UK government commits £2bn for new Northern Ireland executive

Greg Heffer, political reporter

The UK government has committed £2bn to Northern Ireland's new power-sharing executive.

Julian Smith, the Northern Ireland secretary, announced the cash injection following talks this week with Stormont's parties.

On Monday, devolved government returned to Northern Ireland following three years of deadlock after a dispute between Sinn Fein and the DUP saw the last power-sharing agreement collapse.

A "New Decade, New Approach" deal saw the parties restart their joint governance of Northern Ireland, with Prime Minister Boris Johnson hailing the "wonderful compromise" of both sides.

Talks were subsequently held between the UK and Irish governments and Northern Ireland parties over the funding of the new Northern Ireland Executive.

The UK government's initial offer was initially described as being "way short" by Stormont's new finance minister Conor Murphy.

Northern Ireland First Minister Arlene Foster and Deputy First Minister Michelle O’Neill also wrote to Mr Johnson to describe a proposed financial package as inadequate.

But, announcing the UK government's cash commitment on Wednesday, Mr Smith said: "This £2bn injection will help transform public services in Northern Ireland, including ending the nurses' pay dispute.

"New Decade, New Approach is about putting Northern Ireland's Assembly on a sustainable footing.

"This funding provides certainty to the executive and ensures much-needed reforms across health, education and justice can be delivered."

The money will come with "stringent conditions" to deliver a "greater level of accountability for public spending and ensure the new Executive is building sustainable public services", the Northern Ireland Office said.

Of the total cash, £1bn is from an investment guarantee from the UK government based on the Barnett formula for allocating public funds to Scotland, Wales and Northern Ireland.

It includes new funding for infrastructure investment.

A "rapid injection" of £550m has also been earmarked to put the executive's finances on a sustainable footing, of which £200m will be used to resolve a nurses' pay dispute in Northern Ireland.

And around £245m will support public services, while £140m will address Northern Ireland's "unique circumstances".

The previous DUP/Sinn Fein power-sharing executive in Northern Ireland collapsed in acrimony in January 2017.

The cause was a row about a botched green energy scheme, a dispute that later widened to include more traditional wrangles on issues like the Irish language and the legacy of the Troubles.

Analysis: Package falls far short of what new Stormont government requires
By David Blevins, senior Ireland correspondent

Two billion pounds is a lot of money but only £1bn of it is new cash and that falls far short of what the new government requires.

First Minister Arlene Foster and Deputy First Minister Michelle O'Neill had earlier written to Prime Minister Boris Johnson to express their concern that the financial package for Stormont would not be adequate.

The political parties were of the view that they had been promised much more money for the devolved government during negotiations which led to the resumption of power-sharing.

But £1bn of this money was already earmarked for Northern Ireland under the Barnett formula, the mechanism used by the Treasury for the allocation of public funds to Scotland, Wales and Northern Ireland.