Northern Ireland Budget (No. 2) Bill
Monday 4th September 2023
(1 year, 2 months ago)
Commons ChamberNorthern Ireland Budget (No. 2) Act 2023 View all Northern Ireland Budget (No. 2) Act 2023 Debates Read Hansard Text Watch Debate Read Debate Ministerial Extracts Amendment Paper: Committee of the whole House Amendments as at 4 September 2023 - (4 Sep 2023)
The First Deputy Chairman of Ways and Means (Dame Rosie Winterton)
We now come to—
The Minister of State, Northern Ireland Office (Mr Steve Baker)
On a point of order, Madam Deputy Speaker. I think the Mace is in the wrong place.
The First Deputy Chairman
Very well spotted—it will be moved. Thank you.
Clause 1
Use of resources
Question proposed, That the clause stand part of the Bill.
The First Deputy Chairman
With this it will be convenient to consider the following:
Clauses 2 to 9 stand part
The schedule.
I should point out that no amendments have been selected, so colleagues will need to speak very specifically to the clauses, should they wish to speak, but there will obviously be an opportunity for Members to contribute on Third Reading as well.
The Minister of State, Northern Ireland Office (Mr Steve Baker)
Thank you, Dame Rosie, and I am delighted to serve with you in the Chair today as we go through Committee stage of this vital Bill.
In the absence of a functioning Executive, this Bill will allow public services to continue functioning and help to protect public finances in Northern Ireland. I propose to go through the clauses now, and then with the permission of the Committee, respond at the end of the debate to points raised.
Clauses 1 and 2 authorise the use of resources by Northern Ireland Departments and other specified public bodies amounting to £27,403,514,000 in the year ending 31 March 2024 for the purposes specified in part 2 of schedule 1 and subject to the limits set out in subsections (4) to (7) of clause 2. I should remind the Committee that this Bill only sets out the available total resource and capital budget for Northern Ireland Departments of £14.2 billion and £2.2 billion respectively. In the absence of an Executive, it is the responsibility of the Northern Ireland Departments now to make the specific spending decisions to ensure that they live within the budget limits set out in this Bill. The Government recognise that this is not easy and requires difficult decisions.
Clauses 3 and 4 authorise the Northern Ireland Department of Finance to issue out of the Consolidated Fund of Northern Ireland the sum of £22,790,893,000 for the purposes set out in part 2 of schedule 1.
Clause 5 authorises the temporary borrowing by the Northern Ireland Department of Finance of £11,395,447,000, approximately half the sum covered by clause 3. This is a normal safeguard against the possibility of a temporary deficiency arising in the Consolidated Fund of Northern Ireland, and any such borrowing is to be repaid by 31 March 2024.
Clause 6 authorises the use of income by Northern Ireland Departments and other specified public bodies from the sources specified in part 3 of the schedule for the purposes specified in part 2 of the schedule in the year ending 31 March 2024. Clause 7 provides for the authorisations and limits in the Bill to have the same effect as if they were contained in a Budget Act of the Northern Ireland Assembly. It also modifies references in other pieces of legislation to the Northern Ireland estimates, which would normally form part of the Assembly’s supply process. Clauses 8 and 9 are self-explanatory, in that they deal with such matters as interpretation and the short title.
Finally, the schedule to the Bill sets out for each Northern Ireland Department the amount of money authorised for use, the purposes for which it can be spent and other sources of income from which it can draw. Part 1 of the schedule sets out the amount of resources authorised for use by each Northern Ireland Department and other public bodies in clauses 1 and 2 and the sums of money granted to each Northern Ireland Department and other bodies in clauses 3 and 4 for the year ending 31 March 2024.
Part 2 of the schedule sets out the purposes for which resources under clause 2 and money under clause 4 can be used by each Northern Ireland Department and other bodies for the year ending 31 March 2024. Finally, part 3 of the schedule sets out the sources from which income can be used by each Northern Ireland Department and other bodies for the year ending 31 March 2024.
I hope I have provided the Committee with sufficient detail on the intended effect of each provision in the Bill. We have also published more detailed information in respect of each of the Northern Ireland Department’s spending plans through the main estimates, which the Secretary of State laid as a Command Paper on 3 July. I look forward to hearing Members’ views on the Bill and their contributions, and with the leave of the House I will later endeavour to respond to as many points as possible when I wind up.
Tonia Antoniazzi (Gower) (Lab)
It is an honour to serve under your chairship, Dame Rosie, in this Committee. I will keep my remarks brief to allow us to hear from the Northern Ireland parties on Third Reading.
Once again we come together to debate legislation that should be dealt with in Stormont. We still have civil servants running Departments with restricted powers, trying to plug a gap of £800 million and unable to consult with Cabinet Ministers. Stormont is the right and proper place for scrutiny to take place. In this place, we cannot simply provide the level of consideration and scrutiny that this budget deserves.
To quote today’s report from Pivotal,
“managing this situation has been extremely challenging, if not impossible, thanks to two interlocked problems: no political leadership for decision-making and impossibly tight budgets.”
On the first problem, sadly I have seen no sign over the recess that indicates the restoration of the Northern Ireland Executive is any nearer. I would welcome hearing from the Secretary of State what discussions he has had over the summer with parties in Northern Ireland, as the situation is now beyond breaking point.
On the second problem—the budget—we do not oppose the Bill, as services are in desperate need of funding, but the fact is that this budget is not enough to address the problems facing public services in Northern Ireland. A real-terms funding fall of 3.3% means that existing services simply cannot continue to function as normal. The people of Northern Ireland have been left facing cuts to support and increases in charges for everyday necessities during the cost of living crisis. While we appreciate the need to explore avenues to raise revenue, the measures put forward so far may cause more societal damage than the monetary gain is worth. As I have mentioned, we are missing a vital level of scrutiny and accountability for these measures.
We, the Labour party, agree with the principle that local decisions should be made by local politicians, but the situation is now extreme. While there continues to be no functioning Executive, I ask the Secretary of State to consider what he can do within his power to help the people of Northern Ireland. This is a critical state of affairs, and the full impact may not yet be realised, as any overspends will inevitably lead to further cuts the next year. The only viable way forward for Northern Ireland is the restoration of the Executive, and I implore the Secretary of State, the Minister and the main parties in Northern Ireland to ensure that happens sooner rather than later.
Simon Hoare (North Dorset) (Con)
If I may, I will both put on record my thanks to the hon. Member for Hove (Peter Kyle) and my congratulations on his new job, and welcome the right hon. Member for Leeds Central (Hilary Benn) to his new position. I remember the speech the right hon. Gentleman gave in our debate on the anniversary of the Good Friday agreement, just before the Easter recess, which showed a depth of knowledge of, interest in and love for Northern Ireland. I am sure that the Secretary of State, the Minister of State and, indeed, the Northern Ireland Affairs Committee look forward to working with him in the weeks and months ahead.
While I understand that new clause 1, tabled in my name and that of my right hon. and learned Friend the Member for South Swindon (Sir Robert Buckland), has not been selected for debate, I hope that the Minister will give some consideration to the merit that underpins the argument with regard to the maintenance of the Audit Committee, notwithstanding Stormont not being in place.
The hon. Member for Gower (Tonia Antoniazzi) is absolutely right. The delivery of public services in Northern Ireland is under huge pressure as a result of the covid backlog in health, as we know, and an increase in demand with a shrinking supply. The recent events with regards to the PSNI will clearly be putting additional pressures on other budgets as well.
The restoration of Stormont would not provide all the keys to unlock all the currently locked or semi-locked doors, but, by God, it would make a huge difference. The hon. Lady is right on that. I have said right from the start that one can understand the points and principles of the Democratic Unionist party with regard to the protocol and the Windsor framework, but I think the Government have made it clear that will not change; it just has to be made to work. The Minister in the other place has signified that there will be additional statutory instruments. My cri de coeur is one that I have made before—it has hitherto fallen on deaf ears. This is a situation affecting public services and those who are most reliant on them. Those people—protected to some extent by this necessary budget Bill—have no choice other than to use the services provided by the state and the public sector. They cannot go elsewhere. They are looking to local politicians with a depth of understanding to find the answers to these questions.
I appreciate that this is a slightly wider point, but this Bill is required—it is brought about not through the desire of Government but through necessity. That necessity could end, and it could end tomorrow. That would lead to better governance, better decision making and transformational approaches to the delivery of public services, getting more bang for the buck and a better uplift for the people of Northern Ireland. Those of us who are committed to public service should be seeking that. I therefore support the Bill, and will support the Government in any votes in Committee or on Third Reading, but it is a sad day when we have to pass such a Bill because of some who are resiling from the positions of trust to which they have been elected.
The First Deputy Chairman of Ways and Means (Dame Rosie Winterton)
I will call the right hon. and learned Gentleman, but I remind colleagues that there are Third Reading speeches and Committee speeches, and general discussion about the merits of the Bill is probably safer in Third Reading.
Sir Robert Buckland
Thank you Dame Rosie. I will trespass upon your good will by focusing on clause 1 and the necessity of what we have to pass today. I will not repeat the comments of my hon. Friend the Member for North Dorset (Simon Hoare), which I think are sadly axiomatic in a situation that is difficult and not in the long-term interests—or even the short-term interests—of the people of Northern Ireland. It is certainly not in the interests of sustainable public services.
On the Northern Ireland Affairs Committee, we hear time and again from interested groups from the voluntary sector and the third sector in Northern Ireland about the difficulties they face with the absence of long-term planning and multi-year budgets, and the effect on their ability to retain and hire people who can do the important work of providing and helping to support public services, whether in the field of health, education or disability, for example.
Mr Steve Baker
My right hon. and learned Friend makes a very good case. I am conscious that his amendment was not selected, but if he would do me the honour, I would be glad to meet him and hear his opinions on this further. He makes some very good points.
Sir Robert Buckland
I am extremely grateful to my hon. Friend, and I would commend him for any discussions he might have with the Audit Committee and its members who have given evidence to the Northern Ireland Affairs Committee here in Westminster.
On that note I will close my remarks. It is safe to say that it is sad but a reality at the moment that we have to legislate in this way for the affairs of a part of our United Kingdom that has been given the power of devolution but, for reasons that are all too apparent, is not in a position to exercise that power. It must do so soon, not in the self-interest of the politicians who sit in that place but for the people they are supposed to serve.
Question put and agreed to.
Clause 1 accordingly ordered to stand part of the Bill.
Clauses 2 to 9 ordered to stand part of the Bill.
Schedule agreed to.
The Deputy Speaker resumed the Chair.
Bill reported, without amendment.
Third Reading.
Mr Steve Baker
I beg to move, That the Bill be now read the Third time.
I would like to place on record my thanks to all those involved in the passage of the Bill through the House. In particular, I thank the Labour Front Benchers for their constructive approach to the Bill and its necessity. I take this opportunity to welcome the shadow Secretary of State, the right hon. Member for Leeds Central (Hilary Benn), to his place; I know he will hold us to account with great skill, but will seek to pursue the best interests for the people of Northern Ireland. I heard him say “peace, prosperity and progress”. That is what we all want.
I thank Diggory Bailey in the Office of the Parliamentary Counsel for the expert fashion in which he and colleagues drafted the Bill with Northern Ireland counterparts in the Office of Legislative Counsel and the officials in the Department of Finance who assisted greatly in our preparation for this Bill’s passage.
It is no secret that the pressures on Northern Ireland’s public finances are acute. As with the 2022-23 budget, setting the budget was not an easy task but it was necessary to deliver a balanced budget and provide the Northern Ireland Departments with budget clarity to help to get spending under control. As far as possible, we have aimed to protect frontline public services. In recognition of the pressure on the health service, over half the total budget is earmarked for health.
As I have said many times from this Dispatch Box, and as the Secretary of State for Northern Ireland has said many times, people in Northern Ireland rightly expect to see these decisions taken in Stormont and not in Westminster. We agree with them. However, until that happens, the Bill will allow public services to continue functioning and help to protect public finances in Northern Ireland. I therefore commend it to the House.
Hilary Benn (Leeds Central) (Lab)
May I begin by expressing my thanks to my predecessor, my hon. Friend the Member for Hove (Peter Kyle), who has already been mentioned this evening, for the outstanding contribution he made in this role and to wish him well in his new job?
It is clear from the debates during the Bill’s passage that the current situation was not sustainable, hence the need for the Bill. Public services are under strain. Indeed, the Minister has just said that the pressures are acute and I agree with him. It is noticeable that the Bill has been widely perceived as a budget that does not take account of those needs and those pressures. It is clear that we cannot keep setting budgets in this way and that the structural problems in Northern Ireland are getting worse in the absence of an Executive. It is not fair or right to ask civil servants to make decisions which politicians should be making. The political vacuum in Northern Ireland is having serious consequences. The crisis facing the police service is all too evident—we discussed that earlier today in the urgent question—and the Secretary of State heard many references to the financial pressures it is already facing, never mind the costs that may arise from responding to the data breach. But there are concerns about other Departments, too. NHS waiting lists for Northern Ireland are the worst in our country. There are reports that Northern Ireland schools are only now being surveyed for structural weaknesses caused by reinforced concrete. If that finds that costs are required to be met to repair or replace those roofs, will that money have to come out of the budget set by the Bill? I understand that the Secretary of State has received advice from civil servants about possible revenue-raising measures. How does he plan to use them? Will they be published?
Those and other challenges are the stuff of Government. It is what we are elected to deal with wherever it is that we sit, but that is not happening in Northern Ireland at the moment and it needs to in the interests of its citizens, a point made very clearly by the hon. Member for North Dorset (Simon Hoare), who chairs the Northern Ireland Affairs Committee. On Second Reading before the recess, the Secretary of State said:
“The summer therefore presents an opportunity for the Northern Ireland parties to come together as a restored Executive and take their own budget legislation through the Assembly, making the remaining stages of the Bill in this place superfluous.”—[Official Report, 10 July 2023; Vol. 736, c. 101.]
Now, we would all wish that that had happened but, as my hon. Friend the Member for Gower (Tonia Antoniazzi) pointed out, it is not entirely clear what was done over the summer by the Government to try to bring the Northern Ireland parties together. We know that the Prime Minister was very happy to visit Northern Ireland after the Windsor framework—a great achievement, but it was meant to restore power sharing—but his absence since has been noticeable. And it is not clear, to be honest, what the Government’s plan is now to regain trust, including by responding to the continuing concerns expressed by the Unionist community in Northern Ireland to enable the institutions to get up and running again.
The Labour party does not oppose the Bill as to do so would cause deeper instability, but, as I think everybody who has contributed so far tonight has said, the best and only way forward is the restoration of Stormont so that local representatives can get to grips with the budget and be accountable to the people who elected them, the people of Northern Ireland, for the decisions they make. Frankly, that day cannot come soon enough.
Madam Deputy Speaker (Dame Rosie Winterton)
I call the Scottish National party spokesperson.
Richard Thomson (Gordon) (SNP)
I, too, welcome the right hon. Member for Leeds Central (Hilary Benn) to his new position, and I look forward to working alongside him as we discharge our respective roles in opposition to the Government.
I will begin with the now customary bromide that we all wish we were not here to discuss this, and that all the relevant decisions should be made in Stormont, which should be up and running again, scrutinising a functioning Executive—but the fact is that we are back here, and, as I said on Second Reading and as other Members have also said, this is not a budget in any meaningful sense. It is about the allocation of money and what it can be spent on, but it is devoid of any political steer for the emerging priorities and challenges facing communities in Northern Ireland. It is a hospital pass given to the civil servants who have been left to administer, effectively, a salami-slicing exercise with little more than the guidance that they
“must control and manage expenditure within the limits of the appropriations set out in Budget Acts”.
Even within that total, however, the budget has reduced the overall amount available to departmental budgets in Northern Ireland, which means that funding is heading in the opposite direction not only to the pressures of inflation, but to demand for public services and the pressing need—in a cost of living crisis—to negotiate a fair set of settlements across the public sector. Overall, even with the spending decisions that can lawfully be taken at the moment, Northern Ireland is heading for a budget overspend of about £500 million. Expressed like that, it just sounds like a big number, but it is a big number with enormous consequences, and, as ever, those who will be affected are the most vulnerable groups in society, the least well off, and those who are most dependent on public services.
It is not my intention to go through every line of the budget and all the programmes that will be cut, the services that will be reduced and the areas in which people will simply have to do with less in the absence of decision making. However, it is plain that ministerial decisions are urgently needed for the setting of a budget with the necessary strategic direction, which can provide the clarity that will enable the civil service to work with it and deliver not just sustainable public finances, but sustainable public services.
Let me suggest to Ministers, as gently as I can, that standing back and watching Northern Ireland’s public services suffer with less money, and observing the consequences in communities, is a tactic that will have limited effect if the intention is to drive people back to negotiations. The solution to a non-functioning and non-sitting Stormont clearly lies elsewhere. I do not underestimate the challenge that will eventually face an Executive when one can return, but nevertheless this is not the way to bring about the set of circumstances that we all wish to see. The solution that will enable Stormont to sit once again, and enable an Executive to be formed and to function, self-evidently lies elsewhere, and I urge Ministers to continue to do all that they can—to do more, in fact—to help to bring that about.
Sammy Wilson (East Antrim) (DUP)
The hour is late, so I will make just a couple of points about the budget. The first is that, of course, political parties in Northern Ireland have elected representatives. We have our own priorities. We have things that we want to see done, and things that we believe should not have money spent on them. Of course we would love to be in a situation where we had a restored Assembly, but I think that the new shadow Secretary of State—whom I congratulate on his appointment—hit the nail on the head when he said that Government had a responsibility to regain the trust of the parties of Northern Ireland, and this Government have singularly failed to do so. One only has to look at the way in which they have handled affairs since the Windsor framework was introduced. They took Members off Committees because they suddenly realised that the arguments being put forward for legislation were not even going to wear in their own party, so at the last minute we had half the Committee replaced. Over the summer period we have had regulations introduced without any chance of public scrutiny. That enabling legislation will have an impact on trade between Northern Ireland and the rest of the United Kingdom. Now we are heading towards the autumn, when the border operating model will see checks on goods coming from GB into Northern Ireland, as well as Northern Ireland manufacturers and producers finding themselves subject to checks when they try to sell into the GB market. The Government say that they want to restore trust and give us an assurance that we are part of the United Kingdom and a fully integral part of the United Kingdom market, but there is no evidence of that.
Quite honestly, no Government can expect Unionist representatives who have fought to maintain the Union to go back into Stormont to implement policies that will drive a further wedge between Northern Ireland and the rest of the United Kingdom, and where they will be obliged to accept EU legislation, which even the Windsor framework indicated would be the cause of divergence between Northern Ireland and the rest of the United Kingdom.
If the Government really want politicians in Northern Ireland to play a role in deciding budgets and how they are spent, they first of all have to accept that Unionists cannot and should not be expected to participate in the demise of the Union by having to sit in an Assembly that would be forced to implement the very policies that they believe are detrimental to the Union. It would be hypocritical for DUP Ministers and Unionist Ministers to sit in the Assembly and by law—because the courts have ruled on it—have to implement something that their colleagues could be standing here in this place condemning and saying was detrimental to the Union. There is an onus on the Government to recognise that the Windsor framework has not sorted out the issues and that it has made them worse. I think that October will show that it has made them worse, and if we want devolution restored, it has to be on the basis of—
Mr Baker
I am listening carefully, and I appreciate the tone in which the right hon. Gentleman is delivering his remarks, but I have stood here at least twice and said that we recognise that this is a hard compromise for Unionists and Eurosceptics. I think it has to be said that the European Union has its own stakeholders. Personally, I was among those who said for a long time that we could have administrative and technical solutions to deal with the issues of Northern Ireland. I worked on that before the referendum and subsequently I saw to it that papers were produced after I resigned from the Government in 2018.
This is a subject extremely close to my heart, but since the right hon. Gentleman raises it again, I would say to him and to all Unionists, of whatever strength of opinion, that one has to choose from the available futures. He knows that; he is a more experienced politician than me. One has to choose from the available futures. The EU has its own stakeholders. We have managed to reset the relationship with Ireland and with the European Union, and that offers the hope of a better future for all of us in western Europe.
On the budget, the surest way to harm the Union now is to allow Northern Ireland to fail, because people vote for change when the world is not working for them. When I look at the available futures for Northern Ireland, I see that the one that is going to work best and best preserve the Union is to get on and get Northern Ireland working. I know that the right hon. Gentleman is frustrated. I am frustrated, too, and I would like to have done better on the Windsor framework, but now we have to choose from the best of the available futures.
Sammy Wilson
That is the kind of answer that worries me as a Unionist, and it should worry many people in the Minister’s party if they listen carefully.
The Minister seems to be taking the view that, because stakeholders in the European Union demand certain things, the Government should respond. This Government have an obligation, first of all, to the country they govern, and that obligation is to make sure the country is not broken up. That should be the main consideration, not what stakeholders in Europe think and not re-establishing relations with the European Union and the Government in Ireland, if that means breaking off and destroying relations with the people of part of the country to which we belong. If that is the approach, I do not think we will get very far. This surrender approach is not a compromise that Unionists can accept. The Minister may find it acceptable, but we do not find it acceptable.
Mr Steve Baker
I know this is a debate on the budget, so I will try to be very brief. I know the right hon. Gentleman does not need me to give him a lecture on the Belfast/Good Friday agreement, but Northern Ireland has had particular problems and a particular status that do not exist in my constituency or anywhere else in Great Britain. We have to face up to the reality of where we are. This Government believe in the Union, but we also respect the Belfast/Good Friday agreement in all its dimensions, and that includes devolution. I implore him to make the Union work.
Sammy Wilson
Of course, the important thing in the Belfast agreement was that the status of Northern Ireland is guaranteed, and that no change would be made to Northern Ireland’s status unless it is decided by the people in Northern Ireland. The people in Northern Ireland did not agree to this change of status, which makes it a vassal state of the European Union.
I do not want to labour the point—I understand that you are being very good in allowing me to emphasise this point, Madam Deputy Speaker—but if the Government wish to see Northern Ireland politicians make decisions on this, they have to respect that there is a Unionist tradition and a nationalist tradition in Northern Ireland. They cannot ignore the Unionist community’s concerns, worries, fears and opposition to the arrangements that are currently in place. Far, far worse, they cannot expect Unionists to co-operate in facilitating the implementation of those arrangements.
On the budget, the Minister has accepted that there is pressure on public services and spending in Northern Ireland. Nearly everyone who has spoken has said that it would be much better for politicians in Northern Ireland to make these decisions. The truth of the matter is that, even if the Assembly were up and running, it could not deliver the basic services that are expected in Northern Ireland and that are funded in the rest of the United Kingdom, because the Government have done two things.
First, since 1922—and the Fiscal Council has made this clear—expenditure on public services in the rest of the United Kingdom has been based on need, but the Government have ignored their own criteria and the basis on which they decide spending in the rest of the United Kingdom. The Holtham formula has not been applied in Northern Ireland. Indeed, the Fiscal Council has estimated that, as a result of need not being considered, we probably have about £322 million less expenditure available than we would have had if we had been treated on the same basis as England, Scotland and Wales.
I do not believe the Assembly’s decisions have always been good, and I do not believe there has always been the wisest use of money, but the problem has not primarily been caused by the Assembly. The Government’s decision not to base this budget on need is causing some of the issues.
Let me give an example. Education spending has gone up by 6% in the rest of the United Kingdom, but it has fallen in Northern Ireland. The overall budget for Northern Ireland this year has fallen by 3.2% in real terms, whereas the budgets for the rest of the United Kingdom went up by 1.7% in real terms. That is partly a result of the fact that the formula used for the rest of the United Kingdom, which is based on need, has not been applied in Northern Ireland. Of course, the situation has been exacerbated by the Government’s decision to claw back the overspend by the Assembly in the last year in which it was sitting, which amounts to about £287 million. So the pressure on public services, which the Minister has lamented, is partly caused by the decisions that have been made here; they will affect the amount of money we have to spend in Northern Ireland.
I could go through the consequences for each Department, but I am not going to do so at this time of the evening. However, in education we have a real-terms cut, and in policing we are already about 1,000 officers below what the New Decade, New Approach and the Patten arrangements said we should have. That situation is going to get worse. Of course, we also now face the expenditure that is going to be necessary because of the problems in schools and the massive expenditure that will result from the data breach in the Police Service of Northern Ireland. So far, no clear indication has been given that the payment for those things will come from anything other than this overstretched budget. It would be useful for the Minister to indicate to us at the end of the debate whether the money that has to be spent on making schools good as a result of the problems with the concrete that was used, and the massive spending that there will be on fines from the Information Commissioner, the relocation of officers and the mitigation measures that have to be taken to protect officers, will still come from the overstretched budget or whether there will be an in-year consequence for that. Alternatively, will it be treated simply the same as the Barnett consequentials? Will the future Barnett consequentials be treated and ignored?
I hope that the Minister fully understands our position. We are not being truculent. We are not piqued because we have not got our way. We are simply making it clear that the ask that is being made, on the political compromises on the Union and on the financial difficulties that this budget would cause, makes it impossible for the Assembly to be up and running again.
Claire Hanna (Belfast South) (SDLP)
I start by thanking the hon. Member for Hove (Peter Kyle) for his service as Opposition spokesman. He was an enthusiastic and frequent visitor to Northern Ireland, and that was always appreciated. I warmly welcome the right hon. Member for Leeds Central (Hilary Benn). His is a widely welcomed appointment; he is a very substantial person and I just hope he is not regretting his life choice having watched this evening’s debate.
I will not rehearse all that we and others said on Second Reading, except to say that this is, unfortunately, another milestone of failure, delivering this budget in this place. It is another blow to public services and to public faith in politics in Northern Ireland. As we said before the summer, this is about choices. Every budget that everybody has to make faces choices, some of which are difficult and will not be popular with everybody. However, the choice to withhold government is one rejected by the overwhelming number of people in Northern Ireland, of various different backgrounds, most of whom, whatever our differences, want to choose devolved government, hard work, partnership and compromise, as my party is doing. Yes, that includes compromise on constitutional issues, which many of us do every day of our lives when our identity does not match up exactly in every way with the Government we have. However, we work at it and we work on the common ground, in the interests of all the people.
In the interests of protecting those services, on Second Reading we put forward our detailed triple lock proposals, which were a way to protect services from the short-term sharp cuts and to create a pathway to longer-term reform that the public services need. As Members will know, at this stage of this budget we have also tabled a proposal to design an informal consultative role for the Irish Government on these budgetary decisions.
Plan A is a reformed Stormont, where everybody makes decisions together. Plan B is changing the rules to allow those who want to work to do so, but we are registering the principle that hanging around for month after month, doing nothing about the challenges facing Northern Ireland, drifting into the cosiness, for some, of direct rule is just not good enough. The rest of us get to have views and opinions, and good governance as well.
This is not a proposal for joint authority, but Democratic Unionist party Members should be aware that the longer they insist that Northern Ireland cannot work, the wider, deeper and louder the conversation about our changed constitutional future will be. There are big choices ahead about our future, but also about the here and now; it is the here and now that this Budget impacts so substantially. As we outlined before, it has a catastrophic impact on health, education, climate resilience and economic opportunity.
At the weekend, the Secretary of State said that there would be no sticking plasters, but the allocations do not even allow for any healing. For example, next week Northern Ireland will host an investment conference. We will seek investment not only against the backdrop of the governance black hole but with over 100 areas of Northern Ireland that cannot be developed at the moment because of a serious lack of wastewater infrastructure. However, this Budget means that the Government—the 100% shareholder—will not invest in that infrastructure or follow the proposals made by the utilities regulator. That is literally, in a very direct way, impacting not just the environment but our economic future.
The think-tank Pivotal has produced a sobering report, which I hope every Member here will read and absorb, called “Governing Northern Ireland without an Executive”. It details the impact of the neglect and the long tail of the damage that these periods of desertion have on everybody in Northern Ireland. We have a shortfall of about £800 million and the most vulnerable have a bleak year ahead. People in Northern Ireland feel that a global game is being played with them and around them. I say to those people who manipulate the public and leave the public hanging, and then try to get them to go along with their proposals and have faith in them about the constitutional future: it is not going to work.
Gavin Robinson (Belfast East) (DUP)
It is a pleasure, as always, to follow the hon. Member for Belfast South (Claire Hanna), my constituency neighbour, but the content of my speech will be slightly different from hers.
I will not delve into the Committee stage, amendments that were tabled but not brought forward, or amendments that were needlessly provocative and stepped far away from the principles that the party that tabled them purport to stand for, but I want to talk about the Northern Ireland Budget (No. 2) Bill, which is the second such budget Bill that has been before this House this year.
When we discussed the original Bill, it was just called the budget Bill, rather than No. 1 or No. 2. We were dealing with last year’s financial position and, at that stage, Members from my party introduced the discussion around need. We challenged the Government about their understanding of need, and we were patronised at that time. We were told, without any sense of irony, shame or knowledge of the facts, that in Northern Ireland we are over-funded and get £1.21 for every £1 that is spent in England.
But still we tried to bring the conversation back to assessed need and the similar process that Wales had to go through over five years with the Holtham Commission. However, there was no sense that the position that we were outlining, identified by the Northern Ireland Fiscal Council in September last year, was a position that recognised that while our Budget may grow by 3.6%, public spending in England was going to grow by 6%, or a recognition that by the end of this financial cycle households in Northern Ireland would each be £2,000 less well-off than their counterparts in the rest of the United Kingdom, and therefore there was a budgetary problem. It has taken from January of this year to now for that seed to start germinating.
When there is a recognition in public discourse that this is a punishment budget before us this evening—this has been described as a punishment budget, which has been ignored by those in power—and no decision is taken to change it meaningfully or beneficially for the people of Northern Ireland, it will hurt us economically. We cannot systemically assess Northern Ireland public finances and know that what Northern Ireland gets is less than what it needs and not recognise that that has a material impact on the delivery of public services. Yet that is exactly what we are discussing this evening. The Fiscal Council has now published and what it says is recognised. I remember the back and forth with the Chairman of the Northern Ireland Affairs Committee. I was grateful that he took on my request to carry out an inquiry on this issue. He has been on a journey and now recognises that when the Fiscal Council says what we need to deliver effective public services with £1.24, we are getting less than what we need. When that is done year on year, there is a compounding negative impact. It means that every year we are starting with less and that this budget simply has a recurring feature of making sure that public services in Northern Ireland are denied the money that they need to be operated effectively.
I know that repetition is not sinful in this place, but it is worth reiterating time and again that, until the Government embrace this discussion meaningfully and properly, Northern Ireland public services will not be able to flourish. Drastic decisions that are being taken and have been taken will continue to be taken.
Simon Hoare
What the hon. Gentleman is saying is undoubtedly true, but does he also accept—I think the Select Committee has been hearing this during our inquiry—that there is a real sense of frustration among many of the professional practitioners about the absence of the delivery of transformational change: delivering public services in a different way; or getting more bang for the buck, to put it more crudely. A functioning Executive in Stormont would lead to some big, bold and brave decisions. I understand that would be difficult for parties across the piece, but trying to deliver public services in the same old way in the absence of transformational change, given budgetary pressures across the public purse in respect of whichever party in the UK, is an opportunity that is missed and is to the detriment of people across the whole of Northern Ireland.
Gavin Robinson
The best that can be hoped for in this scenario is that a return to devolved Government means that locally elected representatives and Ministers in an Executive can make the choices based on the information put before them. The hon. Gentleman cannot—nor can I—dictate what those choices should be. The choices have been there for previous Executives, yet I may argue that the wrong decisions have been made. But what I am suggesting in the here and now is what we can control. Not only are we continuing to finance less than what we need, but we are continuing to break parity between the delivery of public services in Northern Ireland and England, Scotland and Wales.
The former Secretary of State, the right hon. Member for Skipton and Ripon (Julian Smith), who is in his place, will remember the pay award parity issue that abounded whenever he was embarking on the New Decade, New Approach discussions in 2019, culminating in a deal in 2020. The first nursing strike ever in any part of the United Kingdom was based on that pay parity issue alone. And here we are, just three years later, and parity has broken again. Here we are from the last financial year and we recognise that there is not only a £500 million projected overspend this year, but a £575 million public pay pressure. When we add on the overspend from last year, which was £297 million but now seems to be £254 million, the figure, whatever it is, takes us close to a deficit of £1.3 billion.
I agree with the Secretary of State when he said—I am sure with much thought—that Northern Ireland does not need the sticking plaster of a one-off financial package. Let me be very clear that not one person from my party, or anyone sensible from Northern Ireland, has suggested that what we need is a one-off, one-year sticking plaster to fix a problem that is of this Government’s making. We are asking for a pragmatic and mature reflection on how much it costs to deliver Northern Ireland’s public services, and to get on with recalibrating the Barnett formula to ensure that we can do so. That is what we need. That is not yet what we have. The choices will be there for a new Executive.
The second most drastic thing that I think the Government have introduced into the debate is the notional view that we just need to get on and raise revenue. You have heard it, Madam Deputy Speaker. The Minister mentioned it this evening: a £27 billion budget for the forthcoming year. Take household rates, the biggest household contribution to the public finances that individuals make outside of tax and national insurance, with £1.7 billion raised each year. Can we honestly imagine indicating in a cost of living crisis to our public, businesses and wider society that they should double their domestic and non-domestic contributions to household rates? Doubling them would allow us to get close to where we need to be. No problem. By 2025, we will have £2,000 less than every household in England, but add another £2,000 on, please, to stand still. Get real. Transformation? I have an idea: let us raise money by increasing tuition fees.
That brings me back to when I replied to the hon. Member for North Dorset about the choices that an Executive will have. We cannot determine those, but in the past whenever people were saying that there should be an increase in tuition fees it was for a beneficial outcome. Increase tuition fees and we can get rid of the maximum student numbers cap. Increase tuition fees and we will be able to fund more places so that our best and brightest will no longer have to leave Northern Ireland to be educated in England, Scotland and Wales, or anywhere else in the world. Those were positive benefits from an increase in tuition fees, yet it was never politically acceptable. Now what is on offer is just raising the cost to stand still, or to provide public services when we know that what we get is not sufficient to match the need.
Nobody is asking for a sticking plaster. Nobody can say what the choices shall be. I did not intend to speak for as long as I have, and I want to let other people contribute, but here we are again, with the second budget Bill of the year and the same challenges. It is progress at least that on 5 July the Deputy Prime Minister accepted for the first time, in response to a question from my right hon. Friend the Member for Lagan Valley (Sir Jeffrey M. Donaldson), our party leader, that finances in Northern Ireland need to be predicated on need. That was the first time that we had heard that. Having been dismissed and ignored in January, we had acceptance of it in July. Yet the challenge is there for the rest of the financial year.
The punishment budget that has been outlined and is being advanced this evening will continue to cripple the effective delivery of public services in Northern Ireland. I have heard nothing from the Northern Ireland Office, or from anyone else around Government, to suggest that they are in the space of turning that around within this financial year. We are halfway through it. We want to see political progress, but the idea that we get political progress only for an incoming Executive to falter because they cannot deliver for the people would be the biggest crime of all.
Stephen Farry (North Down) (Alliance)
At the outset, may I join in paying tribute to the outgoing shadow Secretary of State, the hon. Member for Hove (Peter Kyle), and in welcoming to his new role the right hon. Member for Leeds Central (Hilary Benn)? We are going to miss him on the UK Trade and Business Commission, on which he has had a very keen interest in recent years in Northern Ireland and the fallout on it from Brexit, which has had major ripple effects through our politics—not least, as we can hear this evening, on the subject of this debate.
It is six weeks on from Second Reading and it is fair to say that the situation in our politics has not improved. There is no sign of any return to devolution; indeed, the response from the right hon. Member for East Antrim (Sammy Wilson) to the Minister of State illustrates the lack of realism about the choices that face us collectively in Northern Ireland, and the choices that face Unionism in ensuring that Northern Ireland works for everyone. That is in everyone’s interest, not least the interest of Unionists.
With the public finances, I would argue that the situation is indeed much worse than it was six weeks ago, because the Northern Ireland budget is on an unsustainable trajectory. The budget that was set, as others have said, was not sufficient—it was inadequate—but there is a second layer to this, because the guidance to civil servants in the Northern Ireland (Executive Formation etc) Act 2022 does not allow them to take the decisions necessary to live within the measly budget that has been granted.
As the hon. Member for Belfast East (Gavin Robinson) has said, we already have a situation where it is projected that Northern Ireland will overspend by at least £500 million, which is greater than the overspend from the last financial year. That is more than £500 million of public pay pressures before Northern Ireland can even have parity with the settlements that have taken place elsewhere in the United Kingdom. Something is going to have to give. Either an Executive come in with a financial package and can begin to address some of those pressures, or the Government are essentially going to take it on the chin and accept that Northern Ireland will overspend.
That begs the question of what will happen with that overspend in future years. Will it be an albatross around our neck for years to come? Will people be expected to make cuts, or will the Government make cuts in-year to try to balance the budget? I would suggest that trying to do that in-year is now impossible, not least because so much of our budget is linked to salaries. We would lose people, and even if we did we would have to have redundancy payments for them. The only way anyone could possibly balance the budget at this stage is through stopping services completely, which is utterly inconceivable and untenable.
The point has been made that the budget situation is bad and will always be bad, and that having an Executive does not make any difference in that regard. I am not suggesting for one minute that a restored Executive will be a silver bullet, but I suggest to my colleagues who perhaps are dismissing the relevance of devolution at this point that every single stakeholder, when they are asked to comment on the budget crisis, stands up and says, “We want to see an Executive in place.” Whether we are talking about healthcare professionals or people who work in the education sector, the business community or the voluntary community sector, all of them are saying with one voice, “While it is no magic solution, we do want to see the Executive back in place.”
That reference to a restored Executive leads me on neatly to the point I really want to stress regarding a financial package: we need to see a twin-pronged approach to addressing Northern Ireland’s financial needs. Of course we need to address the lack of financial parity and the fact that Northern Ireland is not funded based on need. There is a structural problem of underfunding there, so things are not more generous in Northern Ireland than elsewhere.
I want to pick up on the comments made by the Secretary of State at the weekend to the British-Irish Association in Oxford. The conference is held under Chatham House rules, but I want to comment on what is in the public domain, as released by the Northern Ireland Office itself. In that speech, the Secretary of State was very negative about the concept of a financial package. He talked about money being thrown at Northern Ireland and Executives having squandered financial packages in the past—and there might be an element of truth to that. He said that the Executive need to stand on their own two feet—and, again, that is a worthy aspiration. But I stress that the notion that Northern Ireland can run a balanced budget, invest in public services and drive the economy from a burning platform will never happen. We will see more cuts flowing from budget cuts, and we will end up with decline and more decline. We will end up in a downward spiral in which Northern Ireland becomes ever more dependent, and we will see activity stop and more and more young people leave. That is not the future that I hear the Government articulating in their vision for a prosperous society in Northern Ireland, but what they are doing in terms of the budget belies their very worthy aspiration.
I ask the Minister of State or the Secretary of State to clarify in winding up that something will potentially be on offer when we seek a financial package. I appreciate that that is something that the Government may wish to do solely in the context of a restored Executive rather than up front, but it is important for any financial package to be based around transformation, a proper strategic plan and a programme for government for a restored Executive. That Executive must have clear targets and milestones, and a very clear idea as to how investment can turn Northern Ireland around. That is something on which a restored Executive can work in partnership.
Mr Steve Baker
The hon. Gentleman has just hit the nail on the head: a restored Executive could work in partnership with the Government. But I just emphasise to him that the sum available in this budget is the same as would have been provided were an Executive in place. Just to take further his point about reform and so on, he will know that since 2014, we have put £7 billion into Northern Ireland on top of the block grant. Various commitments to reform have been given in different agreements over the years on various fronts, including education, but it has not happened. I think we are all now getting to a point where we are terribly frustrated on all those fronts. He has hit the nail on the head: we need a restored Executive and then to work in a positive way together to make Northern Ireland function for its people, and that is what we are very willing to do.
Stephen Farry
I am very grateful to the Minister of State for his comments. I largely agree with him, but I will point to a certain disagreement on some aspects. I fully recognise that there have been past financial packages and problems with reform not being fully realised, particularly around integrated education, which is a clear example. We have to do better in that respect. From where we are, I do not see any alternative to trying to do that once again and learning the lessons from what happened in the past. I recognise that we have seen additional funding packages from the UK Government—obviously, we had a major uplift in support to deal with covid and its side effects on the economy, and that support was very welcome—but the fact is, as other Members have said, that our expenditure per head is not based on our need, and that fundamental point has to be recognised.
Gavin Robinson
I think it is helpful to emphasise at this point that, although the Minister indicated that this budget is exactly what an Executive would have been allocated were they in place, last year it was £322 million less than what an Executive would have needed, this year it is £431 million less than what an Executive would have needed, and the projection for next year is £458 million less. So in saying what he said, has the Minister not confirmed the real problem at the heart of this?
Stephen Farry
Indeed. I think we are talking to two separate points in that regard. Yes, the block grant would have been based on the current policy approach from the Government towards the Barnett formula and the assessment of need in Northern Ireland, but what we on these Benches are all saying is that we need to reassess the whole basis of how that is reflected. That is a conversation to be had. I would also take the point a bit further by saying that, if we had had an Executive in place, or indeed if we get an Executive in place shortly, that would be the form by which we could make this case much better to address both the fiscal squeeze and the negotiations on a financial package for Northern Ireland.
To give a human flavour to the scale of the crisis facing our society, I will close with one example of an area of crisis in Northern Ireland: special educational needs. There is a real crisis happening in that regard: the funding available is not meeting the levels of need. As I think all Members appreciate, this is one of the most sensitive areas, and one where Government has a duty to invest in children and ensure that their rights are properly protected. As we meet this evening, that is simply not the case in Northern Ireland. There are multiple failures to provide for children; the academic year has now started, but scores of young people still have not been allocated suitable special educational needs places. That has a major toll on parents and families—mental health issues and financial and career pressures—and on the children themselves, particularly a lack of opportunity, health and safety issues, a risk of regression and a lack of social inclusion. I appeal to Members, from whatever perspective we look at this—the Government in terms of setting the financial parameters, and also those who are still holding out for an Executive—that we need to get back to addressing those types of issues. That is what the coalface is like, and that is what we should be prioritising.
Ian Paisley (North Antrim) (DUP)
We are approaching tomorrow, so I will try not to detain the House too long with the comments I wish to make on this important Bill. At the outset I want to pay tribute, as others have, to the hon. Member for Hove (Peter Kyle), the former shadow Secretary of State, who has now moved on to another post. He visited my constituency on more than one occasion and spent time with businesspeople and community leaders there, which was much appreciated. It was very clear that he wanted to learn as much as he possibly could about Northern Ireland, and he used that information wisely and, on many occasions, powerfully in this House. I hope he continues to maintain that interest, particularly in the hydrogen technologies that he looked at in Northern Ireland, in his new role. I wish him all the very best.
I also welcome the right hon. Member for Leeds Central (Hilary Benn) to his new post. He brings a level of gravity to the post, which is very important, and I wish him all the very best as well. I hope that, as a supporter of Leeds United, that brings us closer to at least some extent.
When the Minister of State opened the debate this evening, he made it clear that he was putting a budget in place—I think I quote him correctly—that would allow Northern Ireland Departments to continue to function. That was its purpose. Of course, at some level those Departments will continue to function, but they will function on the most stingy budget Bill ever brought forward: a Bill that is a crisis point. Whether there is direct rule, the current formation that we have, or a devolved Assembly operating, the current budget is inadequate. It is a disaster for many of the Departments in Northern Ireland, and it will not allow government to function, or to function normally. Many of those Departments have been cut to the bare bone with regard to what they will be expected to deliver.
What lies at the heart of this budget Bill? Of course, it is a fundamental unfairness. It is unfair in terms of the budget allocation; the formula, or the definition of need, that has been used in relation to Northern Ireland; and the outcome that it will have for the people of Northern Ireland, irrespective of their political or other identity. This is a grossly unfair budget, and it will impact harshly on the people of Northern Ireland. It has been described as a “punishment budget”, and I say frankly to the Secretary of State, his Minister and his team that I think it is designed to be a punishment budget—to punish Northern Ireland because of political circumstances.
If the Government are making an argument tonight that they want an Assembly back, this is a very strange way to go about it, because they are basically saying to the political class in Northern Ireland, “If you go into the Assembly and you try to run it on this pinching, stingy budget, you will deliver to the people of Northern Ireland a disastrous arrangement.” It is no encouragement whatsoever to politicians to go into the Assembly on that one narrow point of the budget. Of course, my right hon. Friend the Member for East Antrim (Sammy Wilson) has outlined much more detailed reasons as to why Unionists would not go back into the Assembly on the current arrangements until issues around the Windsor framework and the protocol are resolved.
If ever we needed leadership from the Government that led to decisive outcomes, it would not be this stunt budget that has been pulled in Northern Ireland. It is a pathetic excuse for a budget, and it will damage the opportunity to try to build better relationships not only within this House, but across Northern Ireland. The Government would not dare bring forward these sorts of arrangements for any other part of the United Kingdom—they simply would not dare and they would not have the affront to do it—and it is appalling that they are doing that for this part of the kingdom, Northern Ireland.
The hon. Member for North Down (Stephen Farry) rightly identified that, if we are going to raise more revenue opportunities and invest in the public service, we need resources to do that. I notice that, in our newspapers every day, there are threats that the Northern Ireland Secretary is going to introduce water charges. I have heard this before. When I speak to the head of Northern Ireland Water, she tells me that, to get us back to an even keel in Northern Ireland with regards to the infrastructure of our water service, we need to invest about £2 billion. That is just to get it back to a level playing field and to a state where we could charge people for the water service. Are the Government proposing to put that sort of investment into the process, or are they just saying, “No, we’ll bring in water charges”? It is impossible to bring in water charges and well the Secretary of State knows it.
Just look at the cuts that are being proposed. The shadow Secretary of State rightly identified the problems to do with the concrete in schools across Northern Ireland, yet the education budget is being given the single largest kicking by the Government. Its budget is going to be down by 2.7%. If there is a crisis identified in the schools’ structure—another crisis in the schools’ structure—they just will not have the resources or the capability to resolve that, and we are going to see a major funding crisis there. Justice funding is down by 1.5%; I will come to some more points about that in a moment. Of course, the Department for the Economy funding is down by nearly 1% and this comes in the jaws of the great economic conference the Government are holding in a matter of seven or eight days in Northern Ireland. They are going to invite investors from all over the world and to say, “Come and invest in Northern Ireland—by the way, we have decided to cut the budget of the Department for the Economy, and we have decided to cut the budget for education and for other parts of Northern Ireland”. What sort of a message is that going to send to potential investors? If the Secretary of State has to try to sell these issues to outside investors whenever they decide to cut the budget, I certainly would not want to be a Northern Ireland-based devolved Minister trying to make that point.
Mr Steve Baker
Thankfully, the hon. Gentleman is not writing the speeches for the investment conference next week because, if he were, it would not be very successful. What he knows and I know—and any of us in this House know who knows Northern Ireland—is that it has an amazing, vibrant private sector with terrific entrepreneurs, who are incredibly well grounded in place, care about their communities, and care about making a profit justly while taking care of the environment. They are amazing, inspiring people who can succeed if they are provided with the right capital. If anything, what we are trying to do here, on the point he makes, is to make sure that the very poor quality politics of Northern Ireland ends up matching the very high quality of the private sector. If we could pull that off, Northern Ireland would soar.
Ian Paisley
I thank the Minister, but I was once told, “If you throw a stone among a pack of dogs, the one that yells the loudest has been hit the hardest.” I think that point maybe hit the Minister just a little bit this evening in that he knows that to say to investors, “By the way, we’ve cut the budget”, is not actually a good look for the Minister.
I want to turn to the issue of the cut to the Department of Justice funding; it is down by 1.5%. We all know that the morale of the police is at an all-time low. The issue of police pay for probationers has been raised in this House. It is very difficult to encourage young and newly qualified police officers that what they are doing is worth while. That is because the Department of Justice is going to be faced with another cut.
We have had the drama in recent weeks of the data breach. Police on the database have, shockingly, been given advice that they should remove themselves from the electoral register. That is one of the ways in which they can now protect themselves, undermining the democratic process for them and their families. The integrity of the MI5 officers who work in Northern Ireland has been undermined. That has a massive cost not just economically and politically, but to our security. Of course today there has been the loss of the Chief Constable, who decided to make decisions at the behest of Sinn Féin; rightly, he has had to resign. Who can calculate at this point what the cost of this will be, not just economically but to policing and to resolving that problem? I am disappointed that today the Secretary of State hedged his bets on who will pay the costs of the data breach; compensation will run into tens of millions of pounds. With Department of Justice funding cut by 1.5%, it is impossible to take that level of cost from that Department. The Secretary of State knows that he must do better, that this is not a good budget and that it will hit some of the Departments in Northern Ireland that mean the most the hardest.
Northern Ireland’s biggest industry and single largest employer still today is agrifood, making good-quality, tasty food. It does so not just for the people of Northern Ireland: the 30,000 or so farms in Northern Ireland make food and feed about 17 million people here in the rest of the United Kingdom. That sector of our economy is facing problems because that industry is about to have its veterinary medicines violated by this Government. Under the Windsor framework, the problems facing our farms are coming at them at 100 mph. Over 50% of our medicines for that sector are going to be denied and the UK Government say, “We are in discussions to resolve this issue.” The fact of the matter is that Europe has made it very clear that those discussions are over, yet the Government still think they can solve that. That crisis is coming too and the Government will need to resolve it and do so very soon. I hope that they do. I hope that they actually listen to these points, instead of getting tetchy about them, and recognise that the threat they have caused to the people of Northern Ireland by such a stingy, nasty budget, in such a procrastinating manner, is not serving the purpose of getting Government back into Northern Ireland, but is putting us further into the doldrums.
Dame Meg Hillier (Hackney South and Shoreditch) (Lab/Co-op)
The hour is late so I will cut to the chase, but I think it is worth underlining the views outlined by those from the Front Bench on both sides that the best way to resolve the issues and debates around the Northern Ireland budget will be if the Executive is meeting. It is a terrible shame that we are still debating and setting the budget here. That is not something the Secretary of State for Northern Ireland should be doing and I am very concerned that the situation continues.
I rise because of my particular interest as Chair of the Public Accounts Committee in the UK in the oversight and investigations of the Northern Ireland Audit Office in making sure the money allocated to the Northern Ireland Office and Departments in Northern Ireland is properly scrutinised. I appreciate the Minister taking time to meet me to discuss this because, without the Executive and Assembly in place, there is no real scrutiny of these budgets and it is the Northern Ireland Audit Office that has that particular role. It is important, therefore, and I remain disappointed that its funding is not where it should be.
I know that the amendment was not selected, but the Minister is talking to the right hon. and learned Member for South Swindon (Sir Robert Buckland), and the Chair of the Select Committee, the hon. Member for North Dorset (Simon Hoare), about the proposal that the Northern Ireland Assembly Audit Committee may continue to exercise its power even without an Executive. If that is something the Government are willing to discuss, I will be interested in being involved in those discussions. I can see a number of constitutional challenges on this, even within the context of Northern Ireland, let alone across the UK, but we need further scrutiny if we are going to live through this limbo.
I reflect the points of my right hon. Friend the Member for Leeds Central (Hilary Benn), who I am delighted to see on the Front Bench in the shadow Secretary of State role, that the Government need a better plan. Within this limbo, we have this inadequate position with the Secretary of State. However brilliant any Secretary of State is, they should not be making these decisions directly, and I am pretty sure that the Secretary of State agrees with me on that, yet we do not have any plan or pathway to getting the Executive back. It is down to the parties here present and not present ultimately to do that, but the Secretary of State needs to consider that.
I am concerned about the trajectory for support for audit in Northern Ireland, and I hope that the Northern Ireland Audit Office can do the best it can with the money it has and perhaps prove its worth to the Secretary of State for future budget settlements. I hope we are not here in a year’s time and that we have an Executive up and running that will be making these decisions for themselves.
Carla Lockhart (Upper Bann) (DUP)
I add my comments about the outgoing shadow Secretary of State, the hon. Member for Hove (Peter Kyle), and congratulate the incoming shadow Secretary of State, the right hon. Member for Leeds Central (Hilary Benn). I wish him all the best; he would be most welcome in the Upper Bann constituency—the premier constituency in Northern Ireland—in the coming weeks and months.
The stark reality of the debate tonight is that the budget given to Northern Ireland Departments is not enough for the effective delivery of services in Northern Ireland. Some £297 million is scheduled to be taken from our allocation this year and next. That is a huge chunk of the cake being taken away, from a cake that is already too small to satisfy the appetite or demands of our public services. I am being continually contacted, as I know are colleagues on these Benches, by constituents who are feeling the full effects of this harsh budget and the realities of our underfunded services: of health service waiting lists, crumbling school estates and scrapped road plans. While the physical infrastructure needs of our services are vast, so too is the even greater need of an even greater asset: our public sector workers. They ask for equality in pay, yet this Government refuse to give it. Some £575 million for public sector pay awards is needed, yet the cake is being cut and not made bigger to award people what they deserve.
The line that the Government cannot step in to deal with this matter does not wash with me or the public in Northern Ireland. If the Government want to do something, we see that they go and do it; we only have to look at the track record around the implementation of abortion in Northern Ireland against the will of the vast majority of people in Northern Ireland, or the relationships and sex education guidelines that have been foisted on the people of Northern Ireland without any consultation. Frankly, they are out of step with the values that the vast majority of parents want to instil in their children. The Government should not come at us with this line that “the Government cannot act”, when they can on other issues where there is very clear opposition in Northern Ireland.
When and if the Government want to do something, they do it, yet we see a lack of enthusiasm to deal with the issues that are keeping the doors of Stormont locked. We hear much from the Government that, if Stormont was back up and running, we could deal with the issues, yet they peddle false hope to those awaiting healthcare interventions and raise expectations among our public sector workforce about their deserved pay rises when there simply is not enough money to deliver such increases.
Our party leader, my right hon. Friend the Member for Lagan Valley (Sir Jeffrey M. Donaldson), has said time and again that this party deals in realities. Those are the political and constitutional reality created by the protocol and Windsor framework, the economic reality created by the same, and the public reality that Unionist people have withdrawn their consent for the devolved institutions until their concerns are dealt with and our place within our Union is restored. Sadly, there are those who seek to lay blame for all ills at my party’s feet, yet it is they who are exacerbating the situation by refusing to address the genuine concerns of the Unionist community and, indeed, the continued difficulties faced by many businesses as a result of the Windsor framework and the protocol.
We want a solution that brings a firm foundation for the restoration of Stormont. We want a solution that brings firm political and financial foundations, which will be the key to the impact that any new Executive will have. Underfunding cannot continue. We need transformational moneys and moneys based on the needs of our changing society. Next year—I will reiterate the figures that we have already heard—public spending in Northern Ireland will increase by 3.6%, but in England it will increase by 6%. How is that fair on my constituents in Upper Bann?
My hon. Friend the Member for Belfast East (Gavin Robinson) made a significant contribution on the budget needs and the transformation of the Barnett formula to a needs-based formula. It is time for the Government to act. The people of Northern Ireland—people of this United Kingdom—deserve it. We in Northern Ireland deserve as much as those in England are getting. I implore the Government to do what is right and get a political and financial solution that will allow Stormont to be restored and got up and running, with decisions made in Stormont.
Mary Kelly Foy (City of Durham) (Lab)
I welcome my right hon. Friend the Member for Leeds Central (Hilary Benn) to his new role. It should be the concern of the whole House that a Secretary of State for Northern Ireland, rather than a Minister of Finance in Stormont, is delivering yet another budget for Northern Ireland. This has been happening for far too long. It should concern us, because it reflects a peace process that has become increasingly precarious.
I am a member of the Northern Ireland Affairs Committee, which since February has been inquiring into the funding and delivery of public services in the north of Ireland. We have received evidence from a wide range of stakeholders throughout Northern Ireland. We have focused on the financial situation in areas such as education and health, and how the lack of a functioning Executive in Stormont is affecting those public services. To be clear, these are my views and not those of the Committee as a whole. My personal view is that the absence of an Executive in the north of Ireland, coupled with an austerity budget from Westminster, is a toxic mix, both politically and socially. For instance, we heard from the British Medical Association in Northern Ireland that health services are operating in “crisis mode”, which has taken its toll both on patients and on workers. Underlying that is a
“crumbling estate, with spiralling maintenance costs”.
The Royal College of Nursing argues:
“The health and social care system…is now beyond the point of crisis and is…visibly collapsing.”
It argues that that is due to “years of systematic under-funding”, compounded by the absence of accountability and leadership in Stormont. In addition, the Royal College of Surgeons has stated that one in four people in Northern Ireland are on a waiting list, either for a first-time appointment with a consultant or for surgery or treatment. The health and social care system needs stability, much like it does in Britain. Prevention is always better than cure. In one evidence session, I asked health professionals whether a significant cash injection now would reduce costs down the line. Austerity is never the cheaper option; it always leads to higher costs. I just wish the Government would realise that.
I want to touch on the impact on education, where, as with health, it is unacceptable that cuts are being made. A report in June entitled “The Consequences of the Cuts to Education for Children and Young People in Northern Ireland” argues that
“cuts will increase poverty, widen existing educational achievement gaps”
and “further exacerbate” the mental health crisis in Northern Ireland. Like the healthcare system, as we have heard, special educational needs provision is beyond the brink.
There is also a constitutional issue. My colleagues in the Social Democratic and Labour party have called on the British Government to consult the Irish Government on provisions for this budget as a plan B. That is a very sensible argument, although it is quite surprising that the British Government have not already attempted it. We cannot forget the vital role that the Irish Government played in the peace process. We should not forgo their advice, assistance, guidance and institutional knowledge.
In addition, the pressure on civil servants in Northern Ireland must be commented on. They are working in an extremely difficult environment, and we must recognise that there are unintended consequences. Civil servants are between a rock and hard place. The guidance states that some decisions should not be taken by civil servants, but without an Executive, those decisions must be made. As PCS Northern Ireland has argued, how can civil servants do their jobs effectively when they are worrying about putting food on the table for their families?
Underlying all this is a lack of democratic accountability. At the risk of making an obvious point, it was political parties who were elected in the May elections, not civil servants. If there is no Executive, who will fill those leadership roles in the community? We have heard in the Northern Ireland Affairs Committee that, sadly, some of those roles are already being filled by criminal gangs and paramilitaries. Those gangs are preying on vulnerable people, especially women in deprived communities. They know that there is an absence of statutory childcare, which is a huge barrier to women attaining employment. Those gangs are exploiting poverty. When people have not been able to pay their loans, for instance, they have been forced into transporting drugs and prostitution.
It is a case of austerity affecting services, and a deadlock affecting leadership, leading to cracks in civil society that demand our attention right now. We need the Executive back. To that extent, I must say to the Democratic Unionist party to honour the first word of its name. This boycott is doing real harm. Everyone can see it. I suspect it is not what their constituents want to see. Nothing can be achieved in this deadlock; it only wears people down. But we can achieve something working together. I will never forget the demonstration of cross-party unity that brought peace to an island that means so much to me, my family and so many people in my constituency and beyond. It would be a tragedy if that the spirit of co-operation was consigned to the history books.
Jim Shannon (Strangford) (DUP)
Thank you, Mr Speaker. It is good to see that you and I are the Duracell batteries of Westminster; we keep going when others are starting to lag.
What a pleasure it is to speak on this issue today. Yet again, I come to the House to ask for fairness and equitable treatment for Northern Ireland. I ask for it to be treated and funded the way that Wales is, for the sake of my constituents and all other constituents in Northern Ireland. I ask for our schools to be able to pay for their teachers’ pay rise and for toiletries in school facilities. I ask for a budget that can address the waiting list for hip replacements, and for vital roadworks to be carried out, to provide the bare minimum standard of infrastructure and connectivity. I ask the Secretary of State respectfully to advocate working with us and for the betterment of everyone in Northern Ireland. I believe we can do that together if we all commit to that process.
The people of Ballynahinch and the surrounding areas in my constituency of Strangford have been waiting my entire tenure—I have been an MP since 2010—and long before that for the promised Ballynahinch bypass, which has been deferred yet again. Along with my MLA colleagues Michelle McIlveen and Harry Harvey, I hope to meet the Department for Infrastructure on 6 October to discuss that very issue. It has been on the books for 45 years. And should the hon. Member for South Down (Chris Hazzard) ever decide to take his seat in this place and do his job here, he would be advocating for the same thing: for the funding to be allocated for this vital piece of work. Not to be blunt, but any claim that work can be carried out in whatever way the Department sees fit does not cut it when the current budget does not cover the cost for roads to be resurfaced, never mind major capital projects. Let us be truthful here: the budget allocation for roads is inadequate.
On a slightly more positive note, I highlight Ardglass harbour as a Northern Ireland fishing industry success story. However, the fact is that if we are to build on that success and accommodate the next generation of fishing boats, the harbour needs to be deepened. Kilkeel is also well placed to be a hub for the offshore energy industry. Investment there will see Northern Ireland capitalise on our growing blue economy. The fishing and seafood development programme of the Department of Agriculture, Environment and Rural Affairs recommends investment in all three harbours, and that takes funding. I am delighted to report that funding has been secured for both an enhanced training centre and an improved slipway in Portavogie in my constituency of Strangford. We can build on that and do more. We should have aspirations to grow a powerhouse of a blue economy. Portavogie, Ardglass and Kilkeel give us the building blocks, and the FSDP recommendations give us the tools. What we now need is to add a further budget that has the appetite and ambition to match that of our coastal communities, and that empowers them to meet the next generation of opportunities in the Irish sea and beyond.
We need funding for schools to deal with the substantial rise in special needs assessment and support. The hon. Member for North Down (Stephen Farry) referred to that and he is absolutely right. Every one of us in this House knows that special needs education is under incredible pressure. Funding is needed to create sensory rooms, whose enhancements will give children the opportunity to excel. I have met them in many of the schools in my constituency, and I recognise that that is something we should all sign up to. I sign up to the vision for schools that is operating on the mainland, but I would like our children to be treated the same way as children here and to have the same options. That is not the case because while spending per head is more, so is cost and so is need.
Policies that impact on how our children are taught about religion and sexual issues should not be implemented without a mechanism and space to consult boards of governors or without the opportunity to implement normal practices. Let me be clear: parents and teachers do not consent or comply, and that will be made clear in the days to come. There was a rally where a large group of people came together with some of their elected representatives to make that point.
I conclude with this, because I am very conscious of the long hour. I say this to the Secretary of State and the Minister of State: please, in the interest of fairness and equity, work with us to make changes to the framework that allow us to do what we want to do, which is to take our seats and for our colleagues to be in a working Assembly, with a fit-for-purpose budget and changes in place. That is not only in our hands; it is in the hands of the Government, the Secretary of State, the Minister of State, the Brexit Minister and the Prime Minister. Do the right thing and start to take that action, so we can move forward together in a positive fashion.
Mr Baker
With the leave of the House, Mr Speaker, given that I made a number of interventions during the debate, and given the late hour and a desire not to repeat arguments that we advanced on Second Reading, I think I should just say, “I beg to move.”
Question put and agreed to.
Bill accordingly read the Third time and passed.