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October Monitoring

Ministerial Statements – in the Northern Ireland Assembly at 11:45 am on 25th October 2016.

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Photo of Stephen Farry Stephen Farry Alliance 11:45 am, 25th October 2016

On a point of order, Mr Speaker. We are about to hear a statement from the Finance Minister on the October monitoring round. The Minister is at pains to stress the new procedures that the Executive are now using, and I do not necessarily dispute their right to have a different approach to monitoring rounds. However, it is my understanding that very few Committees in the Assembly, if any, have had a full briefing on the financial situation as it pertains to their Departments.

We are also likely to be facing a situation where there is no draft Budget for the forthcoming financial year. We also see a curious line in the Minister's statement where the Executive are saying what is appropriate in terms of parliamentary scrutiny. I, and many others, are concerned that we are seeing a shift by stealth in the balance between the Executive and the Assembly regarding financial scrutiny; and, indeed, the deputy First Minister has been at pains in the past to stress that the Assembly has to be given its place in that regard. Therefore, Mr Speaker, I ask you to look into this matter and ensure that the Assembly — and its Committees, in particular, which have a statutory duty to hold Departments to account and provide scrutiny — is being given its proper place in the financial process.

Photo of Robin Newton Robin Newton Speaker

Mr Farry, I am being very generous to you.

Photo of Robin Newton Robin Newton Speaker

That is more than a point of order; that is a speech in itself. I might be tempted to ask you to refer to which Standing Order you were making the point of order under. However, I note your comments.

I have received notice from the Minister of Finance that he wishes to make a statement on October monitoring.

Photo of Máirtín Ó Muilleoir Máirtín Ó Muilleoir Sinn Féin

In answer to Mr Farry — I know it is not my job to answer Mr Farry — I can assure him that I am giving this statement to the Assembly to give the Assembly, and all Members, their due place in our deliberations.

As I move through another lengthy statement, I apologise to Members because they have had a long morning already. However, they will be pleased with some of the statements in here, for example, in relation to the British Government being pressed on a fiscal stimulus in the autumn statement on 23 November. Also, there is a shot in the arm for our local economy through a small stimulus package here today, and some good news on financial transactions capital that will not be returning to the Treasury.

A Cheann Comhairle, ba mhaith liom buíochas a ghabháil leat as an deis seo a thabhairt dom an Ráiteas seo faoi Bhabhta Monatóireachta Dheireadh Fómhair agus faoi phacáiste Spreagthach an Fheidhmeannais, An Chéad Chéim a chur faoi bhráid an Tionóil inniu. Seo an dara babhta monatóireachta i mbliana a thagann sna sála ar mo Ráiteas i leith Babhta Monatóireachta an Mheithimh.

A Cheann Comhairle, sula labhraím ar Bhabhta Monatóireachta Dheireadh Fómhair, ba mhaith liom an deis seo a thapú uasdátú beag a thabhairt do na baill ar na cainteanna a bhí agam le cúpla lá anuas le Príomh-Rúnaí an Státchiste agus le hAirí Airgeadais na hAlban agus na Breataine Bige.

Mr Speaker, thank you for affording me the opportunity to present this statement to the Assembly today on the October monitoring round and the Executive’s First Step Stimulus package. This is the second monitoring round of this year and follows on from my statement on the June monitoring round.

Before turning to the October monitoring round, I will take the opportunity to update Members briefly on discussions that I have had over recent days with the Chief Secretary to the Treasury, David Gauke, and the Scottish and Welsh Finance Ministers, Derek Mackay and Mark Drakeford. Yesterday, along with my Scottish and Welsh colleagues, I met David Gauke. During that meeting in London, we discussed a number of important issues, including the outworking of the EU referendum decision. All three Administrations expressed concern at the impact on their economies and the need for the British Government to provide clarity on the way forward. We also discussed a number of specific finance issues, which I will touch on shortly.

Before turning to the detail of this round, I want to pre-empt questions that I expect will follow from Members about the monitoring round process adopted by the Executive. The approach now adopted by the Executive to the monitoring round process no longer requires the submission of bids by Departments. The submission of a wish list of bids did not give a good indication of real pressures and led to slow and cumbersome negotiation, as Members from all parties know. Instead, key pressures are now identified through ongoing engagements between my officials and Departments.

The new process allows the Executive to focus on and react quickly to the key emerging pressures. It is consistent with the position adopted in Scotland, Wales and the South of Ireland, where parliamentary scrutiny takes place through the Estimates process and focuses on in-year changes to budgets with no references at all to bids. In keeping with the practice in those jurisdictions, the Executive do not disclose their deliberations in reaching an agreed monitoring round outcome. The focus of scrutiny is and should be on outcomes. The swift conclusion of the June monitoring round and the fact that I am standing before you today providing details of the October monitoring round demonstrates the efficiency of the new approach.

Before we get into the detail of the monitoring round, it is important to highlight the fact that significant constraints face our resource DEL position in the current year. In that context, aside from meeting a small number of prior commitments, the focus in this monitoring round has been on the capital DEL position and measures that will deliver an economic stimulus to our economy. The starting point for this monitoring round is the outcome of the June monitoring round, which concluded with an overcommitment of £13·5 million on resource DEL and £11·4 million on capital DEL.

I now want to turn to the specifics of the October monitoring round, starting with a number of adjustments relating to centrally held items. Updates to forecasts of regional rate income, interest payments on borrowing and statutory salaries have resulted in a small easement of £0·2 million that can be made available to the Executive in this monitoring round.

Members may recall that, in the 2013-14 January monitoring round, as part of an agreement to provide £35 million of ring-fenced financial transactions funding to Ulster University (UU) for its greater Belfast development, the university agreed to return £7 million to the Executive from its accumulated reserves. Some £3·5 million was returned in 2014-15, and a further £3·5 million was to be returned in 2016-17. The Executive have now received the £3·5 million from UU relating to this year, and it has been made available for reallocation in this round.

In 2015-16, receipts from the carrier bag levy exceeded allocations to environmental programmes by £0·5 million. As receipts from the levy must be used to support environmental programmes, the Executive returned the £0·5 million to DAERA for that purpose in the June monitoring round. However, updated numbers have now been received, and the Executive must now return a further £0·3 million to DAERA for the carrier bag levy. That has been taken into account in this monitoring round.

The Budget for 2016-17 set aside £15 million capital DEL for allocation under the Delivering Social Change programme. The Executive Office has now advised that £7·1 million of that funding will not be required in this year and can be made available for reallocation by the Executive in this monitoring round.

Members will also be aware that the Executive’s Budget faces pressures relating to the renewable heat incentive scheme. I will say more on this later; however, the Executive have set aside £20 million of resource DEL in this year to meet pressures arising from the RHI scheme, and that must be taken into account in assessing the resources available to the Executive. In total, taking into account the opening overcommitment and other central issues noted above, it resulted in an overcommitment of £30·1 million on resource DEL and £4·3 million on capital DEL. That was before taking account of departmental reduced requirements.

Departments declared reduced requirements in this monitoring round of £11·6 million resource DEL and £16·2 million capital DEL. Full details are provided in the tables provided with the statement. On the resource side, the most significant reduced requirements declared include £8 million relating to employment services programmes and welfare support measures from the Department for Communities, and the Finance Department surrendered £3·2 million relating to the development costs of devolving corporation tax. On the capital side, the most significant reduced requirements include £4·3 million from the Department of Agriculture, Environment and Rural Affairs relating to the planned relocation of its headquarters; £4·5 million from the Department for Communities due to slippage on the subregional stadia programme; and £3·5 million from the Department of Health relating to the mother and children’s hospital.

It is good practice that Departments seek to manage any emerging pressures internally before bringing forward bids for additional allocations. Whilst the public expenditure control framework allows Departments scope to undertake many such movements on a unilateral basis, movements across spending areas in excess of the de minimis threshold are subject to the Executive’s approval. In some instances, Departments also seek permission to move allocations across spending areas to facilitate the transfer of responsibility for a particular function from one business area to another. The internal reallocations agreed by the Executive in this monitoring round are included in the tables for information. Departments may also, for a number of reasons, seek to reclassify expenditure from resource to capital or vice versa. All such reclassifications need Executive approval, and they are also shown in the tables accompanying the statement. All of those adjustments impacted on the total resources available to the Executive in this monitoring round. Once all of those issues were taken into account, the Executive had an overcommitment of £18·5 million resource DEL and £11·9 million capital DEL available to allocate.

Before turning to the mainstream allocations, there are other important issues I would like to highlight to Members, starting with ring-fenced financial transactions capital (FTC). The Executive concluded the June monitoring round with £17·2 million of ring-fenced financial transactions unallocated, and, as detailed in the tables accompanying the statement, Departments have declared reduced requirements totalling £4·5 million. As colleagues will recall, the Executive have agreed to establish a £100 million investment fund. The overall aim of the proposed fund is to promote investment, economic growth and jobs, with a focus on urban regeneration projects, including, of course, grade A property, energy efficiency and low carbon projects.

The preferred delivery option involved the European Investment Bank taking an active role in the delivery and ongoing monitoring of the fund. In August, I visited the European Investment Bank and met vice president Jonathan Taylor. During the meeting, Mr Taylor informed me that the European Investment Bank could no longer take an active role in the delivery of the fund. The European Investment Bank will, however, continue to work with the Department of Finance in establishing the fund and providing technical assistance, and the bank's president has now confirmed its position in writing. My officials are reassessing possible delivery models. I remain committed to the £100 million investment fund, and I will update the Assembly on the outcome of that work in due course. However, it is now clear that the fund will not be in place before 31 March 2017, and the £55·8 million of financial transactions capital set aside for the fund in 2016-17 is now available to the Executive for alternative use. Taking account of the funding held centrally and the reduced requirements declared, the Executive will leave the October monitoring round with £77·5 million of ring-fenced financial transactions capital DEL unallocated.

As recently as yesterday in London, the Scottish and Welsh Governments have also expressed concern over the use of financial transactions capital, and we took the opportunity to raise the issue when we met the Chief Secretary to the Treasury.

I raised some specific concerns that I have on the use of financial transactions capital. I requested from the Chief Secretary a special dispensation on the use of FTC that will facilitate the creation of the planned investment fund. I am pleased to say that my request was positively received, and I have now asked my officials to expedite the delivery of the fund.

I turn now to central funds. As part of Budget 2016-17, the Executive set aside £14 million resource and £15 million capital in respect of Delivering Social Change in this financial year. A range of allocations were agreed in the June monitoring round, leaving no resource DEL and £7·9 million capital DEL available for allocation in the October monitoring round. The Executive Office has advised that £0·8 million capital should be allocated to the Executive Office for capital grants to a range of projects under the social investment fund. The Executive Office has also confirmed that the remaining £7·1 million capital DEL will not be required for Delivering Social Change in this year and can be made available to the Executive for reallocation. As a result, there is now no resource or capital DEL remaining unallocated in the Delivering Social Change fund for 2016-17. Budget 2016-17 set aside £8 million resource DEL for the Atlantic Philanthropies programme. Following the June monitoring round, £2·6 million of that funding remained unallocated. The Executive Office has advised that £2·3 million should be allocated to DE for the shared education signature programme. Following that allocation, there is now £0·4 million resource DEL unallocated on the Atlantic Philanthropies fund.

The Fresh Start Agreement secured £60 million over five years to support the creation of a shared future. The Executive’s Budget 2016-17 set aside £12 million resource DEL in this year. Allocations totalling £11·5 million were processed in the June monitoring round. The Executive Office has advised that a small number of allocations should be processed in this monitoring round, including £0·3 million to TEO for shared future and Urban Villages and £0·2 million to the Department for Communities for arts and cultural programmes. My officials will engage with Treasury in securing access to that funding through the Westminster Supplementary Estimates. Following those adjustments, all the funding available for a shared future is now allocated.

Members will recall that, in line with the Fresh Start Agreement, the Executive’s Budget 2016-17 identified £10 million resource DEL to tackle paramilitary activity. Of that, the Executive contributed £5 million, with £5 million to be accessed from the British Government, the latter being subject to the Executive agreeing a strategy to address continued paramilitary activity. The Secretary of State has advised that UK Government funding will not be released until the Executive agree a more detailed action plan. The Department of Justice will progress this to ensure that access to that funding is secured.

The Executive allocated £1·3 million to the Department of Justice in the June monitoring round from the resources that they had set aside for this purpose. Following the publication of its strategy to tackle paramilitary activity, DOJ has now confirmed that a further £2·5 million should be allocated in this monitoring round for measures to tackle paramilitary activity. The most significant allocations are £1·7 million to DOJ, £0·2 million to the Public Prosecution Service and £0·6 million to the Department for Communities. That leaves £1·1 million of the funding set aside by the Executive unallocated following the October monitoring round.

Following June monitoring, a total of £97·3 million was allocated to Departments under the public sector transformation fund, leaving £77·7 million of the £175 million set aside by the Executive this year as unallocated. The public sector reform division has continued to liaise with Departments over recent months to identify easements on allocations agreed in the Budget and any new allocations to schemes with the capacity to deliver further savings for the Executive’s budget. Details of changes to allocations under the public sector transformation fund are detailed in the tables accompanying the statement. Following those changes, allocations under the scheme in this year total £75 million, leaving £100 million of the public sector transformation fund unallocated.

I turn now to the Executive's First Step Stimulus package, a prudent pick-me-up for the economy, if you wish.

The Fresh Start Agreement provides the Executive with flexibility to access the full amount of borrowing made available under the Stormont House Agreement when the voluntary exit scheme does not require all the funding available in any given year. In view of the latest forecasts of spend on the public sector transformation fund, the Executive have agreed to divert borrowing to deliver a short-term economic stimulus through accessing additional borrowing to support capital investment in our economy. While I envisage that a longer-term economic stimulus package will be agreed by the Executive in the near future as part of our capital budget process, it is important that we send an early signal of intent to our citizens through the stimulus measures that I will now outline.

The Executive have agreed to support two schemes in the Department for Infrastructure that will provide a boost to our local economy. First, we will provide £15 million of capital DEL for roads structural maintenance. That allocation will not only enhance our road infrastructure but provide a boost to our local construction sector. A further £10 million of capital DEL will be made available for the purchase of new buses, helping to improve our public transport services and providing a boost to our local manufacturing sector.

I am very pleased that the Executive have also agreed a £5 million community regeneration fund for 2016-17. That fund is specifically aimed at improving infrastructure in our most deprived and marginalised communities, which, of course, are working-class communities. That is a great opportunity. They will be relatively small-scale but focused interventions that improve the quality of key assets for local residents. I will work with ministerial colleagues to identify suitable capital projects in our communities in the weeks ahead and will provide an update to the Assembly in the January monitoring round. The allocations will be funded by accessing an additional £30 million of reinvestment and reform initiative (RRI) borrowing in this year. Full details of allocations under the Executive's First Step Stimulus package are set out in the tables accompanying the statement.

As previously indicated, the resource DEL position in this year remains constrained, and, as a consequence, the majority of allocations agreed by the Executive in this monitoring round are on the capital DEL side. However, while the position does not allow us to progress a full resource DEL monitoring round, there are a small number of prior commitments, totalling £8·9 million, that the Executive have confirmed in this round. Those allocations include £2·5 million resource DEL to the Department for the Economy for route development at the City of Derry Airport; £4·8 million to the Department of Health for Translarna muscular dystrophy drugs; £1 million to the Department of Education for nurture units and other pressures; and £0·6 million to the Public Prosecution Service for service pressures.

I turn now to the capital position. The capital DEL allocations in this monitoring round total £22·7 million and include £13 million to the Department of Education for minor works and the purchase of furniture and equipment for schools, which will please Members; £8·7 million to the Department of Health for essential maintenance and the purchase of ambulance defibrillators, which has also been a demand of many Members; and £1 million to the Department for Infrastructure for investment in LED street lighting, which is an invest-to-save initiative. Full details of the allocations are set out in the tables accompanying my statement.

Ring-fenced resource DEL is strictly controlled, and funding cannot be moved out of that area. Changes to that area are shown in the tables accompanying the statement. Colleagues will note that we exit this monitoring round with £4·1million of ring-fenced resource DEL unallocated. That funding may only be used to address pressures within the ring fence — depreciation and impairments — and is therefore not available for allocation by the Executive.

Members will be aware that a significant additional resource DEL pressure exists from commitments under the renewable heat incentive (RHI) scheme. The Department for the Economy has, through internal reallocations processed in this round, sought, where possible, to manage the budgetary impact of the RHI this year, and I welcome that. As mentioned earlier, the Executive have set aside £20 million of resource DEL centrally to meet pressures anticipated from the RHI scheme. The Executive will further assess the extent of that pressure in the January monitoring round. However, I understand that the Economy Minister is fully engaged on the issue.

I turn now to the October monitoring outcome. As a result of the allocations detailed above and the funding set aside for the RHI, the Executive exit the monitoring round with a £27·4 million overcommitment in resource DEL and £10·8 million in capital DEL.

I believe that, with the cooperation of all Ministers, this position is manageable over the remainder of this year.

As I have said before, I am strongly opposed to the austerity agenda. I think that that is true of Members across the House, or, if not of every Member, most Members. The austerity agenda places constraints on the Assembly and our capacity to provide much-needed funding for our public services. I will continue to fight against austerity at all levels, and, alongside that, I will continue to develop innovative funding solutions, as demonstrated by the first phase of the Executive’s economic stimulus package that I have announced.

I commend the October monitoring outcome and the first phase of the Executive’s economic stimulus package to the Assembly.

Photo of Robin Newton Robin Newton Speaker 12:15 pm, 25th October 2016

As was the case with the previous statement, a large number of Members have put down their names to ask a question. Again, I ask Members to be brief and direct their question towards the Minister's statement. I call Mr Stephen Smith.

Photo of Philip Smith Philip Smith UUP

Thank you, Mr Speaker

Photo of Philip Smith Philip Smith UUP

Thank you, and I thank the Minister for his statement. I appreciate that, from the Minister's perspective, this new monitoring round process may well be more efficient, if not open and transparent. To aid transparency, will the Minister detail what other pressures were identified in discussions between Departments and his officials and have not been addressed in this allocation? Without this clarity, would it be fair to assume that all other budgets, including that for Health, are adequate?

Photo of Máirtín Ó Muilleoir Máirtín Ó Muilleoir Sinn Féin

Thank you, Mr Smith. Go raibh céad maith agat. If you want to wander into the office of any Minister in this Parliament, you will find that there are pressures on all fronts. I have yet to meet a Minister who says that he or she does not need any money or funding. Pressures are unremitting; but, as you know, while the demand is infinite, resources are finite. What I have done today, rather than focus on the process — you say that it is efficient, but it is more than that: it is a process, a delivery and an outcome that will accelerate growth, create jobs and give a boost to those who want to invest further. It will inspire confidence. I know that, in this House at times, people focus on the minutiae. I think that, instead of focusing on opposition, today our focus should be on delivery. I welcome questions and, certainly, if you want to focus on minutiae, I welcome it; but I think that we should focus on the delivery, the pledges made and the investment that we are making in our future.

Photo of Emma Little Pengelly Emma Little Pengelly DUP

I note that in the statement there is in and around £100 million unallocated for public-sector transformation. I am sure that the Member agrees with me that significant reform and change is urgently needed in the system if we are to ensure affordability while protecting front-line services. We have heard that outlined already this morning in terms of Health.

Will the Minister inform the House what actions or special measures he has taken to ensure that good projects and initiatives are coming from Departments that will best meet the need for public-sector transformation across the system?

Photo of Máirtín Ó Muilleoir Máirtín Ó Muilleoir Sinn Féin

I thank the Member for her question. As she will be aware, one of the reasons we are able to deliver October monitoring in October — last year, June monitoring was delivered in November — is what I refer to as a common-purpose Executive. You can see the benefits of that. The Executive met this morning, and Ministers are resolved to bring forward proposals which will provide greater efficiencies and better services and, in particular, schemes that involve investing to save. In that regard, we have reduced the number of Departments that serve our people. It does not make sense to have repetition across former Departments or structures. All Ministers are now focused on outcomes and, in that regard, therefore, instead of trying to protect fiefdoms or trying to ensure that systems that were there in the past have to endure, they are saying, "If we have nine Departments instead of 12, perhaps we do not need people doing a particular job that can be done somewhere else."

At the same time, the voluntary exit scheme (VES) offers those who wish to take redundancy an excellent package, and it frees up money for us to deliver and place in the front line of the services for our people. We are now speaking in particular to the arm's-length bodies. There has been a taking of the burden by some Departments, including the Department of Finance and the Civil Service, and I think that other Departments will now look at what they can do in the time ahead to deliver a more efficient government service. I will work closely with Ministers in that regard.

Photo of John O'Dowd John O'Dowd Sinn Féin

I thank the Minister for his statement and his answers thus far. We were continuing to face austerity measures from the Conservative Government when he came into post, and he has outlined his position on that. There were dire predictions of further cuts in the in-year monitoring rounds but, thankfully, he has avoided any cuts in the June and October monitoring rounds. How has he achieved that?

Photo of Máirtín Ó Muilleoir Máirtín Ó Muilleoir Sinn Féin

I would like to claim that it is all my own work but the principal never let me away with that in school, so I will not get away with it here. What is happening is that, instead of going back to the past, where every Minister paddled their own canoe, made all their own bids and demands and insisted that they could not make any efficiencies, we now have a united Executive which are trying to be as efficient as possible to deliver real value for money. That common purpose is feeding through into our budgets.

As well as that, it is very interesting and should be noted now that six years after the austerity agenda was launched by UCUNF and the Conservative Party in Britain, we have had six years of pain, hardship, penury, unemployment and emigration for people. Members on both sides of the Chamber are saying this, because the DUP also opposed Tory austerity while some parties helped to introduce it. Throughout those six years, we said to the Conservatives that they should end austerity because it is a self-defeating strategy. The good news is that yesterday, in London, the Chief Secretary to the Treasury all but confirmed that in the 23 November autumn statement they will agree that there should be a fiscal stimulus, that austerity has failed and that they are now going to embark on a new start in relation to infrastructure stimulus. Unfortunately, our argument to the Chief Secretary that he should also stop the austerity pressure on our resource budget has not got through yet. Certainly, part of the message that we have been giving for many years about investing to grow the economy is now getting through and we will get a boost to infrastructure spend in the 23 November statement.

Photo of Gerry Mullan Gerry Mullan Social Democratic and Labour Party

Does the Minister agree that Executive secrecy is no way to do business in the House and that bypassing the Finance Committee's scrutiny of the draft Budget and the full Budget does not facilitate a proper scrutiny process?

Photo of Máirtín Ó Muilleoir Máirtín Ó Muilleoir Sinn Féin

I thank the Member for his question but I do not agree. I have appeared at the Finance Committee twice and I am happy to appear again at its request. What you have seen here is a division between those who want to oppose and those who want to invest, those who want to complain and those who want to build, those who want to find a reason to pick at a scab and those who want to heal. What we are seeing here today is a first-step economic stimulus, which we have not tried for many years. We tried it at the height of the crash. We are seeing money being released for defibrillators in ambulances and to maintain and repair our roads. Money is going into our schools to buy new equipment and to maintain, do up and enhance the school estate.

For me, those things are what today is about. I will make neither excuses nor apologies to anyone for delivering on behalf of this Executive. In fact, had I come here today and said that we are facing an October monitoring round of further cuts, then there would be something to apologise for. Instead, we are coming here and saying that we are able to buy more buses and ensure that we have a 21st-century bus fleet for Translink. We are saying that, for the first time, we are trying to partner community organisations in a very focused way over the next few months to try to buy some key properties in working-class areas so that they can continue the work of building a shared future. So, I am sorry for the Member, but I do not agree with him.

Photo of Stephen Farry Stephen Farry Alliance

I thank the Minister for his statement. He will be well aware that, before the reforms announced by the Minister this morning, healthcare inflation was running at 6% but the Budget increase for the Department of Health this year was only about 2%. However, in this statement, the only money for Health is in the form of the very welcome muscular dystrophy funds.

Is it safe, therefore, to assume that the Department of Health can live within its budget this year and there will not be recourse to monitoring rounds to fund healthcare, as there has been in previous years, and that we will avoid what happened last year, when a last-minute bid for waiting lists was not fully spent on waiting lists?

Photo of Máirtín Ó Muilleoir Máirtín Ó Muilleoir Sinn Féin

I thank Mr Farry for his question. I see that our efforts to take the politics out of health have not made it to the afternoon.

My commitment to the Minister of Health is that we know that there will be a cost to the new path on which she has set all of us in this society. She is outlining a vision of trying to manage change rather than managing crisis. The Executive as a whole will have to step up. I hope that one of the lessons or messages from the joint meeting of the Executive today was that we all understand that this is a priority, and, when Professor Bengoa says, rather forthrightly, that if Governments across Europe cannot control expenditure on health, health will take up the entire public purse.

The Health Minister is setting us on a bold and ambitious path. It is a path that requires partnership not only among the Executive parties and with the Minister of Justice but across the Assembly where we take the politics out of health and commit ourselves to trying to improve outcomes in a more efficient health service.

We stand ready to support the Health Minister as she comes forward with her request. The allocation of resource DEL is as outlined, but the Member will not have missed the point — he was here for the Minister of Health's statement — that there will be an added requirement on all of us to make sure that we have the fiscal firepower to deliver the change that everyone wants to improve our health service.

Photo of Paula Bradley Paula Bradley DUP

I thank the Minister for his statement. I welcome the money that has gone towards health through the allocations, albeit that we could probably have had a lot more. I am sure that the Minister came to you with many emerging priorities.

I want to follow on from what my colleague, the Chair of the Finance Committee, said about the transformation fund. Will the transformation fund be used to support the healthcare reform as the Minister outlined earlier?

Photo of Máirtín Ó Muilleoir Máirtín Ó Muilleoir Sinn Féin

Reform and improvement have to go together. We are now set on a path of improving, changing and transforming our health service in a way never seen before. I heard the Minister refer to the two-mandate challenge, and there will be a role in that for the public sector transformation fund. However, let us be clear about this, and I know that the Member will agree with me: we will protect front-line services in health and, of course, in education. The Ministers will manage their budgets and will do so in partnership with the entire Executive. Common purpose means that we are very understanding and sympathetic of pressures when they emerge, but it also means that Ministers give the lead. In that respect, we saw strong leadership this morning not only from the Minister of Health but from the Executive.

Photo of Linda Dillon Linda Dillon Sinn Féin

I thank the Minister for his statement and his answers so far. He referred to a more efficient process, which a number of Members mentioned. How does the timing of this year's delivery of monitoring rounds compare with previous years?

Photo of Máirtín Ó Muilleoir Máirtín Ó Muilleoir Sinn Féin

It is no surprise to the public that, because we have an Executive facing in the one direction and firmly focused on a shared and prosperous future and on making the investments we need to build a strong economy, I have had the good fortune to be able to deliver the monitoring rounds in a more expeditious fashion than heretofore. I spoke about the difference in timings between now and last year. More important than that is this new start, this fresh start and this Executive, who, despite deep political differences, are able to make common cause on these key issues. I think that people on the ground will see the difference in that. If I was a school principal or governor waiting for urgent moneys to repair classrooms or improve and enhance a school estate, I would be pleased. I would be more focused on the outcome than on any concerns about the timing of the announcement.

In all these matters, alacrity is important, and I am really keen to work with the Committee, the Assembly and my Executive colleagues to deliver as we promised. That means June monitoring in June, October monitoring in October and January monitoring in January. The added bonus is that, if we work together, we can identify the pressures that are most urgent. As Executive Ministers, we are making choices together, not just in our own little patch or silo, and we are making decisions that are for the good of all the community and all of society rather than just on behalf of our Departments.

Photo of Mervyn Storey Mervyn Storey DUP 12:30 pm, 25th October 2016

I thank the Minister for his statement. I have campaigned and continue to campaign for nurture units, so I am glad that there is an allocation of an additional £1 million in his statement. Given that Holy Family in Londonderry received the nurture quality mark just this week, it will be welcome news to those involved in nurture.

May I specifically ask the Minister about the planned investment fund and his request to the Chief Secretary for special dispensation? Will he consider widening the urban focus of the planned investment fund beyond the two cities of Belfast and Londonderry so that areas in my North Antrim constituency, such as Ballymena, Ballymoney and Ballycastle, could benefit?

Photo of Máirtín Ó Muilleoir Máirtín Ó Muilleoir Sinn Féin

I thank the Member for his question. My concern extends to his constituency and wider. That said, when I was in Portrush last week, I was deeply impressed by the plans to develop the town to coincide with the Open. What made a real impact on me was the number of small, indigenous businesspeople in the private sector who want to make a contribution and want to invest. They now see an opportunity that would be good for them as businesspeople and really good for Portrush. I have visited Ballymena and Ballycastle, and, as you know, in Ballycastle, evidence of an investment can be seen in the hotel right on the beachfront. That has made a difference.

I say to the Member that we will have the investment fund. We did, of course, have a difficulty with the European Investment Bank that we did not expect, but the response is not to abandon ship but to find an innovative and novel way in which we can have the investment fund. I agree absolutely that TLC is needed not only in the jurisdiction's two large cities but for the opportunities that exist outside them.

My final point is that perhaps still the most impressive initiative that I have visited since my appointment was the South West College in Enniskillen, and I know that it hopes to get new premises. There are opportunities like that across the region — I hope that they will not depend on the investment fund — and I hope that we can seize them, not just those in Belfast and Derry.

Photo of Mike Nesbitt Mike Nesbitt UUP

Earlier, the Minister encouraged us to move away from the fine detail and focus on delivery, so let us do that but include non-delivery, such as the £5 million that the UK Government are not delivering to address paramilitary activity because the Executive do not have a proper plan. This is an either/or question: is the Minister embarrassed that the Executive have to submit their homework to London for marking, occasionally getting an F for "failure", or is it UCUNF's fault?

Photo of Máirtín Ó Muilleoir Máirtín Ó Muilleoir Sinn Féin

I thank the Member for his question. I am happy for you to focus on minutiae. In fact, I know that it is an area of expertise for the Opposition, but I am focusing on delivery. I made it clear to the Chief Secretary to the Treasury yesterday that we would ensure that we deliver stable, sustainable budgets and that we would work in partnership with them on Fresh Start funding but, ultimately, our Ministers would make the decisions. I am confident that the Minister of Justice will be able, in negotiation with our colleagues in Treasury, to deliver an action plan, as they desire.

For me, the overarching point is this: we have taken decisions today that are to the benefit of the community. We have taken decisions that will accelerate economic growth. We have taken decisions that will create jobs. We have taken decisions that will make a real difference in the heart of areas such as east Belfast, Tiger's Bay, the Creggan and Ballymurphy.

It does not surprise me, because the Member is focused on opposition for opposition's sake, that he can see nothing worthy or to be lauded in that. Instead, he wishes to give succour to the British Government, who have created perhaps the greatest economic mess of our time


I know that the Member would like to interrupt, but I will push on. He is very fond of and close to the British Government. He was involved in the architecture of the Tory austerity programme at the very start in 2010. We will focus on making a step change in delivery for our people.

You have my full blessing to focus on minutiae, if you wish. I am happy to go there with you as necessary. You have my full blessing to support the NIO and the Treasury in what they do. However, what I say to Members is this: regardless of taking the politics out of health, let us take the politics out of creating a better future for our people. Let us applaud what deserves to be applauded and criticise where criticism is necessary. To give no welcome at all to this first-step economic stimulus or to our efforts to grow jobs and to create a better future says everything that needs to be said about the failed austerity politics of the British Government, which, of course, were brought into being in the company of our friends in the Ulster Unionist Party as part of the gloriously named UCUNF.

Photo of Caoimhe Archibald Caoimhe Archibald Sinn Féin

I welcome the Minister's statement and the first phase of the economic stimulus package. Will the Minister elaborate on his discussions with the Chief Secretary on protection for financial transactions capital going forward, le do thoil?

Photo of Máirtín Ó Muilleoir Máirtín Ó Muilleoir Sinn Féin

Gabhaim buíochas leis an Chomhalta as a ceist. I should put it on record that, at our meeting yesterday with the Chief Secretary, David Gauke, at the Treasury in London, we had full and firm support from our colleagues in Scotland and Wales. Of course, when we speak together, we speak for 10 million people, not only in our opposition to austerity and our demand for a fiscal stimulus in the autumn statement but in our particular difficulty with financial transactions capital because of the new approach taken by the European Investment Bank. I am pleased to say that, with the three Governments speaking together, we put our case. The Scottish and Welsh also brought up issues that the Treasury — I do not want to say "gave ground on" — moved to a compromise on.

I am now confident that we have £77 million financial transactions capital. Some of my colleagues in the Ulster Unionist Party were fretting in the newspapers that it would be lost to our Budget. If they had called into my office to speak to me first, they would not have made the mistake of thinking for a minute that we would allow any of our resources to go back to London, resources that are given to us to build this society. I am confident that the Treasury will work with us now; that we will not lose any of the financial transactions capital, even if it is unallocated at year end; and that we can now move confidently forward to create the investment fund, the idea of Simon Hamilton when he was Finance Minister. The investment fund concept has been really welcomed by the business community, and people are lining up to engage in new projects if they can get some of the investment fund. We are on course, and it is appropriate to thank David Gauke for his flexibility on the issue.

Photo of Christopher Stalford Christopher Stalford DUP

I thank the Minister for his statement to the House. I also want to briefly welcome the allocations that the Minister detailed for Urban Villages and the social investment fund. Does the Minister agree that it will be essential for the work of the Executive Office in China to become a baseline budgetary item, particularly as Northern Ireland becomes more outward looking and tries to secure international investment?

Photo of Máirtín Ó Muilleoir Máirtín Ó Muilleoir Sinn Féin

I do not think that the First Minister and deputy First Minister would allow me to take over their budget or budget priorities. However, I will say this in agreement with the Member. I was speaking at the weekend with Shaun Kelly, the global CEO of KPMG, who sits on the north-east USA advisory panel for the Minister for the Economy. He is just back from China and met our lead representative there, Tim Losty, who did sterling work for the Executive in Washington and, before that, when the Member was still at kindergarten, for LEDU on investment in working-class areas of the city.

I have found any project that Tim Losty has led on behalf of this Government to have been a worthy one. There are great opportunities there. They require diligence and focused effort. I am pleased to see Ulster University, Queen's University, Belfast City Council and the Executive really lining up together to make sure that we seize those opportunities. I am very sympathetic to efforts by the First Minister and the deputy First Minister to ensure that our efforts in China have adequate resources in the time ahead.

Photo of Claire Hanna Claire Hanna Social Democratic and Labour Party

I share the concerns of other Members about the bypassing of Committees. My question refers to the £5 million community regeneration fund, which is referred to in writing as "improving" key assets but which the Minister just described as "buying" key properties. Can he outline the process for applying to the fund, what the maximum capital will be for projects and whether he can guarantee that this will be transparent and not an invite-only fund like the previous social investment fund?

Photo of Máirtín Ó Muilleoir Máirtín Ó Muilleoir Sinn Féin

I thank the Member for her question. When we were here for June monitoring, the Member discovered allocations that were not made and issued a statement immediately saying that my wonderful officials had got it all wrong, so I am glad that at least this time she accepts the figures. We are making progress. I hope that by January monitoring she might be in a position to welcome the investment that we have made in our health service, our education service and other projects.

The Member might not understand this, but allocating capital DEL is quite a challenge at this stage of the year. It really means that, if, for example, you take the Ballybeen autism centre, which is a really imaginative, innovative and important project in the heart of a working-class area, we could not allocate funds to build because you could not tender and build at this time of the year. Other projects, such as an Cultúrlann McAdam Ó Fiaich, are being well advanced. As everyone in the Irish language sector — pobal na Gaeilge — knows, it has a really inspiring plan to build up what is already the country's greatest Irish language arts centre into a beacon of progress for the entire city at the heart of the Gaeltacht Quarter. It has a project that involves the swift allocation of capital moneys. There are, in fact, projects already on the table. Members who work at the grass roots will know about some of them.

The Member and I share concerns about the speed of delivery. The window of opportunity of £5 million to make transformative investments largely has to go into property or land acquisition or into equipment in some cases. What I will say to the Member is that she and I share the desire that this money be allocated before 1 April, so it cannot be a long-run process. I think that it will be a process that will be welcomed across the community. It is a test for us, because, when I talk about First Step Stimulus, what I am really presaging is what I hope will be the Executive coming together and saying that, from the capital budget for 2017-2021 plus whatever additional infrastructure Barnett consequential there is on 23 November plus hopefully a £200 million loan facility for councils from the European Investment Bank, we are able to fashion a much more strategic, large and meaningful stimulus package — really a Fresh Start package — in our budgets next year.

For now, this is a first step in a stimulus package. For me, it was important that we did not do the First Step Stimulus package without putting some into the communities that have not received enough of the peace dividend. I represent South Belfast, parts of which have done well and some not so well. For me, the First Step Stimulus package would have been incomplete if we had not made a commitment to communities that have great opportunity and are really thirsting for a brighter future.

Photo of William Humphrey William Humphrey DUP

I welcome the announcement of a £5 million community regeneration fund. It is not enough, but it is a good start. I also welcome the £15 million for roads structural maintenance. That is vital. The Minister will recognise the importance of Belfast as a tourism and transportation hub for Northern Ireland. It is Northern Ireland's economic driver.

Despite the politicking of last week, does the Minister agree with me that the York Street interchange is vital to Northern Ireland, particularly in terms of industry and commerce? It connects three motorways, the George Best Belfast City Airport with the west, and the port of Belfast. Does the Minister agree with me that the York Street interchange remains a key priority for the Northern Ireland Executive?

Photo of Máirtín Ó Muilleoir Máirtín Ó Muilleoir Sinn Féin 12:45 pm, 25th October 2016

I thank the Member for his comments. I note that he waited until Mervyn Storey left before he turned the focus back on Belfast. I agree with him: York Street interchange is a key project for the Executive. I go further: I believe that, together, we will deliver the York Street interchange.

I made the point yesterday to David Gauke that, if I were to build a new home and I had the money to build 60% of it, it would not be prudent to move ahead, build 60% and hope that I get the other 40%. The Member will understand that we moved the British Government on their commitment. At first, there was no guarantee over EU funding. They then moved to guarantee a certain degree. Now, they have moved to guarantee until an exit, if it happens. Yesterday I said to David Gauke, "Look, go the extra mile and commit to funding. Even if it comes a month after you exit, you should still commit to cover that". There is still a gap there that we will start focusing on with the British Government in the time ahead. <BR/>As the Member knows, the commitment was made that no funding or projects would be lost. I hope that, in the days and months ahead, we get that commitment. That will enable us to really press ahead with all types of projects that could have funding streams coming and letters of offer issued after March 2019. The Member and I are agreed on the importance of York Street interchange, and I hope that we will see it delivered by our Government.

Photo of Declan McAleer Declan McAleer Sinn Féin

As my party's infrastructure spokesperson, I very much welcome the announcement of the £15 million additional money for road structural maintenance. Coming on the back of the £10 million rural roads initiative, it is very welcome news.

Yesterday, Minister, you joined your Scottish and Welsh counterparts in calling for a shift from austerity to stimulus. How confident are you that that message will be heard? What can the Executive here do to inject much-needed economic stimulus?

Photo of Máirtín Ó Muilleoir Máirtín Ó Muilleoir Sinn Féin

I would love to say that David Gauke and Theresa May took my advice, but I will quote from what the 'Financial Times' has been saying about stimulus for some time, not only because borrowing rates are at historic lows. It said:

"Stimulus policies cannot reverse the long-term effects," — of the uncertainty following the EU referendum, but it can:

"lessen uncertainty and mitigate the shock."

That is true of a stimulus package at this time. It also said that a stimulus package can accelerate economic growth and improve opportunities. There has been a Damascene conversion on the part of the British Government on the issue. Members will know that we asked for additional investment over many years at the height of the lunatic drive towards ideological austerity, and we did not receive a hearing. Now, because of, whatever about our import and influence, the voices of influential bodies, including newspapers like the 'Financial Times' and economic commentators like Robert Reich, the British Government realise that they need to invest in infrastructure. We will get a Barnett consequential from that, and we will then put our shoulder to the wheel to create, I hope, with the agreement of the Executive, a greater stimulus package.

Photo of David Ford David Ford Alliance

Since I never had any connection with UCUNF but did have a small part in setting up the three-person panel on paramilitarism, I hope that the Minister will give me a straight answer. I welcome his statement, but he acknowledged that only £3·9 million out of £10 million budgeted for tackling paramilitary activity has been allocated at this late stage in the year — the last occasion for planned realistic changes to budgets. That is largely because of the failure to publish the proper action plan that was due in June of this year. Given the expertise that the Minister and his Department have, will he advise the House whether he has given any advice to other Ministers about their complete failure so far to put together the action plan that is so sadly needed? It means that we are losing out on £5 million of Treasury funding.

Photo of Máirtín Ó Muilleoir Máirtín Ó Muilleoir Sinn Féin

I thank the Member for his question. The last time I saw him, he was on the stage with the Belfast Community Gospel Choir singing, 'Oh Happy Day'. I thought, perhaps, you would give us a few verses of that today in response to this first step economic stimulus.

When Claire Sugden was appointed, she asked, "Who will I turn to for advice?", and I said, "David Ford, of course". Here you are today, giving her advice. I do not know whether it is tinged with envy; I am not going to suggest that it is. I am confident that all Ministers will deliver and that the Justice Minister, in particular, will deliver on her promises and pledges based on the budget she has been allocated; that that money will be spent and that none of it will be lost, and that it will do the work that the Member worked towards in uniting our community and tackling paramilitarism. I am confident that it will deliver on that pledge in the time ahead.

Photo of Robin Swann Robin Swann UUP

I thanked the Minister earlier for his blessing in dealing with the minutiae, because I will do that. The Minister refers to renewable heat incentive (RHI) and to the Department for the Economy's management of a number of internal reallocations, such as £1·4 million from apprenticeships and youth training, £600,000 from shared skills and £1·7 million from Invest NI to cover a shortfall of £3·7 million in the RHI scheme. What period does that £3·7 million cover? Has any of the £20 million that has already been brought down by the Executive been utilised yet?

Photo of Máirtín Ó Muilleoir Máirtín Ó Muilleoir Sinn Féin

I thank the Member for his question to go with the minutiae. The good news is that the Economy Minister is up for questions shortly and you can probe him on how he made his allocations.

One of the things that pleased me greatly over recent weeks is that, first, we moved £20 million to the centre, as you know, in June. That has not been used yet, but it is a contingency, and we know that RHI is causing us problems. You will know about this, more than most, since you chair the PAC. I was pleased that the Economy Minister and his Department tried to absorb some of the pressure rather than coming back to October monitoring saying that they needed an extra £7 million or £8 million. The Economy Minister will have to answer in more detail as to why he was able to do that. We will take that money and see how it can be used to offset the costs of RHI.

The second thing that I would say to the Member — I know it will please him as well — is that I think we are making progress with regard to RHI. Last week, your colleague talked about the exorbitant costs if we do not get it in check. I hope that the Economy Minister, at Question Time in the near future, will be able to able to give you some comfort in that regard. We are absolutely united in making sure that we control the RHI cost and that we, as far as possible, eliminate it in the time ahead because it is a drain on our budgets.

Photo of George Robinson George Robinson DUP

I thank the Minister for his statement. Will the very welcome £2·5 million resource DEL allocation to Eglinton Airport be used for new national or international routes?

Photo of Máirtín Ó Muilleoir Máirtín Ó Muilleoir Sinn Féin

I thank Mr Robinson for his question. As the Member knows, some of this was trailed previously in the press in relation to drugs and the city of Derry investment. It is the hope of the City of Derry Airport that it can actually create a jobs boost by locating a manufacturing or maintenance facility at the airport which can use the resource that the airport has — for example, the hangars, not only the equipment but the airport itself. I hope to hear more news coming out of the City of Derry Airport on its plans. We know that all airports are under pressure, not least because of air passenger duty, and there were a couple of body blows to the City of Derry Airport earlier in the year. I am confident that the City of Derry Airport realises that it has to use this money in a way in which it will actually try and base jobs there and perhaps create a new initiative. I hope that that happens in the time ahead.

Photo of Alex Attwood Alex Attwood Social Democratic and Labour Party

I thank the Minister for his statement. Referring back to your meeting yesterday, did you raise the issue of corporation tax with the Chief Secretary to the Treasury? Given Mr Gauke's previously stated views that this will happen only when his Government agree a reform package with this Government, has the issue of corporation tax devolution, 18 months from now, been put firmly on the back boiler?

Photo of Máirtín Ó Muilleoir Máirtín Ó Muilleoir Sinn Féin

I think that the RHI has got you confused; it is the back burner that you put things on. We have many boilers going in the RHI.

I can tell you this about Mr Gauke in all honesty: to save his own blushes, he did not pretend for a minute that the delay in corporation tax was on our side. Let us be honest: these are the guys who have no idea what they will announce about their own corporation tax on 23 November. This is the Government who have created what Mr Hammond refers to as "economic turbulence" at this time. This is the Government who cannot tell us with absolute certainty what they will do with our resource budget in the time ahead. There were indications yesterday but not absolute certainty.

The Chief Secretary, by the way, did not mention the issue of reform at all, but I went back over the rule book with him. I am committed and confident that we will introduce a reduced rate of corporation tax on 1 April 2018. We will do so to create thousands of jobs and a step change in our economic growth, which will benefit, in particular, communities that have not seen the economic bounty that they should have in the past. I am taking his own views from him on the issue. The Member will know — he has spent many years in the corporation tax furrow — but he understands that there is a negotiation ahead. He also understands that, until the 23 November statement, which is around the corner, and a clear declaration of where their corporation tax is going, we cannot have the type of intense negotiation that we need to have, but we are on track.

If the Member wishes to put pressure on the British Government in this regard, he can be my guest. Let the British get the 23 November statement out of the way. Will they commit to 17% or something else? I think that there may be no change, neither that suggested by George Osborne nor by the papers at the weekend. We will do our bit, and I am committed and confident. We will make it affordable, because that is in the Fresh Start Agreement as well. We will make sure that it opens up a discussion and conversation with the British about how we grow the economy in the time ahead and how they make sure that we have all the fiscal measures to do that, not just corporation tax. We are very much on course; it is not on the back burner at all.

Photo of Sandra Overend Sandra Overend UUP

I thank the Minister for his statement. Many schools across the country continue to lobby MLAs. They are crying poverty, and the wells have truly run dry. Many redundancies have been made, and the delivery of the entitlement framework is under threat. While I welcome the £13 million capital budget given to the Department of Education for minor works and the purchase of furniture and equipment for schools, I am disappointed that there is no resource budget allocation. Has the Finance Minister had any discussions with the Education Minister about the way that schools can spend the money allocated to them, so that they have more control and can achieve better value for money? If not, will he commit to doing so?

Photo of Robin Newton Robin Newton Speaker

Minister, I must ask you for a short, sharp and concise answer.

Photo of Máirtín Ó Muilleoir Máirtín Ó Muilleoir Sinn Féin

I thank the Member for her question and would be happy for her to put that question to Peter Weir. I welcome her welcome of the extra injection of capital funds into schools.

Photo of Robin Newton Robin Newton Speaker

The Business Committee has agreed to meet at 1.00 pm. I propose, therefore, by leave of the Assembly, to suspend the sitting until 2.00 pm. The first item of business will be Question Time. Questions on the ministerial statement will resume after Question Time, when the next Member to be called will be Richie McPhillips.

The business stood suspended. The sitting was suspended at 12.59 pm.

On resuming (Mr Deputy Speaker [Mr Kennedy] in the Chair) —