith Cochrane said, one week of that would pay for the early years fund. I see that the Minister of Education is now in the Chamber. I think that it is a shame that the austerity project that he has taken forward in his Department to cut the funding for early years is a disgrace. In the context of welfare reforms, they talk about how they want to protect the most vulnerable. Certainly, I have had conversations and discussions with organisations and children's groups that have been affected by the cut to the early years fund. I am talking in particular about Tober Tinys in Tobermore, which I know has been seriously affected by this. I hope that the Minister reflects on that decision and looks at it again.

Again looking at my constituency, I heard Mrs Overend refer to Desertcreat. We all know the debacle that the Northern Ireland training college has gone through. The Minister of Justice and former Ministers of Finance have had to deal with that, as has the current Minister. In fact, I had conversations with her and her special adviser the other day to see how we can move it forward. It is important that we try to find a way out of this. The Desertcreat college is an important economic driver for the Mid Ulster constituency, as are the benefits that it would bring to our local economy.

When I look at the issues on the £1·4 million that had been allocated through the social investment fund to Mid Ulster, I can see that, if we fail to get through this impasse, they will have a serious impact, again on Mid Ulster. I am glad, however, that the Magherafelt bypass has been signed and that work has commenced. If we had not got it to that stage, I fear that that would have been lost too.

I hope that common sense will prevail. I am not hopeful about that within the SDLP, because, having listened to Alasdair McDonnell and Alex Attwood, there is no hope, because hope is lost. Therefore, I can only hope that common sense prevails.

Photo of Mitchel McLaughlin Mitchel McLaughlin Speaker

Order. First of all, the noise level in the Chamber is rising, and it is becoming very difficult for Members to make their contribution and to be heard. I ask Members, especially those in the corner to my left, to pay attention to that.

The second thing is that, as there are still a number of Members wishing to speak in the debate and the Minister has still to make a winding-up speech, the Whips have agreed to adjourn the sitting at around 10.00 pm. I will judge how many speakers we can fit in. The Business Committee will consider rescheduling the remaining unfinished business for Wednesday 24 June, and an Order Paper for Wednesday will be issued after the Business Committee meeting tomorrow.

With the best of order, I call Mr Jim Allister.

Photo of Jim Allister Jim Allister Traditional Unionist Voice

Thank you, Mr Speaker. I assure you that I will not be on my feet at 10.00 pm. That might be the only support I get tonight.

It is a paramount and rudimentary function of any credible Government to produce a balanced Budget on the expenditure over those they govern. Of course, it follows that it is equally the function of a credible Assembly or Parliament to be involved in the endorsing of that balanced Budget. <BR/>Whatever we can say about this Budget, one thing that is abundantly clear is that it is anything but balanced, because at its heart lies that black hole of £604 million. That makes these financial arrangements something of a shambles. Make no mistake: this is a failure of government. It is a shambles made in Stormont. We cannot blame anyone else for it.

Yes, there are some who want to blame the wicked British Government. Mr Attwood even came close to suggesting that the Republic of Ireland could and should be more generous to us, but the truth is that this is a shambles of Stormont's making. It is home-made and home-produced, and that in itself is a most striking commentary on the state and structures of government in Northern Ireland.

It is a failure of government and the structures of government that we have got to this ludicrous situation in which the answer that government in all due consideration can come up with is, "Let's kick the can down the road". That is what this Budget is doing. Let us not face the stark reality that is staring us in the face, but let us buy a bit more time and kick the can down the road in the hope — maybe more than in the expectation — that, in the meantime, something will work itself out. When government is reduced to that modus operandi, it has reached a very low level indeed, and that is the point that we are at.

One of the consequences of that, and the Minister said it, is that, if things do not work themselves out, adjustments are going to be required to the Budget. The problem, as I pointed out last week, with putting oneself in that position is that, to make those adjustments, the very people who put you in the mess have a veto over whether or not you are permitted to make those adjustments.

The Finance Minister cannot bring adjustments to the Estimates and arrangements under this Bill if and when it becomes an Act without the approval of the Executive. Of course, within the Executive, the spendthrifts — those who have no regard to financial probity — hold that absolute veto. Therefore, we are in a situation in which, on a wing and a prayer, we are going through a process of kicking the can down the road and of trying to obscure and forget about the reality that, if something does not turn up, when the moment of reckoning comes, it may be impossible to fix the situation, because of the veto that rests with those quite content to bankrupt Northern Ireland.

Let us not put a tooth in it: Sinn Féin is quite content to bankrupt Northern Ireland and to demonstrate that, in its terms, it is the failed political entity that it has always said it was. The Minister's predicament is that she has put herself as victim to that ransom situation, in which she can be held to ransom by the very people who have created this financial mess. That is not a good position for any Finance Minister or any Government to be in.

During Mr Wilson's speech, I asked him how one would get through adjustments in that scenario. He did not answer. I ask the Minister, because the legal and financial reality is this: having voted through Estimates that include £604 million that we do not have, Departments cannot now without adjustments be prevented from drawing down that fictional money. There is no methodology by which they can be stopped. In order to stop them, you need to make the adjustments, and, in order to make the adjustments, you need the permission of those who put you in that position, namely Sinn Féin. That seems to be part of the sorry mess into which things have resolved themselves.

Mr McCrea said that he welcomed the fact that Sinn Féin was giving conditional support to the Budget and that it was a good thing. Is it? Is that not Sinn Féin doing precisely what Sinn Féin always does? They pocket what they can get at any given moment. They did it at Stormont House, and they are doing it again today. They have £604 million that we do not really have, so they pocket that situation in the belief that they can extract more. That was the essence of the hit-and-run speech of the deputy First Minister. It was that they would give conditional support in order to extract more further down the road. He made it very clear that the Finance Minister and the Executive would be a hostage to that situation.

I want to say something else about the Budget. The expenditure for the Departments in the Budget has already been pared back by something in the order of £70 million to £80 million because of the Stormont House Agreement. Some £564 million was taken out over six years of the ordinary expenditure of Departments in order to underwrite the welfare goodies. I assume that that money or the extraction of that money must already be in the Budget. This is a Budget that, in its spending power — never mind the rolling programme of the 2011-15 situation — must already have that magnitude of cuts within it, plus the provision for the penalty clauses that arise from the failure to implement welfare reform. This is a Budget that has already been stripped back in that regard.

I want to come to the question of the £604 million, and I want to ask the Minister how that £604 million is actually made up. I note that she was asked that in a priority question for written answer by Mr Gardiner back on 3 June. When I checked today on the Assembly website, I saw that, although we are now almost three weeks beyond that, that question still had not been answered. In replying on Wednesday, will the Minister give us a breakdown of how that £604 million is comprised? Is there any money in that that reflects the cost of the exit scheme? That is a specific question that I would like to ask her. The exit scheme was supposed to be funded with £200 million this year by loan. Is there any component in the £604 million to facilitate an exit scheme in the absence of the loan? Perhaps it would be useful if the Minister were to spell out exactly the component parts of that £604 million. When she replies, will she tell us when she is likely to make the June monitoring statement to the House? That, of course, is also an important component of the financial exercise in which we are involved. When will that come about?

I now turn to one or two of the comments made by some of the nationalist representatives. I know that there always was a date in July with which some people were totally infatuated and besotted; it seemed to dominate their every waking hour. This year, it seems to be a new date in July: it seems to be 8 July on which the world will end as far as some are concerned.

Photo of Jim Allister Jim Allister Traditional Unionist Voice

So it seems. They tell us this, in essence: how dare the mandated, recently elected Government of this nation state implement the policies that the electorate who elected them mandated? The sheer audacity of it: the pretence that this nation, with its central government at Westminster can, somehow, through special pleading and once more producing the tiresome argument of us being a special case, exempt us from the natural consequences of the functioning of government. Then they foolishly suggest that the party that is in government has no mandate: of course it has a mandate. We might not like that mandate, and this Province might not have contributed to that mandate, but it has a mandate. It is a national mandate.

Whether we like it or not, that is the reality of life in 2015 in this United Kingdom, which provides us, through the generosity of all its taxpayers, with the very funds that keep the lights on in the House, keep government functioning and provides a colossal subvention. Those who complain most about the shortfalls have no idea how we would plug that gap if the British Government were not continually writing the cheques. That is the reality that some in the House seek to dodge, avoid and run away from. Unless and until we face the reality that we are part of the components of the nation state that has control of these matters, we fool ourselves.

Some, of course, as I suggested, are more than happy to fool not just themselves but others in the belief that there is some utopian answer in another constitutional direction. Of course, the reality is very, very different. Until this devolved institution realises that it is not a sovereign institution but a devolved institution subject to all the frailties and constraints of that and grows up and lives with that reality, the mayhem that has been brought to the meddling in the financial process will intensify and grow. That is the reality that the House needs to face.

Photo of Steven Agnew Steven Agnew Green 9:30 pm, 22nd June 2015

Earlier this afternoon, I hosted the launch of a 'VIEW' magazine issue specifically dedicated to child poverty. The levels of child poverty in Northern Ireland were highlighted by each of the speakers. It is currently estimated that around one in five children lives in poverty. Professor Paddy Hillyard, who spoke at the event — I have seen him speak on a number of occasions — has often highlighted how, since 2007, Budgets and policies that have passed through the House have shifted resources from the poor to the better-off. Effectively, what has been overseen is a process of robbing the poor to pay the rich. An example of that is the rates cap, which currently treats everyone living in a house worth over £400,000 as if they were living in a house worth £400,000. In other words, it acts, effectively, as a tax rebate for the most wealthy in our society — roughly 2,500 households. It has been pointed out to me that, as a representative of North Down — the so-called gold coast — many of those people may be in my constituency and that I should not raise the issue as it might affect my vote. To anyone who makes that point, I would say, "Why should my constituents in the Kilcooley estate subsidise the rates of those in Cultra?". I will say that to someone in Cultra as much as someone in Kilcooley. It is not right; it is not fair. All the points have been made about difficult financial circumstances. It is regrettable and unacceptable that we continue such policies in the Assembly.

We are told that, because of the difficult finances, we must make cuts to welfare, but the people who make those arguments abhor any proposal that we might ask those who have wealth to pay more. Members must accept that we have to ask for more from those who can afford it. Members make much of the fact that we are in the sixth-largest economy in the world. This is still a wealthy country; there is wealth in this country. Until those who tell me that I must accept cuts to the welfare of the poorest in our society accept that we have to ask for more from those who can afford it — the wealthiest in our society — I will not take lectures on fiscal responsibility or sound economics. It is clear that that rhetoric is used simply to protect the better-off and punish the poor for the excesses of the rich.

Photo of Jim Allister Jim Allister Traditional Unionist Voice

The Member talks grandly about how we must ask the rich to pay more. Who is the "we"? The House has no powers or fiscal functions in that regard. It is an argument that could be made by the Member's representative in the House of Commons, but it is not an argument for this House. This House has no powers whatever to compel anyone to pay more or less.

Photo of Steven Agnew Steven Agnew Green

I thank the Member for his intervention. This House does, of course, have rate-varying powers, which is a form of property taxation. We have chosen not to introduce water charges, which could be done on a progressive basis if that were the way that we decided to implement them. We had a freeze on rates. We now have a real-terms freeze in that we have only inflationary rises. These are choices that we have made and that predominantly benefit those who are better off. Those choices have been made by the Assembly. I accept that we do not have full fiscal responsibility, but, even when we seek extra powers, such as on corporation tax, we seek to give further benefits to, in that case, large businesses, again at the expense of public services, which disproportionately affects the poorest in our society. At the event today, Professor Hillyard made the point — I paraphrase — that, to lift children out of poverty, we must increase the resources provided to and the incomes of the poorest in our society.

Photo of Basil McCrea Basil McCrea NI21

Will the Member give way?

Photo of Basil McCrea Basil McCrea NI21

I will not take too long. One of the ways that the Joseph Rowntree Foundation suggested that we lift children out of poverty is to get their parents a job. Getting people off benefits and into work is really what the Budget should try to do. If you are going to force people and their children to live on benefits for the rest of their life, how can they have a proper life?

Photo of Steven Agnew Steven Agnew Green

I thank the Member for his intervention. It is clear that the target of the Tories is not just those who are out of work but those who are in work. We know that there are now more people living in poverty who are in work than who are out of work. We have a Tory Government —

Photo of Steven Agnew Steven Agnew Green

I will in one second. Let me make the point.

We now have a Tory Government who seek to cut in-work benefits to further hit those who are on low pay. Another category of the poor in our society is those who are in work but suffer from poor pay. I give way to Mr McGlone.

Photo of Patsy McGlone Patsy McGlone Social Democratic and Labour Party

Thanks for giving way. In fact, you made the very point that I was going to make, which is that that very element of what the Tories seem to be about at the moment is directed at those who receive tax credit for their children and are currently in work. The outcome of that will be that the working poor will become poorer.

Photo of Steven Agnew Steven Agnew Green

I absolutely agree with the Member. The slogan has always been "We must make work pay": for that reason, I cannot understand why the current Government want to punish those in work, who are on low pay through no fault of their own but through their employer's unwillingness to pay. Indeed, we hear nothing from a party that proposes to make work pay about promoting and expanding provision of the living wage.

We must put more resources towards families in poverty and improve their income. Indeed, the welfare reform proposals on which the Bill is predicated, despite the fact that they were not agreed by the Assembly, would take money away from the poorest. That would undoubtedly impact negatively on levels of child poverty, which are predicted to rise considerably by 2020. We should not accept that as an inevitability. It is something that we can and should seek to mitigate through the powers that we have in Northern Ireland. Judith Cochrane listed what seem to be Tory figures of how welfare would benefit the poorest in our society.

Photo of Judith Cochrane Judith Cochrane Alliance

Just to be clear, they are DSD figures.

Photo of Steven Agnew Steven Agnew Green

I thank the Member for her intervention. Mr Attwood often asks whether or not Mervyn Storey is working on behalf of the Department for Work and Pensions. I will not get drawn into that debate, but it sounded like it was replicating what has come from the UK Government.

I put it to the Member and her party: whether it is £115 million at the lower end or £250 million at the higher, how can you take that out of welfare? How can you cut welfare spend, and the welfare recipients be better off? It does not take a mathematical genius to see that those numbers do not, and cannot, add up. Those are the cuts that would have been imposed had we implemented the Welfare Reform Bill.

Photo of Arlene Foster Arlene Foster DUP

Will the Member give way?

Photo of Arlene Foster Arlene Foster DUP

The Member has made comments about DSD figures not adding up, and I am sure that the Minister for Social Development will have his own commentary on that. Does he accept that, already, we have lost around £200 million to the block grant in Northern Ireland in penalties? We lost some £87 million last year and £114 million this year. That rises next year again, and that is before any further welfare reforms are put through at Westminster, which will make that gap even bigger. So how does he propose to deal with those penalties in the context of what he is advocating tonight?

Photo of Steven Agnew Steven Agnew Green

I thank the Minister for her intervention. She knows fine well that we have not lost that money. Northern Ireland has not lost that money; it may have been lost to the block grant but that money has gone directly to people on welfare. Instead of cutting their benefits, the decision was made not to do that and the payments continue to go through the annually managed expenditure. It is money moved from one pot to another in the way that the Stormont House Agreement, incidentally, proposes to move it in the opposite direction.

Photo of Steven Agnew Steven Agnew Green

I will give way in a second.

It is money that is still going to the poorest in our society. I and my party, the Green Party in Northern Ireland, suggest that that is a good use of public money.

Photo of Arlene Foster Arlene Foster DUP

Will the Member give way?

Photo of Steven Agnew Steven Agnew Green

I will give way to Ms Cochrane. I will finish making my point.

It is a good use of public money because the priority of government should be to protect the poorest and most vulnerable in society. In making the decision not to implement welfare reform, we allowed that money to go directly to welfare recipients, to be spent in our economy and to stay in Northern Ireland.

Photo of Judith Cochrane Judith Cochrane Alliance

I thank the Member for giving way. Is the Member aware of the different concessions that were put in place through the Stormont House Agreement and which were going to protect people for the next three years? People who may not even have been entitled to certain benefits were still going to receive protection, but at least that was a decision that we were making, to take that money out of our block grant, rather than just suffering penalties. It was a decision that we could take in order to protect those people. People were not going to lose out for the next number of years.

Photo of Steven Agnew Steven Agnew Green

I thank the Member for her intervention. We sought to amend the Welfare Reform Bill, but those proposals were rejected. During the period of negotiations, whilst I was not involved in the cross-party negotiations, I met the First Minister and put forward my party's proposals and, yes, we could have had a Northern Ireland solution, but it fell short. Despite assurances from parties in this House, it still would have meant the implementation of the bedroom tax, despite promises that it would not be implemented. It still would have seen cuts to child disability benefit. It still would have seen an increase in the maximum penalties in welfare sanctions. Those were issues that we sought to have addressed but they were not, and therefore we could not support the Bill as it came forward.

Photo of Basil McCrea Basil McCrea NI21

Will the Member give way?

Photo of Basil McCrea Basil McCrea NI21

As the Member is talking about figures and takes issue with some of them, can I ask him about these figures from the 'Summary of Public Sector Finances' produced by the Office for National Statistics? I want to know what he makes of this: in May 2015, and that is not that long ago, the public sector in the United Kingdom spent £10·1 billion more than its income in that one month. Despite all the rhetoric that we have had, this is a reduction from the previous year of only £2·4 billion. In other words, we spent some £12·4 billion more in the UK in the month of May last year. I do not know how people do not get it. People talk about the deficit as reduction, but the debt is still going up. Where is the money going to come from to do all the great things that you want? I am not against doing good things; I am saying that there is no money and, unless you can tell me where the money is going to come from, I do not know how you plan to implement your proposals.

Photo of Steven Agnew Steven Agnew Green 9:45 pm, 22nd June 2015

I thank the Member for his intervention. I will certainly not defend the Conservative Government on their deficit reduction plans. I do not know the exact details of the figures that he refers to, but I believe that I understand the figures for Northern Ireland. We outlined them in advance when we initially opposed the Welfare Reform Bill and said that we did not see how the £90 million top-up could meet the minimum £115 million cut. Latterly, others came alongside us on that.

All along, our position has been that, if we implement the Tory party welfare reform agenda, what is the great reward for the people of Northern Ireland? The great boon that was achieved in the Stormont House Agreement was that we could devolve corporation tax and reduce it if we so chose. The same people advocating that policy bemoan the fact that we cannot afford £2 million a week on welfare payments to the most vulnerable in our society. They call them penalties, but the reality is that it is money that still comes to Northern Ireland. They wish to impose a corporation tax reduction that would cost us £6 million a week.

Photo of Arlene Foster Arlene Foster DUP

Will the Member give way?

Photo of Steven Agnew Steven Agnew Green

I will give way, but I have to finish at some point.

Photo of Arlene Foster Arlene Foster DUP

I hope so.


The Member talks about corporation tax. It is so difficult to listen to somebody who does not have an aspiration for economic growth for this country and who has no vision for Northern Ireland moving into the future but would rather keep people on welfare benefits. That is the vision of the Green Party that we are hearing tonight. We are not hearing anything about productivity or moving forward; we are hearing about keeping people on welfare benefits. I hope that the Northern Ireland public hear that, but, of course, they will not, because it is 9.45 pm, and very few people are listening to the debate.

I made a point earlier about corporation tax. The full impact of corporation tax on the block grant does not take effect until three years after its introduction. The original timetable referred to April 2017, which may have slipped now. I am not sure what the current thinking is with Sinn Féin on that. It raised some issues recently, although that was on the mistaken belief that the cost would come out of the block grant immediately. The full amount of corporation tax comes out in year 3, and, by that stage, we will already be bringing money back into the economy and, therefore, growing the economy. The full impact does not happen until 2020 or even 2021 on the earliest estimates, and the Office for Budget Responsibility states that the Budget for the whole of the UK will be in a surplus position by that stage. We will be in a changed circumstance when we talk about a corporation tax reduction for Northern Ireland. If the Member is going to throw out figures, he has to put them in the context of when we will have to take the hit.

Photo of Steven Agnew Steven Agnew Green

That is the typical response when, if you disagree with someone's economic philosophy, you do not want to see productivity. I have promoted the living wage, and all evidence shows that that boosts productivity. The Minister said that we have no vision for growth. She has been in the role of Enterprise Minister and Finance Minister and has served on the Government since 2007, and, to date, the income gap between Northern Ireland and other regions of the UK has increased. We have become poorer compared with other regions of the UK under the last two Executives in Northern Ireland. The Minister can talk about vision, but her record is one of failure.

Photo of Arlene Foster Arlene Foster DUP

You will have to give way. You have to give way on that.

Photo of Steven Agnew Steven Agnew Green

Our economy is not benefiting the people of Northern Ireland —

Photo of Steven Agnew Steven Agnew Green

— and the modest growth that we have had is —

Photo of Steven Agnew Steven Agnew Green

I get that.

The modest growth in recent times is as much to do with a global recovery as anything in the policies of the current Executive.

We heard previously from Mr Ross —

Photo of Arlene Foster Arlene Foster DUP

Is the Member not going to give way?

Photo of Mitchel McLaughlin Mitchel McLaughlin Speaker

It is clear that the Member is not going to give way.

Photo of Steven Agnew Steven Agnew Green

There are 10 minutes before we are due to wind up.

We heard previously from Mr Ross that we will pay the cost of reducing corporation tax through cuts to public-sector employment. His party may find that palatable, but I do not accept that it is the way to boost our economy and the well-being of our society. It is not just about GDP, which we know measures many negative, as well as positive, attributes of our economy. The proposal is to guarantee job losses in the public sector in the hope of job increases in the private sector. The projection from the economic advisory group is that we are supposed to break even on jobs after 11 years. That is 11 years of decreased employment as a direct result of that policy. To make up the tax shortfall from reducing corporation tax, we would need to grow our economy by a third. It is extreme optimism to believe that a single policy will do that. As Mr McCrea and others pointed out, believing that a single policy intervention, at the same time as cutting investment in skills, will increase our economy by a third is optimistic to say the least.

The parties that prioritise that sort of economics have, in my view, got their priorities wrong. Indeed, David Ford, in attacking me and my party in his Alliance Party conference speech, said that we could not afford to protect welfare claimants. In the same speech, he said that we must make the cut in corporation tax. If people want a single example of what separates the Green Party from the Alliance Party — it is a question that I am often asked — that sums it up quite simply: when it comes to a choice between protecting the most vulnerable or giving tax breaks to big businesses, the Green Party will always put people first.

In the Stormont House Agreement, many unrelated elements were put into a single pot: welfare, corporation tax, public sector employment, victims and historical issues. They need to be decoupled. It is clear that the agreement has unravelled, and those who signed up to it can answer for that. It was never an agreement that my party signed up to. We did not endorse it, nor did we ever support it. It is clear that it is unsustainable. Parties talk about other parties putting their head in the sand. When you produce a Budget predicated on welfare reform, despite the fact that the Assembly did not agree welfare reform, that is clearly putting your head in the sand. The elements of the Stormont House Agreement need to be decoupled, and negotiations need to take place. We cannot continue on the trajectory that we are on.

I started my speech by talking about child poverty. It is clear from its history since 2007 that the Assembly has done nothing to redistribute wealth to the poorest. To support the Budget would be to support the continuation of a policy of robbing the poor to give to the rich. For that reason, my party cannot endorse it.

Photo of Mitchel McLaughlin Mitchel McLaughlin Speaker

Thank you. It is now 9.55 pm —

Photo of David McNarry David McNarry UKIP

On a point of order, Mr Speaker. In fairness, could you rule that the Members next in line on the Speaker's list will be taken first on Wednesday, if that is your choice today?

Photo of Mitchel McLaughlin Mitchel McLaughlin Speaker

You pre-empted me. That is exactly what will happen, I expect. The Business Committee will, of course, reschedule the unfinished business for this evening. We will pick up the speaking list as it stands at the present time. Three other Members wish to speak, and we have to hear from the Minister. That comprises the business that was unfinished this evening.

The debate stood suspended.

Adjourned at 9.55 am.