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DUP agrees £1bn deal with Conservatives to prop up Theresa May's minority Government

Theresa May (2R) stands with Britain's First Secretary of State Damian Green (R), Democratic Unionist Party (DUP) leader Arlene Foster (2L), DUP Deputy Leader Nigel Dodds (L), as DUP MP Jeffrey Donaldson (3L) shakes hands with Britain's Parliamentary Secretary to the Treasury, and Chief Whip, Gavin Williamson, inside 10 Downing Street - AFP
Theresa May (2R) stands with Britain's First Secretary of State Damian Green (R), Democratic Unionist Party (DUP) leader Arlene Foster (2L), DUP Deputy Leader Nigel Dodds (L), as DUP MP Jeffrey Donaldson (3L) shakes hands with Britain's Parliamentary Secretary to the Treasury, and Chief Whip, Gavin Williamson, inside 10 Downing Street - AFP

A £1 billion deal has been done between the Conservatives and Democratic Unionist Party to prop up Theresa May's minority Government.  

Arlene Foster, the leader of the DUP, and Mrs May agreed the deal which will see the extra funding provided to Northern Ireland over the next two years during talks at Downing Street on Monday morning. 

The deal also guarantees that there will be no changes made to the state pension triple lock which ensures pensions rise by at least 2.5 per cent every year or to winter fuel payments for pensioners. 

The deal will see the DUP's 10 MPs back Mrs May on key votes in the House of Commons and allow her to command a narrow majority after a disastrous general election left the Prime Minister and the Tories unable to govern alone. 

Theresa May (2L) poses for a picture with Democratic Unionist Party (DUP) leader Arlene Foster (2R), DUP Deputy Leader Nigel Dodds (L) and DUP MP Jeffrey Donaldson at 10 Downing Street - Credit: AFP/Daniel Leal-Olivas
Theresa May (2L) poses for a picture with Democratic Unionist Party (DUP) leader Arlene Foster (2R), DUP Deputy Leader Nigel Dodds (L) and DUP MP Jeffrey Donaldson at 10 Downing Street Credit: AFP/Daniel Leal-Olivas

The "confidence and supply" agreement comes just days before MPs will vote on the contents of Mrs May’s Queen’s Speech which sets out her legislative plans for government.

The agreement was signed by Tory chief whip Gavin Williamson and the DUP's Sir Jeffrey Donaldson while Mrs May and Mrs Foster, along with Damian Green and Nigel Dodds, watched on.

Speaking in Downing Street after agreeing the deal Ms Foster said: "As part of our policy agreement both parties have agreed that there will be no change to the pensions triple lock and the universal nature of the winter fuel payment across the United Kingdom. 

"We are agreed to meet the Nato commitment of spending two per cent of GDP on the armed forces and we are further committed to the Armed Forces Covenant and to its implementation throughout the United Kingdom. 

How the £1 billion deal with DUP breaks down
How the £1 billion deal with DUP breaks down

"Following our discussions the Conservative Party has recognised the case for higher funding in Northern Ireland given our unique history and indeed circumstances over recent decades. 

"The UK government will publish as an annex to our agreement the details of financial support that will be made available to Northern Ireland. 

"Our aim in these negotiations has been to deliver for all of the people of Northern Ireland and the support measures which we are announcing will be to the benefit of all our people. 

"They will boost the economy and invest in new infrastructure as well as investing in the future of our health and education sectors and a range of other measures.

Theresa May (2L) sits with Britain's First Secretary of State Damian Green (L), and Britain's Parliamentary Secretary to the Treasury, and Chief Whip, Gavin Williamson (3L) as they talk with Democratic Unionist Party (DUP) leader Arlene Foster (2R), DUP Deputy Leader Nigel Dodds (3R), and DUP MP Jeffrey Donaldson, inside 10 Downing Street - Credit: Daniel Leal-Olivas/AFP

"We welcome this financial support of £1 billion in the next two years as well as providing new flexibilities on almost £500 million previously committed to Northern Ireland."

The terms of the deal will mean the DUP will support the Government on votes on the Queen’s Speech, the Budget, and legislation relating to Brexit and national security.

Who are the DUP MPs who hold the balance of power?
Who are the DUP MPs who hold the balance of power?

Mrs May said in a statement: “The agreement makes clear that we remain steadfast to our commitments as set out in the Belfast Agreement and its successors, and in governing in the interests of all parts of the community in Northern Ireland.

“I welcome this agreement which will enable us to work together in the interest of the whole United Kingdom, give us the certainty we require as we embark on our departure from the European Union, and help us build a stronger and fairer society at home. In the interests of transparency, the full terms of this agreement have been published."

The key parts of the deal:

Pensions

There will be no change to the triple-lock on pensions - which guarantees pensions will rise by 2.5 per cent, inflation or average earnings, which ever is the greater.

The Conservatives had set out plans in their manifesto to down-grade the protection to a double-lock.

Winter fuel allowance

Tory plans to introduce means-testing for the winter fuel allowance in most of the UK have been dropped.

An extra £1 billion in funding will go to Northern Ireland, mainly over the next two years, with £400 million earmarked for infrastructure projects, £200 million for improvement of the health service and the rest going on ultra-fast broadband, tackling deprivation, health and education pressures and mental health services.

Defence

The Nato commitment to spend at least 2 per cent of national income on defence will be met.

Both parties have committed to implementing the Armed Forces Covenant "throughout the United Kingdom".

The DUP has previously claimed the covenant has not been fully implemented in Northern Ireland.

The Union

The deal says the Conservative party will "never be neutral in expressing its support" for the Union but will "govern in the interests of all parts of the community" in Northern Ireland.

Length of the deal

The agreement covers the length of the Parliament but will be reviewed after each session. This means that a new deal will be drawn up in mid-2019 for the next Parliament.

DUP to vet laws

A co-ordination committee comprising senior Conservative and DUP figures will be set up to check and vet laws before they are put to Parliament.

The agreement says: "The Government and the DUP will work together to ensure the necessary support can be established by both parties to fulfill these arrangements."

Farming

The Government will continue "to commit the same cash total in funds for farm support until the end of the Parliament" in 2019.

The DUP was very keen to ensure that measures to protect farming were included in the deal.

Air passenger  duty

The Government has agreed to commission a report "into the impact of VAT and APD on tourism in Northern Ireland to recommend how best to build upon the growing success of that sector".

The Telegraph disclosed earlier this month that cash from any deal could be ear-marked to allow Belfast airport to waive air passenger duty on some flights.

One source said there was a concern Dublin airport was “undercutting” Belfast International airport because it did not charge APD.