Northern Ireland (Regional Rates and Energy) (No. 2) Bill

Lord Hay of Ballyore Excerpts

2nd reading (Hansard): House of Lords
Tuesday 12th March 2019 Lords Chamber

[Lord Hay of Ballyore (DUP)]

My Lords, there has been a wide range of speeches on the Bills here this evening, all very much with a similar theme: the lack of transparency, scrutiny and certainly accountability. We might get a few hours in this House to debate a budget for Northern Ireland—a very unsatisfactory situation for all the people of Northern Ireland—with no real scrutiny or knowledge of how the allocations to departments have been reached. As the noble Lord, Lord Browne, said, this is the third year that expenditure in Northern Ireland has been debated through this House. Surely the people of Northern Ireland deserve better; they are in a very difficult position. We were told that the Bill has been fast-tracked because there was hope that an Executive, an Assembly, would have been restored to make these provisions. Over the past number of months, was there any real prospect of an Assembly being restored to go through the process of setting a budget? I think not.

While I believe that we have the mechanisms here within Parliament to scrutinise such Bills, I just do not know why those procedures are not used. We will all have known over the last several months that this Bill was coming. We also know that the Assembly would not be meeting to process such Bills. I think this is something the Northern Ireland Office needs to answer, because this is not the way to do business. It is just not possible. Yes, I understand that in the absence of a working devolved Government in Northern Ireland, the United Kingdom Government have a responsibility to safeguard public services and public finances in Northern Ireland. I know that the Bill is putting spending on a statutory footing; that has already taken place. Of course, this is more or less a spending Bill giving departments in Northern Ireland the ability to continue to spend money with a higher than normal level vote on account of 70%. The tragedy of this process is that the Secretary of State cannot direct the spending with these departments or what programmes they can spend money on, so there is no real control over how our Civil Service in Northern Ireland spends money.

Of course I welcome the £140 million of new funding that will go to the health service, education and other projects in Northern Ireland. I place on the record my gratitude to the Minister, the Secretary of State and the Treasury for finding that extra £140 million. Education especially is in dire straits at the moment in Northern Ireland. The various principals of all our schools will tell you the seriousness of the education situation right across Northern Ireland. Our health service in Northern Ireland, which has been mentioned continually in this House, continues to suffer, and our waiting lists get longer and longer. Why? Because we have no Minister in place to lead and to decide policy. It is a total and absolute tragedy. Of course, the £140 million is on top of the £330 million of funding that comes from the Government’s confidence and supply agreement with the party.

I will move on quickly, because the evening is getting on, and raise the issue of a city deal, which has already been raised by the noble Lord, Lord Browne. I specifically raise the city deal that is very much ongoing in my own city of Londonderry and the region. The Minister will know that I have raised this with him on several occasions. My understanding is that there may be an announcement within the spring estimates. I am not too sure; I do not want to pre-empt that decision. He will know that it will certainly regenerate the region and create employment, economic development and inward investment. A city deal for the region has all of that connotation. Certainly, on two or three occasions someone has mentioned a medical school for the city, which is very much part of the wider city deal. It is something that the Minister knows about and that I have spoken to him about.

I also want to quickly raise the issue of RHI, which comes under the rates and energy Bill for Northern Ireland. The Bill deals mainly with the RHI scheme. We have all received emails and letters from individuals who feel aggrieved by the proposals in the Bill—and rightly so. They went into the scheme very much in good faith and now feel that they are being unfairly treated. I agree with them, and I will not stand here and defend the scheme: it was flawed from day one. We need to be honest enough to say that.

The Minister will be well aware of our concerns about the lack of proper scrutiny for these proposals, which will change the tariff to 12%. The Minister knows that MPs have challenged the figures that the civil servants have come up with. These, of course, are the same civil servants who got the scheme wrong from the start. They are now telling us that the figures are right. I am glad that the Northern Ireland Affairs Committee has decided to launch an inquiry into the figures and has called for representations; I hope that we can move forward that way. It is, however, a tragedy, and there will be a number of people out of pocket from all this.

The rest of the United Kingdom set a rate of return from the scheme of between 8% and 22%. Here we are told that because of the whole issue of legal aid and the European Commission, Northern Ireland can have only the 12% tariff. There are a number of questions about this. I hope that the ongoing Select Committee inquiry will tease out all these issues, because I and others are concerned that the figures presented to us are not correct and need to be challenged.

In finishing, I mention the issue that the noble Lords, Lord Alderdice and Lord Cormack, and others raised about why the Assembly is not meeting. There is some suggestion that the Assembly should meet in shadow mode. If all the parties could agree, we would be there in the morning, because at least that would be a start towards getting the Assembly to function as a fully devolved Government in Northern Ireland.

The answer to dealing with these issues is devolved government in Northern Ireland, and I hope that this is the last time that we deal with such important business—budget-related business in particular—for Northern Ireland. We should not give up hope of Stormont being brought back, perhaps sooner rather than later. Direct rule—and I know that at some point we may have to go to direct rule—has not been good for Northern Ireland. We had direct rule Ministers flying in and out of Northern Ireland with no accountability, making decisions that affected the lives of people in Northern Ireland with no responsibility to them. That cannot happen again. We need to get the Assembly and a workable Executive up and running, because direct rule Ministers, as good as they are, make decisions that affect the lives of all the people in Northern Ireland with no accountability. For me, therefore, it is devolution back at Stormont, and I hope that we redouble our efforts to get the Executive and the Assembly up and running.

I place on record my appreciation for the meetings, short as they may have been, that the Secretary of State and the Minister held to discuss these Bills. He and his officials took time out of a busy schedule to brief us as best they could; I thank him and the Secretary of State.

--- Later in debate ---

[Lord Duncan of Springbank]

I accept the words of my venerable and noble friend. I am trying to find a way of moving this forward as best I can. I wonder whether there might be an opportunity for us to meet collectively in a different forum to discuss that very thing. I do not think I will be able to resolve it on my feet. I do not doubt that in a few moments or so I will be getting little notes from my assistants in the Box.

[Lord Hay of Ballyore]

To follow the remarks of the noble Lords, Lord Alderdice and Lord Cormack, has there been any discussion on the idea of a shadow Assembly within the talks at any time? Has it been put by the Secretary of State to the parties? What has their reaction been, if any at all?

[Lord Duncan of Springbank]

The noble Lord raises a question to which I do not have the answer, I am afraid; I do not have it to hand. That is why if we are in a position at a date soon hereafter to sit down and explore some of these issues in an effort to move them forward as best we can, that would not be a bad initiative. Let us revisit that. I am not trying to park it in any way.

I hope noble Lords will forgive me for being a little disorganised: I seem to have an awful lot of papers spread in front of me. I will try to take the points raised by each noble Lord in turn. The noble Lord, Lord Bruce, asked about the RHI situation and how it compares with other parts of the United Kingdom. We are broadly agreed that the scheme in Northern Ireland was not well constructed; we can probably all accept that. The unfolding inquiry into that will set out clearly exactly what has gone on. In response to the question from the noble Lord, Lord Alderdice, yes, we can have that debate should your Lordships desire to have one at the stage when a report emerges; I am happy to say that.

The scheme set out a 12% return; that was at the heart of what was meant to be achieved by the initiative. It is indeed 12% in Great Britain itself; the scheme that we anticipate in the Republic would be 8%. One of the reasons that we end up with different figures is that there are different ingredients going in. For example, the scheme in Great Britain is a 20-year scheme, whereas that anticipated in Northern Ireland is a 15-year scheme. Some of the capital costs involved in the scheme depend on when the emergent technology became more cheaply available. The scheme in Northern Ireland that commenced in earnest in 2015—although it opened earlier—contrasts quite clearly with the scheme which opened in Great Britain in 2012, during which there were significant cost reductions.

The scheme construction also differs significantly between Great Britain and Northern Ireland, not least the element of “tiering” which exists in British schemes but not in Northern Ireland and the digressive component. I will not go into greater detail on that; we will have an opportunity to do so next Tuesday evening. In the intervening period, I recommend that any of your Lordships who are minded to find further details meet my officials so that those who have serious concerns can have them addressed.

To put this into context, the 12% return that we talk of is the needful part within the state aid rules. The scheme in Northern Ireland as it initially emerged had a return rate of 55%—noble Lords will see the contrast between 55% and 12%. It is not difficult to see how those individuals, who, through clear guidance, accepted a scheme with its various component parts and invested on that basis, now find themselves in the invidious position of all their calculations being blatantly wrong, based as they were on incorrect information. It is important for me to stress that those who were responsible for the wrongness of that scheme, I do not doubt, will emerge from Patrick Coghlin’s report; we will have an opportunity to discuss that further.

I stress that those within the Northern Ireland Civil Service undertaking the work on the current proposals are not the same people. This has been conducted in a very different fashion, based on significant investment in looking at the actual data rather than forecast data. Rather than trying to anticipate what the figures will be, the report itself and the consultants who examined it looked at the actual data. Again, it might be worth getting into the detail of that at an opportunity that will be provided by my officials and by others, because noble Lords will be surprised how quickly this moves from a high-level discussion into extraordinary technicalities.

I have written at the top of this page: “still a Minister”. I think that must reflect on what was going on down the Corridor. I will check when I leave, obviously.