Northern Ireland (Interim Arrangements) Bill
Wednesday 10th May 2023
(3 years, 3 months ago)
Commons ChamberRead Full debate Northern Ireland (Interim Arrangements) Act 2023 Read Hansard Text Read Debate Ministerial Extracts Amendment Paper: Committee of the whole House Amendments as at 10 May 2023 - (10 May 2023)
The Minister of State, Northern Ireland Office (Mr Steve Baker)
I beg to move, That the Bill be now read a Second time.
It is, of course, with profound regret that I return to the Dispatch Box to bring forward legislation in the absence of a Northern Ireland Executive. I am sure that right hon. and hon. Members across the House will agree that this is not a position that any of us would want to be in. The Government remain committed to supporting the restoration of the Executive in Northern Ireland as soon as possible. Functioning governance for Northern Ireland by its elected representatives is the best outcome for citizens.
Last month, we all came together to reflect on the 25th anniversary of the Belfast/Good Friday agreement, and to mark the progress that Northern Ireland has made over the past quarter-century and the peace and prosperity that the agreement has brought. Of course, we also reflected on the work that remains to be done. The anniversary is an opportunity for us all to recommit to building an even brighter future for Northern Ireland. We need to see Northern Ireland’s political leaders come together and restore the devolved institutions established by the agreement, which is the surest way of delivering on the priorities of Northern Ireland’s peoples and of safeguarding our Union.
We have been very clear that to strengthen and protect the Union, we must persuade people and demonstrate that devolved government within the UK is what works best for Northern Ireland. It is in that spirit that we agreed the Windsor framework, seeking to restore the balance of the agreement and solve the issues posed by the Northern Ireland protocol. Now is the time for the parties to move forward together for what is the best possible future for Northern Ireland, and to deliver on the priorities of its people. That includes a more prosperous economy and better, more sustainable public services.
Mr Gregory Campbell (East Londonderry) (DUP)
The Minister quite correctly draws attention to the fact that the best way for Northern Ireland to have success in the future is to get devolved government up and running within the United Kingdom. Does he agree that that can best be done when all main sections of the community in Northern Ireland buy into the process of governance by which they would be governed?
Mr Baker
Yes, of course. My right hon. Friend the Secretary of State and I agree that it must involve all sections of the community. I will be very frank with the hon. Gentleman: I recognise that the Windsor framework is a hard compromise for many sections of the Unionist community because it leaves in place some European Union law in order to have an infrastructure-free border. That is why it is also a hard compromise for Conservative Eurosceptics and for me. But I recognise that, of all the plausible futures for Northern Ireland before us, the one that is best for the people of Northern Ireland is to accept the Windsor framework, including the Stormont brake and the consent mechanism, to restore devolved government and move forward together.
As I said when I answered the final oral question earlier, Northern Ireland has an amazing opportunity. Northern Ireland Members will know better than me the incredible strength of the entrepreneurial private sector in Northern Ireland. What I see is a sector that could, with political stability, soar. With privileged access to the UK, to the EU, and to our free trade agreements under UK services law, we could achieve amazing things that will secure Northern Ireland’s prosperity, and, I believe, secure consent for Northern Ireland’s place in the Union. But I think that, for the moment, I had best leave unsaid what will happen if people continue to go without good-quality devolved government and where that will lead. If that is a topic that Members wish to pursue, perhaps we can have a different debate. I hope that is helpful to the hon. Member for East Londonderry (Mr Campbell).
I want to be absolutely clear that my right hon. Friend the Secretary of State, the Prime Minister and I all wish to preserve Northern Ireland’s place in the Union, respecting the UK’s commitments under the Belfast/Good Friday agreement. We are Unionists, although I am aware that there are some commentators for whom we can never be Unionist enough—but I am allowing myself to digress and I should get back on track.
Sir Jeffrey M. Donaldson (Lagan Valley) (DUP)
It may just be the way in which the Minister phrased what he said, but this is important: our ability to trade with the rest of the United Kingdom is not a privilege; it is a right. It is a right under article 6 of the Act of Union that we have the economic right to trade, barrier-free, with the rest of our own country. Yes, privileged access to the EU, but let us not talk about “privileged access” to the UK market. We are part of the United Kingdom.
Mr Baker
The right hon. Gentleman is absolutely right, and I apologise to him and to Northern Ireland Members. I had it in my head to say “privileged access to the EU”, but seeing him sitting there, I wanted to mention the UK first. It was a mistake. He is absolutely right that Northern Ireland’s right to trade unhampered into the UK is one that, as we explained at oral questions earlier, we continue to stand by and preserve, and which, under the Windsor framework, we have permanently guaranteed. I am grateful to him for clarifying that point. I will press on.
Before I provide an overview of the Bill, I should say a few words on Northern Ireland’s public finances. As the Bill’s provisions indicate, we are acutely concerned about the long-term sustainability of public finances in Northern Ireland. It was with considerable disappointment that my right hon. Friend the Secretary of State found it necessary once again to step in and set a budget for Northern Ireland for 2023-24 in the absence of a Northern Ireland Executive and Assembly. As the Secretary of State has made clear on multiple occasions, the extent of the budget pressures facing Northern Ireland Departments is extremely challenging. Departments are facing difficult and unavoidable decisions in the current difficult and frustrating circumstances.
The Government recognise that we need an Executive in place to take some of those difficult decisions and make the choices on budget priorities—choices that officials should not have to face without Ministers. We stand ready to work with a restored Executive on that, but in the meantime, we the Government of the UK have a responsibility to ensure that public services and the management of public funds can continue in their absence, so we will in due course take forward legislation to put the budget on a legal footing. Members of this House will have the opportunity to debate those allocations in detail at that time, if and when we come to it.
Stephen Farry (North Down) (Alliance)
There is concern about the nature of the current civil service guidance. The Government believe that the civil service has the capacity to take decisions; civil servants do not believe that they have the vires to take decisions, particularly in relation to statutory functions. Does the Minister recognise that we are at somewhat of an impasse in the current status quo, and that there is a danger that we end up either with difficult decisions being deferred, which makes them more painful, or with a managed overspend, which is another very undesirable situation?
Mr Baker
I do recognise those aspects. We have published today revised guidance and those relatively small changes are now available on gov.uk. We will certainly be interested in the hon. Gentleman’s views, and those of all relevant parties, on that guidance. In a nutshell, I agree with him that the best way forward is to restore the institutions. I am trying not to hector, but we are all very frustrated. As I have repeatedly said, I recognise that the Democratic Unionist party and Unionism more broadly face a very difficult compromise, but I am committed, as I know the hon. Gentleman is, to saying that devolved government in Northern Ireland is the best way forward.
Simon Hoare
I am grateful to my hon. Friend for giving way. Picking up on the point raised by the hon. Member for North Down (Stephen Farry) with regard to the role of civil servants, is the Minister able to consider seconding GB civil servants with experience of delivering dynamic change management to both the Northern Ireland civil service and the Northern Ireland Office in order to help deliver those changes? Although we hope it will for a short period of time, all hands are needed to the pump.
Mr Baker
My hon. Friend makes a very sensible suggestion. I am sure it will be considered in due course, but I hope he will not mind me saying that it would be best if that request came from a restored Executive. I know that I sound like a broken record, but that is the present issue.
I will press on. First, I express my sincere thanks to Opposition Members for continuing to ensure that Northern Ireland is served as well as possible and for not making it a political football. I appreciate that most sincerely.
The Bill does three important things. First, it continues the provisions relating to decision making for Northern Ireland civil servants, which Parliament passed in December in the Northern Ireland (Executive Formation etc) Act 2022. Those provisions, which clarify the decisions that civil servants in the Northern Ireland Departments can take in the absence of Northern Ireland Ministers and an Executive, are due to expire on 5 June. Under this Bill, those powers will continue until an Executive are restored. This will avoid a governance gap arising if an Executive are not in place by 5 June. As before, senior officers will be required to have regard to guidance, now published, set by my right hon. Friend the Secretary of State and the Government. That draft is out there, and we will take representations on it.
The second thing that the Bill does, and this is a little more novel, is give power to the Secretary of State to explore, with Northern Ireland Departments, options for budget sustainability, including further revenue raising, in Northern Ireland. Alongside allowing him to commission advice, the Bill will allow the Secretary of State to direct consultations to be held by Northern Ireland Departments on those matters. These powers are time-limited and apply only until an Executive are formed.
Colum Eastwood (Foyle) (SDLP)
I am grateful to the Minister for giving way. He has talked about revenue raising. It is possible that a new model for funding higher education will be looked at. Given that all Governments have said that they want to ensure an expansion in student numbers in Derry, can he guarantee that that hope and desire will be protected under any new funding model?
Mr Baker
As the hon. Gentleman knows, I cannot guarantee what a restored Executive will choose to do, but I can guarantee that we will listen to him and all relevant stakeholders. Indeed, we meet the university frequently—I did so on a recent visit. We certainly wish to take the advice of the universities and, indeed, representatives from Northern Ireland as we work towards commissioning advice. Without wishing to preview what we are likely to do, of course student finance is an important matter to consider. I am grateful to the hon. Gentleman.
The powers are deliberately focused on official advice and consultations on budget sustainability. Final decisions on implementation are best taken by locally elected representatives, and this Bill does not give the Secretary of State any power to direct implementation of such budget measures.
The third thing the Bill does is ensure greater political oversight of the management of public money in the absence of the Assembly, by providing for Northern Ireland Departments’ accounts and associated documents to be laid in the House of Commons. In previous absences of the Northern Ireland Assembly, the law has provided for that scrutiny to fall to Parliament, and the provision in this Bill will do that again. This provision will be active for all periods where there is no functioning Assembly, on the basis that public bodies must always be scrutinised to ensure good management of public money.
In conclusion, the measures in this Bill will ensure a continuation of the current Government’s arrangements in Northern Ireland.
Jim Shannon (Strangford) (DUP)
I thank the Minister very much for what he has said so far. My constituents are concerned about the issue of childcare. I know that the moneys allocated by this House for childcare are for England alone, but as we approach the council elections, my constituents and others I have met on the doorsteps over the past few days have informed me that they are very concerned that Northern Ireland has not been offered childcare arrangements similar to those in England. Whether that will come through the Barnett consequentials or elsewhere, it has to happen. I am making a constructive comment, and I hope that the Minister will accept it as such. Only 60% of employed women with dependent children work full time, as opposed to 95% of men with dependent children. It is clear that the lack of affordable childcare—this is what they are telling me on the doorstep—is holding back women in Northern Ireland. What can be done through this interim arrangements Bill to enable childcare provision in Northern Ireland?
Mr Baker
I have enormous empathy for what the hon. Gentleman says. He is right to say that without childcare, women will be held back. That is why my right hon. Friend the Chancellor included so much on childcare in his Budget statement. As awkward as it is for me to once again be a stuck record, the hon. Gentleman knows that it is a devolved area. Barnett consequentials are relevant and it will be for a restored Executive to put these things in place. I am not for a moment pretending that this is a perfect or permanent solution for governance in Northern Ireland. These are interim arrangements and we very much hope, for reasons that I have begun to sketch, that we might be able to persuade Unionism to support the return of the institutions so that we can make sure that Northern Ireland gets all of the services for which he passionately and rightly argues.
The measures in the Bill will ensure the continuation of governance arrangements should there be no Executive when they expire on 5 June. They are not, and cannot be, a substitute for devolved government, as I have just said. They are by no means ideal, particularly in the context of this financial position. I want particularly to thank Northern Ireland civil servants, because they are in a very difficult position and we are extremely grateful to them for the burden that they are taking on. We continue to be grateful, and we will continue to give them what support we can.
The marking of the Belfast/Good Friday agreement has reminded us all of the importance of making the institutions in Northern Ireland work. This Government believe that an effective and functioning devolved government is crucial to showing that the Union works for the whole community in Northern Ireland. That is why the restoration of the Executive remains a Government top priority. We will continue to do everything we can to make that happen, and as we do so we will keep these arrangements under review. But for now, I commend the Bill to the House.
Peter Kyle (Hove) (Lab)
I thank the Minister for setting out the measures in the Bill. We will not oppose it, as it is necessary to allow civil servants to keep running Departments in Northern Ireland in the absence of an Executive. It is also welcome that Northern Ireland Department accounts will be laid before Parliament, to allow some scrutiny in this period.
Of course, what we would all like to see instead of this Bill is the restoration of accountable local government. Six months ago, on Second Reading of the Northern Ireland (Executive Formation etc) Bill, I said—
Peter Kyle
I am repeating what I said because I am not sure that the Secretary of State was paying as much attention as he might have done at the time. I said:
“The longer the Executive are collapsed, the hollower the 25th anniversary of the Belfast/Good Friday agreement…will be. Power sharing is the essential and hard-won outcome of that agreement. It is incumbent on the UK Government and the European Union to engage with the concerns of the Unionist community that led to its withdrawal from the institutions. Equally, any solution that emerges must be acceptable to the nationalist community to allow power sharing to resume.”—[Official Report, 29 November 2022; Vol. 723, c. 827.]
I will happily repeat that again if the Secretary of State missed it this time.
However, something has gone wrong. On paper, we have an agreement between the United Kingdom and the European Union that intends to restore power sharing, yet Stormont is still empty. The 25th anniversary was not hollow, but it is a missed opportunity that Stormont has not returned despite the Windsor framework and all the good will generated by the anniversary itself. Listening to Tony Blair at the Queen’s University conference, it was clear how persistence from a prime ministerial level was crucial to finding a solution in 1998. He described the
“seemingly endless days and nights”
of negotiation. It was a huge commitment for a new Prime Minister to make, and it was also a risk.
Tony Blair’s deep optimism about Northern Ireland’s future, then and today, shone through. He also paid tribute to the extraordinary leadership across Northern Ireland’s communities, saying that
“this agreement only happened because leaders were prepared to put their leadership in peril for the good of their people.”
The current Prime Minister needs to display a similar commitment and similar leadership—to stay the course and keep showing up, even when there are no prime ministerial visits. There is clearly a disconnect between what he believes the framework has achieved and what some members of the Unionist community say that it does. These challenges are not insurmountable, but progress can only be achieved if Westminster remains deeply committed and deeply engaged. We on the Labour Benches supported the framework in the national interest, so we would welcome an update to Parliament on its implementation and what is still needed from either side for its effects to be felt.
Ultimately, it might only be perseverance that builds back some of the trust in the UK Government that people in Northern Ireland have lost. More defined processes would be very helpful, so that we avoid a disconnect between what the Government are trying to achieve and what actually happens. In the Windsor framework, the Government committed to further legislation that would ease Unionist concerns about Northern Ireland’s place within the United Kingdom. In a recent session of the Northern Ireland Affairs Committee, the Secretary of State said that he was
“yet to be able to determine the exact items”
that would go into such legislation. Perhaps the Minister could elaborate on when that mystery legislation will appear, and what the consultation process for it will be.
The Labour party will always take a constructive approach when it comes to Northern Ireland. There are clauses in the Bill that give the Secretary of State power to ask for advice on options for raising public revenue. Those have led to some very useful discussions on the fiscal framework in which the Executive operate. In particular, I praise the work of the Northern Ireland Fiscal Council, whose updated estimate of the relative need for public spending has grabbed the attention of all parties. The Secretary of State also said to the Northern Ireland Affairs Committee that
“there is the ability, will and understanding of the public finances necessary for us to come together with a plan for transformation.”
It does feel like movement is building to improve Northern Ireland’s financial stability. It would be good to hear what the next steps are for the Secretary of State once he receives the requested advice on policy options from civil servants.
The powers in the Bill last only as long as there is no Executive, so there will hopefully be a limited opportunity to use them. The decision-making powers we have given to civil servants will also now last until the Executive are formed, instead of there being a six-month deadline. I pay tribute—just as the Secretary of State and his Minister, the hon. Member for Wycombe (Mr Baker), did—to all civil servants who are being asked to go far beyond what should be expected of them. The head of the civil service, Jayne Brady, gave evidence last week to the Northern Ireland Affairs Committee. She highlighted some of the challenges that the civil service is facing on how to make decisions within the budget that the Secretary of State now has to set out. In her words, even with the Bill,
“there will be decisions that we will not be able to make because they will not be aligned with the legal construct we are operating in.”
In summing up, the Minister should address that possible gap and what decisions might fall into it.
One of the themes from meetings that I recently had with Northern Ireland groups is that it is difficult to understand where responsibility ultimately lies. That really worries me—as a Parliament, it should worry all of us. The Secretary of State has been clear that we are not moving into direct rule; what we have instead is limited interventions from Westminster that keep public services functioning with limited scrutiny. The situation cannot continue forever. I hope that we can build on the momentum of the 25th anniversary and the recognition of how special the peace process was and continues to be, and I hope that we see power sharing restored soon.
Mr Deputy Speaker (Sir Roger Gale)
I call the Chairman of the Select Committee.
Simon Hoare (North Dorset) (Con)
I support this Bill as a necessity, without any particular enthusiasm, and I echo and endorse entirely what my hon. Friend the Minister said in exhorting political parties to get back into Stormont to deliver for people. I also echo the point made by the shadow Secretary of State, the hon. Member for Hove (Peter Kyle), about the importance of learning from the process of talks and leadership that got us to the Good Friday agreement. We cannot sit like latter-day Mr Micawbers, waiting for something to turn up; we have to try to make the weather. I suggest to my hon. and right hon. Friends on the Government Front Bench that if conversations are not already being had with Dublin as one of the two capital co-guarantors of the Good Friday agreement, they should re-inject some energy, pull people in and find out precisely what the issues are and what, if anything, can be done to address them and rebuild trust, in order to get back to serving the people of Northern Ireland through directly elected politicians.
Over this coronation weekend, I learned from our vicar in Blandford Forum a new Henry Ford quote—it was new to me, although possibly not to anybody else. Henry Ford once said that if he had asked the population at the time what they wanted, they would not have said a motor car; they would have said that they wanted a faster horse. Sometimes, we as politicians have to make the weather, and show leadership and shape the debate, rather than merely echo what the base has to say. That requires the vision, the courage and the bravery that we saw from that political class in the mid-1990s, running through to the Good Friday agreement. I am an optimist, and I believe that that spirit of delivery in public service still exists. It is not beyond the wit of this place and the political parties in Northern Ireland to resurrect it and to see Stormont come back.
I think we all recognise that for too long, bold and brave policy initiatives in Northern Ireland have been slightly less to the fore. There has been a tendency to ask for additional moneys from the Treasury, and the Treasury coughing up and providing it through some avenue or another. Everybody is conscious of the unique history of Northern Ireland as part of the United Kingdom, and therefore of the additional needs for public expenditure and intervention that are required, which are different from any other part of the UK. However, as we, hopefully, move forward—we discussed this at the Select Committee this morning, and Sir David Sterling certainly echoed this point—in order to deliver step changes of improvement for those who use public services, a greater reliance on match funding from the Treasury needs to be looked at. That means that local politicians in Northern Ireland deliver new streams of money, either through revenue or expenditure savings, and the Treasury provides new money. To just continually provide new money with no concomitant reform from Belfast does not serve any particular purpose, and arguably raises too many questions in the minds of English voters as to why they are not getting a greater share of the public purse than, for example, those in Northern Ireland, because they too readily and easily forget the difficult history.
Gavin Robinson (Belfast East) (DUP)
The Chairman of the Northern Ireland Affairs Committee will remember that back in January, he and I argued the toss on issues of how Northern Ireland is financed. Since then, I appreciate that he took a letter from me. He understood exactly where I was coming from on the structural improvements required for the funding of Northern Ireland and launched an inquiry in that regard. I appreciate those efforts, but I regret that even today he is talking about coughing up on a regular basis more and more money from the Treasury, when he knows from the Fiscal Council that this is not a separate discussion about reform, though that is necessary and important for the delivery of public services. Northern Ireland is structurally underfunded by this Parliament, and it has been for years, with a compounding impact on the ability to deliver public services. Rather than pitch us against his constituents in England, would it not be better for him to reflect on the structural underfunding, the resolve to get Northern Ireland to a more sustainable place with public finances and the need to use a comparator such as Wales, which went through exactly the same process 15 years ago, culminating in a financial uplift 10 years ago?
Simon Hoare
Let me answer that point first. The hon. Gentleman makes a perfectly valid point, and I am grateful to him for being the genesis for the Committee’s current inquiry, which is proving incredibly useful. He is right to talk about the disparity, and perhaps the phrase “coughing up” might not have been the most elegant I could have used, but he knows me well enough to know that elegance is not one of my greatest strengths. I can almost feel a second letter of “I agree with you” coming from him. He will be pleased to know that the one he sent me some months ago adorns the wall of the downstairs loo, as a rare thing of him agreeing with something that I said in this place in a debate on Northern Ireland.
In all seriousness—this is a point we discussed upstairs in Committee—constituents in England, Wales and Scotland are paying for things that residents of Northern Ireland currently are not paying for. While he is right to point to some of the structural imbalances, it does need to be a two-way street. There should not be an opportunity for the continuance of water and other things being outwith the charging mechanisms while expecting additional resource from Treasury to meet that gap. If he has looked at the reports of the Fiscal Council, he will see clearly the amount of money that could be generated by introducing charges.
Claire Hanna (Belfast South) (SDLP)
This is an interesting discussion, and the hon. Member for Belfast East (Gavin Robinson) has, on a number of occasions, made sensible points about the challenges of delivering public services with the economy of scale that we have in Northern Ireland. Would the hon. Member for North Dorset (Simon Hoare) agree that when we look to a wider economy of scale, perhaps on the island of Ireland, services become considerably more viable? Would he further agree that it opens up the opportunity of using numerous other fiscal levers to take us outside the locked-in cycle of just being dependent on pocket money from UK Governments? Would he further agree that the substantial budget surplus that the Republic is currently identifying and enjoying could help with some of these problems?
Simon Hoare
The hon. Lady digs the most elegant of tiger traps, hoping I will jump into it, but I will swerve around it. She makes a point that most people in their heart of hearts would agree with, which is that if a greater bang for the public sector buck can be achieved, which then has a direct benefit for outcomes in health, economic development, education and so on, that should be explored. Part of the reason why so many people in this place were keen to ensure the openness of the border north-south was that huge exchange of people, trade and ideas that takes place on a daily basis. Purely in the need to try to drive as much efficiency for the taxpayer as possible, nothing should be ruled in or out. If, however, her intervention was an elegant way of inviting me to endorse the idea of joint authority, I am afraid I will have to disappoint her, because devolution is the only game in town as far as I am concerned, and the Minister articulated that, too.
I move to my final point, because I know that others wish to speak. Under new section 5A in the Bill, which concerns advice and information, any direction from the Secretary of State falls or lapses at the end of the current period in which there is no Executive. What that could effectively mean—perhaps the Bill is deliberately opaque on this—is that all the work, consultation, information, advice and so on is lost. Does it get passed to Ministers in Stormont as a piece of work that they may or may not wish to consider? We know that the Secretary of State perfectly properly—although that in itself is a debatable point—cannot take decisions based on the advice or consultation. However, if that good work, particularly that undertaken by civil servants—as always, they will be rising to the challenge of trying to deliver not just existing public services, but public service reform—is to be meaningful, I would hope that the advice and information tabled to the Secretary of State would be passported over to the relevant new Minister in the Executive.
It is clear, certainly in the evidence sessions that we have held, in meetings that the Committee has had and on visits to Northern Ireland, that the public are ahead of us on this. They know that there are problems with public service. The right hon. Member for East Antrim (Sammy Wilson) made the point to me some while ago that a resurrected Stormont could not solve all the problems, and he is right to make that point, but it can certainly play a part in trying to find solutions to very many of them. The public appetite for public service reform is acute, as people face the cost of living crisis post covid and the economy faces all the challenges as a result of Ukraine and the associated knock-on effects. I would like to hear from the Minister what will happen to that advice.
I join the Minister in praying, exalting, urging—whatever. The people of Northern Ireland deserve so much better than this. They do not deserve interim arrangements. They do not deserve or need temporary sticking plasters. They need fundamental, robust, energised and engaged public service. The appetite is there, and I believe that it is growing across the political parties in Northern Ireland. I hope that we can get Stormont back up and running because, as we all know, devolution really is the only show in town.
Mr Deputy Speaker (Sir Roger Gale)
I call the Scottish National party spokesman.
Richard Thomson (Gordon) (SNP)
Let me say at the outset that I wish we were not here once again discussing this issue, but we all know exactly why we are. For the purposes of form, I will say once again that my firm belief is that Northern Ireland is best governed when it is governed locally, and the best place for MLAs to be is in Stormont, getting on with what the people of Northern Ireland would expect them to be getting on with: the job they were elected to do.
The Bill may be necessary to help close what is being termed as the governance gap in the absence of an Executive, but the damage of not having the Assembly up and running and the Executive in place is obvious in terms of good government in Northern Ireland. Decisions taken in Northern Ireland by politicians elected in Northern Ireland with a mandate from the people of Northern Ireland will always be much better taken, much better informed, much more legitimate and have far greater transparency than any decision, with the best will in the world, ever taken in this place on devolved matters on their behalf.
Where the preferences and priorities of voters in Northern Ireland run counter to those of the Government in Westminster, it is an inevitability that when Ministers in Westminster exercise those powers, it will be in line with their own preferences and priorities, rather than necessarily those in Northern Ireland. That lack of legitimacy matters, as does the absence of political direction, which has results in the decision-making process.
From my own time in local government, I developed a great admiration for council officers and officials. They were knowledgeable and expert, and in a lot of cases they were delegated and tasked with many things, including taking many decisions that were considered operational or that were not considered to be of the scope or scale that needed a direct political decision from an elected politician. However, the primary role of a senior official in most cases is to advise, rather than decide, and where any decisions of a major or strategic nature need to be taken, they ought to be taken in line with the democratic mandates and priorities that have been established at the ballot box. The absence of locally appointed Ministers and a sitting Assembly to scrutinise the choices that Ministers make when big decisions are required is highly unsatisfactory.
Make no mistake, big decisions are going to be required pretty urgently, because following the setting of the recent budget by the Secretary of State, the Northern Ireland Fiscal Council has stated that some £800 million of cuts, savings or revenue-raising measures are going to be required to fill the budget gap. To drill down a little further, the education sector in Northern Ireland faces a 2.7% cut, the Department for Infrastructure is going to be around £146 million short of its estimated requirements for the financial year and the Department of Finance says that it is now a matter of trying to
“plot the least harmful course we can”.
I think Northern Ireland deserves better than simply plotting the least harmful course that can be plotted, and it requires some major political choices to be made about how budgets are to be balanced, services are to be provided and better outcomes can be achieved.
Those are the sort of budgeting and policy decisions that simply cannot be taken or cannot be addressed in the form of salami-slicing in line with the ministerial decisions taken in years past. So the measures in this Bill that will allow the Secretary of State to request advice and information on developing options for a sustainable approach to the public finances, including revenue raising, are necessary, if inadequate. I would just say that it risks an element of paralysis by analysis and consultation in Whitehall. It certainly represents a very poor substitute for the people of Northern Ireland and the good operation of the services that they depend on, and it falls some way short of the level of scrutiny that ought to be applied to the spending of public money.
In drawing my remarks to a close, we support this Bill, but what we support most of all is the best solution of seeing a swift return of the Assembly and the Executive. We would urge the Secretary of State and his ministerial team to continue to do all they can in that regard to bring about that much better situation.
Sammy Wilson (East Antrim) (DUP)
In my opening remarks, can I first thank the spokesman for the Opposition, the hon. Member for Hove (Peter Kyle), for what I regard—this is probably the death knell for him in his position—as a very balanced presentation of the situation we face in Northern Ireland? He recognised, because of the experience he had over the period when we were remembering the signing of the Belfast agreement, the balance that is required there, and the fact that devolved Government in Northern Ireland cannot operate without the support and consent of both communities and their representatives in Northern Ireland.
That is something I think the Minister has still failed to recognise: he does not understand. It is quite clear from some of his remarks today that he does not understand the deep opposition to the current arrangements for governing Northern Ireland, and the difficulties that those arrangements cause for the Unionist population. Quite frankly, we still see the arrangements—whether the Northern Ireland protocol version or the Windsor framework version—as ones that damage our ability to trade with the rest of the United Kingdom to which we belong, and that will lead to divergence in the long run between Northern Ireland and the country to which we belong.
While the Minister may be prepared to accept the compromise, as he says, of some EU law applying to Northern Ireland as the means of having what he described as an “infrastructure-free border”, we do not see it as an infrastructure-free border. An infrastructure is being built in Northern Ireland, and further infrastructure will be built. Indeed, as I pointed out during Northern Ireland questions earlier today, it is not just in Northern Ireland that we are now going to have that infrastructure; we are going to have it in Cairnryan, Liverpool and Holyhead for goods moving from Northern Ireland into GB. I am afraid that is not what he or I campaigned for when we campaigned to leave the European Union. I do not think he should expect Unionists to compromise on being part of the country that many of them fought and died to remain in during a terrorist campaign of over 35 years in Northern Ireland.
The Minister’s second point was that, despite calls for the Assembly to get up and running, he is concerned—I will quote his words back to him—
“about the long-term sustainability of public finances in Northern Ireland”,
as well as that the pressures are “extremely challenging” and the Northern Ireland Executive have “difficult …decisions” to make. However, he knows that even if the Executive were up and running, and working splendidly, and everyone was co-operating and prepared to make the hard choices, there still would not be enough money in the pot.
The Minister knows—he actually referred to this—that the Fiscal Council has already made it clear that, in relation to the application of the Barnett formula, Northern Ireland is the only part of the United Kingdom that falls below the needs assessment on which public finance, spending in Northern Ireland and the block grant should be based. We are below it, and we are falling further below it. We are continuing to fall, and the gap is getting wider. When that happened and it was identified in Wales, there was immediate recognition of the problem. Wales had not actually fallen below the percentage, although it was moving towards it, and the Holtham commission made recommendations that ensured not only that a floor was set for moneys to be made available in Barnett consequentials for Wales, but that there were transitional arrangements.
I think this is important, because a lie is being spread around Northern Ireland. The Minister says he is not hectoring us today about getting us back into the Assembly, but I am afraid he does plenty of hectoring when he gets across the water, including putting on Facebook, or wherever, about chanting with groups to get back into Stormont, when he knows full well that getting back into Stormont is not going to grow the purse, change the financial situation or make it any easier. The extremely challenging difficulties for long-term sustainability will still be there, so let us not fool anybody.
I do accept that the Assembly had some responsibility for the situation we are in, but when I was Finance Minister in Northern Ireland we always balanced our budget. In fact, we were able to get three-year rolling budgets, so there was certainty for Departments, and we were able to make efficiency savings of 3% almost every year. However, some bad decisions have been made, and the fact that Sinn Féin could not get any of the parties to agree to the budget proposals brought forward when the Executive was functioning is an indication that there is such a role there. The Finance Minister was not capable of delivering a budget on which we could reach agreement, hence the overspend that has occurred. The impact of all that is that even if the Assembly were up and running, the detriment to public services in Northern Ireland would not disappear.
Let us look at some of the implications of the current budget and draw some comparisons. This year, Whitehall Departments will have an increase of 1.8% in resource spending. People argue that is not enough—it does not meet inflation, pay pressures and so on, and I accept that—but in Northern Ireland resource spending will fall by 0.9%.
For education, the budget in England will go up by 6.5% in the next year; in Northern Ireland it will fall by 2.7%, and £100 million of that fall is on special education. Almost every week we see people coming to our constituency offices who are desperate about their youngsters, who need support because they are autistic or have attention deficit hyperactivity disorder, or one of many other educational disadvantages, yet they cannot get assessed, let alone get support. Of course, the pressure on teachers’ pay will further add to school budgets.
In health, over the period to 2024-25 spending in England will go up by 32.9%. In Northern Ireland it will go up by 18.1%. So, again, we will fall further behind even though we have the difficulties and waiting lists that we currently face.
In policing, the Government have recently been boasting that they have reached their target of 20,000 extra police officers in England. In Northern Ireland, despite the promises made in New Decade, New Approach, as a result of the budgetary pressures we have a fall in police officers to well below what Patten recommended was needed to police Northern Ireland.
To add to that, although the Minister knows that Northern Ireland is not being fully funded—the Fiscal Council has told him that—that the Barnett squeeze is getting greater and that the gap will increase, we are being told that if there are any Barnett consequentials for Departments in Northern Ireland this year as a result of, for example, the Government nicely agreeing to pay increases, Northern Ireland will not get them, because they will be used to repay the overspend on what is already accepted to be an underfunded budget. It was last year, the year before and the year before that—in fact, I think it goes right back to 2017. That is what we are facing.
Just last week, I spoke to a school principal who said, “If there’s a pay increase for teachers, as the education budget has been cut by the degree that it has, I cannot afford to pay it unless I sack teachers.” It will be the same with nurses and right across the public service. Indeed, at a time when cuts are biting, the Department for Communities has said that it has got a £27 million deficit, so it does not have the money to recruit the extra staff it needs to process benefits, because of the increasing demand for them.
Those are all the consequences. So given the scale of the gap, let us not pretend that, somehow or other, if the Executive were up and running tomorrow, fairy dust would just fall on Northern Ireland and all of those fiscal problems would disappear—they would not. That is not a reason for not wanting devolved Government back, but it is an indication that we should not be selling the lie to people in Northern Ireland of, “Get back into government and suddenly all of the problems that you are facing—in health, education, communities, policing and everything else—will disappear.”
One of the reasons for amendment 5 is that the DUP recognises that, in order to look at the long-term sustainability of public services in Northern Ireland, we need to know what the Fiscal Council is saying and put in place an arrangement—
Mr Deputy Speaker (Sir Roger Gale)
Order. I do not wish to interrupt the right hon. Gentleman, but Committee consideration will follow this stage, so I would be grateful if he confined his remarks to Second Reading.
Sammy Wilson
Thank you, Mr Deputy Speaker. I was not going to go into the amendment in any detail—we can do that later—but I just wanted to refer to the fact that the Fiscal Council had made its comments.
When we look at the Bill, as has been described by a party leader in an earlier comment in Northern Ireland, we see that most of it is actually about ways of raising finance and advising how there should be consultation. Clause 2 talks about the consultation on different ways of raising finance as if that is how we will fill the gap. That takes money out of an economy that the Government have already damaged through the protocol, with the difficulties that has caused to Northern Ireland businesses and the costs that people there now face as a result of it being more difficult to get goods from the cheapest source—GB—with which they would normally have traded. Now they have to buy more expensive, and probably lower quality, goods from an EU supply chain. There are also the extra costs on businesses, and indeed the extra cost on the public purse, because £500 million now has to be devoted to the trader support service to help companies over the hurdles caused by the protocol.
Is the answer simply to raise more finance in Northern Ireland? I accept that people in Northern Ireland have things such as free prescriptions that, it could be argued, we could well look at. I remember a debate about free prescriptions. As Finance Minister, I was not keen on them, but I was told at that stage—it was true—that the cost to be spent on administering the distinction between people eligible for free prescriptions and those who were not would hardly compensate for the amount of extra money.
However, let us look at the extensive source of revenue that we do have in Northern Ireland: the rates. It has been estimated that even if we increased rates by 107%—if we more than doubled them—which would have a massive impact on households in Northern Ireland, we would raise only about 5% more revenue to the block grant that we have at present. The argument could be made if rates in Northern Ireland were much lower than those in the rest of the United Kingdom, but actually they are higher than those in Manchester, Sunderland, Liverpool and many other parts of England. So it is not as if we do not already tax people in Northern Ireland where we can to a level that is commensurate, we believe, with their ability to pay.
Clause 2 is included in the Bill to say, as has been widely spread around Northern Ireland, “If the Assembly is not up and running, it is more likely that other ways of raising revenue will be imposed on people in Northern Ireland, so get your politicians back, because otherwise you’ll be charged for things for which you weren’t in the past, or given extra charges on things you are being charged for at present.” I must say to the Minister that that kind of blackmail is not the way to restore the Assembly.
The Assembly will be restored when, first of all, the terms of the Belfast agreement are adhered to so that the views of Unionists, as well as nationalists, are respected, and Unionist Ministers are not required to sit in the Assembly and implement the very arrangements that we then come here and complain will destroy us as a part of the United Kingdom. I hope Members understand that. That is what is being asked of Unionists: to go into the Assembly under court direction and implement the Windsor framework, even though we know that in the long term it will be detrimental to the Union. We will talk about amendments later, but departmental officials will have to make some very controversial decisions. That will require some ministerial direction, hence why we believe there should be provision in the Bill for ministerial direction of civil servants, so that difficult decisions can be made and we can try to make some reforms.
I will make one last point, which relates to one made by the hon. Member for Belfast South (Claire Hanna). Can we not look at ways to better use public money? I say that with some knowledge of the steps that Unionist Ministers have taken in the past in recognition of the fact that there are better ways. The Altnagelvin cancer unit, in the constituency of the hon. Member for Foyle (Colum Eastwood), is a good example. It was indicated to us—I was Finance Minister at the time and the DUP held the health Ministry—that we could not afford a cancer unit in the north-west and the Irish Government could not afford a cancer unit of their own in the north-west, so we co-operated. They provided some of the capital and we provided some of the capital. They provided some of the running costs—they still do—and we provided some of the running costs. So this idea that Unionists are not willing to look at how we can make reforms, take decisions and make public finance more sustainable is just not on.
I look forward to the day when devolution is restored and we can work in a co-operative way, but it will not happen until there is respect for the Unionist view in Northern Ireland. And even when it does happen, it will not be effective if the resources are not there to enable us to make the kinds of changes that are required.
Colum Eastwood (Foyle) (SDLP)
It is great to hear that the Democratic Unionist party now supports north-south co-operation. It would be good if we were to allow the north-south bodies to operate properly as well. I totally agree with the right hon. Member for East Antrim (Sammy Wilson) and the hon. Member for Belfast East (Gavin Robinson) about the deficiencies of the Barnett formula. The SDLP, many years ago, proposed moving away from the Barnett formula to a more needs-based approach. It is just a pity that DUP Ministers at that time campaigned loudly and actively against it. However, we are here now.
This is a Bill that nobody wants, least of all the civil service which is being asked to use these powers. We know why we are here: the DUP refuses to form a Government. Many of the arguments some of us are using today were used by the DUP when Sinn Féin pulled the Government down and kept it down for three and a half years. It seems to me that people cannot even learn the lessons they were trying to teach others. We know how that ended: Sinn Féin realised halfway through that boycott that it was doing nobody any good. The waiting lists were still getting longer and certain people were beginning to get the blame for that. My view is that we have a responsibility to all the people in all our constituencies, no matter what their politics are, to have a Government functioning and working together. I heard again today from the DUP that devolution cannot work without the consent of both communities. That is painfully true and obvious, but is it okay, then, to have direct rule, which is basically what this is becoming, operating without the consent of the nationalist community? That is what we are being asked to have, and that will have its own consequences as we move through the process.
The shadow Secretary of State for Northern Ireland, the hon. Member for Hove (Peter Kyle), rightly referenced the 25th anniversary of the Good Friday agreement—the immense change it has brought about and the bravery of that political generation to make very hard decisions and take very big steps, much bigger than those we are asking people to take today. Its impact has been profoundly significant for many people, particularly in my generation.
Over the last number of years, we have faced chaos in our politics inflicted by a Brexit vote somewhere else, because the people in Northern Ireland voted to remain by a majority. That has been the genesis of the crisis we are in today. We argued for a couple of years about the protocol and its implications. Now we have the Windsor framework, which gives us the opportunity to trade into both markets. We have had former American Presidents, the current American President, former US Secretaries of State and the current US Secretary of State, countless Senators and Members of the House of Representatives coming over and telling us that they want to help us by bringing jobs to Northern Ireland. There is not a single other place in the world where American politicians are saying they want jobs to leave America for. That just does not happen. It goes against the political current in the United States of America right now. This is a huge opportunity, and it is an opportunity that we need to grasp. Frankly, I do not understand why we cannot do two things at the one time.
Paul Girvan (South Antrim) (DUP)
I thank the hon. Gentleman for giving way. On the point he just made about investment into Northern Ireland, that was promised to us 25 years ago but the Republic of Ireland, with its fiscal taxation policy, sucked in all the inward investment that we were to get. We never benefited from the major companies that, over the last 17 years, went into the Republic of Ireland when they should have come to Northern Ireland.
Colum Eastwood
That is a very interesting take on the fact that next year the Irish Government will have a budget surplus of €16 billion and we are squabbling over the crumbs from London’s table. There is another question the hon. Member should ask himself: why are we not trying to join the thriving economic entity that is the Republic of Ireland? Our people would be a lot better off.
The point I was making is, in my view, very obvious. I accept that DUP Members still have some difficulty with some issues, and I am happy to sit down and work through them. I will speak to the Irish Government, the British Government and whoever we have to speak to, to help us to get over this hump. The reality, though, is that we are well capable of doing that at the same time as getting into government and dealing with the health crisis. I know we will not be able to solve all the issues overnight, but we will not be able to solve them by doing nothing at all. Why can we not sit down as grown-ups and work through the difficulties, while at the same time implementing the changes required to help people in Northern Ireland get off the waiting lists, to help people create jobs, and to bring in investment that keeps our young people at home instead of sending them off to work somewhere else? That is not beyond the wit of the political class in Northern Ireland today, given all the hard things that had to be done, including by the DUP, in the peace process we have had since before 1998. We can do this very, very simply. There is no logic any more in holding up the institutions of the Good Friday agreement so that we can deal with outstanding issues. We can do both at the one time.
The Bill and the budget are imposing huge cuts on the most vulnerable in our society. The extended schools programme is aimed at schools in disadvantaged areas and at kids who are the most disadvantaged in our society. It brings things like counselling for young people, breakfast clubs and after-school clubs. It is being axed because of this budget. We are axing free baby books for kids. Every year, 20,000 families are given access to free books and reading advice from the Book Trust, a vital tool we can give to our children. Anybody who has kids understands that teaching them to read as early as possible is a really important life skill. We are cutting that—that is where the axe is falling as a result of this budget.
We are also cutting special needs places in nursery schools. Little Orchids in my constituency, which looks after kids from two to four years’ old, was told a couple of days ago that it would have to halve the number of children that it can help in its facility. They are the people affected by this particular budget. We are also told that there will be no new school buildings or extensions. Many of the teachers’ and children’s classrooms are crumbling. None of that work will start this year, and we do not know at all when it will.
In all the discussions we have on radio stations, in TV studios and here about the need for health service transformation, as difficult as it will be, we have all bought into doing the hard things needed to make the health service more sustainable, to get 500,000 people off waiting lists and to make a health service that we can be proud of. Right now, we have a health service that is not free at the point of delivery because people cannot get access to it without paying. Many people in my constituency are going to the credit union to get loans that they cannot afford to pay back, so that they can have the vital surgery they need to live their lives in a normal and comfortable way. There is no space in this budget for proper health service transformation. Those 500,000 people will remain on waiting lists, which will grow and grow.
I made this point earlier to the Minister, but I will make it again: we can talk about the detail of revenue raising at any point, but I want to make it clear that the Irish Government, the British Government and the former Northern Ireland Executive all committed to expanding university places in Derry, which has been waited for and campaigned on for many decades. In any new funding model for higher education, that needs to be protected, and the opportunity needs still to be there for expansion of university places in Derry. If we are really serious about rebalancing the economy regionally and giving people the opportunity to create jobs and get employed in their own areas, that has to be our No. 1 priority.
Mike Kane (Wythenshawe and Sale East) (Lab)
The hon. Member is making a powerful speech, but he knows that his city is the only city on the island of Ireland without an independent university. We have campaigned for many years for the expansion of Magee, but it is not happening the way that we or John Hume envisaged it. What is his view on one day going for an independent university in the great city of Derry?
Colum Eastwood
I thank the hon. Member for his intervention and his work on this issue. There was a short period when we did not have an MP for Foyle in this Chamber making these points. The hon. Member and others stepped up on that issue, and we were very grateful to him. The people of Derry have been starved of a university since 1964. That has massively damaged our economic opportunities—that along with the bombing campaign that blew the place to bits. We are now 25 years on from the Good Friday agreement, and we still have not maximised that opportunity.
We have a university in Derry—we are clear about that—but it is not big enough and it does not do enough to attract the kind of students who, in turn, will attract the economic opportunities that we want. I have been clear with the leadership of Ulster University that people are very weary, tired and lacking in trust in that institution. The leadership needs to come up urgently with a plan to expand university places to at least 10,000 students or people will begin to look elsewhere, as the hon. Member says. We must be realistic and serious, and we must make this happen because we cannot wait any longer to have proper university provision for the people in my city.
We are now basically in a period of direct rule, and we are moving inch by inch closer to London-only rule. That flies in the face of the Good Friday agreement and every single agreement that we have made since. I urge this Government to think carefully about what happens next, because this situation cannot be allowed to run and run. If we are not to have institutions at Stormont, and if locally elected people are not to have representatives running the place because they are denied that opportunity, the British Government need to look seriously at a greater role for the Irish Government in the affairs of Northern Ireland. I say that advisedly because in a number of periods when we were denied institutions at Stormont, it was only that promise that encouraged some people to get back and to form a Government representing all the traditions on the island. That is well worth considering.
We are knocking on doors and speaking to people. An awful lot is said about Unionist concerns, which we listen to and try to be respectful of, but many of the people we speak to say, “Why would we have any faith in the DUP to work with nationalism? Why would we have any faith in Stormont to deliver for us?” People are beginning to think differently about their future. I will argue every day to end the divisions on our island and to build a new Ireland, but I caution those who stand up and talk about the precious Union a lot in his place that they are opening a door to something that they might end up regretting, because more and more people are moving away from support for Stormont. I do not want that to happen. I think we can do two things at once. We can have locally elected people running the institutions of Northern Ireland. There is a better way to do this in the longer term.
Sir Jeffrey M. Donaldson
The hon. Member is touching on a very important point, which I think is overlooked. The UK Government and Unionism recognised that a hard border was not the solution in relation to Brexit. Why? It would have undermined nationalist sensitivities in relation to the agreement and the political institutions. We sought to find a way forward that respected the integrity of the United Kingdom and avoided a hard border on the island. Even the Taoiseach has recognised that the protocol went way too far in creating an Irish sea border. Although the hon. Member is right that nationalist sensitivities must be given regard, so too must Unionists’ sensitivities because consensus is the way forward, as the former Member for Foyle John Hume often said from that seat.
Colum Eastwood
I have tried my best to understand the concerns of Unionism, and I think the European Union and the British Government have as well, to be fair. That is why we have the Windsor framework. If there are still outstanding issues, let us talk about them. Even when we were threatened with a hard border, we did not walk away from government. We did not stop working in the institutions. We wanted to sit down and continue to work with our neighbours—even those who we disagreed with—because that goes right to the heart of the Good Friday agreement.
Walking away and boycotting will solve nothing, in our strong view. If there are outstanding issues, and if there are solutions that do not impact upon the principle of protecting all-Ireland trade and avoiding a hard border, we will be open to looking at those and to working with the right hon. Member for Lagan Valley (Sir Jeffrey M. Donaldson) and his colleagues to achieve some modicum of change around that. My appeal to him is this: let us sit down, work together in our substantial common interest, work the common ground, get back into Stormont and try—as hard as it might be—to begin to fix some of the problems that beset all our people.
Gavin Robinson (Belfast East) (DUP)
I appreciate being called earlier than I had anticipated, Mr Deputy Speaker. We had a brief conversation earlier, and despite what you said, the prospect of another four and a half hours of debate is probably too tantalising to ignore. Although normally I do not speak for long, I may take the opportunity to speak a little longer this afternoon. [Interruption.] I jest.
Like others, I lament the fact that we are debating this Bill this afternoon and dealing with a Northern Ireland Office that, yet again, I am sorry to say, is missing a crucial opportunity. It is a Northern Ireland Office that has lost any sense of strategic direction; it has lost the ability to engage, understand and resolve some of the pressures that we have in Northern Ireland. I lament the fact that the relationships from which we benefited over the last few decades no longer exist, and I lament, more than anything else, the fact that, while the Bill has been described this afternoon as legislation that closes a constitutional gap—or continues a governance gap—that opportunity has been 100% missed.
It did not need to be this way. The Northern Ireland Office had been actively engaged with the Northern Ireland civil service over the last three or four months, and had drafted provisions for the Bill that would have given the Secretary of State step-in powers and the opportunity to assist with some of the difficult decisions that are facing our Northern Ireland public service Departments. However, the NIO actively chose to leave those provisions out of the Bill. I know that this is not a Committee stage, but because new clause 5 has not been selected, I will say now that we tabled it to highlight the point that the choices that now rest with permanent secretaries in Northern Ireland are unfathomable. The opportunity was there for political direction on the taking of decisions when political direction was required, but those in the Northern Ireland Office have chosen not to take it. They will continue to say what they have said over the last few months—“It is not for us to make political choices”—but that is a political choice that they have made.
When the Government raised the rates in Northern Ireland this year, while still talking about revenue raising and the need for more finance to come from Northern Ireland, they made a political choice. They increased the burden on homeowners, domestic ratepayers, by 6%, and excluded businesses by freezing their regional rate. They made a political choice. When they talk about revenue raising, they know that some £1.5 billion to £1.7 billion a year is raised from revenue. If every domestic and non-domestic ratepayer in Northern Ireland paid 50% on top of their bills that are due next week, that would still not cover the shortfall that faces Northern Ireland Departments as a result of the budget given to them by the NIO.
When that budget was delivered last week, it was delivered in the explicit knowledge of the decisions that permanent secretaries would have to make, but cannot make. Everyone in the Chamber is aware of the legislative preclusions that prevent them from making those decisions. Members know the impact of the Buick and JR80 judgments. They know that the permanent secretaries cannot do that. They had indicated in advance to the Northern Ireland Office—to the Secretary of State and the Minister of State—that the budget that they were handed would mean they would have to take decisions that would conflict fundamentally with the statutory obligations and duties that they have to undertake. They cannot do it.
While the flexibility on the £279 million is useful in one sense, it is hugely dangerous in another, given the damage that it will do through the breach of parity in public pay awards between Northern Ireland and the rest of the United Kingdom. Anything that is agreed in the forthcoming weeks and months in England will benefit public workers in England but not those in Northern Ireland, and that gap will grow. The flexibility is useful, but given the direct knowledge of the underspend and the challenging decisions that will have to be taken, it is outrageous that that is the sort of offer that our Departments have received.
Stephen Farry (North Down) (Alliance)
I agree with much of what the hon. Member is saying about the failure of the Northern Ireland Office to address the governance gap, but does he not think it is a little bit difficult for people to hear him say such things when his party has the power to address all the concerns he has been raising if they return to the Executive? While he is right to criticise the Government, surely he should also exercise some self-reflection on the role of his own party, because all those ills could be cured by him and his colleagues tomorrow.
Gavin Robinson
I find it amazing that the hon. Gentleman has made that point. He knows it is the biggest falsehood that is being peddled today, and it was addressed earlier by my right hon. Friend the Member for East Antrim (Sammy Wilson). If the Executive were up and running tomorrow, the fundamental damage being caused by the budget and the fundamental choices having to be made would still be there, but the resource would not. Departments are saying today that there is an £800 million shortfall in their ability to deliver, and that they will now have to take decisions that conflict with their statutory obligations, and that same choice will be there tomorrow unless the Government say that they will reflect on the systematic and systemic underfunding of the Northern Ireland budget, and will recognise that the Barnett formula must be assessed on the basis of need. Unless that happens, the choices that are there today will be the choices that are there tomorrow.
Let me spell it out. What do we know from the Department of Justice? It is hundreds of millions of pounds short of what it needs. The police alone do not have enough money to cover last year’s shortfall, let alone an additional £35 million shortfall this year. Where can they make the cuts? They can make them through headcount and non-pay. On headcount, we know that devolution was restored in 2020 under the New Decade, New Approach agreement, which recognised that policing numbers needed to reach 7,500. In March this year the figure was 6,700, and it is projected to be 6,400 in March next year. That is the sort of choice that is available today to a permanent secretary, and would be available tomorrow to a restored Government.
Earlier today, the Minister of State was answering questions about the cost of living crisis, but yesterday we heard from the Department for Communities about the extent of its shortfall. A third of the social homes that were planned to be built this year cannot be built: 2,000 were projected, and 1,400 will be delivered. No money is available for the new health assessments associated with benefits, and there is not enough money to progress the assessment of benefit applications. That is what has been delivered by the NIO: choices that are there today and would still be there tomorrow if there were a return to devolution.
Then there is the enormous shortfall in the Department for Infrastructure, where the permanent secretary is highlighting her statutory obligations and the money she does not have in order to meet them. So what are her choices? To stop gritting the roads? To stop treating waste water? How often do we hear about the importance of climate issues and looking after our environment? But that is one of the choices available to the permanent secretary in the Department for Infrastructure. Another is to turn off the street lights. I do not think that the Secretary of State or the Minister of State or the NIO is interested in streetlights. The only thing in which they seem to be interested at present is gaslights, because the politics of all this has been about gaslighting people in Northern Ireland. What is psychologically questioning our understanding of how finances work, and telling us that we are overfunded when we know that we are structurally underfunded—standing in this Chamber and saying, “Oh, but Northern Ireland gets 121% of what people in England get”, when we know that that is less than what Northern Ireland needs—if it is not gaslighting? That is the diet that we have had over the past number of months, and it seems certain that that is the diet that we are going to continue to get.
The Northern Ireland Fiscal Council has been explicit. When I talked about the Northern Ireland Fiscal Council in this Chamber in January and last year, whoosh, it went straight over people’s heads. It meant nothing. I know that sometimes the figures in these documents are boring, but they are crucially important in terms of the ability to deliver public services for everyone in Northern Ireland.
I represent a constituency that has some incredibly affluent areas, but it also has some incredibly deprived areas where social deprivation is a real thing. Wards in my constituency feature in the top 10 most deprived wards in Northern Ireland. In the Mount ward, at the bottom of my constituency, just off the Newtownards Road, 25% of children are leaving primary school without basic literacy and numeracy skills. Forget the 11-plus—they are going on to secondary school without the basic ability to read, write and count. What has this budget delivered? It has delivered an end to the extended schools programme and an end to free books for babies. Just a few months ago, the Northern Ireland Affairs Committee visited EastSide Learning in my constituency. The chairman cheekily asked, “I see those books—the spines haven’t been broken. Does anyone read them?” He was informed that they were brand new books, but the Department of Education is not going to be able to give brand new books to children in my constituency any more. It is outrageous.
The Pathway funding, which is about ensuring the social, emotional and cognitive development of young children before they get to nursery and primary school, is not going to be there. The Department of Education has said that from June there is no money available for such vital developmental early years intervention. Whether it is the Dee Street and the Ballymacarrett youth centre or the Bloomfield Community Association youth centre, all of these interventions matter. The public services that are delivered in Northern Ireland matter, and this budget fundamentally constrains the opportunity to provide for the needs of those children and our constituents right across Northern Ireland. The opportunity was there, and it should be there, to make a difference.
I want to make this point with as much power as I can: we can debate and talk every day of the week about the pressures that exist with the Northern Ireland protocol, the Windsor framework and the impediments to the return to devolution. Whether people agree with me on those issues or they ignore those issues, that is fine; we will continue to work for resolution. But the point needs to be understood that we cannot and will not have sustainable government in Northern Ireland if we do not have sustainable finances alongside a return to devolution.
The idea that any elected representative is going to stand up in government to stand over the dismal budget that has been provided is for the birds; it is not going to happen. I want to see Northern Ireland work. I want to see Northern Ireland as a place where all communities within our Province are at peace with one another and enjoy the benefits of the country that we have the privilege to live in. These issues need to be resolved and that can happen only when the finance is there to deliver positively for those people.
Sir Jeffrey M. Donaldson
My hon. Friend is making an excellent contribution to the debate and I fully support what he has said about a needs-based approach. Indeed, I think of the work of the Atlas Women’s Centre in Lisburn, in my constituency, which has used Pathway funding to help some of our youngest children to develop the skills they need for mainstream education. Does my hon. Friend agree with me that in seeking to change the way that our public services are funded, it is essential that in Northern Ireland we also recognise the need for the reform of those public services and that part of what we need from Treasury is investment for reform?
Gavin Robinson
The truth is that the shortfall from last year and the shortfall in this financial year need to be covered—that is the short term. The medium term needs to be about getting reform agreed, and the long term needs to be about sorting out how Northern Ireland is funded and providing a stable way for doing so.
There are huge opportunities. Some people like to dismiss it and some people do not want to listen to it, but the last thing we want to see is a return to devolution where the foundations are unstable. We want sustainable government in Northern Ireland. We want the ability to deliver proudly positive public services for the people of Northern Ireland, and we want to resolve the issues that have created the impediment thus far. There is nothing new in that. Sometimes it takes quite a while for people to hear and listen.
We are getting there. I am sorry that we are having to go through another Bill like this and that opportunities are being missed to deal with delivery for the people in Northern Ireland, through one way or another. We want to protect public services. We want to protect the street lights and end the gaslights. It would be nice to have a debate on these issues where we could talk practically and factually about what the impediments are, which all of us work to resolve.
Stephen Farry (North Down) (Alliance)
It is a pleasure to follow my neighbour, the hon. Member for Belfast East (Gavin Robinson). This debate is happening in something of a twilight zone, in the sense that we have a twin budget and governance crisis. Frankly, neither is being adequately addressed today.
The Northern Ireland Office is operating in hope, and possibly expectation, that at some point the DUP will return to the Executive of the Assembly. Indeed, there is an overwhelming logic to that. If people want to make Northern Ireland work, then the Assembly and the Executive have to work, and that has to be seen as the overarching issue. Any notion of a democratic deficit that may happen elsewhere pales into insignificance compared to the current democratic deficit that we are facing.
As much as I agree with parts of the analysis given by my neighbour, the hon. Member for Belfast East, around the fact that the Northern Ireland Office is not stepping in on governance, others are not stepping in on governance either. I appreciate that the overall context is difficult—that may not change—but governance is core to solving this issue. We are in a frankly intolerable situation in that regard.
If my colleagues in the DUP are genuine about returning to the Assembly—some optimistic voices expect them to reach that conclusion in the next weeks or months—the longer they leave it, the more damage is going to be done to Northern Ireland. My message to them is, if they are going back, they should tell us they are going back and let us get on with it. If they are not going back, then they should say so and let us put in place alternative governance arrangements. The drift is killing us, both metaphorically and literally.
In terms of governance, the guidance is insufficient and in some ways contradictory. The Government may think it is perfect clearly, but it is evident that the Northern Ireland civil service does not think that. For example, we have a situation where our guidance is telling civil servants to act in the public interest, not to undermine statutory services or commitments, not to take major public sector decisions and to avoid long-term damage. It is hard to see how taking cuts is consistent with any of those criteria, but that is what they are now being expected to do.
I fear we are, yet again, at something of an impasse. That will lead to two potential outcomes: first, we will see certain decisions being deferred till later in the financial year. If decisions on cuts are taken even later in the year, the pain and impact becomes even sharper than it would be today. Alternatively, we will see a situation where it is impossible for them to live within the spending envelope that has been allocated, and we will see yet another overspend at the end of this financial year, with all the associated complications for planning that will flow from that.
The current situation we are facing is contributing to lengthening waiting lists and will reinforce educational underachievement, block the skills pipeline and compromise our ability to tackle economic inactivity. To date, the civil service approach has been to focus almost entirely on the very narrow ground of what are viewed as non-statutory activities—discretionary spending, in other language—but that is often some of the most effective spending, as it is often aimed at early intervention or prevention, which goes a long way to addressing steeper cost pressures that may emerge elsewhere in the public sector later in the process. For instance, if we do not address mental health in the community, we end up with more people having to be admitted to secondary care, which is more costly, and the same goes for skills and educational underachievement.
I recognise that this is a genuine dilemma for the Government and that we do not want a drift to formal direct rule because of all the implications that flow from that, but I must say to them that the current status quo is unsustainable and something must give. This is not the same context as that between 2017 and 2020, when there was a much more stable financial environment. I appreciate that direct rule is not palatable, and if it does have to happen, there will have to be an Irish dimension to it—people will have to face up to that. I clarify, however, that that is not joint authority, which I consider to be a different concept outside the context of the principle of consent. However, a consultative role for the Irish Government in direct rule has been established going back to the Anglo-Irish agreement, and, again, if people are uncomfortable with that reality, they know the options open to them to stop that happening.
On the finances, I recognise there are major structural problems in Northern Ireland’s public sector and expenditure profile. Some of that has been self-inflicted: the roof has not been mended while the sun was shining in previous years. A lot of decisions around reform have been ducked and opportunities have been missed by previous Executives. At the same time, however, we must recognise that there is a wider context. I do not want to labour this point today, but our current crisis in Northern Ireland is happening in the context of the UK public finances, which took a major hit towards the end of last year, and that has had a ripple effect throughout UK public spending, including the Northern Ireland block grant. We also, of course, have the Barnett squeeze, which I will discuss later.
Given all I have said, it is true that this year’s budget allocation will more or less be along the lines set out, regardless of whether an Executive were in place. It is, however, utterly disingenuous to say that the presence of an Executive is irrelevant in that regard. The governance gap fundamentally matters: without an Executive there is not a process for managing the pressures as efficiently and effectively as possible. That matters much more in the context of a crisis than when there is a surplus. It is like when a business is falling apart and running out of options and all the finance directors and the managing director have left their posts and others are trying to make do as the situation develops. The impact of cuts will be sharper without an Executive, because there cannot be early decision making on difficult decisions—I have made that point in relation to the civil service guidance. Some decisions cannot be taken because the governance structure is not sufficient, while other decisions will be deferred, and there will be a lack of strategic approach. Also, early intervention and prevention in particular are being targeted for cuts given the absence of a wider programme for government and a strategic framework. We will be storing up even greater problems in our public sector for subsequent years; the legacy of what is happening at present may be with us for a generation unless we swiftly get a handle on it.
We have long since lost the opportunity of a three-year multi-year budget, where we could have had planning from one year to the next and had some degree of stability and certainty in finances, allowing some long-term decision making. Crucially, with an Executive in place we would be in a much better place to go to the Treasury and ask for a financial package, and indeed make the case in relation to the Barnett squeeze. But in the context of a vacuum, all we will be looking at is cuts after cuts and decline and more decline, lost economic opportunities and damage to our public services.
In terms of our economy, this comes at a time when people want to do business with Northern Ireland. We have had the Good Friday agreement 25th anniversary, and I commend the Northern Ireland Office on its contribution to that, alongside many others, but people are now talking about a prosperity decade lying ahead, and the Government have welcomed that. We are having a trade conference in Northern Ireland in September, and Joe Kennedy III, the US economic envoy, has offered to bring a trade mission to Northern Ireland. All that is sitting there for us, but unless we have political stability and are investing in our skills, infrastructure and research and development, we are not going to be able to take advantage of those opportunities. They will not last indefinitely: there is a sweet spot at the moment and we must seize this opportunity. Instead we are seeing some of the key economic drivers being cut and undermined and, rather than taking opportunities, we are going in the opposite direction, and things are going to be getting even worse.
We must look to ways in which we can break this cycle, and all of this requires an Executive to be in place, but for us there are three ways in which this can be done. First, we must look for an invest-to-save transformation package for Northern Ireland. Most people recognise that we need to transform our public services to invest in our economy. There will be a lot of scepticism around this, and I have heard, for example, the comments of the hon. Member for North Dorset (Simon Hoare), Chair of the Northern Ireland Affairs Committee, about previous packages. We will have to learn the lessons from previous interventions and we will have to accept a lot of conditionality if that were to come. But unless we escape the cycle of cuts and the platform we are on, we are not going to transform our public services and invest in our economy. So we need to have that conversation. My party has put forward some proposals to the Government and I hear other Members talking in similar terms. We need to come together as political parties, ideally with a devolved Executive, to make this case. If that is to happen, it will need to be tied to a plan, which we have in place, including reform, that we stick to over multiple years.
The second area is inefficiency in our economy. That includes the cost of managing intervention in society and looking to other areas such as what we are doing on the health service. There are counterproductive, knee-jerk reactions to the budget crisis. For instance, the more we use agency workers, the more expensive that becomes, rather than investing in long-term staff, which is much more cost effective—that is counterproductive in terms of costs. Domiciliary care is necessary to take people out of hospital beds, which are more expensive, but, again, that will be sacrificed in a difficult budget setting—so, again, it is very counterproductive. In education, there is duplication between what happens in post-16 school settings and in further education. That is not sufficiently streamlined. We estimate that there is potentially £70 million in duplication there, which could be addressed with a proper 14-to-19 plan.
Finally, there is the Barnett squeeze issue. There must be an assessment in the work of the Fiscal Commission; much more work needs to be done on that, but we need an Executive to be batting for us with the Treasury to make that case for a different approach.
For me, the budget crisis is by far the biggest political issue facing Northern Ireland. With respect to my colleagues, it is a far bigger issue than the Windsor framework. I regard the Windsor framework as now being a done deal, and I welcome it: it is a progression from the original version of the protocol. There are issues to clarify on the margins, with more detailed guidance, but the fundamental structure is in place and we need to move on. To some, the issues being debated are relatively abstract and pale into insignificance compared with the impact on people’s everyday lives in terms of health and education.
Again, I say to Unionist colleagues: the best way to secure the Union is not through a narrower and narrower circle, based on defending an abstract notion of sovereignty; it is by making Northern Ireland work. The Union is based on the principle of consent. That lies in people seeing Northern Ireland working, and without an effective Executive and Assembly, they are getting the message that Northern Ireland is not working. From their perspective, that narrative needs to be turned around very quickly, rather than continuing the stand-off on the increasingly narrow ground of the Windsor framework.
Jim Shannon (Strangford) (DUP)
Thank you for calling me, Mr Deputy Speaker: as so often in this House— and there is nothing wrong with this, by the way—I am called last, but always very pleased to make a contribution to the debate.
My colleagues who have preceded me outlined the precarious situation we are in due to the punishing budget that has been set. The Minister may well say that that is a different debate—and perhaps rightly so—but there can be no other topic. Interim arrangements within which the Secretary of State will continue to act in the absence of the Assembly can be acceptable only if the Secretary of State intends to act, instead of sitting and watching foundational aspects of the country crumble, in an attempt to strongarm Unionists into accepting an incomplete and damaging framework.
We are happy—I state this very honestly and truthfully— to work with the Prime Minister, and with the Secretary of State and Government, to find a workable solution, but there must be a massive effort to find that solution, with engagement that understands the position of Unionism. I understand that the mechanisms in place need the assent of this House to continue. However, the question that Northern Ireland MPs must ask themselves today is whether we are willing to play a part in this distraction from the harm that Government are seeking to do to Northern Ireland and their people, who dare—that is us: we dare—to demand parity of esteem within this United Kingdom of Great Britain and Northern Ireland. Obviously, different political parties are making their plea to find a way forward, and we have different interpretations of that, but we are all trying to secure a way forward for everyone.
In preparing for today’s debate on the Bill, I met a number of playgroups in my constituency to discuss the interim arrangements. I want to flag the removal of the pathway fund for early years, due to the ridiculous funding cuts faced by the Department of Education under the budget, which is only one of the harms that I am concerned that this Bill will perpetrate. A constituent of mine emailed me in the last two weeks regarding the likelihood that the pathway fund project that her child attends will cease at the end of June 2023. This is a massive issue in my constituency. I have met a number of playgroups over the last week or 10 days, and they have all made similar requests. I quote this lady:
“The project offered by the local provider helps support the social and emotional, cognitive and physical development of my child, using a holistic approach, delivered in a safe and engaging environment. My child should not have to miss out on being able to access this service which provides them the opportunity to learn and develop because of the removal of the Pathway Fund in our local community.”
She continues:
“As parents we continue to be reminded that the early stages of a child’s life is the most important and we inevitably try our best to ensure our children have the best start in life. Opportunities to access and engage in projects that support, not only my child’s development but my own as a parent, are not readily available within this area. I am significantly worried about the negative impact the loss of the Pathway Fund will have on my child, our family and the local community.”
This debate on the interim arrangements Bill gives us the opportunity to highlight this issue. The same concern has been replicated in my constituency of Strangford by more than eight playgroups that have contacted me. Early years development, as outlined in the Prince of Wales’s groundbreaking report, is absolutely essential—there is not an MP in this House, and certainly not on the Opposition side of the Chamber, who does not recognise that. This situation will have a dire long-term effect on the children in my constituency, as well as throughout Northern Ireland.
I had three boys. They are young men now—35, 33 and 31—but when they were small, they attended the playgroup and nursery. I could see the engagement at an early stage that my boys had at that playgroup, which is similar to the one I have mentioned. It gave them social engagement and the chance to build friendships. They kept those friends from nursery and the playgroup the whole way through to primary school and secondary school, and today, in adult life, they still have those friends.
I have often said that Northern Ireland has been used as Europe’s political football to score points. When I look at my children’s education, I can see how vital it is, and yet children’s education will potentially be reduced. The Secretary of State for Northern Ireland will have received my meeting requests, which I sent to him just last week, to discuss this very issue. Following that action, let me say that the education and future of our children is not, and can never be considered—I use these words deliberately—as cannon fodder. Continuity funding is what we are requesting, and it needs to be allocated. That is my plea today on behalf of parents throughout my constituency and across Northern Ireland, including in constituencies whose MPs do not even take their seats here—we are here to advocate for them as well. This interim arrangements Bill allows for things to continue. The view of Unionists on the ground in Northern Ireland who I have spoken to is that they are to be punished by the Government here.
The hon. Member for Foyle (Colum Eastwood), who is not here—I am sure he is not too far away—referred to the Republic of Ireland as the place we should be looking towards. I will give the House a couple of wee facts about that. In the Republic of Ireland—which is where he seemed to indicate he wishes to be—anyone who wants an appointment with their GP has to pay €45 to €60 each time. If they have to go to accident and emergency, they pay €100 every time. Anyone 16 or over who has to stay overnight in the hospital pays €80, while the cost of living in the Republic of Ireland is 21% higher than in the United Kingdom. And anyone who wants a Big Mac from McDonald’s—I am not a fan; I do not buy them—will have to pay £2 more in the Republic of Ireland than they will in Northern Ireland or across the United Kingdom. Those are just examples of that paradise that the hon. Gentleman refers to—which is not a paradise at all—so let us keep things in perspective when we look at costs.
I spent last weekend, as I know my colleagues also did, at community events and meetings with constituents. The huge majority, reflecting that opinion, urged us to work for a solution: to get back to Stormont while standing firm for Unionism. That is the key, and it is disappointing that, while we are pushing for a solution that recognises the position of Unionism where it is, we are unfortunately not getting the reply from Government that we would wish for. That is the challenge for the United Kingdom Government and the Minister of State, and that what we are attempting to do. I humbly ask my Government to work with us and not against us to find the solution to the difficulties for our businesses and to legislate for our constitutional position, so that we are not at the whim of Government and whatever position they have taken that most expediently deals with the Northern Ireland issue.
It is important to put on record where we are with the Windsor framework. One of the reasons why, at this moment in time, my party has not accepted the Windsor framework is that we have sought legal opinion on whether it is worth the paper it is written on. The legal opinion from one law firm is that it is not. The Loyalist Communities Council, the Orange Order and the Unionist Forum each sought a legal opinion from three different law firms, and every response was the same. The Stormont brake is not worth the paper it is written on. The European Research Group, of which the Minister was once the leader, also sought a legal opinion, and the response it received is that the Windsor framework is not worth the paper it is written on. I have great respect for the Minister, but what a disappointment it is to find that his opinion today is so different from that which he had when a member of the ERG.
I understand the necessity for this Bill, but the Government have to take a giant step to embrace Unionism and its viewpoint. Northern Ireland Unionists are being treated abysmally.
Sammy Wilson
It is not just a case of asking the Government to embrace Unionism. This is about the Government standing up for the country they claim to govern, because through the protocol and the Windsor framework they have handed responsibility for lawmaking to a body outside the United Kingdom.
Jim Shannon
Those words are salient. I am sure the Minister is taking note, and hopefully he will give a positive reply. My right hon. Friend is right. We are clearly second-class citizens.
This punishing Bill hurts not only Unionists but everyone in Northern Ireland. If I am to endorse the Bill, which allows the Secretary of State to continue wielding the necessary powers, I ask for an assurance that the extension will bring about a signal change, which the Government are currently not doing. As my right hon. Friend said, this Bill causes great concern even to the staunchest British heart in Northern Ireland. What are we clinging to? That is the question he asked.
I remind myself of those who shed their blood to protect Northern Ireland and the United Kingdom, including many relatives of mine. Every year we celebrate the anniversary of the Ballydugan four, who were murdered by the IRA 33 years ago—no one was held accountable. My cousin Kenneth was murdered by the IRA—no one was held accountable. Billy Montgomery’s son Stuart was murdered by the IRA in Pomeroy—no one was held accountable.
All these people gave their life, and their family’s lives, for this great United Kingdom of Great Britain and Northern Ireland. In their name and memory I once again ask that we are treated justly and fairly, because we have shed our blood and served in uniform for this country. I served in the Ulster Defence Regiment and the Territorial Army, and my right hon. Friend the Member for Lagan Valley (Sir Jeffrey M. Donaldson) served in the Ulster Defence Regiment too. We are not afraid of serving in uniform because it is the right thing to do. As British people, we think we should do that, and many others do too.
When this extension is granted once again, as I am sure it will be because of the Government’s strength, I urge the Government and the Minister to take this fresh opportunity to engage with constituents and work for the benefit of the whole Province, both those of a Unionist persuasion, as we are, and those of a nationalist persuasion. I love this country, this great United Kingdom of Great Britain and Northern Ireland, and I say we are better together, but that means everyone being equal, and at this moment we are not.
Stella Creasy (Walthamstow) (Lab/Co-op)
On a point of order, Mr Deputy Speaker. Have you been notified of any change to the business, either today or tomorrow, in the light of the announcements in The Daily Telegraph—I believe a written ministerial statement has also been published—about the Government’s proposed fundamental changes to the Retained EU Law (Revocation and Reform) Bill? We have debated the Bill at great length in this place, and I understand from The Daily Telegraph that the Business Secretary is proposing changes to regulatory reform, in addition to deleting certain regulations, but that has not been notified to us.
I know you will be as concerned as I am about parliamentary scrutiny of any substantial changes, and I am sure the Business Secretary would not wish to evade that scrutiny in taking back control to this place so that we are able to understand what the Government intend. Have you been informed of whether we, as parliamentarians, might have an opportunity to scrutinise any of these proposals?
Mr Deputy Speaker (Sir Roger Gale)
The straight answer is no. Mr Speaker has repeatedly made it plain that he expects information to be relayed to the House before it is announced to the media. However, from what the hon. Lady has said, it sounds as though a written ministerial statement has been made. There has been no indication to the Chair at this stage of any change to the business. That may, of course, change tomorrow.
Tonia Antoniazzi (Gower) (Lab)
I feel an enormous sense of déjà vu as I stand here once again to speak about Northern Ireland. As was mentioned by my hon. Friend the Member for Hove (Peter Kyle), the shadow Secretary of State, we will not be opposing this Bill today. It is vital that, in the absence of an Executive, public services continue to function to support the people of Northern Ireland.
Like other Members across the House, I want to pay tribute to the civil servants who have spent more than a year working in these testing circumstances; it is not ideal, but it has been necessary. The removal of the six-month limit of this legislation will at least allow for continuity of governance as we hopefully move closer to the restoration of power sharing. The fact is, however, that these civil servants are confined to “business as usual” and are unable to take any new or bold decisions. Such decisions would be at the feet of Ministers and subject to scrutiny by politicians elected by the people of Northern Ireland to represent their interests. Without a functioning Executive, key levels of scrutiny from Committees are missing from those big decisions.
Public services in Northern Ireland are under severe pressure, with the impact of that felt throughout all of Northern Irish society. Just last week, for example, it was reported that since 2015 about 10,000 children have not been fully inoculated, with workforce shortages and delivery capacity in GP practices being given as the reasons for that. Deep-rooted issues such as that require proactive solutions, which should rightly be made by elected officials.
Furthermore, as was highlighted in Northern Ireland questions earlier today, the significant cuts included in the Northern Ireland budget are of great concern. I am grateful that the Secretary of State has included measures in this Bill that will allow for departmental accounts to be laid before Parliament for some scrutiny, but ultimately such scrutiny would be best applied by those on the ground in Stormont, who are answerable to the people of Northern Ireland. The Northern Ireland (Executive Formation etc) Act 2022 allowed the Secretary of State more time before calling an election in Northern Ireland. I would welcome hearing what steps he plans to take during this time to ensure that by the time of the next election, a functioning Executive will stay in place.
Despite the introduction of the Windsor framework, this deadlock has yet to shift and the people of Northern Ireland are suffering the most negative impacts of that. It is clear that there is a gap between the Government and the Unionists, which must be bridged in order for progress to be made. Dialogue between the Government, the European Union and the Unionist parties must continue. Of course, any way forward must take into account the nationalist communities, such is the nature of power sharing.
The recent celebrations for the 25th anniversary of the Good Friday agreement should highlight how important it is that we prioritise the restoration of power sharing and of a functioning Executive. I encourage the Secretary of State and the Minister to do all they can to try to push matters forward. I also ask that they work with the Prime Minister to ensure that he shows that he is fully committed to the restoration of power sharing. We cannot afford to spend another year debating issues that the devolved Administration would usually cover, while public services decline further and the cost of living crisis deepens. This Bill ensures that there is enough governance for now, but I sincerely hope it will not be needed for much longer.
Mr Baker
With the leave of the House, I rise to close the debate, and I thank all those who have participated in it. Once again, we have seen that on the main substance of the Bill there is wide agreement. There is agreement that it is necessary but regrettable, as we continue to seek to avoid the governance gap.
I will now seek to respond to as many points as I can. The shadow Secretary of State raised the issue of some difficult decisions being too much for officials. We recognise that the Bill is an interim arrangement. It clarifies the powers that civil servants need in order to maintain public services in the absence of an Executive. We recognise that civil servants will be uncomfortable taking some of the difficult decisions that are needed. Indeed, it is possible that they will feel unable to take them, but that, of course, is why we need the Executive back. I am aware that we are sounding like a stuck record, but getting the Executive back is what we are seeking to do.
Before I go any further, I will just say to the hon. Member for Gower (Tonia Antoniazzi) that I know the Prime Minister would want me to say that he is fully committed to the return of devolution, but that is a point to which I shall return later.
My hon. Friend the Member for North Dorset (Simon Hoare), who chairs the Northern Ireland Affairs Committee, asked about advice. He raised a great point and I am happy to clarify that it is our intention that the options developed for budget sustainability will be shared with the new Executive, and we hope that the new Executive will act swiftly to implement such measures. Further to various points that he made in relation to direct rule, I am absolutely clear that the Bill does not give us any powers to implement measures. I hope that is helpful to my hon. Friend—it is just the powers of the Secretary of State to direct that there should be advice and consultations, which would fall away.
The hon. Member for Gordon (Richard Thomson), who speaks for the SNP, made a speech to which I listened very carefully. I am happy to say that, on this occasion, I did not spot any areas where I disagreed with him, but I shall have to revisit Hansard. I am grateful to him for the manner in which he has approached this debate, and I can assure him that it made a pleasant change.
A number of Members have talked about the budget. I know that if the moment comes that we are forced to bring forward a budget Bill, we will no doubt touch on all of the issues in detail, but I hope the House will forgive me if I do not go into any further detail on that this afternoon. What I will say is that we will have to bring forward a Bill if there is not an Executive, which I and the Secretary of State will regret should that be necessary.
On the issue of funding, the Government have, for many years, recognised the unique challenges that Northern Ireland faces. We have provided about £7 billion in additional funding to Northern Ireland since 2014, on top of the Barnett-based block grant and the Northern Ireland budget. Per person, that is around 20% higher than the equivalent UK Government spending in the rest of the UK. I am well aware of the Fiscal Council’s report, which suggests that, on a needs basis, it should be even higher, but I have to say that 20% extra would go a long way in Wycombe—the streets are not all paved with gold there.
Mr Baker
I will, if the hon. Gentleman will let me finish my point.
We do need the Executive back, and not because we believe all the problems will go away—far from it—but because we need the problems to be addressed by Northern Ireland Executive Ministers. I am very clear that the road ahead will be long and hard for those Ministers.
Gavin Robinson
Does the Minister accept that, within the next two years, the upward trajectory for the budget in England is 6%, but the trajectory in Northern Ireland is 3.6%? Per household, that equates to £2,000 less in Northern Ireland than for his constituents in Wycombe.
Mr Baker
I am confident that the hon. Gentleman has done his homework, but I hope he will forgive me for saying that I will not confirm the figures when I do not have them immediately in front of me in the terms that he has put them. As I mentioned in oral questions earlier today, for all of us in this House, and indeed in all the devolved institutions, we do need to engage with the fiscal projections of the Office for Budget Responsibility. There is no doubt in my mind that, for the rest of our political careers and far beyond, there will be a problem with meeting the many demands of age-related spending. All of us will need to rise to that challenge, as it will need, in particular, healthcare reform. The Bengoa report is long since overdue in implementation. I also talked earlier about healthcare.
A total of £600,000 a day is spent maintaining a divided education system. It cannot be right just on a cost basis, never mind all of the social divisions that it leads to. That conversation needs to be had. I have made that position clear. The Government’s position is very clear: we are in favour of integrated education. I know that there will be a spectrum of views on this, but when it comes to funding, we are all clear that the problems that are faced will endure. We are clear that there will need to be a conversation about the Barnett formula—I am aware of the Barnett squeeze—but none of these things will be anything like plausible to solve, in a way that will be acceptable to all sections of the community, until the Executive is restored.
Sammy Wilson
I ask the Minister, whose party talks all the time in this House about choice in education, why he wishes to shoehorn education in Northern Ireland into one particular system. Does he not accept that, in Northern Ireland, there are those who choose to have church education, those who choose to have grammar school education, and those who want to have integrated schools? Does he not accept that the same choice that he would have for his constituents should be available to people in Northern Ireland?
Mr Baker
I absolutely do. Since the right hon. Gentleman mentions my constituents, I am happy to tell him that we are a grammar system in Wycombe and that the Highcrest Academy has built what it calls an “all ability” school there, which I regard as a comprehensive. Strangely enough, I helped it against the forces of the hard left, which were trying to avoid building an all ability school under the grammar system, and I rather approve of its ability to bring back choice for parents.
We have a co-operative school in my constituency, which I support, and a Catholic school—by the way, Muslim parents, and there are many in Wycombe, choose freely to send their children to the Catholic school. I am all in favour of school choice for my constituents and for the right hon. Gentleman’s constituents, but the question is at what cost. That question is one that he and his colleague Members of the Legislative Assembly need to answer in a re-formed Executive.
However, when I go over to Northern Ireland as a Minister and meet young people who say to me, “I was 16 before I met my first Catholic”, or “I was 18 before I met my first Unionist”, there is so much wrong with that. I find myself amazed that that is even a conversation in the 21st century. Yes to choice, but at what cost?
Stephen Farry
I welcome what the Minister says in relation to integrated schools, but I have two points for him. First, I want to reinforce that there is significant demand for integrated schools right across the community in Northern Ireland. Secondly, and most relevant to this debate, does he recognise that moving from a split system to more of a shared, integrated system involves some degree of investment? The problem is that the Department of Education cannot do that at present, in a context of declining budgets where it is trying to protect what it has.
Mr Baker
The hon. Gentleman’s point is very well made; he knows that I hear it now and have heard it in the past.
We are clear that finances in Northern Ireland are not sustainable, but we are also clear that it is for an Executive to act on it. In the absence of an Executive, the Government through this Bill will ensure that time is not lost in starting to think about and work on that. We will commission advice from the Northern Ireland civil service on the options for budget sustainability in Northern Ireland, and we are happy to engage with any Member of the House in more detail about what we commission.
I heard what the hon. Member for Foyle (Colum Eastwood) said, and I am particularly interested in engaging with him and the universities. I also recognise the point he makes about places in Derry. He is right that Northern Ireland will never be a laissez-faire paradise, and it will be necessary for policy to embrace the point he makes about rebalancing towards Derry/Londonderry.
We are happy to engage with hon. Members, although I do not wish to pre-empt any particular piece of advice we might commission. We are absolutely clear that it is for locally accountable leadership to take these difficult decisions, but we are clear that those decisions will endure.
Questions were asked about future strategy, but the Government are clear about our strategy for Northern Ireland: devolution, moving forward with the Windsor framework and making the most of our new, constructive relationship with the EU and Ireland to improve that framework in a collaborative way when problems arise, as they inevitably will. Since this point came up earlier, we will then also work towards the review of the trade and co-operation agreement and try to improve our overall position.
While we are doing that—because, as has been said, we can do more than one thing at once—we will do everything we can to cheerlead for Northern Ireland. It is an amazing place, loved by people all over the world and full of talented people with an incredible capacity for innovation and development. They deserve investment, and I for one want to see that they get it.
Finally, I join in the lament about the gap that has opened up between the Government and Unionists. Once again, this has been a painful debate for me to listen to. Sometimes hon. Friends in the DUP have directed their remarks at me, but I would say to them that I do not wish to be hard on them. I must say to my right hon. Friend the Member for East Antrim (Sammy Wilson) that I do not regret having given voice to people in Fermanagh who said, “Get on with it.”. That is what people want in Northern Ireland. There was no chanting—it was just a cry of “Get on with it”, and I am not sorry that I gave voice to that sentiment.
Hon. Members will have noticed that I have tried to be as emollient as possible in recent days—I really have. I have put on record that this is a difficult compromise for me too. I know that it is an even more difficult compromise for them to go back into the Executive with the Windsor framework, but I just say again that we have to choose from available futures.
Everybody here knows that it is not enough just to say what you want; you have to know how you will get it. I am clear, as we go forward with the Bill, that we do not want to be here again with Bills of this nature. We want to celebrate a return of devolved government, and yes, by all means, continue a conversation about the detail of the Windsor framework and what we can do to support the Union and Unionism. But, my goodness, I want us to get to the point, beyond this Bill, where we are celebrating the return of devolved government to solve the real problems that we face, and celebrating a Northern Ireland that has a much better and brighter future.
Question put and agreed to.
Bill accordingly read a Second time; to stand committed to a Committee of the whole House (Order, this day).
Northern Ireland (Interim Arrangements) Bill
Wednesday 10th May 2023
(3 years, 3 months ago)
Commons ChamberRead Full debate Northern Ireland (Interim Arrangements) Act 2023 Read Hansard Text Read Debate Ministerial Extracts Amendment Paper: Committee of the whole House Amendments as at 10 May 2023 - (10 May 2023)
The First Deputy Chairman of Ways and Means (Dame Rosie Winterton)
I remind Members that in Committee, they should not address the Chair as “Deputy Speaker”. Please use our names. Madam Chair, Chair, and Madam Chairman or Mr Chairman are also acceptable.
Claire Hanna
I beg to move amendment 6, page 1, line 12, leave out “when an Executive is formed” and insert—
“when the Executive Committee of the Northern Ireland Assembly has completed a formal meeting at which substantive business has been transacted”.
The First Deputy Chairman
With this it will be convenient to discuss the following:
Clause stand part.
Amendment 5, in clause 2, page 2, line 15, at end insert—
“such as providing advice in relation to the Northern Ireland Fiscal Council’s 2023 Report, Updated estimate of the relative need for public spending in Northern Ireland, and the precedent arising from the December 2016 Agreement between the Welsh Government and the United Kingdom Government on the Welsh Government’s fiscal framework”.
Amendment 7, page 2, line 21, leave out “may” and insert “must”.
Amendment 8, page 2, line 21, at end, leave out paragraph (a) and insert—
“(aa) consulting the Equality Commission, the Northern Ireland Human Rights Commission and the Northern Ireland Fiscal Council;
(ab) who else is to be consulted;”.
Amendment 9, page 2, line 24, leave out from “consultation” to end of line 27.
Amendment 2, page 2, line 28, at end insert—
“(4A) The Secretary of State must direct a Northern Ireland department to commission a report to provide an assessment of expenditure costs associated with communal divisions for the purpose of developing options for improving the sustainability of public finances in Northern Ireland.”
This amendment would provide a report to make an updated assessment of the financial costs associated with a divided society and how they could be redirected to improve financial sustainability.
Amendment 3, page 2, line 28, at end insert—
“(4A) The Secretary of State must engage—
(a) with Northern Ireland departments to explore options to transform public services and the economy in order to identify options for improving the sustainability of public finances in Northern Ireland;
(b) with the Treasury on options to provide an invest to save fund to support the transformation and sustainability of public finances in Northern Ireland.”
This amendment would direct the Secretary of State to explore an invest-to-save transformation fund.
Amendment 4, page 2, line 28, at end insert—
“(4A) The Secretary of State must engage with Northern Ireland departments and the Northern Ireland Fiscal Council to produce a needs-based assessment of funding compared to the Barnett formula in order to address the financial sustainability of Northern Ireland, specifically considering changes in relative need arising from differences in population characteristics and socio-economic conditions between Northern Ireland and England, to prevent the funding premium from falling below relative need.”
This amendment would direct the Secretary of State to explore the prospect for a needs-based spending floor and percentage uplift in Barnett consequentials to reflect relative need in Northern Ireland.
Clause 2 stand part.
Amendment 11, in clause 3, page 3, line 20, after “2022” insert—
“during a period when the Assembly is not functioning”.
This amendment would limit the exemption from Assembly scrutiny of directions under this Bill to only periods when the Assembly is not functioning, rather than throughout the period when there is no Executive.
Clauses 3 to 7 stand part.
New clause 2—Assembly power to exercise accountability over section 5A directions—
“(1) In a period where the Assembly is functioning but there is still no Executive, nothing in this Act will prevent a committee so mandated by the Assembly from seeking or taking evidence from relevant Northern Ireland departments or consultees named in any direction by the Secretary of State under section 5A of the Northern Ireland (Executive Formation etc) Act 2022 in respect of options which might be considered or developed on foot of such a direction.
(2) In such a period as described in subsection (1), a committee report adopted after a vote of the Assembly shall duly inform relevant departments and the Secretary of State in respect of relevant stated options for raising more public revenue in Northern Ireland or otherwise improving the sustainability of public finances in Northern Ireland.”
Claire Hanna
I rise to speak to amendment 6 in my name and that of my hon. Friend the Member for Foyle (Colum Eastwood), and to make brief comments on a couple of other amendments.
We absolutely echo and share the frustrations of others that we are doing yet another of these Bills in this place. I am struggling to think of a single such Bill—certainly in the three and a half years that we have been here—that was neither a cause nor an effect of Stormont dysfunction, which occupies rather too much time here and limits our potential. We understand the need for interim decision making, but the Bill risks going too far in bypassing Assembly scrutiny. Our amendments aim to address that by guarding against the potential use of graduated responses or the other fairly unedifying stunts that we have seen when the Assembly is being used as a political tool or weapon, and against the cynical use of such Bills to do things that damage public services in the name of reform, as a way to avoid responsibility and scrutiny.
The DUP’s new clause 1(3) instances the possibility of the Assembly functioning in some way alongside these new powers in the absence of an Executive. I want to be absolutely clear: there is, as others have said, no alternative in the here and now to devolution under the Good Friday institutions. People are ready to suspend their disbelief one more time and go back in to make that work, but a graduated response allowing these powers to be deployed to do all the grisly stuff through indirect rule, and turning it into some soap opera where everybody is hopping up and down and opposing the changes, will not be appropriate.
We cannot set up civil servants to instigate and drive controversial issues only to get them out of the way before everyone goes back in. We absolutely need reform in public services, but we need it to be done with scrutiny, not just as a mask for austerity. It needs to be done in a way that builds public trust so that people say, “Yes, you may lose service A, but you will gain service B and C”. Amendment 6 would support and evidence some of those necessary reforms by designing in a role for the Fiscal Council—a body that we have been hugely supportive of—as well as for the Human Rights Commission and the Equality Commissions as consultees. Those bodies are truly creatures of the Good Friday agreement. They are there for a reason and they should have a role in this as well, to give them a locus and so that, as I say, it is not used in a cynical way.
I want to address briefly the contradictions in the messaging we are getting about sustainable finances. There is, rightly, a serious public conversation going on about the sustainability of Stormont’s finances and structures. It is absolutely right to tackle the lack of responsibility-taking in our region, which in its century of existence has never enjoyed good governance. It is appropriate that we do that in a genuinely transformative way.
I also want to address the contradiction in what has been said about sustainable services in the light of the punishing and severe budget we face. What is more sustainable to invest in than children and young people, their health, education, future and resilience? The proposed cuts to the extended schools programme, Bright Start mental health support, pathway funds, education authority schools and youth services—alongside the loss of European social funding for Women’s Centre, which provides childcare and many other forms of family support—are the furthest thing from being sustainable. St Malachy’s youth club in the market area of my constituency does a mind-blowing array of interventions with young people, including homework support, citizenship, fitness, nutrition and lawfulness, making them good citizens and getting them ready for the world and the jobs out there. What is sustainable about its finances being cut by over a third, which will undermine all of its work with those young people? We have put off hard decisions for too long, but it is really important that this Bill is not used as a mask for the same austerity that we have had for over a decade, which does not change outcomes and limits the potential of our young people and of our economy, because they are its future.
I want to address a couple of other amendments. Amendment 1 is a vital intervention by the hon. Member for Walthamstow (Stella Creasy), who has, crucially, been vigilant on the ticking timebomb of the Retained EU Law (Revocation and Reform) Bill, which has the potential not only to deepen and widen the implications of any sea border for goods and for rights, but to dramatically undermine economic sectors and actors on this island. We have absolutely no interest in doing that, so I hope that the reports that there has been change of direction on that very damaging Bill—like others, we wish to hear about those reports in the appropriate place and to have the opportunity to scrutinise them—are correct.
Finally, I support amendment 4, tabled by the hon. Member for North Down (Stephen Farry), which is prudent and sensible in addressing the cost of division. It is time to get on. There is endemic division in our schools and communities. It is time to get past pointing at it and to start the process of reform, transformation and giving people a feasible way to live shared and integrated lives.
Gavin Robinson
I rise to speak to amendment 5, tabled by my party leader, my right hon. Friend the Member for Lagan Valley (Sir Jeffrey M. Donaldson), our Chief Whip, my right hon. Friend the Member for East Antrim (Sammy Wilson), and other colleagues. I hope that the Minister of State has considered it positively, and I look forward to hearing that the Secretary of State agrees with it. He will know that it does not any way undermine the substance of his Bill, but that it will be hugely important in assisting him in gathering information as part of his consultation exercise, as we navigate and chart our course through the myriad issues discussed this afternoon relating to dangers to public finances.
I do not think that anyone in the Chamber will disagree that I have probably said enough. The long and short of my aspiration is that the Minister of State, given all the pleasant support he has received from us to date, will look favourably on amendment 5.
Stephen Farry
I cannot promise to be quite as brief as my colleague, the hon. Member for Belfast East (Gavin Robinson), but I will try. Essentially, I want to speak to those amendments that stand in my name: amendments 2, 3 and 4, which are all focused on the issue of financial sustainability. We recognise the line that the Government have put into the Bill, and I seek to encourage the Minister to take it forward in a substantive way.
Stella Creasy (Walthamstow) (Lab/Co-op)
Thank you, Madam Chair. [Interruption.] Apologies, Dame Rosie, it is hard to remember all the different protocols, but I hope I can make up for it in making a short contribution. I put on record a number of concerns. I recognise that amendment 1, which we tabled to address the concerns directly, has not been selected, so let me speak in support of amendments 6 and 8 from my colleagues, as well as new clause 2. I think they all get at the same point, which is why it matters to have scrutiny.
Members in this Chamber who know of my interests in human rights in Northern Ireland might expect me to come at this issue from the question of what is happening with the delivery of abortion services in Northern Ireland. For several years now, that has been done by the Government, rather than the devolved Assembly overseeing it, because of the challenges within Northern Ireland. That powerfully makes the case, for example, for using the Fiscal Council or consulting the Northern Ireland Human Rights Commission, which has been a diligent and doughty defender of the rights of women in Northern Ireland to equal access to abortion.
However, I want to talk about the points that my amendment raised about the use by this Government of the powers in the Retained EU Law (Revocation and Reform) Bill, knowing that right now something very different is happening to that legislation, which nobody is clear about, as the Government are yet again hiding from scrutiny on it. That is not a new concern when it comes to Northern Ireland, because for months now we have been asking the Government to come clean about how they intend to use the powers in the Retained EU Law (Revocation and Reform) Bill in Northern Ireland. So far as I am aware, with today’s announcement there is no change to how that Bill approaches devolution, so let us be clear that it gives the Secretary of State, in proxy of the devolved Administration, the power to decide when the sunset clause that was in the legislation, which I think has now been removed, would kick in, and to replace, restate or revoke legislation. Those are serious powers over how thousands of regulations would be interpreted in Northern Ireland. In the absence of a sitting Assembly, those powers are falling to this Government and a Minister who cannot even be bothered to respect the issue, listen or engage with what is being said. That, again, tells us something about how seriously they take these powers. I digress, but I am sure that whatever I am saying about how he treats the employment rights of people in Northern Ireland is not as important as what he is talking to his Parliamentary Private Secretary about.
As ever with Northern Ireland and devolution, these are complicated issues. They are complicated in two different ways—first in the EU regulations that may or may not be at stake, and also in north-south co-operation, and the restrictions and requirements that are made in order to have convergence. Let me say a little, if I can, to resolve why those complications may happen, and therefore why amendments on the role of the Fiscal Council or the Human Rights Commission—or, indeed, about the ability to take evidence on, frankly, what the Government are doing on behalf of the people of Northern Ireland on this issue—matter.
This issue covers devolved competencies of things such as employment skills, pensions and child support, and environmental laws such as planning and equal opportunities. Northern Ireland Members will no doubt be as shocked as I was to discover that this Government were planning to delete, without any public consultation, people’s right to a basic protection that originally came through EU regulation, which was that if their company went bust, they would be entitled to at least 50% of their pension pot. Rules on pensions are devolved competencies, but the Government announced in the Retained EU Law (Revocation and Reform) Bill Committee that they will revoke at the end of this year the EU regulation holding businesses to account which makes sure that people have at least some basic protection. I do not know the status of that now, but it is a good example of the sort of legislation we would be talking about.
Obviously, Members who have huge experience of devolution would point out to me that when the UK left the European Union, the UK and the EU agreed the protocol—if I can dare to mention that word—which talked about maintaining the necessary conditions for north-south co-operation and protected the 1998 Good Friday agreement. In doing so, Northern Ireland stayed dynamically aligned over many of these areas of legislation, and the Minister may therefore say that this is not an issue to be concerned about and that it does not need this level of scrutiny, because these issues are covered by the protocol. However, Queen’s University Belfast is very clear that about 300 areas of EU regulation are not covered by the protocol, and therefore would be automatically deleted by the Retained EU Law (Revocation and Reform) Bill. They would cover many of these issues, and there is also the issue about direct effect cases, which is where the judgment about protecting people’s pension pot comes from.
The 142 areas of co-operation identified in 2017 as being underpinned by EU policy frameworks and north-south co-operation are the areas up for grabs. Indeed, there is ongoing co-operation in 61 areas. Let me give some examples of the sorts of EU laws that we would be talking about. There is the single-use plastics directive, the regulation on clinical trials of medicinal products for human use, directives about medicines, directives about organisation in agricultural markets—I know that is a deep concern for many of my colleagues representing constituencies in Northern Ireland—and EU Acts on the regulation of energy and electricity markets. This is not small fry when we add it all together.
The point of the amendment I tabled and of the questions we have been asking the Government is how, in the absence of Stormont to scrutinise, these devolved competencies may be used, given the potential impact of changing these regulations in undermining the Windsor framework and therefore changing the alignment on which many of these deals have been done. Those are not my words, but concerns raised by the European Union. The fact is that the Government have consistently tried to avoid even answering the question. They have suggested that the Stormont brake would apply, but it does not, because this is about existing legislation—not new legislation, but existing legislation. People currently have the right to have their pension pot protected, but we still do not know quite what will happen to that pension pot protection at the end of this year for anybody in the United Kingdom. However, certainly in Northern Ireland, where the competency of the devolved authority would be expected to be a part of it, the lack of clarity about how the Government are proceeding on this is deeply troubling, especially when we are entering into another process of having to bring in these interim arrangements, so there is even less scrutiny of how they are using those powers.
I have asked through freedom of information requests for information about the kinds of meetings the Government are having, because they have told us in answer to a written question:
“UK Government Officials have been proactively engaging with their counterparts in the Northern Ireland Civil Service on the progress of the Bill”.
What that means in layman’s terms is that some decisions must have been made about how to use those competencies, and we know that these interim arrangements will exactly cover the period during which those decisions are being made. Now, add into the chaos the announcement that the Retained EU Law (Revocation and Reform) Bill will be changed and we have a recipe for people in Northern Ireland with nobody having an eye on the ball when it comes to their basic rights, because the Government will not be clear or be scrutinised about those conversations and which devolved competences they may use to amend those rights.
The First Deputy Chairman of Ways and Means (Dame Rosie Winterton)
I call the shadow Minister.
Tonia Antoniazzi
I will keep my comments brief as I do not want to repeat what was said on Second Reading. Labour does not oppose the Bill as it is a necessary step to ensuring that governance in Northern Ireland can continue in the absence of a functioning Executive. The amendments show a clear indication from the Northern Ireland parties that improving Northern Ireland’s financial stability is a priority. Indeed, the Northern Ireland Fiscal Council’s recent work was highlighted a number of times. The Secretary of State mentioned during Northern Ireland questions that he had been in conversation with the Fiscal Council. It would be great to hear his assessment of its report and how he intends to proceed with that information.
Continued engagement with the Northern Ireland parties, as well as with bodies such as the Northern Ireland Fiscal Council, is paramount to best representing the people of Northern Ireland. I hope that such engagement from the Secretary of State and the Minister will continue.
Mr Steve Baker
I very much appreciate the contribution everyone has made. Everybody who has spoken in today’s debate is very much seized of the issues and very well informed. They have made their points with great force.
The hon. Member for Gower (Tonia Antoniazzi) raises the Northern Ireland Fiscal Council, so I will turn first to amendments 4 and 5 on relative need and needs-based spending. Provisions in the Bill already allow the UK Government to work with the Northern Ireland civil service on fiscal sustainability for the benefit of people across Northern Ireland, so neither amendment is strictly needed. I do not think it would be right for me to commit the Secretary of State to a particular piece of advice or consultation, but we have of course heard the debate—I listened extremely closely to it—and we are all fully committed to the sustainability of the finances, and to treating people justly and fairly.
Gavin Robinson
The Minister knows that the DUP tabled amendment 5 and there is a decision to be taken on whether to press it, or amendment 4 tabled by the hon. Member for North Down (Stephen Farry), to a Division. If the Minister does not wish to commit the Secretary of State to accepting our amendment or to commissioning advice on the basis of the work of the Fiscal Council, it would be very useful if he would at least commit the Secretary of State to engaging with me and colleagues on this issue, so that when advice is commissioned and he is consulting, we can incorporate this as part of the advice he seeks.
Mr Baker
Yes, of course. We would be delighted to engage with the hon. Gentleman. We have already said, in relation to commissioning advice and the draft guidance, that we are very happy to engage with Members of all parties, and I am grateful to him for that intervention.
On amendment 6, on the Executive Committee, we believe—with apologies—that it would be unworkable. The decision-making provisions apply only to functions exercised in the absence of Ministers, so once Ministers have been appointed, they can no longer have any practical effect.
Claire Hanna
Is the Minister aware—I cannot remember which year it was, because there have been so many crises —of the in-out Ministers stunt? I think it was conducted in mid to late 2015. Ministers resigned on a rotating basis over a period of months, so Ministers were in place but there was not a functioning Executive. It is that kind of carry on we are trying to guard against.
Mr Baker
Yes, and I confess that my mind boggles that such a thing should have happened. Equally, I recognise that, standing here right now, I am not aware of the full circumstances. I certainly hear what the hon. Lady says, but even so I hope she will understand that right now I cannot accept the amendment.
Turning to amendments 7, 8 and 9 on specific consultees, we believe that this would be unnecessarily restrictive. Requiring the Secretary of State to direct the Department to consult the specified bodies listed in the amendment is not necessary. The consultee lists for the Northern Ireland Departments are well known and recognised, so we do not wish to pick out the three bodies over any others because it would beg the question, why not include them all? In particular, picking up on the Fiscal Council, the Secretary of State has already confirmed, I think through me, that he is engaged with the Fiscal Council. He is happy to commit to the Committee that he will ensure that it, and all the bodies listed in the amendment, will be consulted on budget sustainability. We therefore ask the hon. Member for Foyle (Colum Eastwood) not to press the amendment to a Division.
On amendment 11, on scrutiny and the scrutiny of Ministers, the approach in the Bill to the power of the Northern Ireland Assembly to call for witnesses and documents is consistent with previous circumstances where the UK Government have taken certain powers to give direction to Northern Ireland Departments. If UK Government Ministers give Northern Ireland Departments a direction, it is right and proper that the line of accountability comes here to Parliament, where UK Government Ministers are accountable. It is not appropriate for the Northern Ireland Assembly to be able to hold UK Government Ministers to account in that way.
On amendment 2, on communal divisions, the hon. Member for North Down (Stephen Farry) makes his points extremely well. He knows—I think I have illustrated it—that I feel his pain on this issue, but we already have, for the purpose of pursuing fiscal sustainability, the ability to take advice and pursue consultations. I certainly look forward to further conversations with him and to taking his advice on where we should look in relation to communal divisions. I will be glad to meet him to consider that issue further. On his amendment 3, on transformation, the Secretary of State would have the powers under the Bill to commission advice and go for consultations to achieve budget sustainability through transformation. I hope that the hon. Member will accept that the amendment is not strictly necessary, but once again, I hear him and he makes his point very well and with great force.
On the Retained EU Law (Revocation and Reform) Bill, I hope the hon. Member for Walthamstow (Stella Creasy) will accept that it is not the responsibility of the Northern Ireland Office to take it through the House, but I listened carefully to what she said about its impact on Northern Ireland. I am conscious that her amendment was not selected, so I hope that she will not mind if I do not go any further.
Stella Creasy
The Bill explicitly gives the Minister, in the absence of Stormont, the powers to use the devolved competences. Is he saying that he has not looked into those powers at all, or is he not prepared to talk about how he is exercising them?
Mr Baker
As on the face of the Bill, we will be able to seek advice from officials in the Northern Ireland Departments and require consultations, but we will have no powers to implement any of the measures on which we have taken advice. We are clear that devolution is the best way to govern Northern Ireland, as we have said many times.
With that, I am grateful to everyone who has participated in the Committee.
The First Deputy Chairman of Ways and Means (Dame Rosie Winterton)
I believe that the hon. Member for Belfast South (Claire Hanna) wishes to withdraw her amendment.
Claire Hanna
I beg to ask leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Clause 1 ordered to stand part of the Bill.
Clauses 2 to 7 ordered to stand part of the Bill.
The Deputy Speaker resumed the Chair.
Bill reported, without amendment.
Third Reading
Mr Steve Baker
I beg to move, That Bill be now read the Third time.
It is not an especially happy occasion. As the House has fleshed out, we see before us the many difficult decisions that lie ahead. But it is a necessary occasion, as we have all agreed.
I want to place on record my thanks to everyone involved in the Bill’s passage through the House for their support of its expedited passage. I particularly thank the Front Benchers of all parties for their collaborative and constructive engagement on the legislation, recognising the importance of getting it on the statute books to avoid a governance gap from 5 June. I place on record my appreciation to the House authorities, particularly the Clerks who, as ever, have guided us in an expert fashion. I thank the excellent Diggory Bailey in the Office of the Parliamentary Counsel for the expert fashion in which he and colleagues drafted the Bill. I thank my colleagues and officials in the Government Whips office for helping us progress in a smooth fashion, and in particular on this occasion for not putting me under undue time pressure. I am most grateful to them, as always.
I conclude by repeating what I said at Second Reading. People in Northern Ireland rightfully expect to see these decisions taken in Stormont not Westminster, and I agree with them. I think the House does, too.
Madam Deputy Speaker (Dame Rosie Winterton)
I call the shadow Secretary of State.
Madam Deputy Speaker (Dame Rosie Winterton)
I call the shadow Secretary of State.
Peter Kyle
I rise briefly to express my gratitude to the Minister for seeing the Bill so deftly through all its stages today, and also to share his thanks to those who made it happen and those who have spoken today.
The Minister has repeated numerous times today a sentiment that we all share, which is in fact shared by all the Northern Ireland parties and leaders themselves: namely, the desire for Stormont to be up and running again. I would just remind him, when he points to and urges members of Northern Ireland parties, that he is a Minister in the UK Government, and the UK Government have some skin in the game. They have some agency when it comes to the functioning relationships within Northern Ireland—those core relationships between the Irish Government, all the Irish parties and the UK Government.
Mr Baker
For such a matter to come up so late in the debate is just one of those things, but I think that I have a good track record on renewing the relationship with Ireland and with the European Union. The hon. Gentleman is right to say that we have agency, and I am determined, as is the Secretary of State, to work with everyone as expeditiously as possible to make a success of restoring the Executive.
Peter Kyle
On numerous occasions today the Minister has urged the Northern Ireland parties to get back in. It is my job to hold his feet to the fire as well, and to point out that he, as a UK Government Minister, has skin in the game on this one. It was, of course, some of the actions of the UK Government that led to some of the challenges that are faced in Northern Ireland, which proves that what happens here in Westminster—the decisions taken in Downing Street and in Whitehall—has a profound impact over there. So rather than always looking to those parties to sort out the problems that have sometimes been created through decisions taken over there, the Minister must be a very active participant in that process.
Sammy Wilson
Does the hon. Gentleman accept that while the Minister may say that he has built bridges with the EU and the Irish Government, he has built a bonfire on the bridge with the Unionists?
Peter Kyle
My job, at times like this, is not to take the opportunity that the right hon. Gentleman has put before me, but to stand to one side and allow this conversation to unfold between his party and the Government. Clearly there is some healing to do in that relationship—a relationship that has at times been so close that it has led to the two parties serving in the same Government, and to his party supporting the Government—but at present there is dysfunction there, which I accept and acknowledge and view from afar, while trying as hard as I can on behalf of the Labour party to do everything possible to ensure that we can build strong relationships that can heal the divides and get Northern Ireland going again.
Question put and agreed to.
Bill accordingly read the Third time and passed.
Northern Ireland (Interim Arrangements) Bill
Thursday 11th May 2023
(3 years, 3 months ago)
Lords ChamberRead Full debate Northern Ireland (Interim Arrangements) Act 2023 Read Hansard Text Amendment Paper: Committee of the whole House Amendments as at 10 May 2023 - (10 May 2023)
Northern Ireland (Interim Arrangements) Bill
Thursday 18th May 2023
(3 years, 3 months ago)
Lords ChamberRead Full debate Northern Ireland (Interim Arrangements) Act 2023 Read Hansard Text Watch Debate Read Debate Ministerial Extracts Amendment Paper: Committee of the whole House Amendments as at 10 May 2023 - (10 May 2023)
The Parliamentary Under-Secretary of State, Northern Ireland Office (Lord Caine) (Con)
My Lords, before I turn to the Bill, I pay tribute to Peter Brooke, Lord Brooke of Sutton Mandeville, Secretary of State for Northern Ireland from 1989 to 1992, who sadly passed away this week. I had the immense privilege of being Peter’s special adviser in the months before the 1992 general election and supported him before that as the Northern Ireland desk officer in the Conservative Research Department. He was, as has been pointed out, a man of profound personal integrity, learned, witty and unfailingly polite and courteous. Peter served as Secretary of State while the Troubles were still raging and—we should never forget—around 100 people a year were losing their lives as a result of the security situation. He cared deeply about Northern Ireland and, with infinite patience and determination, sought a better, more peaceful and stable future for all its people. His huge role in the origins of what became the peace process should never be underestimated. I am sure that I speak for everyone in the House in sending our sincere condolences to his widow Lindsay and the Brooke family at this difficult time.
I turn now to the Bill itself. It is, of course, with profound regret that I return once again to this Dispatch Box to bring forward legislation in the absence of a Northern Ireland Executive. I am certain that noble Lords across the House will agree that this is not a position in which any of us would wish to find ourselves. In line with our steadfast commitment to the 1998 Belfast agreement, His Majesty’s Government remain committed to supporting the restoration of the Executive in Northern Ireland as soon as possible. In our view, a strong devolved Government, with elected representatives from across the community working together, is the surest foundation for the governance of Northern Ireland within our United Kingdom and the best outcome for all its people.
Last month, many of us came together, including Members of your Lordships’ House—including the noble Lord, Lord Murphy of Torfaen, on the Bench opposite—to reflect on the 25th anniversary of the Belfast agreement. We marked the progress that Northern Ireland has made over the past quarter of a century and the relative peace and prosperity that the agreement has brought. This anniversary remains an opportunity for all of us to recommit to building an even brighter future for Northern Ireland. Now is the time to decide how we want to move forward together, to create a better future for and deliver on the priorities of the people of Northern Ireland. That includes a more prosperous economy and better, more sustainable public finances and services.
On that note, and before I provide an overview of the Bill, I will say a few words on Northern Ireland’s public finances. As the provisions of the Bill will indicate, we are acutely concerned about the long-term stability of public finances in Northern Ireland. It was with considerable disappointment that, in the absence of devolved government, my right honourable friend the Secretary of State for Northern Ireland found it necessary, once again, to intervene and set a budget for 2023-24. I set out that budget in a Written Statement to your Lordships’ House on 27 April. As he has made clear on multiple occasions, the extent of the budget pressures facing Northern Ireland departments is, to put it mildly, extremely challenging. Departments are facing difficult decisions in the current circumstances. The Government recognise that, and it is one of the overriding reasons why we need an Executive in place to take some of these decisions and make choices on budget priorities.
As the UK Government, we stand ready to work with a restored Executive on these issues but, in the meantime, we have a responsibility to ensure that public services and management of public funds can continue. We will, in due course, introduce legislation that will put that budget on to a legal footing, if the Executive are not restored to do so. Members of your Lordships’ House will have the opportunity to debate in more detail those allocations if and when we have to introduce that legislation.
Today, though, I will focus on the Bill and its provisions. The Bill is of course a short one and I will seek to be brief in recognition of that. I once again express my sincere thanks to the Benches opposite for their continued co-operation as the Government seek to bring the Bill forward at the requisite pace. I am particularly grateful to the noble Lord, Lord Murphy of Torfaen, and the noble Baroness, Lady Suttie, for the constructive manner in which they and others intend to approach this legislation.
The Bill does three important things. First, it continues the provisions relating to decision-making for Northern Ireland civil servants which Parliament passed last December through the Northern Ireland (Executive Formation etc) Act 2022. These provisions, which clarified the decisions that civil servants in Northern Ireland departments can take in the absence of Northern Ireland Ministers and an Executive, are due to expire on 5 June. Through the Bill, these powers will continue until the Executive are reformed. That will avoid a governance gap arising if an Executive are not in place by 5 June. As before, senior officers will be required to have regard to guidance issued by the Secretary of State; the Government published an updated draft of that guidance on 10 May. We would, of course, welcome any representations that noble Lords or others may have on that guidance before we finalise it.
The second main provision of the Bill—and the more novel provision in this legislation compared with previous Bills—is to provide for new powers for the Secretary of State to explore, with Northern Ireland departments, options for budget sustainability including further revenue raising in Northern Ireland. Alongside commissioning advice, the Bill will allow the Secretary of State to direct consultations to be held by Northern Ireland departments on those matters. These powers are, again, time limited and will apply only until an Executive are formed. These measures are deliberately focused on official advice and consultations on budget sustainability. Final decisions on any implementation are best taken by locally elected representatives; the Bill does not give the Secretary of State any power to direct implementation of any such measures.
Finally, the third thing that the Bill does is to ensure greater political oversight of the management of public money in the absence of the Northern Ireland Assembly. The Bill does that by providing for Northern Ireland department accounts and associated documents to be laid in the House of Commons, in the absence of the Assembly. In previous absences of the Northern Ireland Assembly, the law has provided for that scrutiny to fall to Parliament, and the provision in the Bill will do that again. This provision will be active only for this and any future periods where there is no functioning Assembly, on the basis that public bodies must always be scrutinised for their good management of public money.
In conclusion, the measures in the Bill will ensure a continuation of the current governance arrangements in Northern Ireland, should there be no Executive when they expire next month. However, these measures are not, and cannot be, a substitute for devolved government in Northern Ireland. We acknowledge that the current arrangements are by no means desirable—to put it mildly—particularly in the context of Northern Ireland’s difficult financial position. I also recognise that the Bill is not a long-term solution to the wider issues with which Northern Ireland is grappling: they are matters for a newly reconstituted Executive and Assembly to address. The marking of the 25th anniversary of the Belfast agreement has reminded us all of the importance of making the institutions in Northern Ireland work, and work for the entire community. His Majesty’s Government believes that having an effective and functioning devolved Government is crucial to showing that the union itself works for the whole community in Northern Ireland. That is why the restoration of the Executive remains our top government priority in Northern Ireland. We will continue to do everything that we can to make that happen in as short a timeframe as possible and, as we do that, we will keep these arrangements under review. For now, I commend the Bill to the House.
Lord Morrow (DUP)
My Lords, we certainly agree with the Minister when he says that it is regrettable that the Northern Ireland Assembly is not up and operating—but we all know perfectly well why. My party gave much notice—in fact, I think that we gave 13 months’ notice—in this House and elsewhere that the Northern Ireland Assembly and Executive were on life support. Now the whole thing has collapsed due to these red lanes, green lanes and border controls. We are no longer strictly a part of the United Kingdom in the same sense as Scotland and Wales.
But the main point I want to make today pertains to Clause 2 in relation to advice and information on options for raising public revenue. The Government are right to be alive to the fact that Northern Ireland needs more public revenue, but the implication of this is that the way forward is through local means. That, however, is to distract attention from the key point at issue. On 2 May, the Northern Ireland Fiscal Council published a report that uses the Holtham formula to calculate what needs to be spent in Northern Ireland in order for needs to be met on the same basis as they are in England. Crucially, the Holtham formula for defining need per head of population is not a random assertion but the result of a government commission that the UK Government have already accepted for Wales, Scotland and Northern Ireland.
Using the formula, the Fiscal Council demonstrated that in order for needs to be met in Northern Ireland on the same basis as England, Northern Ireland needs to receive £124 per head. Crucially, however, the Treasury block grant transparency document shows that spending per head in Northern Ireland for the spending review period of 2022 to 2025 is £121 per head. It is, therefore, no surprise that Northern Ireland is currently in the midst of a very serious funding crisis, with Stormont departments having to make cuts right, left and centre. Today, Northern Ireland is the only part of the UK to be in receipt of below-needs block grant funding. Northern Ireland thus finds itself in a similar position to Wales in 2009-10, but, rather than just being £1 below need for one year, Northern Ireland is £3 below, and not just for this financial year but for the last financial year and for the next financial year.
If we extrapolate for the three-year funding review period, the Fiscal Council report demonstrates that we are currently underfunded to the tune of just over £1.2 billion. The critical point in all this is that after Wales went below need for funding in 2009-10, the UK Government responded in a way that established three critical precedents. First, they accepted the Holtham formula as a definition of need. Secondly, they introduced a 5% transitional needs adjustment for Wales, whose purpose it is to slow down the Barnett squeeze up until reaching the Holtham formula definition of need. This applies when funding per head has not fallen below need. Thirdly, it introduced a Barnett floor for Wales on the basis of the Holtham formula definition of need to introduce a complete needs adjustment at the point where funding per head reaches need and threatens to go below.
In making that arrangement, the UK Government have agreed that it would be wrong for funding per head ever to fall below need, and made provision to prevent this ever happening again. The Government are now duty bound to afford the people of Northern Ireland the same courtesy. As we have already fallen below need, this should result in a full needs adjustment backdated to the beginning of the spending review period. In recent weeks, the Government have sought to press the DUP back into government in various ways. I ask that they reflect very carefully about the implications of trying to use the current funding crisis as a means of doing so. The reason we had to withdraw from Stormont is that we were not prepared to settle for, and thus effectively cement in, a second-class citizenship in which we no longer have the right to stand for election to make the laws to which we are subject and in which we are forced to be presented to the rest of our home economy as if we are a foreign country. I do not think it would reflect well on the Government to do that and I do not think it would be wise.
Finally, in the normal sense of events there would be an opportunity to ask the Minister for a meeting between Committee and Report to discuss the need for a comparable Barnett floor provision for Northern Ireland to that which exists in Wales. However, there will be no time between Committee and Report, as all remaining stages are to be taken on one day, so I will take this opportunity of asking for such a meeting to discuss this ahead of the remaining stages.
Lord Bew (CB)
My Lords, I support the Bill, but I want briefly to echo the words of the Minister on Lord Brooke and the major contribution he made to the affairs of Northern Ireland as part of the United Kingdom.
There is no alternative at this moment to the appearance of the Bill, which I think I can say safely that the whole House regrets. I welcome the fact that the Northern Ireland Affairs Select Committee in the other place is taking a closer look at the general question of Northern Ireland funding and the longer-term problems of the financing of Northern Ireland. I note with great interest the point made by the noble Lord, Lord Morrow, that there may be lessons to learn from Wales: I think we should listen carefully to what he said on that.
As I said, there is no alternative at this moment, but of course there could be an alternative in quite quick order if the DUP were to take up its share of the co-premiership of Northern Ireland. Our briefing note from the Library is absolutely excellent—it is of very high quality—but it refers to the DUP taking up the deputy premiership as if it were, like the deputy premiership in the other place, a subordinate position, whereas of course Northern Ireland is a co-premiership and it is worth just making the point that the DUP would have half a share of the co-premiership were it to take up that position. Indeed, I remind the House that, on the basis of its previous work in this respect, it actually delivered 10 years of stability to Northern Ireland—something that is all too casually forgotten.
I conclude by briefly referring to the words of the Foreign Secretary at the Select Committee of the noble Lord, Lord Jay, on the working of the protocol. That committee, which has done important work, will soon, I hope, be the Select Committee on the Working of the Windsor Framework. The Foreign Secretary stressed the way in which, if the DUP returned to government, it would not lose agency, it would actually gain agency. At this point, it is a passive spectator with respect to realities which, however objectionable, are actually not going to change.
It is worth remembering that we are on a road and on a process. The Theresa May iteration of the withdrawal agreement that arrived in this House contained absolutely no reference to the existence of the Northern Ireland Assembly. The Johnson iteration changed that, and it has been changed much more again by the new Windsor Framework. It is perfectly clear that the role of the Northern Ireland Assembly going forward in handling the relationship of these tricky problems—and they are tricky problems, to which there is no perfect solution—is now considerably enhanced. Parliament as a whole has moved very substantially on what is called the democratic deficit: indeed, the committee of the noble Lord, Lord Jay, has laid a lot of emphasis on that.
I remind the House that the brake which has been introduced in the new arrangement is a new development. It is increasingly clear, from listening carefully to the debates, that it is not disputed on any side that it is of significance. There is an argument, given the totality of developments, about how important it is, but there is no argument any more about its specific effectiveness, on either side. That is one of the few points of clarity in what I think has been a very confused debate in Northern Ireland which has not focused enough on the exact details of what has been before the people of Northern Ireland over the last few weeks; it has become increasingly clear.
I draw brief attention to the unilateral declaration by the UK Government on the democratic consent mechanism in Article 18, posted on 24 March of this year on the EU website and noted by the EU. This again raises a whole space for political play in dealing with the possible difficulties that might well arise. Of course, ultimately there is a simple reality. As Lord Trimble did twice, with my total support, if it turns out that undertakings have been given—for example, the apparent undertakings in the very important White Paper the Government have laid out—and if the DUP enters the Executive and it turns out that the undertakings, or the apparent basis on which the DUP is entering, are not correct, there is the option of actually withdrawing again. Nobody can dispute this. Lord Trimble effectively did it twice. It is not very nice and I would deeply regret seeing it happen. I deeply regretted it being done twice in a different era, but it was actually the right thing to do and it sustained the process in the end. But it is indisputably an option.
So the alternatives are either to be a passive recipient of things that cannot be changed or to engage in genuine political debate about the future.
Baroness Hoey (Non-Afl)
My Lords, the Minister said it was with profound regret that he was bringing forward this Bill; I think we all share that sentiment. I do not want to repeat what the noble Lord, Lord Morrow, said, but it is important that we remind ourselves why we are here: we are here because the United Kingdom Government decided that Northern Ireland could be treated differently, and our citizenship is being eroded in many ways. The internal market has gone and all the hype about the Windsor protocol, as I would call it, is being exposed more and more. Therefore, we are here through the Government’s own making, and because they are not committing to the whole of the United Kingdom leaving the European Union—which was what was on our ballot paper in Northern Ireland as well.
Of course, we have to go ahead with this Bill; it is important. However, I think we should also remind ourselves that the 1998 devolution process, which we have been commemorating recently, is inherently unstable. It may have enhanced peace, yet there have been over 150 terrorist murders in that period, mostly killings between terrorist groups and each other. None were caused by the state, although around five involved the deaths of security force and prison staff. You could be forgiven for thinking otherwise, given the ceaseless list of 1970s legacy cases going through the courts in Belfast—every week there is another one—all of which are trying to rewrite history by reallocating blame for killings from the IRA to some element of state forces. It is really important that your Lordships realise and remember that.
A working Executive could do various things. They could agree on dividing up the money from the block grant. However, as we know in this House, any issues which require the two communities to yield on their particular hard and fast views mean we in Parliament end up legislating time after time: on legacy, abortion, gay rights or welfare reform—anything that is really controversial ends up here. We need to remember that as well.
The 1998 consociational structure means that Stormont operates on two tracks that do not meet. Local government works because it operates more on a committee system that cannot be boycotted easily. We see, and it is quite sad, that the Government, having changed the date of the local council elections to today, then put Northern Ireland legislation on the agenda for today. My personal view is that we should be strengthening local government in Northern Ireland, increasing the numbers of Members of Parliament, and doing away with and abolishing the whole Stormont set-up.
The current Secretary of State will not remember it, unlike the Minister, but when David Trimble twice pulled down the Executive over decommissioning, or the lack of it, he experienced the same wave of outrage that we hear in the media in Northern Ireland about what is not happening and Stormont not sitting. Today that rage is compounded by the strategic budget cuts. I believe that Northern Ireland needs the same focus on the Barnett formula, and how it works, that Wales got—it really is time for that. People in Northern Ireland are not stupid. They know that some 98% of government spending in Northern Ireland will proceed, regardless of whether Stormont is sitting or not. The financial situation is dire, and of course some of that happened under Stormont. The Sinn Féin Finance Minister could not get his budget through Stormont, so the idea that if we all get back to Stormont tomorrow the finances would be sorted is rather silly.
We have a legislative lockdown, but with only the minimum of law changes needed to keep the show on the road and to stop the lack of money supply actually wrecking sections of the economy. However, I feel the Secretary of State has perhaps decided that punishing the Northern Ireland people is the way to get devolved government back. We have seen senior civil servants—who I am sure are taking soundings from government Ministers—choose the most conspicuous cuts, such as this week’s cut to nurse-training funding, to frighten the public. I am sure this is being given the green light by certain people in certain positions. That health cut is going to inflict a major workforce shortfall in three years’ time, when those nurses who should have been graduating and entering the local profession will not do so—and of course there is a huge shortage of trained nurses in Northern Ireland and Great Britain.
There is some common sense in the Bill. Clause 2 gives powers for the Secretary of State to direct departments to provide advice or information, and even to oblige them to carry out a consultation. There might be a seed of a possible return to what I think would be a more sensible solution, and that would be a form of direct rule.
I know the noble Lord, Lord Murphy, on the Front Bench, will probably have a different view, but I think the Orders in Council system could have been a better way. We are going to find it extremely difficult to get Stormont set up and working well. It is time we started to think about that and to realise that Northern Ireland does need the direct attention of this place, and not treat devolution as some way of getting rid of it. We need to remember that while we have the Windsor protocol we will not have devolution.
Lord Rogan (UUP)
My Lords, I share the regret expressed by the Minister and other Members that we are discussing this Bill today. It is deeply unfortunate that this legislation is necessary. However, rather than repeat the argument about how we got here—I am no fan of either the Northern Ireland protocol or the Windsor Framework—I wish to concentrate my remarks on the perilous financial position the people of the Province now find themselves in.
His Majesty’s Government have committed to bring forward a separate Bill to put the draft budget recently set by the Secretary of State for Northern Ireland on the statute book. That budget could have been part of the Bill before us today, but I am pleased it is not because it at least holds open the possibility of a change of approach from Mr Heaton-Harris.
I know the Secretary of State is a fan of sport, and indeed a qualified football referee. However, I do not know if he is a poker player. If he is, I would not expect him to be a particularly successful one. It is perfectly obvious to see what he is attempting to achieve, both by publishing his draft budget and by his comments surrounding its content.
To be fair to Mr Heaton-Harris, I understand his frustration at the lack of a functioning Executive and Assembly at Stormont. It is a frustration held by a great number of people in Northern Ireland, albeit for an assortment of different reasons. However, I do not believe it is right for him to place such fear and worry in the minds of so many individuals, families and organisations across the Province because of the failure of politicians in Belfast and London, and indeed Dublin.
According to the Northern Ireland Fiscal Council, Stormont departments—now run solely by unelected civil servants—will be expected to find £800 million in cuts and revenue-raising measures as a result of what has become known locally as the “punishment budget”. The fiscal council calculates that the draft budget amounts to a reduction of some 3.3% in real terms this year. That is a much harsher cut than that faced by Whitehall departments, which have been handed a 0.7% real-terms budgetary reduction.
In education—I declare an interest as my wife is a retired principal of a leading primary school in south Belfast—schools in Northern Ireland are facing a 2.7% cut in funding. In contrast, the budget for schools in England is due to rise by 6.5%. I fail to see how that is in any way justifiable, particularly in the wake of the pandemic and the challenges pupils in Northern Ireland, as indeed elsewhere, have had to face.
There are other areas of grave concern for me regarding the Government’s planned budget cuts, but I will highlight just two. First, on policing, speaking at the end of last month, Assistant Chief Constable Bobby Singleton told the BBC that the PSNI expected to be hit by a budget cut of £150 million. He said this figure was based on indications he had been given by the Department of Justice, which, as the Minister confirmed to me in a recent Written Answer, is responsible for its funding. Given the recent and thankfully failed attempt by dissident republicans to murder DCI John Caldwell, and the increase in the terrorist threat in Northern Ireland from “substantial” to “severe”—a decision taken by MI5, independent of Ministers—I believe the cut to PSNI funding is particularly ill-advised and a reckless path to tread.
His Majesty’s Government have had few achievements to proclaim over the past few months, but one has been meeting their target of recruiting 20,000 additional police officers in England and Wales since 2019. Meanwhile, earlier this year in Northern Ireland, the chief constable announced plans to reduce numbers by 6% to just 6,700 officers, making it the smallest force it has ever been. Given the ongoing terrorist threat and the time it takes to train new officers, that is an appalling state of affairs which is neither acceptable nor sustainable.
I also want to speak about health. Here in England, barely a day goes past without another story in the media about the dire state of NHS waiting lists, but waiting lists in Northern Ireland are by far the worst in the entire United Kingdom. In figures released in March, 122,267 Northern Ireland patients were on waiting lists in the in-patient and day case categories, with 66,302 waiting a year or more for their surgeries. Further, 6,000 had been waiting for five years or more—long before the world had even heard of Covid-19. Yet, in the Secretary of State’s draft budget, NHS funding in the Province is due to rise by a mere 0.5%, far below the increased amounts for health in Great Britain.
I also have deep concerns about the problems faced by community pharmacies in Northern Ireland, many of which are struggling to stay afloat because of a range of problems, including the Northern Ireland drug tariff and the delayed implementation of the community pharmacy commissioning plan for Northern Ireland. Rather than go into the intricacies of the situation on the Floor of the House, I politely ask the Minister to meet with me and representatives of community pharmacies in the Province to hear their concerns directly. I hope that is an invitation he will accept.
Finally, today is local elections polling day in Northern Ireland. As politicians, we are more aware than most that it should be a day of excitement and hope for a better future. However, given the political vacuum people in the Province have found themselves in once again, there is no sense of optimism. Local voters face the prospect of a continuing absence of accountable political leadership, a seemingly endless stream of funding cuts to key services and little prospect of respite any time soon. Even the levelling up fund, which many local community groups and sports clubs were hoping would enable them to do something positive for their areas, allocated only a minimal amount for Northern Ireland in round 2 and left numerous applicants significantly out of pocket because of the expense of putting together their professional bids.
The Bill is before us today because His Majesty’s Government were left with few other options. However, if and when a budget Bill is brought forward, I hope Ministers, including the Prime Minister, will have the foresight and wisdom to look again at the figures, particularly in relation to health, education and policing. I accept the need to reform how Stormont operates, but in the depths of a cost of living crisis I appeal to the Government to do the right thing by protecting the people of Northern Ireland from the perils that the current draft budget graphically exposes them to.
Lord Robathan (Con)
My Lords, I shall not detain the House long nor repeat everything that has already been said, because it would be quite unnecessary. I have great respect for the noble Lord, Lord Bew, and I agree entirely with what he said: there is no alternative to this legislation. That is unfortunate but true.
I think this is the first occasion on which we have debated Northern Ireland business since the death of Lord Carswell, a former Lord Chief Justice of Northern Ireland. I raise his death and pay tribute to him because I remember being here during the Brexit debates, which were long, monotonous and varied, when he spoke about his childhood in Belfast and how he could bicycle down from Belfast to Dublin and never saw a border or a border guard. That was in his lifetime. We talked a lot of nonsense about how there might be a hard border in Northern Ireland, but there has never been a hard border across the island of Ireland. Friends of mine spent many years trying to stop illegal border crossings, mostly smuggling and terrorist-related, across the internal border, and they completely failed.
One should remember what Lord Carswell said because this is partly behind the whole issue about the Windsor Framework. My view is that the Windsor Framework is flawed but it is the best deal we will get. In addition, we live in the art of the possible; that is what the Windsor Framework is. In politics, much as we might wish to, we do not always get our own way on everything. I deprecate the fact that the European Union should have anything to do with a sovereign part of the United Kingdom, but that is the situation we are in.
To move on slightly to the broader issue, I very much deprecate the fact that Sinn Féin is the largest party in the Assembly now—or it would be if the Assembly was sitting. I hate it. Sinn Féin was always described as the political wing of the IRA, and I think it still is. Because of that, it sticks in my craw that anybody should vote for Sinn Féin, although a lot of very decent people do. The IRA is now somewhat romanticised in Northern Ireland, but in fact it is a bunch of ghastly, murderous thugs, and we should remember that—starting with Gerry Adams, who, not in this world but perhaps in the next, should answer for the deaths of people such as Jean McConville. However, I say to my fellow unionists that we live in the world as it is and we are in the art of the possible.
I will not digress too far, but after 1997, many people in the Conservative Party wished to go back and say, “Why didn’t these stupid people, the electorate, vote for us?” Finally, however, we worked out that you do not blame the electorate—you blame yourselves for why people do not vote for you. I say to my fellow unionists, we have to change. The world changes; we all have to change—unbelievably, I am less hard-line than I was. I say to my fellow unionists that we need political leadership to understand how to get the electorate’s confidence back, and political leadership to go back into the Assembly so that we have an Executive in Northern Ireland. For all its defects, that is the best way forward.
Viscount Stansgate (Lab)
My Lords, it is a pleasure to follow the noble Lord, and I am grateful for the opportunity to speak in the gap and make one point, which is about the relationship of science to the Bill. I begin by associating myself with the remarks of the noble Lord, Lord Caine, about Lord Brooke. It is right that his contribution and the work he did over many years is acknowledged in a debate of this kind.
Science, and the science community in Northern Ireland, needs an Assembly as much as any other community. Much excellent work is done on science in Northern Ireland, as well as elsewhere in the UK. It was no coincidence that on the recent visit of the President of the United States, he went to the University of Ulster to open the new premises, because good work is done in Ulster, as well as elsewhere.
I have reason to share the view of the scientific community that it needs a working Assembly. For many years, in a former capacity, with colleagues in the science community, I used to organise the science event known as “Science and Stormont”, which was held every year in Stormont with a working Assembly. Science is a refreshingly non-partisan area of endeavour, and at those meetings, year after year, representatives of all the major parties would come to this event to speak: we would have a sort of round table. Sometimes we went to listen to the Assembly in action later. These were very successful events and they mattered to the scientific community in Northern Ireland.
I understand entirely why the Bill is necessary, and I support it. Beyond that, I simply wanted to use my moment to make the point that science really matters, and science needs a working Assembly, and I very much hope that it will not be too long before we see that.
Baroness Suttie (LD)
My Lords, it is a great pleasure to follow the speech of the noble Viscount, Lord Stansgate, on the unusually important but not often raised issue of science in Northern Ireland and the role that Northern Ireland can play in that regard. I, too, begin by paying tribute to Lord Brooke of Sutton Mandeville for the invaluable work he did in paving the way towards the peace process. I was very moved by the Minister’s comments—I know he used to work for him—echo his sentiments and send my condolences to Lord Brooke’s family.
This has been a very interesting and, in terms of recent debates, relatively short debate. No doubt many colleagues are back in Northern Ireland today for the local election polling day. As ever, I thank the Minister and his private office for the very courteous way in which he consulted all parties ahead of Second Reading. As is customary and has been said by all noble Lords speaking in this debate, we support the need for the Bill but deeply regret that it remains necessary. One can but hope that with the results of the local elections in Northern Ireland at the weekend will come an end to this continued state of political paralysis and limbo. The continued absence of a functioning Executive and Assembly is hugely to be regretted and is having an extremely negative impact on ordinary people’s lives. It is causing financial, governance and constitutional issues that are of concern to us all.
A Northern Ireland friend told me this week that her mother had a fall last Thursday afternoon and ended up at A&E at the Ulster Hospital in Dundonald. There were 165 people in the queue ahead of her, including children with broken bones, and nine ambulances were waiting outside. In Northern Ireland, as perhaps elsewhere in the UK, the NHS is in a state of crisis and, for as long as there remains no functioning Executive and Assembly, there is little or no opportunity to take major healthcare or other public sector decisions. The state of limbo is equally resulting in an inability to promote educational reforms, to move forward and make progress in dealing with the legacy of the past or to take long-term economic strategic and budgetary decisions for the future.
This is all the more tragic because there are potentially very positive economic opportunities for Northern Ireland. A major trade conference is planned for September and the US envoy has offered to bring a trade mission to Northern Ireland, but without a functioning Executive in place it will be hard to take full advantage of these opportunities. While praising the continued hard work and dedication of the Northern Ireland Civil Service, does not the Minister agree that this continued state of limbo is putting the Civil Service in a very awkward position? Although the Bill seeks to put sticking plaster over some of the difficult public sector finance issues facing Northern Ireland, does the Minister agree that the definition of public interest, as set out in the Bill, is ultimately a subjective political judgment?
It is not our intention on these Benches to table amendments to the Bill before us today, but I would like to ask some follow-up questions on reviewing public financing stemming from the amendments tabled by my friend Stephen Farry MP and the Alliance Party in the House of Commons last week. If the Minister is unable to give an immediate response to these questions, perhaps he would consider giving a more detailed response later in a letter.
First, would the Minister consider commissioning a report to provide an assessment of expenditure costs stemming from duplication as a result of divided communities, and its impact on public finances in Northern Ireland? Secondly, does he agree that it would be useful to engage with the Treasury on options to provide an “invest to save” fund to support the transformation and sustainability of public finances in Northern Ireland? Thirdly—an issue raised by other noble Lords already—will the Northern Ireland Secretary engage with Northern Ireland departments and the fiscal council in relation to the Barnett formula and a needs-based review?
The 25th anniversary of the Good Friday/Belfast agreement reminded us all that progress is made as a result of political leadership and courage, often at the highest level. The signing, welcome on these Benches, of the Windsor Framework agreement was also clearly driven by the Prime Minister. I appreciate that there are a great many other issues currently facing the Prime Minister, but does the Minister agree that finding a way to end the continued impasse and bring back a functioning Executive has to be a key priority for the Prime Minister and his team in the weeks ahead? If that does not happen and the current stalemate continues, can the Minister tell us what thought has been given to how and when the Government will decide that, for the sake of the people of Northern Ireland, enough is enough?
Lord Murphy of Torfaen (Lab)
My Lords, obviously, I join the Minister and other Members of your Lordships’ House in referring to the work of Lord Brooke. Peter Brooke was a man of huge decency and integrity. He was a colleague of mine in the House of Commons, and obviously a very effective Secretary of State in the sense that he actually progressed the peace process. Also, and sometimes forgotten, he was a very effective chairman of the Northern Ireland Select Committee. He will be missed. He played his part in Northern Ireland history; there is no question about that.
We of course agree with the necessity of the Bill. It has a very innocuous name, the Northern Ireland (Interim Arrangements) Bill. What it actually means is that we are going to carry on with a sort of direct rule until we can resolve the problems with regard to the restoration of the institutions. That is not good, of course—we deeply regret it and I will come to that in a second—but with regard to the Bill, particularly on the issue of finance, there are important questions that the Government have to address. They have been raised by the noble Lord, Lord Morrow, the noble Baroness, Lady Suttie, and others. There is a case—I speak as a former Finance Minister for Northern Ireland—for a re-look at, reform of and rethink of how the Barnett formula applies to Northern Ireland.
The noble Lord, Lord Morrow, quite rightly referred to Northern Ireland, in the formula sense, being underfunded. He referred to the position of Wales, which I know a little about. It is quite interesting to reflect that the settlement changed for Wales because of the work that was done and the pressure that was put on the Government by the Welsh Assembly and the Welsh Government. Would that have happened without devolution? It might have done, but I doubt it. A sitting Government in Cardiff and a sitting Parliament could address these issues in detail and then negotiate with the United Kingdom Government. Therefore, the issue which the noble Lord, Lord Morrow, referred to is best addressed in the context of a restored Executive and Assembly in Northern Ireland.
I do not agree with the noble Baroness, Lady Hoey, that we could exist without an Executive and an Assembly in Northern Ireland. If we completely forget about the Good Friday agreement and the peace process, with a Parliament in Edinburgh and a Senedd in Cardiff, it would be impossible not to have a devolved Parliament in Northern Ireland, irrespective of the peace process. We must live with that, and we should, because it is the only answer to the problems of Northern Ireland. Every time a Member from Northern Ireland gets on their feet in the Commons or in this House, ultimately it is not good enough. Those people in the Assembly in Belfast are elected directly by the people of Northern Ireland to address the specific issues which are devolved to Belfast. The Minister knows that there are dozens and dozens of huge decisions which cannot be taken by civil servants. It is totally unfair, in a modern democracy, to put on the backs of people who are unelected the burden of having to make huge decisions which only politicians can decide, particularly regarding finance.
Obviously, we still understand the problems that the Democratic Unionist Party has with the settlement in Northern Ireland regarding the European Union. However, the Windsor Framework is a real step forward and should be the basis of proper negotiation to arrange a settlement. This morning I was looking, yet again, at Section 1 of the Northern Ireland Act1998, which I had the privilege of steering through the House of Commons a quarter of a century ago. It says specifically that Northern Ireland is a part of the United Kingdom and will only cease to be so if the people of Northern Ireland so decide by a majority. I cannot see that happening for some time to come—who knows?—but that is what it says. The principle of consent—
Baroness Hoey (Non-Afl)
I thank the noble Lord for giving way and I agree with that part of the 1998 Act. I am sorry for going on about a very simple thing, but it is the kind of basic thing that makes people in Northern Ireland feel very left out: duty-free. Why can people flying from Belfast to anywhere in the EU not get duty-free, when you can fly from the rest of the United Kingdom to anywhere in the EU and get it? I got an answer recently which almost implied that part of the reason was because you could fly from Northern Ireland to the Republic of Ireland. Of course, as the noble Lord knows, you cannot fly from Northern Ireland to the Republic of Ireland, but that is just a simple thing that sets us apart.
Lord Murphy of Torfaen (Lab)
I do not think that in any way alters the position that Northern Ireland is a part of the United Kingdom. The noble Baroness will recall, because she comes from Northern Ireland and lived the early part of her life there, that there has always been a difference between Northern Ireland and the rest of Britain in certain respects. For example, livestock and agriculture have always had to be checked as they came across the Irish Sea, for various reasons. There was a separate Government for decades in Northern Ireland which imposed various restrictions, but that in no way affected the fact that Northern Ireland is part of the United Kingdom, so long as the people in Northern Ireland decide it should be. I do not underestimate the problems that have arisen, frankly because of Brexit. Without Brexit, this dilemma would not be in front of us, but we have to live with it. It seems to me that the Windsor agreement is a good start.
There are elections today in Northern Ireland. We will not know the outcome for another day or so. The marching season will soon be upon us. The recess is not far away. However, that should not stop the Government from planning for proper structured negotiations with the political parties in Northern Ireland and the Irish Government, so far as they affect the agreement. There should be a big role for the Prime Minister in the weeks and months ahead to work with parties in Northern Ireland to get a settlement. Despite the problems which we have had in Northern Ireland over the last two years regarding the protocol and the difficulties about the suspension of the institutions, there is no doubt from when we celebrated the Good Friday agreement some weeks ago in Belfast and elsewhere—and I do mean celebrated—that there has been a huge change. The noble Baroness, Lady Hoey, said quite rightly that, tragically, there have been 150 deaths in Northern Ireland over the last 25 years, mainly as a result of terrorism. However, that must be set against the 3,500 people who perished in the 25 years before the Good Friday agreement. That is the real measure of where we are in Northern Ireland.
Lord Caine (Con)
My Lords, I am very grateful to all noble Lords who participated in this debate, which was relatively short by our recent standards. I thank noble Lords for their kind words about my late colleague, Lord Brooke of Sutton Mandeville, and for their general support for this Bill. The noble Lord, Lord Murphy, referred to the title of the Bill including “Interim Arrangements”. When we were discussing this, I was very keen to avoid calling it “temporary arrangements”, given that everything in Northern Ireland that has had “temporary” attached it over many years has assumed an air of permanence.
I am also grateful to the noble Lord Murphy of Torfaen for reminding the House of Section 1 of the Northern Ireland Act 1998, which makes clear that Northern Ireland is a part of the United Kingdom and will never cease to be so without the consent of most of its people. Speaking for this Government, I would not want the current constitutional position to change. Regarding his point about the restoration of the institutions, and echoing other noble Lords across the House, including the noble Baroness, Lady Suttie, I assure all noble Lords that, irrespective of the calendar, our focus will remain very firmly on restoring those institutions which, as I said at the outset, are in the best interests of the union and of the people of Northern Ireland.
I politely disagree with the noble Baroness, Lady Hoey, who argued for the strengthening of local government and effectively the abolition of Stormont, which would be a fundamental change to the Belfast/Good Friday agreement. That is not a position that the Government can support. We remain firmly committed to the agreement and to the institutions across all three strands that the agreement establishes. Our priority is to make the agreement and the institutions work for the good of the people of Northern Ireland.
Unsurprisingly, a number of noble Lords focused on the current budget situation in Northern Ireland. As I said in my opening speech, if there is no restored Executive, it will be our intention to bring forward a Bill at the appropriate time to put the current budget allocations on to a legal footing. We will have a further opportunity to discuss the budget at that stage. However, picking up on one or two points, we recognise that the current situation is unsustainable and that Northern Ireland departments, in the absence of Northern Ireland Ministers, will have to face very difficult decisions to live within their budget, but these are unavoidable.
I heard my noble friend Lord Rogan and the noble Baroness, Lady Hoey, refer to the “punishment budget”, as some people have described it—but it is not a description that I accept for one second. The budget reflects the reality of the fiscal situation in which Northern Ireland currently finds itself.
It is for that reason that, over many years, the Government have recognised the unique challenges that Northern Ireland faces. I recall that the spending review in 2021 was the most generous since the restoration of the devolved Government in 1998-99. It gave Northern Ireland the possibility of multiyear budgets, as opposed to the single-year budgets that have bedevilled us over a number of recent years. Sadly that proved not to be possible.
In addition, we have seen billions of pounds of extra spending through the Stormont House agreement, the fresh start agreement, the confidence and supply agreement, and New Decade, New Approach. It is difficult to sustain the argument that Northern Ireland has been systematically underfunded by the Government. As the noble Lord, Lord Morrow, reminded us, public spending per head in Northern Ireland is still running at about 20% higher than the United Kingdom average.
However, I recognise that there is a discussion about the funding formula, which the noble Lord, Lord Morrow, raised in some detail. To echo the words of the noble Lord, Lord Murphy of Torfaen, that discussion would be far better taking place between the United Kingdom Government and a restored Northern Ireland Executive. In the spirit of openness, I am of course more than happy to have a conversation with the noble Lord about these matters. Likewise, I am happy to respond positively to the invitation from my noble friend Lord Rogan to meet the pharmacists in Northern Ireland.
A number of noble Lords again raised issues with the Windsor Framework. I know that the noble Baroness, Lady Hoey, and the noble Lord, Lord Morrow, feel very strongly about this. I gently remind noble Lords that the House of Commons approved the Windsor Framework by 513 votes to 29, and your Lordships by 227 votes to 14. It clearly represents the settled will of Parliament that the framework be carried forward and implemented. In our view, it delivers stability for the people of Northern Ireland, protects Northern Ireland’s place in the union and restores the balance of the Belfast agreement.
I agree with my friend, the noble Lord, Lord Bew, who made a powerful case in saying that the framework increases Northern Ireland’s agency. He referred to the role of the Stormont brake; it gives the Assembly a very powerful role in determining future EU legislation and regulations. For that brake to be effective and to be operated, we need a functioning Northern Ireland Executive and Assembly. I referred also to the institutional reforms raised by the noble Baroness, Lady Hoey.
The issues raised by the noble Baroness, Lady Suttie, reflected a number of amendments that were put forward in the other place in the name of her sister party, the Alliance Party of Northern Ireland. She raises important points, such as the costs of division in Northern Ireland, which are substantial and need to be addressed, and the transformation funds. I will write to the noble Baroness in more detail, but my initial reaction is that it is wrong to commit the Secretary of State to exploring any particular options at this stage. The Bill gives my right honourable friend a degree of discretion around this and it would probably not be right, as the Alliance Party was trying to do in the House of Commons, to put some of these things into legislation. But I am very happy to discuss these issues further and to write to the noble Baroness.
The noble Baroness, Lady Suttie, also referred to the position of civil servants under the legislation, as did the noble Lord, Lord Murphy of Torfaen. I agree that it puts them in a very difficult situation, and these concerns have been voiced within Northern Ireland itself. We are asking a lot of civil servants under this legislation. In our view, this approach is unfortunately necessary. It strikes the right balance between ensuring that governance can continue while giving parties in Northern Ireland the time and space to form an Executive. I entirely agree that this is not a long-term fix; it cannot be a long-term fix or a substitute for the proper re-establishment of a functioning devolved Government in Northern Ireland, in line with the Belfast agreement. On that note, I beg to move.
Northern Ireland (Interim Arrangements) Bill
Tuesday 23rd May 2023
(3 years, 2 months ago)
Lords ChamberRead Full debate Northern Ireland (Interim Arrangements) Act 2023 Read Hansard Text Read Debate Ministerial Extracts Amendment Paper: HL Bill 137-I Marshalled list for Committee - (19 May 2023)
Lord Morrow
Lord Morrow (DUP)
My Lords, Amendment 1 is in my name and that of my noble friend Lord Dodds of Duncairn.
Clause 2 of the Bill is concerned with:
“Advice and information on options for raising public revenue”.
My amendment requires that the advice should be expressly required to cover the Northern Ireland Fiscal Council report, Updated Estimate of the Relative Need for Public Spending in Northern Ireland, published on 2 May this year, and the precedent arising from the December 2016 agreement between the Welsh Government and the United Kingdom Government on the Welsh Government’s fiscal framework.
Some might suggest that all relevant things can and should be taken into account and it is not necessary to specify these two documents. However, they are of such central importance to the situation in which Northern Ireland finds itself that it would be a dereliction of duty not to put them front and centre of advice and information on options for raising public finance. I will consider both, starting with the agreement with the Welsh Government.
In 2007, the new Welsh Government’s programme for government identified the need to address the problems relating to the Barnett squeeze on the funding available for services for UK citizens living in Wales. To understand this, it is important to remember that before 1979, when the Barnett formula was introduced, the union was treated as a unit and funding allocations were made within that unit on a basis that was alive to need. The reason for considering a change in the funding formula at that time was devolution, which the then Government hoped would be delivered by referendum that year.
The initial proposal was that the funding formula should be needs-based. Treating England as 100, the Treasury claimed that on the basis of need, Northern Ireland should be rated at 131, Scotland at 116 and Wales at 109. However, a decision was made to delay the introduction of this new system and to use instead a simple interim model that allocated monies to Scotland, Wales and Northern Ireland based on their relative populations as a proportion of that of England. This temporary formula came to be known as the Barnett formula. Here we are 44 years later, and it remains in place, notwithstanding the 2009 report of the House of Lords Select Committee on the Barnett Formula, which called for its replacement with a needs-based formula, and a number of robust exhortations to the same end from your Lordships’ Constitution Committee.
When the Barnett formula was first applied, it was to a pre-existing level of spend that had been cognisant of need and thus with more money per head going to Northern Ireland, Scotland and Wales than to England. However, the challenge remains that all subsequent increments in funding from the introduction of the Barnett formula have not been based on need in Wales, Scotland and Northern Ireland, but have simply been the appropriate and proportionate fair share of what had been spent in England. Mindful of the populations of Wales, Scotland and Northern Ireland, that means that although incomes keep increasing, funding does not increase as much as it would if monies were allocated from the centre on the basis of need—as if the UK operated on a UK-wide rather than just an England-wide notion of need.
The spending differential between Northern Ireland, Scotland and Wales, on the one hand, and England, on the other, has reduced, and in the absence of correction, there would ultimately come a time of convergence, when spend per head in Wales, Scotland and Northern Ireland would be far below need. This downward pressure towards convergence is called the “Barnett squeeze”.
Baroness Ritchie of Downpatrick (Lab)
My Lords, first, I apologise to your Lordships’ House for not being present last Thursday at Second Reading of this Bill; I was otherwise engaged in Northern Ireland at the local government elections.
The Bill deals with interim funding arrangements for Northern Ireland during the absence of an Executive and Assembly. In many ways it continues indirect rule and, I suppose, it gives civil servants limited powers. Before we move to the amendment itself, I want to ask the Minister whether the Bill itself might not be a recipe for judicial review and legal quagmires, centred on the issue of political power versus the extent of the authority of civil servants. Where does that power and control begin for civil servants and where does it end? In what circumstances can they act, and has Clause 2 of the Bill been tested for legal resilience in this respect?
Notwithstanding that, I have sympathy with the amendment brought forward by the noble Lords, Lord Morrow and Lord Dodds, because I believe that the Barnett formula should be based on the principle of need. We have already seen what has happened in Wales. The recent work of Holtham and the Northern Ireland Fiscal Council highlighted that, in Wales, funding is £124 per head of population while in Northern Ireland it is £121.
We know about the funding crisis in the Department of Health and in education and infrastructure; and only today, we learned about the shortage of special educational needs places. Earlier today, I met the chief executive of Women’s Aid in Northern Ireland and her chief operating officer. They are facing a funding crisis. At the end of the day, they need financial assistance to help women who have been impacted by abuse—abuse that has been persistent and prevalent for many years.
I do not disagree with the amendment and I have sympathy with it, but I honestly feel that the best place for this debate, and for action, is in a restored Northern Ireland Executive and Assembly where local MLAs and Ministers who are best placed to identify the needs of the local population in Northern Ireland can specify and outline those needs. They could then prepare a report and seek a delegation meeting with the Secretary of State for Northern Ireland, the Chancellor of the Exchequer and the Treasury ministerial team to make a case for a review of the Barnett formula and the necessity of a needs-based assessment.
If anything, we need our own local government in Northern Ireland. We need all the institutions of the Good Friday agreement to be restored as quickly as possible.
Baroness Foster of Aghadrumsee (Non-Afl)
My Lords, I rise to support the amendment in the name of my noble friends Lord Dodds and Lord Morrow. Reflecting on the comments of the noble Baroness, Lady Ritchie, we absolutely do need to see our Executive up and running again on a sustainable and fair basis. Of course, that was also the case in 2017, when Sinn Féin collapsed the Executive for not one, not two, but three years.
During those three years, which should have been spent reforming our National Health Service after a very expensive report was brought forward in the name of Rafael Bengoa, that report sat on the shelf, because the then Health Minister Michelle O’Neill, along with her colleagues, decided to come out of government. As a result of that, we have seen the sustainability issues in Northern Ireland get worse over time. I say that as, along with my noble friend Lord Dodds, a former Finance Minister in Northern Ireland.
Baroness Hoey (Non-Afl)
My Lords, I strongly support this amendment in the names of the noble Lords, Lord Morrow and Lord Dodds. I agree very much with what has been said by everyone who has spoken so far, although obviously I disagree with the noble Baroness, Lady Ritchie, that somehow the only way in which this can be dealt with is by getting the Executive back. There is no reason for that, given that the Fiscal Council said what it did, and the Minister knows that Northern Ireland is not being fully funded because the Barnett squeeze is getting greater. Surely if the Government know that that is happening to a part of the UK, they should be able to act without waiting for an Assembly or an Executive, which, given what has been said, is very unlikely to come back in the near future. I urge the Minister not to treat this as some kind of bargaining point with politicians in Northern Ireland; that is not the way to deal with this serious financial situation.
It is important that the point about consultation be included in the Bill. Being realistic, there are things in Northern Ireland that—forgetting the whole issue of the Barnett formula and the overall funding—could raise more money. That has always been difficult because controversial decisions are very difficult to take between the two mainstream political parties and the two factions —or perhaps three factions—in Northern Ireland. There are some things that are not the same as in the rest of the UK but should be. No doubt I would be slated by the media in Northern Ireland for saying this, but I genuinely think we should be looking at prescription costs. There is a huge amount of waste due to the fact that prescriptions are free for everyone in Northern Ireland. That is just one small thing, but I am certain that, if the public were properly consulted on it, talked about it and understood it, there would be support in many areas for that way of raising extra funds.
There are other such issues but I will not go into any of those. I know the Minister is particularly knowledgeable about and supportive of Northern Ireland, but he may not have a Secretary of State who is necessarily quite so knowledgeable and supportive, so it is important that the Secretary of State listens to what people who understand Northern Ireland are saying.
As we are on finance, I will ask the Minister about policing in Northern Ireland, which is in a particularly difficult situation over its funding. Morale among the Police Federation there is very low. Are the United Kingdom Government giving extra money to the police to make up for the huge amount that it cost to have the very short visit of President Biden and all the other dignitaries who flew in and flew out again as quickly as possible, having joined in the commemoration of the Belfast/Good Friday agreement? It cost a huge amount of money to bring over police officers from Great Britain. Have the Government given any extra money for that? If not, why not?
We had a wide-ranging debate at Second Reading, so there is no point going over all the arguments again; we cannot in a debate on an amendment anyway. But let us not forget that we are here discussing the Bill only because we have no Executive, and we have no Executive because this Government—our Government—have decided that Northern Ireland is to be treated differently. We are being left under EU trading rules, which have set us apart and will set us further apart as time goes on. That is the really important issue that noble Lords need to remember.
Lord Dodds of Duncairn (DUP)
My Lords, I too am sorry that I was not able to be present, along with other noble Lords and noble Baronesses who have spoken, for the Second Reading of the Bill last Thursday because of other commitments in Northern Ireland. I put it on record that it was somewhat strange that the Second Reading was scheduled for the day of the local government elections in Northern Ireland. If nobody in the Government realised that, it tells us a lot about competence; if they did realise it and scheduled it anyway, it tells you a lot about their regard for Northern Ireland. I would like to know what actually happened that such a thing should be scheduled in that way.
I am glad that we have the opportunity to debate the amendment in the names of my noble friend Lord Morrow and me. It raises an important issue because, despite what is constantly said about the restoration of the Executive and the Assembly, if they were back tomorrow that would not make the slightest difference to the underfunding of Northern Ireland. In fact, Ministers—newly installed Ministers—would have to go about the business of slashing public services in health, education, policing and so on to an unprecedented degree. I do not agree with the idea that we should wait for the Executive and the Assembly to be restored. The need is here and now. The underfunding is taking place as a result of decisions taken here, in Whitehall and Westminster, by the Treasury.
It used to be the case over many years that the Northern Ireland Office was the advocate for Northern Ireland vis-à-vis central government and the Treasury, but it now appears that the current Secretary of State’s position is to become an advocate for the Treasury against the interests of Northern Ireland. He came on the other day to say that there would be no problem finding £100 million for a sports stadium. That is somewhat controversial in Northern Ireland but he was saying, “No problem at all—we’ll find the money if the bid’s successful”. But he cannot find an extra penny piece to deal with extraordinarily long waiting lists in the health service, education underfunding, police underfunding and the rest.
That sort of glib response to the crisis in Northern Ireland by the current Secretary of State, married to the refusal in this Bill to bring forward powers to give direction to civil servants, is an absolute abdication of responsibility by government Ministers who will no doubt respond and say, “Well, you should get into the Executive”. But they themselves are responsible for the current position in Northern Ireland by their refusal to restore the power of the Northern Ireland Assembly to make laws over 300 areas. Right across the economy of Northern Ireland, there are powers that do not reside in Belfast or here at Westminster or in Whitehall; they reside in Brussels with the European Commission—unaccountable and unanswerable. The Government need to recognise the current situation as it exists.
My noble friend Lord Morrow has very ably and in considerable detail set out the arguments behind our amendment. The Government may respond by saying that for many years they have funded Northern Ireland considerably well; the Minister referred to this at Second Reading. But whatever the past, what we are dealing with is now. As a result of government decisions taken by the Treasury, Northern Ireland is more below need on a funding-per-head basis than has ever been the case in any constituent part of the United Kingdom in the last 40 years. That is unacceptable and should not continue a moment longer. They cannot justify underfunding today on the basis of past settlements. Today’s budgetary position in Northern Ireland means social, economic and political dislocation. That is agreed and assented to by all the political parties in Northern Ireland across the board. It cannot be justified by looking backwards to previous financial settlements.
We will no doubt be told that Northern Ireland receives 20% per head more than the UK average spend. But, as we have heard, the true measure is spending against need. In Wales, steps were taken despite spending per head there being above the UK average. This is a question of asking not for favours or a privileged position but that the funding is structured so that services for the people of Northern Ireland meet the level of need, as is the case elsewhere in the United Kingdom. It is a quest not for privilege but for a level playing field. It is not a question of comparing Northern Ireland spending per head against England; it is about comparing Northern Ireland spending against need.
Of course, many people in Northern Ireland suspect the real game that the Northern Ireland Office is playing. I do not include in this the Minister answering on the Front Bench today, who has displayed time and again a willingness to fight Northern Ireland’s corner and stand up for the union. There are people within the NIO who no doubt believe that, by imposing this kind of budget and underfunding Northern Ireland both in the short term and going back some years, we will fix all this or come forward with a package if only the Executive and Assembly are restored and unionists operate the Northern Ireland protocol/Windsor Framework. That would entail operating measures that are injurious to the union and breach the Belfast agreement, the Acts of Union and the New Decade, New Approach document—the basis on which Northern Ireland devolution was restored in January 2020.
We have to face the reality that the failure of the Government to restore Northern Ireland’s place within the United Kingdom—subjecting it to arrangements that undermine democracy and are a breach of the agreements—is the fundamental problem we are grappling with. Unless that issue is tackled, we will continue to have a lack of devolved government in Northern Ireland. We have to accept the fundamental reasons why we are in the present position. Of course we do not want to see legislation having to be passed in this place to deal with the situation and would far rather have the Executive and the Assembly restored, but we have to have it back on the basis that we have powers to make the laws that affect and govern the economy of Northern Ireland. That cannot be avoided, and the fact is that the restoration of devolution lies in the Government’s hands.
The DUP stood on a manifesto in which we made it clear that the Northern Ireland protocol—the Windsor Framework—needs replacing
“with an arrangement that passes our seven tests”,
including getting rid of the Irish Sea border. It means restoring democracy and giving us the power to formulate and pass laws over our own economy, which seems very simple, straightforward and basic in terms of equal citizenship for all citizens of the United Kingdom. We are asking for something that would be seen as a matter of fact and common sense in every other part of the United Kingdom. Indeed, those who advocate different arrangements would never accept it for one minute for their own constituency, region or country in the United Kingdom.
Lord McCrea of Magherafelt and Cookstown (DUP)
My Lords, I too support the amendment in the name of my noble friends Lord Dodds and Lord Morrow. I also apologise for not being able to be present at Second Reading last Thursday. I am sure that it does not escape the notice of noble Lords that there was a council election on that day. Everyone knew about it, including the Government, yet they had a Second Reading debate on a Northern Ireland Bill in this House.
Like the Minister when he spoke on that occasion, I too regret the fact that we are debating the legislation in the absence of an Executive at Stormont, but the Government have known for over 13 months that a functioning Northern Ireland Assembly and Executive could not continue until the genuine concerns expressed by the unionist elected representatives were adequately addressed. One can bury one’s head in the sand or face reality. We have found out in recent days that burying one’s head in the sand does not do anything; therefore, you have to face reality.
The Northern Ireland protocol and the Windsor Framework were forced on the Northern Ireland people without consent. We all know that the Belfast agreement was built on the very foundation of cross-community consent, but, sadly, the constitutional position of Northern Ireland within the United Kingdom was compromised to appease Europe during the withdrawal arrangements and at the behest of the Irish Republic.
In last week’s debate, the Minister stated that the 25th anniversary of the Belfast agreement is
“an opportunity for all of us to recommit to building an even brighter future for Northern Ireland. Now is the time to decide how we want to move forward together, to create a better future for and deliver on the priorities of the people of Northern Ireland. That includes a more prosperous economy and better, more sustainable public finances and services”.—[Official Report, 18/5/23; col. 381.]
No one could disagree with the sentiments so ably expressed by the Minister, who I think genuinely believed in them. But, in reality, that is all that they were: sentiments.
As we all know, since we last met in the House to discuss Northern Ireland business, there has been an election. Over recent months, the people of Northern Ireland, especially unionist voters, have been bombarded with endless anti-DUP propaganda, much to the delight of some and the dismay of others—so there has been a process of brainwashing the public. Not only was that fuelled by political opponents within republicanism or nationalism but so-called independent observers and commentators—cheered, aided and abetted by the so-called great and good in society—joined in to blame every ill in society on the DUP, including the smallest pothole in some back laneway and the serious, long and grievous waiting lists in the health service.
Of course, none of that happened and those accusations were not made when Sinn Féin boycotted the other place, and Stormont and the Northern Ireland Executive for three years. In fact, I remember debates in this very House when we were told that we were all to grow up and do something to get us out of the situation. In actual fact, it was Sinn Féin that had stepped aside from the Executive and from Stormont, but Members of this House did not have the courage to name Sinn Féin. No: everyone was to blame. We were supposed to be to blame for the actions of Sinn Féin. They pointed the finger and chided us, telling us to return to the Northern Ireland Executive. So here we are today.
After all the brainwashing, the unionist community took a principled stand, as did its elected representatives, on our constitutional rights and demanded to be treated as equal citizens within the United Kingdom. Of course, we are now told that the answer to every ill will be to return to Stormont. Many in this House hoped that, with all the brainwashing process in operation, they would witness the demise, or least the humiliation, of the DUP in the election and the elevation of the Alliance Party as the up-and-coming, as they saw it, central bloc to challenge the DUP. That did not happen. Indeed, Members of this House must face the reality that we have not gone away, you know.
There has been a lot of talk since the election about Sinn Féin’s political tsunami at the election. In reality, the DUP faced a political tsunami of criticism and bile before the election but, through the ballot box, we now know that the unionist people expect their politicians, at a critical moment, to honour their election manifesto pledges, no matter how hard the road will be, and we will.
It is true that Sinn Féin has increased its representation and become the largest party within local government by practically wiping out the SDLP, but was the political tsunami as it has been told to us? In actual fact, Members have perhaps not realised that Sinn Féin went down 20,000 votes in the council elections from the last test one year ago, the Assembly election. The Alliance Party went down by 17,000 votes, the Ulster Unionists by 15,000 votes and the SDLP by 13,000 votes. The party that went down least in votes since that last test was the DUP. I know that this is very hard for some to swallow. Indeed, commentators nearly choked admitting it, and the media outlets found it extremely hard to acknowledge that the DUP did not lose one seat at the Northern Ireland council elections.
So we faced political brainwashing, which failed, but we now face and confront what is, in my book, political blackmail. Part of the Bill’s provisions relate to decision-making for the Northern Ireland Civil Service. Recently, the Government set a budget and, according to the Northern Ireland Fiscal Council, civil servants will be expected to find £800 million in cuts and revenue-raising measures. The cuts demanded are harsher than any facing other Whitehall departments, but it is hoped that, when they begin to hit the community, the DUP will be blamed again.
Civil servants now want to meet the political parties in Northern Ireland to guide them where to make the cuts and to slash services. That is what the new Executive are supposed to do. Because of this budget, we are told that 300 fewer nurses will be trained this year while the health service is already understaffed. To pay the nurses a proper wage, as negotiated on the mainland, more cuts will have to come. That is at a time when the Government here in London boast that they plan to train thousands more nurses and doctors.
Under New Decade, New Approach, we were promised that police numbers would be 7,500, but while in England the Government boast of recruiting 20,000 new police officers, our chief constable tells us that we are to reduce our numbers of police officers, which are now down to 6,500.
My noble friend Lord Morrow outlined that, compared to Scotland and Wales, our budget has been underfunded by £1.2 billion. In my honest opinion, this underfunding and unfair budget for Northern Ireland is not by chance but by design. Those in authority know well that these cuts, when they come, will hurt the sick, children, the vulnerable, the elderly and the weakest in society, but they believe that this would be a price worth paying to force the Assembly and the Executive to get up and running.
The Government have already told us that the black hole in our finances was because of the Executive and that Assembly decisions and the crisis in the health service, infrastructure and education happened under the stewardship of this Executive. What can the Executive do to alleviate the problems facing society when they are told that they will have to make cuts, and more cuts? I am reminded of when I was in the other place and the Labour Government were leaving office, and a certain Minister wrote a famous note that said, “There’s no money left”. We are told that there have to be cuts, but we all know that this is to be used to endeavour to blackmail the DUP to get back into the Executive, with a nod and a wink that money will follow if they do—in other words, the money tree will magically blossom again. But that would be at the cost of tramping over every genuine promise made to the unionist electorate that we would stand firm until the Government granted us equal rights within the United Kingdom. Some will say, “Isn’t that what most parties do—break their promises?”
As I conclude, I have no doubt that the Government, facing the reality posed by recent elections, will seek to cobble something together, hoping to satisfy some with meaningless words, but that will not do. Unionists as well as nationalists have faced difficult days because of the 30 years of the IRA campaign but, with resolve and belief in the right of our cause, we must prevail. I trust that the party in government, which prides itself on being named the Conservative and Unionist Party, will honour the pledge it made to the people of Northern Ireland to respect all parts of this United Kingdom, and thereby rid us of the undemocratic protocol and Windsor Framework and allocate the necessary funds to make life more comfortable for the less well-off. I support the amendment.
Baroness Suttie (LD)
My Lords, I will endeavour to be fairly brief. I have quite a lot of sympathy with the DUP amendment. Indeed, I raised similar points at Second Reading last week, and it is similar to an amendment tabled in the House of Commons by my friend Stephen Farry MP.
There is no doubt that Northern Ireland faces an extremely challenging situation as regards future public financing, but I am afraid that I completely agree with the noble Baroness, Lady Ritchie: surely the place for this to be debated is the Northern Ireland Assembly. I am under no illusions that a fully functioning Assembly and Executive would immediately be able to resolve these complex issues, but they would provide one strong voice to lobby the Treasury—a voice that is much closer to the people affected by these issues.
I have to say to the noble Lord, Lord McCrea, that I am a democrat—a Liberal Democrat—and someone who believes in the union and believes strongly in democracy. Both the House of Lords and the House of Commons have overwhelmingly supported the Windsor Framework agreement. I hear what noble Lords have said; I understand there is still a strong feeling about this issue. I sincerely hope the Assembly and Executive will be fully functioning as soon as possible but, listening to the debate this afternoon, I am perhaps less optimistic than I was before the debate. Can the Minister say, if it is not fully functioning again, how these issues will be dealt with in terms of parliamentary oversight? I presume, as ever, he will consult and involve all the political parties on this, as a Bill has to come forward, but this is just a plea to the Minister to make sure that all parties are consulted. Could he say a few words about how parliamentary oversight could be properly achieved? I plea, one more time, to the noble Lords opposite: surely a fully functioning Assembly and Executive is the best way forward, to have their voice heard loud and clear.
Lord Murphy of Torfaen (Lab)
My Lords, here we are. I have been either asking or answering questions on the Barnett formula for something like 32 years. It started off as a formula, and then you add a floor, and now you have a Barnett squeeze. Some of your Lordships may remember that Lord Joel Barnett, himself, who invented this, towards the end of his life completely denounced it and said that it was not suitable any more. Indeed, it probably is not. We lived with it for the last 20 or 30 years because there was no real alternative, but the world has changed since then, certainly in terms of Wales, Scotland and Northern Ireland.
The noble Lord, Lord Morrow, put a convincing case for a very serious look at the situation at the moment. I can tell him and Members of your Lordships’ House that, when I was the Secretary of State for Wales, I did not persuade my colleagues in the Treasury that there was a need for a change. I tried, but when you are a territorial Secretary of State, you are always battling with the Treasury, the Chancellor of the Exchequer and the Chief Secretary to the Treasury. You are in the same team. Sometimes you win, and sometimes you lose. But the key to the success of what happened in Wales, with the Holtham commission, was that it was in fact conceived by the Assembly, set up by the Government of Wales, and had cross-party support when the commission reported. That meant that there was a seriousness about that report which impressed the Treasury. It was convinced, after all this discussion and all these commissions, that things had to change, but I could not do it on my own. It had to be done with the Assembly, the Welsh Government and Holtham and his commission, which spread over a couple of years. That is how it was achieved.
The same thing is going to happen in Northern Ireland. There has to be a concerted effort by all political parties in Northern Ireland to be able to persuade the Government that there is a serious case for equating Wales and Northern Ireland—I leave Scotland out at the moment, as that is an even more complicated case. But that is only reasonably sure of success if it is not simply left to the Secretary of State for Northern Ireland. There has to be this pressure internally, from those who have been elected and thus are there in that Assembly, elected by the people of Northern Ireland to take issues like this up.
I know there is a meeting in the next week or two with the head of the Northern Ireland Civil Service. She has quite rightly asked political parties for some guidance as to what to do. A budget is not simply adding up and taking away figures; a budget is about priorities of government. What do you put first? What do you put last? Where do you put this money and that money? You do that on the basis of proper consultation, not only with Members of the Assembly but with all the political parties. That can best be done only in the context of a democratic Assembly and government.
There is no question that there is some merit in discussing these issues in your Lordships’ House, but we are not here to run Northern Ireland; we have not been elected to do that—we have not been elected to do anything but certainly not to do that. When that meeting is held in the next week or two, I hope that the parties in Northern Ireland will impress upon the head of the Northern Ireland Civil Service the importance of trying to work out what those priorities would be and how to do it. Rather her than me—it is a terribly difficult thing to do if you are not an elected politician. The decisions are so tough and so harsh, and in some ways so impossible, that they can be made only by people who are answerable in a democracy to the electorate. That is not the case at the moment.
Yes, there is a very strong case for looking at change, and a strong case for asking officials to do what they did in Wales, but that can best be achieved only if the Assembly and the Executive are both restored.
The Parliamentary Under-Secretary of State, Northern Ireland Office (Lord Caine) (Con)
My Lords, before replying to the debate that we have just had, I would like to make a very brief statement on legislative consent. Clearly, the reason we are here is that there is neither a functioning Executive nor a functioning Assembly in Northern Ireland. It has therefore not been possible to seek a legislative consent Motion.
I thank the Committee for the constructive debate that we have had this afternoon. I am very grateful to all noble Lords who have spoken to the amendment. I thank the noble Lords, Lord Morrow and Lord McCrea, for their time this morning, coming in to discuss this issue with me in the Northern Ireland Office.
Amendment 1, tabled in the names of the noble Lords, Lord Morrow and Lord Dodds, provides an example of the advice or information that the Secretary of State could request from the Northern Ireland Civil Service under Clause 2 of the Bill. Specifically, the amendment references the Northern Ireland Fiscal Council’s 2023 report—referred to by a number of noble Lords this afternoon—entitled Updated Estimate of the Relative Need for Public Spending in Northern Ireland. I join noble Lords in thanking the Northern Ireland Fiscal Council for its work, and have noted its report on the updated estimate of the relative need for public spending in Northern Ireland. The noble Baroness, the former First Minister of Northern Ireland, was right to refer to His Majesty’s Government’s role in the establishment of the Northern Ireland Fiscal Council, following both the fresh start agreement in 2015 and New Decade, New Approach in 2020. The Secretary of State, my right honourable friend Chris Heaton-Harris, met the chair of the council, Robert Chote, two weeks ago to go through the report’s findings. I assure the Committee that we will have further such meetings with him.
As noble Lords will be aware, there are clearly many different ways to assess need, as the Northern Ireland Fiscal Council itself acknowledges in its report. However, the report indicates that funding is currently broadly in line with relative need, through a combination of the Barnett-based block grant, locally generated revenue and additional UK Government funding packages. In that context, I refer noble Lords to the penultimate bullet point on page 3 of the report and the penultimate paragraph on page 21 of the report.
I should add that the report also makes clear that locally accountable leadership—to echo the comments of a number of noble Lords this afternoon—is urgently required to ensure that Northern Ireland has a stable and flourishing economy.
For many years, the Government have recognised the unique challenges that Northern Ireland faces. The argument that it has been systematically underfunded by the Government simply does not hold water, in my view. In the 2021 spending review, the Government announced that the block grant for Northern Ireland would be £15 billion per year, on average, over the next three years, representing the largest settlement since the restoration of devolution in 1998-99. We have provided around £7 billion in additional funding to Northern Ireland since 2014, on top of the Barnett-based block grant. As a number of noble Lords pointed out, the Northern Ireland budget per person is around 20% higher than the equivalent UK government spending in other parts of the United Kingdom, and it is set to rise to around 25% by 2024-25.
In 2013, shortly before we brought the G8 summit to Northern Ireland, we made available £300 million in additional borrowing power and funding top-ups through the building a prosperous and united community package. We made available almost £2 billion in additional spending power for Northern Ireland as a result of the Stormont House agreement in 2014, a further £500 million through the fresh start agreement in 2015, and £2.5 billion of financial support and flexibility through the confidence and supply agreement in 2017.
In more recent years, we have invested over £3.5 billion in Northern Ireland through the £400 million new deal for Northern Ireland, £617 million for four city and growth deals covering all of Northern Ireland, £730 million through PEACE PLUS, and £2 billion in funding and a Barnett investment guarantee in the New Decade, New Approach financial package, following the restoration of the Executive in January 2020. Noble Lords will recall that the priorities committed to by the Northern Ireland Executive within New Decade, New Approach specifically included £245 million earmarked for the transformation of the health service and wider public sector. The UK Government are also investing over £250 million in Northern Ireland through the levelling up fund, the UK shared prosperity fund and the community ownership fund.
Despite these significant levels of investment from the UK Government, over and above the Barnett-based block grant, the Northern Ireland Executive have consistently been unable to allocate this funding to deliver the much-needed transformation of public services. In that context, I acknowledge the comments made by the noble Baroness, the former First Minister, regarding the period from 2017 to 2020. Consequently, the £200 million health transformation funding provided through the confidence and supply agreement, and the £245 million of funding for public service transformation allocated through New Decade, New Approach, have primarily been used for short-term funding pressures, not to deliver genuine reform.
I gently echo the point made by the noble Lord, Lord Murphy of Torfaen, at Second Reading—and to some extent repeated this afternoon—when making comparisons with Wales on this issue. It is important to underline that that arrangement was negotiated between the Welsh Government, the Welsh Assembly and the Treasury. As the noble Lord, Lord Murphy, reminded us, the Holtham commission was established in 2008 and negotiations took place over the next seven years. That seven-year period is crucial to today’s debate because it underlines that this is not an issue that could be solved overnight, even with the best will in the world.
As was pointed out by a number of noble Lords, particularly the noble Baroness, Lady Suttie, and the noble Lord, Lord Murphy of Torfaen, it would be far more powerful if the case made by noble Lords on the Benches behind me were made from a functioning Stormont. It will not surprise anyone in this Committee to hear me say that this is an issue best addressed in the context of a restored Executive and Assembly in Northern Ireland, in discussions with the Treasury. I agree entirely with the noble Baroness and the noble Lord on those points.
More broadly, in the absence of an Executive the UK Government will be able to commission advice from the Northern Ireland Civil Service—I mentioned this at the outset—on how current funding can be used more efficiently to the benefit of the people of Northern Ireland. However, it would not be right for me to commit the Secretary of State to exploring certain defined options—that would be the effect of this amendment—in advance of commissioning Northern Ireland departments for advice on options for budget sustainability.
The noble Baroness, Lady Suttie, asked about parliamentary oversight. She and other noble Lords will be aware that, in the continuing absence of an Executive, we will need to bring forward a budget Bill, which will be debated in your Lordships’ House.
I am of course willing to continue to engage with noble Lords, particularly those who brought this amendment —as I referred to earlier, I did so this morning—on these important issues. In that spirit, I invite the noble Lord to withdraw the amendment.
Lord Morrow (DUP)
My Lords, I thank everyone who has contributed to the debate. If there is one striking note, it is that I did not hear anyone say they oppose what we are trying to do, so I will take that as a positive and welcome it. Some, of course, have said, “If we had an Executive” or if we had this or that, but I have always found in life that you are better off moving from where you are, rather than where you would like to be. That is the only way we are going to move forward. If, one day, there is an Executive—I can say with some degree of confidence that it is not going to be tomorrow—they will no doubt deal with those issues.
I was struck by one thing the Minister said when he summed up. He said that we extended additional powers for borrowing some £300 million. In my experience, any time I borrowed money I always had to repay it and sometimes, the pain of repaying it was nearly as great as the pain of asking for it. Incidentally, I never had to borrow £300 million; that just would not have happened. The Members who spoke highlighted different issues; for example, that our health service is where it is, and that we have monumental waiting lists. However, we had those when we had the Executive. There are three of us here—the noble Baroness, Lady Foster, my noble friend Lord Dodds and I—who have at different times served in that Executive. I nearly forgot—how could I?—the noble Baroness, Lady Ritchie, also served in it. We are not antagonistic to devolution. We know there are merits in it but, for goodness’ sake, can those who see our salvation entirely in a restored Executive please take on board that that will not happen at present because we do not have a level playing field? When we get to that stage, we will all be enthusiastic and break down the gates of Stormont to get in, but that is not where we are, so I ask noble Lords to take cognisance of that.
What happens when devolution is not functioning? Is it not the responsibility of government to step in and accept responsibility, as a government, and keep things moving forward? That, surely, has to be right. I do not doubt for a moment the Minister’s sincerity— no one has—but we say to the Government, “You have responsibility; let’s get on with it.” The noble Lord, Lord Murphy, quickly corrected himself and reminded us that none of us here is elected, but the other place is elected. Is that not their responsibility, or do they just throw up their hands and say, “Oh well, we can’t do anything here”? They cannot do that. Let no one underestimate the difficulties there will always be in keeping devolution afloat. Those will always be there, but the Government have a responsibility to ensure that when things break down back home, they do not shirk their responsibility to do some of the heavy lifting here to encourage the people of Northern Ireland and ensure that they do not suffer.
My Lords, I will stop there. I beg leave to withdraw my amendment, which was intended more as a probing amendment.
Royal Assent
Wednesday 24th May 2023
(3 years, 2 months ago)
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