Northern Ireland is set to miss out on a cost-of-living payment included in an additional £270 million for the region unless Stormont ministers can agree a budget, Secretary of State Sir Chris Bryant has indicated.
Stormont Executive parties have all said they have been unable to agree a budget more than halfway through this current financial year due to a lack of funding.
Sir Chris said with Northern Ireland departments limited to 95% of last year’s spend, and missing out on additional money on offer, agreeing a budget “is a no-brainer”.
He said he would be speaking with the Stormont Executive parties by phone on Wednesday, pressing them to agree a budget, and will meet in person if necessary.
He suggested £270 million in Barnett consequentials for Stormont is more than he had expected would come, clarifying it will be an extra £131 million to spend in this financial year.
That includes funding to extend the £100 cost-of-living payment to lower income households in Northern Ireland.
However Stormont Finance Minister John O’Dowd said a “significant gap” remains, and added there is £44 million more available to the Executive when you remove the energy uplift funding.
“There remains a significant gap between the funding required by the Executive to deliver frontline public services, pay our public sector workers to pay uplifts they deserve, and grow our economy than that was put on the table today by the British government,” he said.
Mr O’Dowd said significant engagement with the government is required.
He said: “I would hope that would start as early as possible because the Executive wants to and needs to be able to set a budget but to set the budget, we need the right quantum of funding to be able to do that.”
Mr O’Dowd added: “That gap remains a challenge both for the Executive and for the British government and there needs to be real engagement at this stage to begin to close that gap.”
Sir Chris said: “There is absolutely no reason now why the Northern Ireland Executive can’t sit down and agree a budget, not just for this year, but the next three years,” he said.
“I think most ordinary people in Northern Ireland are getting bored with this process, and would say they should have done it some months ago, the deadline has long passed.
“Some people kept saying to me there is bound to be more money, what we have seen today is that finances are very, very tight. We have had to use some fiscal headroom we previously allowed because of the war in the Middle East.
“We really have to get this done.”
Executive ministers have repeatedly argued their main financial settlement from Westminster, decided through the Barnett formula, is not sufficient to fund public services given the region’s relatively larger public sector workforce and political commitments to UK-wide pay parity.
Sir Chris clarified that in the continuing absence of an agreed budget, in addition to the 95% limit, the Executive also could not access the £131 million.
“I will try to gather people together if necessary, it may be that tomorrow (Thursday), the Executive will meet and agree a budget,” he said.
“If that doesn’t happen I probably will have to sit them down, either one by one or all together, and work out how we will do that over the next week.”
Last week, DUP leader Gavin Robinson suggested a closing of the funding gap announced by Chancellor John Healey could give Stormont ministers a “fighting chance” to balance its budget.
Sir Chris said at that stage, neither he nor Mr Robinson knew what the Barnett consequentials would be.
“I certainly didn’t know it was going to be £131 million, highest expectation at that point had been something like £90 million, so when you add all of these things up, it’s a bit of a no-brainer for the Executive – they either limp forward through the rest of the year only able to spend 95% of last year’s budget, or they sign up, they get the £500 million that we offered four weeks ago, plus the £131 million, and they have to make some tough decisions, but they get that for three years,” he said.
“So they should do that.”
