‘Urgent action’ needed from UK to establish fiscal floor for Northern Ireland

The UK government must take “urgent action” on putting a fiscal framework in place to ensure Northern Ireland receives the funding it needs.

Stormont Finance Minister Caoimhe Archibald said she has pressed the Chief Secretary to the Treasury on the importance of putting this in place “as quickly as possible” to ensure Northern Ireland is funded based on need.

The Stormont budget was unveiled at the end of last month, but Ms Archibald then contended she had had just £1 billion to allocate once previously earmarked funding was provided.

Her department had received funding bids from ministers totalling £3.2 billion.

Ms Archibald was asked by Sinn Fein MLA Colm Gildernew for an update on discussions with the Treasury about a fiscal framework during question time for her department in the Assembly on Tuesday.

She said a fiscal framework is “essential if the executive is going to be able to deliver sustainable quality public services”.

“My officials are engaging with their Treasury counterparts on the application of the needs based adjustment factor included in the financial package, the necessity for the Executive to be funded at an agreed level of need going forward and the development of a wider fiscal framework,” she told MLAs.

Ms Archibald said it is critical that a new fiscal framework provides clarity on the long term funding model for Northern Ireland.

She referred to reports by both the Northern Ireland Fiscal Council and Northern Ireland Affairs Committee that raise concerns about funding for the region.

Ms Archibald said: “They both raise concerns about the financial cliff edge that we are facing, and that our funding should be adjusted based on need from the start of the current spending review.

“The Fiscal Council has made the point that we are the only devolved administration that is being asked to deliver public services whilst being funded below its level of need.

“So in my view these assessments reaffirm the position for the British government to secure an urgent, long-term solution to ensure public services are sustainably funded and any new framework will be key in achieving that.”

SDLP MLA Patsy McGlone said in three months the UK Government has not changed its position, and asked whether there is a plan B.

“The engagement is continuing.

“So far it has been constructive.

“My officials are engaging with Treasury officials.

“I’ve met with the Chief Secretary to the Treasury on a number of occasions and meeting her again later this afternoon,” she responded.

“But we do need to see urgent action from the British government to ensure, a that we are funded appropriately based on our level of need, but obviously that we don’t face financial cliff edge in two years time.

“That’s something that I have stressed with the Chief Secretary to the Treasury on my previous engagements with her and I will be continuing to do that because despite that short term uplift for our public finances due to the financial package, the current situation will see us effectively trapped below our level of need for a number of years which effectively creates a fiscal ceiling rather than a fiscal floor, which is what all parties have been united in asking for.

“So we’re not asking for special treatment here.

“We’re asking to be treated the same as Scotland and Wales and for our funding to be needs based.”