Northern Ireland Budget Bill
Monday 23rd January 2023
(1 year, 3 months ago)
Commons ChamberRead Full debate Northern Ireland Budget Act 2023 Read Hansard Text Watch Debate Read Debate Ministerial Extracts Amendment Paper: Committee of the whole House Amendments as at 23 January 2023 - (23 Jan 2023)
The Minister of State, Northern Ireland Office (Mr Steve Baker)
I beg to move, That the Bill be now read a Second time.
I begin by asking the leave of the House to take all stages of the Bill. The Secretary of State sends his apologies; I am pleased to say that he is enjoying a trip to the United States where he is representing Northern Ireland as he seeks to drum up business for local people.
Once again, I stand here with a strong sense of disappointment. On Second Reading of the Northern Ireland (Executive Formation etc) Act 2022, my right hon. Friend the Secretary of State said:
“No Northern Ireland Secretary would want to introduce a Bill of this nature.”—[Official Report, 29 November 2022; Vol. 723, c. 820.]
That sentiment very much applies again today.
The Government are bringing forward this legislation because the Northern Ireland parties have been unable to form an Executive and subsequently, therefore, to set a Budget. In the absence of an Executive, the Government stepped in to set a Budget, which the Secretary of State put before the House on 24 November last year. We are legislating for that Budget today.
Setting the Budget was not an easy task. Northern Ireland departmental Ministers were in post until 28 October, which meant we could take over only from that point. They had not been operating with confirmed spending limits and had not implemented plans to deal with their looming overspends.
Of course, pressures on Northern Ireland’s finances did not happen overnight. Successive former Executives also failed to put finances on a sustainable footing. As a result, the Government inherited a Budget halfway through the year with an overspend of some £660 million. That is unacceptable, and the unsustainability of Northern Ireland’s finances cannot continue.
Spending per head in Northern Ireland is already at the highest level of any region in the UK. Northern Ireland receives 21% more funding per head than the UK average and has received record levels of financial support. The difficulties that Northern Ireland Departments now face are the result of tough decisions not being taken by elected representatives in Northern Ireland, not just this year but in successive years before that.
Funding alone will not solve those issues. They need strong and responsible leadership by a stable, devolved Government.
Ian Paisley (North Antrim) (DUP)
I thank the Minister for giving way, but I know that he will go down the predictable line that all this would be sorted out if we had an Executive. How does he juxtapose that with his comments on 23 October, when he made it clear that
“we will not have devolved government in Northern Ireland”
until Unionist demands are met and the jurisdiction of EU Law comes to an end? Does he admit that the idea that the Executive will be a magic wand is a fallacy?
Mr Baker
There is no question of admitting any kind of fallacy. What I was saying with the quote the hon. Gentleman referred to was really a reflection of the DUP’s position. In a sense, I am grateful for his party’s clarity about what it requires to go back into government. From my engagement with its voters in Northern Ireland, I think they know that a price is being paid by not having the Executive up. It would be churlish of me not to admit that those voters—it was a small section—wanted to pay that price, but others will be devastated by the consequences of not having the Executive up. It is only fair that I, as a Government Minister, reflect the full spectrum of opinion, and people in Northern Ireland very much want the Executive back and dealing with the issues before it.
As for a magic wand, I would be the first to admit that government is difficult, whoever is in power. All these decisions are difficult—they are difficult decisions in difficult times—and there is no question of a magic wand. However, everyone in this House is aware of the devolution settlement, and I am sure everyone here would want Northern Ireland Ministers to be taking decisions in an accountable way locally. However, there’s no question of a magic wand, and I would be the first to be realistic about the conditions the hon. Gentleman and his party have set out for going back into the Assembly.
Sammy Wilson
I am glad the Minister accepts that there is no magic wand, but does he also accept that, given the nature of the Executive, which is a mandatory coalition, we have had a Sinn Féin Finance Minister, and no Sinn Féin Finance Minister has, I think, ever succeeded in presenting a Budget that other parties could support? That is one reason why we face the deficit that we have at the moment. Indeed, the restoration of the Executive would make things difficult, given that some Ministers do not even attempt to reflect the spending wishes of the other parties in the Executive.
Mr Baker
The right hon. Gentleman makes some legitimate points. The particular point about mandatory coalition is of course an important part of the Belfast/Good Friday agreement strand 1, which we completely respect. We are open to hearing suggestions for institutional reform that will deliver more stable government. Members on the Opposition Benches will know the difficulties in reforming the institutions. The Government are clear that any conversation would need to be led by the political parties of Northern Ireland and would need, in the end, to enjoy cross-community consent to be viable.
Simon Hoare
My hon. Friend will probably know that the Select Committee was in Northern Ireland last week. I think this endorses and underscores the point he was making a moment or so ago, as he might know about this. The elections were some while ago—an analogue time for a digital age, if you will—and we were hearing from both traditions and both communities a growing sense of worry and anxiety about the impact on the quality of life and on outcomes in health, education and housing for ordinary people in Northern Ireland, who look to their political leaders of all persuasions to deliver for them. There is a growing sense of real anxiety and disappointment that they are being let down yet again.
Mr Baker
My hon. Friend is spot on in what he says. If the situation in Northern Ireland presented itself in Wycombe or anywhere else in Great Britain, there would be outrage. There is 21% higher spending per head than in the rest of the UK—that is not something I wish to repeat too often, in case it is noticed by my electors—with dreadful public services, as he points out, and a Budget that is not balanced, because of a failure to take important strategic decisions. As I will come on to, we are a number of years on from the Bengoa report, which said that there needed to be transformation to maximise the quality and quantity of Northern Ireland’s health services, and that transformation has not happened. The public are suffering the consequences today. Having said that, I will press forward.
The Budget position set out on 24 November was a difficult one, not unlike the Chancellor’s autumn statement in the weeks preceding it, but it is a fair outcome. We are acutely aware of the difficult decisions that now have to be taken in relation to health, education and right across the spectrum in Northern Ireland to live within the Budget.
In setting the Budget we are legislating for today, it is clear that action needs to be taken to get Northern Ireland’s finances under control and to deliver the much-needed and long-promised transformation of public services to which I referred earlier. Six years on from the Bengoa report, we are yet to see the Executive deliver the changes that are necessary. That work needs to happen now, but it requires leadership and strategic decisions that should rightly be taken by locally elected politicians in a new and functioning devolved Government. However, in the absence of that, this Government will take those steps necessary to maintain the delivery of vital public services and to protect Northern Ireland’s finances. Clearly, consideration will need to be given to a sustainable and strategic Budget for the financial year 2023-24.
Paul Girvan (South Antrim) (DUP)
There are many aspects of Bengoa that could be implemented, but there is seemingly a reluctance to do so. Whether that be political within the Department or whatever, I would say that it is not just down to having no Ministers; aspects of Bengoa could be implemented through good management, which people have the authority to do, to move forward on some of the savings that can be made.
Mr Baker
The Northern Ireland (Executive Formation etc) Act 2022, which we put through, gives civil servants the clarity they need to make certain decisions. We have put those officials in a difficult position to take those decisions, and I put on record now, since the hon. Gentleman gives me the opportunity, my thanks to them for rising to the challenge and bearing with this difficult situation. I am grateful indeed that permanent secretaries and others are rising to the challenge of taking the decisions that need to be made, but it is obviously not desirable that we should be in this position. Ministers should be in post in Northern Ireland doing what needs to be done.
If the Executive are restored in time to set a Budget for next year, the UK Government will of course continue to work constructively with Executive Ministers on a sustainable Budget that delivers for the people of Northern Ireland and supports economic growth.
Stephen Farry
I thank the Minister for giving way. He will appreciate that in other circumstances the Executive would normally now be considering the Budget for the coming financial year and that it is important to have certainty ahead of the start of a financial year so that decisions can be made, particularly in tough times. If the Executive are not restored very soon, in order to give some degree of certainty to Departments and related agencies, can the Minister give an assurance that the Government will act in the near future to put in place a framework not just for this year’s Budget legislation but for next year’s?
Mr Baker
I expect the hon. Gentleman knows that clauses 8 and 9 put in place a vote on account for next year. I will come to that as it is in my notes; if memory serves it covers 65% of the spending, but I will confirm that when I reach that section. That puts in place the spending for next year, but of course we would like the Executive to return to set the Budget for next year. If they do not return, we will have to do the job, and it will be tricky; there is no getting away from that. Without Northern Ireland Executive Ministers in place, it has not been possible to take the difficult political decisions necessary to balance the Budget at this very late stage in the year, and that of course compounds the problem for next year. It is with great sobriety that I stand here and acknowledge that it is going to be very difficult. I for one would be up for the challenge of doing it, but it is not the Government’s position that we as UK Government Ministers do that; we would like the Northern Ireland parties to step up to that duty.
If the Executive are not restored on time, we will continue to work with the Northern Ireland civil service to prepare for next year’s Budget. The Government’s priority for that Budget will be to deliver a fair outcome for all taxpayers and citizens in Northern Ireland. We will work to put Northern Ireland’s finances on a sustainable long-term footing, which means appropriate consideration of a wide range of options including revenue-raising measures, as well as reviewing all spending.
Jim Shannon
I thank the Minister for giving way and respectfully say to him that I have a suggestion for saving money in the Department of Health. We all know that agency costs for employing nurses are sometimes 25% to 30% higher than the costs within the NHS system; the obvious solution is to employ more nurses in the NHS system in Northern Ireland. Does the Minister agree that in order to make savings we should reinstate nurses who want to work and do away with agency staff whose costs are higher?
Mr Baker
I thank the hon. Gentleman for raising that point, but I hope he will not mind my saying that today’s Bill is a technical Bill to put on a legal basis the written ministerial statement laid before the House last year, and I am reluctant to get into particular decisions. However, I think every Member of this House will know that agency staff are very expensive and it would be much more preferable to avoid their use.
I do not propose to waste the House’s time by going through every detail of every clause on Second Reading—I will come back to that in Committee—but in summarising the Bill I want first to thank Opposition Members, in particular those on the Front Benches, for the approach that they take to these matters. I know they do not hesitate to hold the Secretary of State and me to account, but equally when necessary measures need to be taken, they are constructive, for which I am grateful because this Bill is about making sure that public services can be provided in Northern Ireland.
The Bill will place the Budget that the Secretary of State outlined to the House in his written ministerial statement on 24 November 2022 on a legal footing. It will also allow Departments and other listed public bodies to continue to deliver public services into the first half of the 2023-24 financial year through a vote on account. I do not propose to repeat the contents of that written ministerial statement, which set out the respective allocations reflected in this Bill; what I will say is that those Budget allocations were developed as a result of extensive and sustained engagement with the Northern Ireland civil service. I want to thank again the Northern Ireland civil service, and indeed our own officials in the Northern Ireland Office, for working with great passion and at great pace to work through this Budget; it was inspirational to see and I am particularly grateful to our senior leadership team for the way it rose to the occasion.
The Secretary of State has met Sir Robert Chote, the chair of the Northern Ireland Fiscal Council, and has received a range of representations from public groups and individuals. We have prioritised spending in health and education, with an overarching objective of protecting the most vulnerable: this Budget increases education spending by just under £300 million and delivers a £786 million increase in non-covid-related health spending.
The challenges that all Departments now face are due to the repeated failure of previous Northern Ireland Executives to take strategic decisions to reform public services and deliver sustainable finances. When Ministers left office in October, the Department of Education, the Department of Health and several other Departments were set to overspend significantly, with no plan in place to address that. The best solution for Northern Ireland’s health, education and other public services is a functional and effective devolved Government taking much-needed decisions to place those public services on a sustainable footing.
Karin Smyth (Bristol South) (Lab)
Like many Members of this House, I will be immediately affected, through immediate family, by the Bill’s provisions on education and on health, with the collapse of a care contract in my family this year because of the lack of budgets in the voluntary sector. I am afraid that the Minister is speaking as if none of this were the Government’s fault. Although of course it is up to devolved Members to create an Assembly, over the past six years they have been unable to function as they would in Wycombe or Bristol because of the situation with Brexit, the discussions on the protocol and so on.
This afternoon’s debate is like living in some kind of fantasy land. That is not acceptable from the Government. The very least that they could do is advise us how quickly they will act to resolve the issues around the protocol so that the parties can get back around the table, because the two things are not separable.
Mr Baker
I am grateful that the hon. Lady finished with an encouragement to resolve the issues in the protocol. I have to tell her that I think the sense among all parties at the moment—including the Government of Ireland, the parties represented here in the House, Ministers and the European Union—is that we all want a deal. We want to move on. We want a deal that respects the legitimate interests of Unionism, that keeps the whole UK together and out of the European Union, that respects the Acts of Union and so on. My sense is that through much-improved constructive relations between the UK and Ireland and the European Union, we may well be able to get a deal, but I have to say to people watching this debate that right now there is no deal on the table. There is a large gap to be bridged, and we are working intensively to do just that.
With respect to the hon. Lady’s earlier remarks, she knows as well as I do what the devolution settlement is. I can tell her that the responsibility that we bear certainly sits heavily on the shoulders not only of Ministers in the Northern Ireland Office, but of our officials. She will know that our officials often have friends and family in Northern Ireland or who come from Northern Ireland; I am grateful that she acknowledges that. All those people, I dare say, will feel as acutely as she does the implications of the situations that she has set out. She will know that it is very difficult today to see a Government moving into direct rule. In the absence of direct rule, we simply must make progress on the protocol.
As we approach the anniversary of the Belfast/Good Friday agreement, I really hope that this exchange will be heard in the European Union, because we all want to be able to celebrate that agreement and 25 years of peace—and to celebrate it with the Executive up and running. DUP Members have made it very clear what is on the table, and I think that it is a moment of considerable gravity for us all. But in terms of the real effects on everyday people in Northern Ireland: yes, I am acutely aware.
In conclusion, the Bill is essential to deliver spending for Northern Ireland Departments within the Budget limits that have been set. It will not be an easy task; it will take place in difficult circumstances. People in Northern Ireland rightly expect to see decisions being taken in Stormont, and I agree. Once again, I must state my continued disappointment that it is necessary for the Government to step in and legislate for this Budget, and once again I urge the Northern Ireland parties to find a way back to forming a Government. However, until a functioning Executive returns, the Bill will allow public services to continue functioning and help to protect public finances in Northern Ireland. I therefore commend it to the House.
Madam Deputy Speaker (Dame Rosie Winterton)
I call the shadow Secretary of State.
Peter Kyle (Hove) (Lab)
I thank the Minister for setting out the measures in the Bill. It is needed to allow public services to function in Northern Ireland and we on the Labour Benches will not oppose it. The Bill will not provide new money, but allow Departments and public bodies in Northern Ireland to spend within the limits set out by the Secretary of State in his written ministerial statement in November.
Once again, we are legislating on Northern Ireland budgetary matters here at Westminster. This is not a step that any of us would want to take. Unfortunately, in the time available to us today, we are not going to be able to scrutinise the Budget properly. One hundred and forty-eight pages of a supporting memorandum detail the decisions that the Secretary of State has made. The Government have rushed the Bill forward at such a pace that the Northern Ireland Affairs Committee has not been involved in pre-legislative scrutiny in the way it normally would.
The explanatory notes for the Bill state:
“As Northern Ireland Ministers remained in office until 28 October 2022, it was not possible for the UK Government to take steps to set a Budget before this date.”
I have sympathy for the Government here. It was right to prioritise trying to restore power sharing last year, instead of preparing for a prolonged absence. The last time Westminster took through a Budget for Northern Ireland was in 2019. Of course, at that time, the Executive collapsed for three years before the New Decade, New Approach agreement was reached. I hope that the Minister can update us today on the progress of negotiations on the protocol, which we hope will allow power sharing to return.
I am pleased that the Government have taken on board the Opposition’s ideas and that the Prime Minister has now finally visited Northern Ireland. We have now passed the latest deadline for the appointment of Ministers, and the Secretary of State has 12 weeks to decide whether he will call elections again.
There has recently been an abundance of optimism on the direction of the protocol negotiations—on which, I think, the Minister just poured a bit of cold water. We are now nearing the 25th anniversary. This is not just an issue within the United Kingdom; it is one that our allies around the world are looking at, particularly the United States and our friends and partners in the Irish Government, who are looking on closely. The clock, as we used to hear, is ticking. I hope that that cold water can be mopped up and we get back to the point where we not only have optimism in these negotiations but can —finally—get something across the line. We stand ready to support any deal that the Government strike that delivers in our national interests and for the people of Northern Ireland.
To return to the Bill, the Government previously said that the totals in the Budget are “difficult choices” that are the result of political failure. It is only fair that we put on record some of the reactions of stakeholders to the difficult choices that the Secretary of State has had to make. Paul Mac Flynn of the Nevin Economic Research Institute said:
“the UK government intend on contracting public spending in Northern Ireland and have no interest in understanding how that will impact on the delivery of services here”.
Last week, the leaders of seven bodies representing all schools and the four main Churches in Northern Ireland highlighted a similar concern. In a letter to the Secretary of State, they warned of
“a crisis in education funding”
and requested a meeting. Let me remind the House that Education was the Department that the Secretary of State said would be required by the Budget to make
“significant reductions in current spending trajectory levels”.
Difficult choices have difficult consequences. It is the view of school leaders in Northern Ireland that
“Without question, reduction in funding and ongoing under investment will negatively impact the quality of education of every child and young person”
living in Northern Ireland. We are reluctantly supporting the Bill, but it is right to highlight the real-world effects that these allocations will have. I hope that the Secretary of State will arrange a meeting to discuss the school leaders’ concerns.
The health service in Northern Ireland will also require more long-term thinking than is possible with this Budget. It is noticeable how little progress has been made since New Decade, New Approach promised to transform the healthcare service in Northern Ireland. Waiting lists in Northern Ireland are the worst in the United Kingdom. I was shocked by a recent report by Channel 4 which laid bare the experiences that patients are facing. Since 2011, the number of women in Northern Ireland who have had to wait more than two weeks to see a breast cancer consultant has risen 55-fold. Let me repeat that: it has risen 55-fold. In 2011, 10 patients a month would miss this target; now the figure is a staggering 569 every single month. In response to the report, the Northern Ireland Health Department said:
“In the absence of an agreed multi-year budget for health and a significant overspend for this year, the ability to strategically plan beyond 22/23 is extremely challenging.”
Sir Robert Buckland (South Swindon) (Con)
The hon. Gentleman is right to talk of the inability to set out multi-year plans. We were being told about that when the Committee was in Northern Ireland last week, in a range of different areas. This is the problem: without a functioning Executive, there cannot be that multi-year longer-term thinking. The Government are doing everything they can year on year, but that will not replace a strategy and a plan that would help women with breast cancer and help children to get a decent education.
Peter Kyle
I am grateful for that intervention from the right hon. and learned Gentleman, and I am grateful for the fact that his Committee, or the majority of it, made it to Northern Ireland last week, while the shadow Foreign Secretary and I were snowed in. I know that some members of the Committee were struggling to get there. I am pleased that he did and that the Committee was able to complete its inquiries.
We have six hours of protected time here today, but it would take six hours to prosecute what landed us in this situation. The right hon. and learned Gentleman is correct —as is the Minister—to say that the best way to move forward from this particular moment in time is to have Stormont, and devolution, up and running, carrying out the required scrutiny of public services and with long-term strategic planning and political oversight and processes also up and running. However, I remind him and others, in fairness to those in the DUP, that they were raising these concerns about the protocol from a position within a devolved Administration long before they withdrew the Executive and then again failed to appoint a Speaker last year. There was a fantastic six-month window of opportunity in which to resolve these issues before the Executive collapsed, and that is the missed opportunity that has led us down the path on which we find ourselves today. The right hon. and learned Gentleman is correct to say that we need to get the institutions up and running, but I cannot forgive the negligence that allowed this state of affairs to emerge in the first place—and that negligence, I am afraid, started here, and in Whitehall and Downing Street.
This Bill will legally be considered a Northern Ireland Assembly Budget Act, but it serves only as a sticking plaster until the Assembly returns. If we keep passing Budgets for Northern Ireland in this way, the problems facing public services will keep building. We are also asking a huge amount of the civil servants in Northern Ireland who are now effectively running Departments. They are the ones who will have to make the choices about where the savings that this Budget requires can be found.
I want to raise the issue of education again, as it is the Northern Ireland Education Department of which this Budget is asking the most. I am sure that everyone here follows the reporting of BBC Northern Ireland. Last week, its education correspondent Robbie Meredith revealed that the Education Authority, the body that delivers school transport, meals, maintenance and support for special educational needs, is struggling to find £110 million of savings. In the authority’s view,
“The majority of the options available to save £110m in less than three months of the remaining current financial year would lead to highly unacceptable and detrimental risks to our children and young people and therefore could not be recommended for implementation.”
The fact that these discussions are happening behind closed doors and not receiving the attention they deserve from politicians shows that something has gone very wrong. It is my view that education is the greatest way of levelling up any part of our country, so any cuts should receive so much more scrutiny than is available here today.
To sum up, we need to accept the need for this Bill to allow public services to keep functioning for this present financial year. This process, however, is unsatisfactory for everybody across Northern Ireland. As the Secretary of State has said, he will start preparing a Budget for next year. I would welcome discussions with him about how to improve the scrutiny of taxpayers’ money. Of course, the best solution would be that Stormont is restored and that local representatives can agree on a Budget with political accountability. I would welcome an update from the Minister on progress on addressing the issues that are holding that back.
Madam Deputy Speaker (Dame Rosie Winterton)
I call the Chair of the Northern Ireland Affairs Committee.
Simon Hoare (North Dorset) (Con)
It is a pleasure to follow the shadow Secretary of State, the hon. Member for Hove (Peter Kyle). I think we could have waved at each other last week when he was trapped somewhere in Derry/Londonderry as we went over the hills to get there. At least we are all back safely and able to speak in this afternoon’s debate.
Here we go again. Once again, Northern Irish exceptionalism has to come into play and this place has to step in to fill a gap. My hon. Friend the Minister of State was absolutely right when he said that if this were the service being given to his or, indeed, my constituents in North Dorset, not only would questions be asked in the House, but there would be real and tangible anger. People would feel a sense of abandonment. I think there would also be a growing sense of, “We are the public and we need and want public service, but that can only be delivered at the political level. If the politicians we have do not want to do it, give us the opportunity and we will find some who will.”
There will always be ultras in this sort of debate. I well remember talking to an SNP friend from the 2015 intake when the price of oil was absolutely on the floor. I hope you will give me a moment to expand on this point, Madam Deputy Speaker, before you start wondering, “Where the hell is he going with this?” I said, “You must be rather pleased that Scotland decided to stay part of the United Kingdom in the referendum. We’re able to support you and so on because your income as an independent Scotland would have been down as a result of the collapse in oil prices.” A steely glint came into the eye of this person, who must remain nameless—and I can see a steely glint coming into the eye of the hon. Member for Argyll and Bute (Brendan O’Hara), who will speak on behalf of the SNP in this debate—and he said, “Simon, you’re right: the quality of public services would fall. Things would be difficult, and we would have to take difficult decisions, but we would be doing it with an independent Scottish people in an independent Scotland, and that is a price worth paying.”
There will be some who will always say that the price is worth paying—people whose fixed point of principle on one side or the other is so important to them that, no matter how much suffering and pain are occasioned, they believe that it is a price worth paying. I respect those two positions—we always have to have extremes in any debate—but I do detect, as I mentioned in my intervention on the Minister, a growing sense across the communities of Northern Ireland of real anger and disappointment at the failure of politicians to rise to the occasion and to deliver the public service that they expect.
The shadow Secretary of State was right to point out some of the problems that this process, by definition, generates in Northern Ireland. The Government are to be commended for bringing forward the Bill—a common sense act by a sensible Government. But the problem we are going to have—this has been tested in the courts—is that there will be huge reticence among the civil servants. I do not criticise civil servants for that in any way, shape or form, but they will only be able to deliver policies that have already been agreed. If they act ultra vires, there would be a problem because this has been tested in the courts and we know how they ruled on it. Moreover, some of these policies—not all of them—are analogue for a digital age. They do not reflect the cost of living crisis, energy costs and the increase in inflation. They do not reflect the need for fleet action to fill the gaps and address the problems created as a result of covid in education and health, although not exclusively those two things. We need a local Northern Ireland Budget set by Northern Irish politicians in Northern Ireland, reflective of and given cognisance to what they are hearing on their own doorsteps. This process, by its very definition, cannot meet that challenge.
I want to speak briefly about what we, as a Committee, heard from both sides of the community in our visit last week. My right hon. and learned Friend the Member for South Swindon (Sir Robert Buckland) referenced the very real concerns about the absence of a multi-year settlement. We heard from an organisation whose main funding was from the Northern Ireland Office and Stormont. The NIO part of its funding had been agreed and signed off—it knew it had it. It had no idea at all what it would get out of this budgetary process. No idea at all. Notices were going out to their paid staff to say, “We may have to make you redundant. We hope we won’t have to. We hope we will get the money, but we do not know.”
These are not institutions or organisations teaching origami, advanced flower arranging or contract bridge for the winter months. These are organisations that are stepping in for peace building and community building. They are community-led. They are working to help women who find themselves, as the BBC “Spotlight” programme showed, caught in a cycle of the cost of living, leading them to default to extortionist money lenders of the so-called paramilitaries, only to find they cannot pay the money back. They then have to resort to criminal behaviour, being forced to give sexual favours as payment in lieu or seeing their children brought into the ambit of influence of these paramilitaries as a way of paying off debt.
Those groups, which are so dependent upon the money that this Budget could provide and that Stormont could reflect, now find their work in jeopardy. I encourage female Members of this place to take a growing interest—I know many do, including the shadow Minister, the hon. Member for Gower (Tonia Antoniazzi)— in the impact of the budgetary pressures and other deficiencies in the delivery of public services for the women of Northern Ireland. I make no judgment on the merits, but this House has focused on that issue merely in access to abortion services.
There are a hell of a lot of other things going on—bad things—for the young women of Northern Ireland and, by definition, their young children. They look to those organisations to help them and to protect them, to help them be better parents and to keep their kids on the right path. I think we heard from every single organisation that we met—my right hon. and learned Friend the Member for South Swindon confirms that—the anxiety about the effect that this absolute abdication of the delivery of public service is having and will have.
My hon. Friend the Minister will also know of the potential poor budgetary settlement for the Police Service of Northern Ireland, which will have ramifications across the whole of Northern Ireland. They need to do so much in order to build on those peace foundations laid 25 years ago by the Belfast-Good Friday agreement. They will have to make a choice. Everybody in this House will understand and readily applaud the determination to continue community policing. We all know the merits of good community policing in our own communities, and those are magnified still greater in Northern Ireland. But you will not be able to have good community policing and good criminal policing. Something will have to give. The hon. Member for North Antrim (Ian Paisley) was right to say that there is no magic wand, and Stormont would not, by itself, have the answer to all these problems, but—by God!—notwithstanding the absence of that magic wand, are not the people of Northern Ireland hampered yet further by not having in place MLAs who can take to officials and to debates what they hear on the doorsteps, or in their church halls?
Sir Jeffrey M. Donaldson (Lagan Valley) (DUP)
At the beginning of 2020, in “New Decade, New Approach”, the UK Government committed to addressing the issue of police numbers in Northern Ireland, and to helping the Northern Ireland Executive with the funding necessary. The Assembly and Executive were restored on that basis. From early 2020 until October 2022, the UK Government failed to deliver on their commitment. The Treasury would not provide additional funding to enable the recruitment of extra officers, despite that being an NDNA commitment. Does the Chairman of the Select Committee understand our frustration? We keep hearing that if we had the Assembly and the Executive back, we could address those issues, but there are many examples where that is not the case. Not least of those is the issue of the UK internal market and the protection of our place in it—another key part of NDNA that was not delivered. This Parliament and Government are not innocent when it comes to these issues.
Simon Hoare
I very much agree, and I wrote to the PSNI only today, following our visit, asking it to put in writing in more detailed terms what we heard last week, so that the Select Committee and this place can better understand the implications of that for policing in all its guises. I agree with the right hon. Gentleman that those on the Treasury Bench need to step up and honour the agreements reached in “New Decade, New Approach”.
I have always felt that the slight fault line is that when there is a problem or impasse, people say, “I know—we’ll have an agreement! It will promise almost all things to all people; there will be something in it for everybody.” Then they say, “But, you know, we didn’t really mean it. We were just using it as a device—a negotiation stepping stone to get us from one side of the river to another,” and, “Oh, you mean that we will be held accountable for delivering that?” I think in this instance they will be. The right hon. Gentleman and his colleagues from across the parties in Northern Ireland need no lectures or lessons from me on the huge damage that would be done to community safety, and the criminality that would arise, if the PSNI was not functioning. He can rest assured that as soon as I receive that missive from the PSNI, either the Committee will look at the matter still further and go into detail on it, or I will raise the matter with the Treasury and the Secretary of State.
Let me conclude by picking up a thread from the right hon. Gentleman’s intervention—and this points to what was said by the hon. Member for North Antrim. There is no goose that lays golden eggs—we know that—and there is nobody who advocates for the speedy return of Stormont. Nobody is suggesting that that would solve all the problems of Northern Ireland. However, the fact that an organisation cannot do all the good, all the time, should not stop it from trying to do as much good as it can, as long as it is there to do it. That is the fundamental choice.
DUP Members are fed up, and they are fed up with me saying this—I will not even ask them to nod in support, because I know they are. They are nodding, but they do not even know what I am going to say. It is this: Members on the Treasury Bench have made the error of allowing issues and concerns about the protocol to be conflated with the delivery of functioning devolution. They are two very separate work streams. The protocol offends some in Northern Ireland, but the absence of Stormont affects all, and that is what we should be focused on.
Brendan O’Hara (Argyll and Bute) (SNP)
I will not detain the House very long, because there are many voices from Northern Ireland—those directly elected by the people of Northern Ireland—who need to be heard and should quite rightly be heard. It is a pleasure to follow the hon. Member for North Dorset (Simon Hoare) , who I think spoke for many when he said “Here we go again.” That must be the overwhelming sense of the people of Northern Ireland as well, who deserve so much better than they are being given.
I share the Minister’s frustration that it has come to this again, particularly when people are struggling to make ends meet and there is a cost of living crisis. People have to know, they have to be able to plan and they have to have a Government that plan. They need their Executive up and running as quickly as possible. The hon. Member for Hove (Peter Kyle) made that all too real when he brought up the statistics and talked about the health crisis in Northern Ireland, because that is the consequence of being unable to make multi-year decisions about how Northern Ireland goes forward.
The SNP supports this Bill. We regret the circumstances that have brought us here today, but we accept that it is necessary. Nevertheless, it is hugely disappointing that it has come to this and that this place is acting in the stead of the Northern Ireland Assembly. Having Stormont back working properly as soon as possible is in the interest of all the people of Northern Ireland, because there is no substitute for local people making local decisions. Let us be frank, with all due respect to my DUP colleagues, nobody knows better day to day what the people of Northern Ireland want and need than the local MLAs who have been elected and whose job it is to deliver on those priorities.
The people of Northern Ireland need the politicians they elected to the Assembly back at work as quickly as possible. That is why this Budget should not be set here—but while there is no functioning Assembly, this Bill, as I say, is better than nothing and in the absence of Stormont, we will support it. It is essential that those hard-working public servants get what they need to allow them to do their job and that the people of Northern Ireland get what they need.
From a Scottish perspective, it is absurd that we now have trade barriers not just with our European partners, but within the UK itself. Having been promised the “best of both worlds” by the former Prime Minister, we now appear to have the worst of all worlds. I speak particularly as the Member for Argyll and Bute with our fishing industry. We can see across the water to Northern Ireland and the fishing communities there; we share the same waters and we fish for the same catch, but we have completely different regulatory systems.
My communities have been—excuse the pun—battered by a double whammy of Brexit, which was totally mismanaged, and the choice the UK made to turn a blind eye to the inevitable problems that would be caused by Brexit to Northern Ireland. That has led us to where we are now. The passing of this Bill goes nowhere near resolving those problems, but it is necessary, and on that basis we shall support it.
Sammy Wilson (East Antrim) (DUP)
First, I too join the Minister in expressing sympathy on behalf of my party to Alex Easton, one of the MLAs for North Down, whose parents died tragically in a house fire today. Our thoughts and prayers are with him. He has lost both elderly parents today.
Stephen Farry
Alex Easton lives in my North Down constituency and, to echo what the right hon. Gentleman has said, the community in Bangor is extremely shocked by what happened overnight. Regardless of politics, the entire community across Northern Ireland will want to give their full support to Alex and his family at this most difficult time.
Sammy Wilson
I am sure that feeling will be widespread across the constituency, as Alex—a former member of my party—is well known and loved there.
I share the Minister’s view on at least one point he made at the start of the debate—namely, I would have preferred it if this Budget had been discussed in the Northern Ireland Assembly, and if decisions about priorities and spending had been made there. Unfortunately, that has not been possible because the Northern Ireland Assembly cannot function, because the very basis of the Northern Ireland Assembly has been destroyed. The Assembly has to work on the basis of consensus, but that consensus has been destroyed by the protocol. We hear ad nauseum from the hon. Member for North Dorset (Simon Hoare), who chairs the Northern Ireland Affairs Committee, that we should all be back and we cannot have any more Northern Ireland exceptionalism, but Northern Ireland has been made exceptional by decisions that he has supported—namely, that Northern Ireland no longer remains fully part of the United Kingdom as a result of the protocol.
Furthermore, even though I, my party and our representatives, as Unionists, believe that the protocol is damaging to Northern Ireland’s position in the United Kingdom and to our economy, had we been sitting in the Assembly today, we and our Ministers would have been required to implement the very thing that we say is damaging us, making us exceptional, removing us from the rest of the United Kingdom, causing huge economic burdens—I will mention some in a moment—and being a drain on the Northern Ireland Budget. Yes, we would like to see this legislation debated and these decisions made in the Assembly, but until the basis of the Assembly is restored—that is, until there is cross-community consent for decisions that have to be made—that will, sadly, not be possible and this House will be required to intervene.
It is quite right that the Minister has taken a decision. I do not criticise him for leaving it so late, because he could not have done it before. Indeed, this Budget crisis originated not in October last year, but at the very start of that year—ironically, when the Assembly was fully functioning, and we had a Finance Minister in place, an operating Executive and Ministers who could make decisions about priorities—when, for the second time, Sinn Féin failed to present a Budget that could have the support of any party in the Assembly. There have been only two Sinn Féin Finance Ministers, Máirtín Ó Muilleoir and Conor Murphy, and neither has ever been able to bring forward a successful Budget. There is this idea from the Chair of the Northern Ireland Affairs Committee that these things would be resolved if only the Assembly were functioning—but the Assembly was functioning, and this was not resolved.
Simon Hoare
I understand why the right hon. Gentleman is trying to say what I said, but I am afraid he is missing the mark. What I actually said, if he had heard me, was that I appreciate entirely that a functioning Stormont would not be able to solve all the problems, but that surely solving some—or at least playing an active part in trying to solve some, even if they cannot do all—is better than nothing.
Sammy Wilson
For any problem to be resolved, as the hon. Gentleman knows full well, we need a Budget that Departments work from. The Northern Ireland Assembly has collapsed twice in the last four years. On both occasions, it collapsed without a Budget; that is a fact. It collapsed without a Budget because the Finance Minister could not present a Budget that people and other parties could sign up to. On both occasions, the Ministers responsible were Sinn Féin Ministers. All I am saying to the Chairman of the Select Committee is that we could not have had a functioning Assembly. Leaving aside the principle of consent, we could not have had a functioning Assembly because the Assembly did not have the authorisation to spend money on Departments because of the failure of Ministers.
Colum Eastwood (Foyle) (SDLP)
Of course, the right hon. Gentleman is a former Finance Minister, but we should not go into his record in that Department if we want to get through the day. He knows that I am no supporter of Sinn Féin, but has he noticed that Sinn Féin has said that it would take the Department for the Economy if an Executive were formed tomorrow? Given everything we have seen over the past 25 years, that would likely mean that the DUP would get the Department of Finance. Surely that is an incentive for the DUP to go back into government and put a Budget in place very quickly.
Sammy Wilson
I do not want to get into history, but I would point out that in the first year I was Finance Minister, we had a 5% cut in the Budget in the middle of the financial year as a result of decisions made here, and we agreed a Budget. Furthermore, we agreed a Budget not just for one year but for three years, so it is possible for the Assembly to make decisions. All I am saying is that, in its current form and with the current party holding the Department of Finance, that has not been possible. The point I am trying to make is that rather than lay the blame at the feet of the DUP for not operating an Executive—in which its views were excluded anyway—we should lay the blame for this situation at the feet of those who could not make an operable Budget even when the Executive was functioning.
Moving on to my second point, the Minister has made great play today of the fact that Northern Ireland gets treated more generously than the rest of the United Kingdom. I accept that, but so do Scotland and Wales. One of the important things about being part of the Union is that there are fiscal transfers from those parts of the country that have geographical, economic and infrastructure advantages that other parts do not have. I do not believe that it shows a begging-bowl mentality when people in Wales, Scotland or Northern Ireland—or indeed the north of England—say, “Look, there are parts of the country that are richer, but one of the benefits of being part of the Union is that those parts help the areas that are in difficulty.” Indeed, the Government’s own philosophy at the moment is what? To level up, and to accept that there is a responsibility to transfer resources to those areas that, for whatever reason, face disadvantages.
I would point out to the Minister that the increase in the money we have had to receive is partly due to the protocol, which his Government signed up to. There is nearly £500 million a year in the trader support scheme, as well as the resources behind the extra sanitary and phytosanitary checks—the people who have had to be employed, the computers that have had to be installed and the buildings that we now find are going to be built, but not as a result of a decision made by Ministers in the Northern Ireland Executive, because of course there could not be agreement on that.
Ministers at Westminster have now taken over the power to deliver at least a £47 million investment in border posts within our own country. There are questions—not for today, but at some other stage—about who authorised civil servants to start the work on those before Ministers in Westminster took responsibility, even though it was controversial. The Minister has talked about the difficulty of civil servants taking decisions, but it seems that when they want to, they can even make controversial decisions—decisions that split the United Kingdom and put border posts between Northern Ireland and the rest of the United Kingdom. Nothing can be more controversial than that, yet civil servants seem to have been able to take those decisions.
The Bill allows Departments to spend until the end of this financial year, and then into the middle—I think it is June—of the next financial year. That is not unusual. Indeed, if the Assembly had been functioning, that power would have to have been given to give the Departments the ability to spend that money on account until the Budget was finally agreed—it usually was agreed, but it was not agreed in some cases—in the Assembly in June of this year.
There are aspects of the Budget that are particularly difficult: one, which has already been mentioned in interventions, is the expenditure on education. Once education and health are taken out of the Northern Ireland Budget, we do not have a great deal left, because they account for over 60% of spending between them. However, education has been specifically targeted by Ministers to face a reduction, even though education spending in Northern Ireland is at the lowest level per head in all parts of the United Kingdom. The difference between Northern Ireland and Scotland, for example, is £1,200 per pupil. I know that these things are not always solved by money: although Scotland has the highest level of expenditure per head when it comes to education spending on pupils, its outcomes are actually falling, so let us not imagine that there is a direct correlation all the time between spending money and getting outcomes.
I am sure the Minister will make the point that that is why it is important for Government Departments to make decisions about performance, efficiencies, productivity and so on. Some of the decisions that the Assembly has made have not been helpful in that regard. The Integrated Education Act (Northern Ireland) 2022, which was passed just before the Assembly collapsed, gives preference to one particular sector of the education system. I think that Act is going to make it much more difficult to rationalise education and, therefore, to ensure that money is better spent. While I do not want to go into the detail of the Act today, that is what the other sectors of education believe as well—that it is going to make that whole process of efficiency and spending in education more difficult than it is at present. Again, that is an example of where just having a devolved Administration, which should know local needs, does not always ensure that the most efficient decisions will be made.
On health, leaving aside the money that is spent directly from Westminster—annually managed expenditure —we are now spending nearly 45% of the total Budget that the Executive has to spend on health, yet outcomes are falling and waiting lists are increasing. I get letters from constituents and angry letters from doctors all the time, saying, “We need to spend more on health. We are under- resourced; we are underfunded.” I do not know how much of the Budget we can continue to take out and give to one particular sector—there are other areas, as Members have mentioned, including policing, infrastructure, education, universities, training, agriculture and industrial promotion. All those things are in competition, and we cannot simply say, “Here is one part of the Budget that we will keep pouring money into.”
Of course, as I mentioned, some money could be released for the trader support service and the other expenditure around the protocol—nearly half a billion pounds every year. As the Government now accept, the reason why that money is spent is that the protocol is such a big disadvantage and a burden on business that they need to help those businesses overcome the bureaucracy, and the barriers and impediments to trade between GB—our biggest market—and Northern Ireland.
The other point I wish to make on the Budget this afternoon is that when it comes to looking at priorities, even in the absence of devolution Ministers could do more to look at where we need to spend the money and direct civil servants. Despite what the Minister has said, civil servants now have the power to have greater flexibility in how money is spent. I know it is difficult for them and that some of those decisions are political, but there have already been political decisions made about the priorities that the previous Executive and the Assembly wanted. Surely those things should be guides to civil servants in making decisions about how money could be more effectively spent. As I have said, they make some controversial decisions in relation to the protocol, so there is no reason why we should not have tweaking of the Budget.
The last point I wish to—
Mr Steve Baker
The right hon. Gentleman has mentioned this a couple of times and I mean to come to it as I close the debate. We have to insist that it is Ministers who decide, and officials who advise. He will know that the protocol is the responsibility of the Foreign Office. I am highly confident that Foreign Office Ministers will have taken a decision and taken responsibility for it. Of course, it is not Northern Ireland civil servants who are responsible on the protocol, but the Foreign Office. I want us to respect the fact that the Foreign Office is taking this matter very seriously.
Sammy Wilson
The point I was making—the Minister knows this, because we have raised it here on a number of occasions—is that the responsibility did lie with the Northern Ireland Executive. The Foreign Office did not like the decisions that Democratic Unionist party Ministers in the Executive made on the protocol infrastructure and only recently have taken over the responsibility to implement that. Even before that happened, civil servants—I do not know whether they did this at the prompting of officials or Ministers in the Foreign Office—were already making decisions about clearing sites in my constituency to build border posts.
The last point I would—
Sir Jeffrey M. Donaldson (Lagan Valley) (DUP)
Surely it is even more serious than that. The reality is that the Northern Ireland Executive and Assembly are now in a position where they have to administer laws that are not even created by this Parliament, never mind by the Assembly itself. This applies in more than 300 areas of law; the way we administer, for example, our ability to trade with the rest of the UK is now determined by a foreign polity, the EU. It imposes laws on Northern Ireland, on which we have no say; there is no scrutiny and no accountability for those laws. So the democratic deficit in Northern Ireland is very real to the Northern Ireland Assembly and Executive and is one of the fundamental reasons why we do not have functioning political institutions, because our party is not prepared to tolerate a situation where we are treated like an EU colony.
Sammy Wilson
Until that situation is revolved, we are going to be faced with the kind of situation we are discussing today. What amazes me is that other parties in the Assembly, which equally will have no say on those laws, meekly accept those powers being taken from them and not being available to them. I have heard many debates in this Chamber about the Government snatching power from devolved Administrations on various Bills, yet we find that some parties in Northern Ireland are happily accepting that they should not have the ability to make decisions on matters that will greatly influence the lives of ordinary people.
Simon Hoare
The point about the democratic deficit is important, as everybody would understand. Does the right hon. Gentleman share my understanding that both Westminster and the EU are very alert to this, and that the EU is keen to find ways, such as Norway has, whereby the views of directly elected Northern Irish politicians, business organisations and others will be taken into account and canvassed in order to shape rules, which may apply to businesses, standards or whatever it may happen to be within Northern Ireland? I appreciate that that does not hit the sweet spot that he would like to see, but we should all draw comfort from the fact that everybody recognises that there is an issue with the democratic deficit and that there are models whereby it can be addressed.
Sammy Wilson
I am amazed at the hon. Gentleman’s intervention. As far as I know, he is a member of the Conservative and Unionist party, and as a Unionist, he should be interested in that sweet spot. Simply to hand over power and then find some complicated mechanism to ensure that maybe someone’s voice is heard and considered, while laws from outside are still imposed in our country and a foreign court adjudicates on whether they have been applied properly, does not hit the sweet spot with me, and it should not hit the sweet spot with him; otherwise he should take “Unionist” out of the title of his party membership.
Let me make one last point, about the size of the Budget. Unless there is a radical movement in the EU’s position, the situation could continue for some time. It is important that Ministers consider some of the points that have been made by the education sector, especially in Northern Ireland. Youngsters have fallen behind as a result of covid, and have been locked out of schools. Many of them—and I know this from my own constituency—are youngsters who are most disadvantaged in education anyway, and there should be a discussion with the education sector about what can be done to introduce additional help, especially for youngsters who have fallen behind as a result of the covid closure of schools.
There will be further discussions after the Bill progresses, and I hope that many of the priorities articulated in the Chamber today will be considered. I understand that there are certain sides on a cake, but I do not believe that the cake is big enough. If we consider the existing pressures—teachers, wage increases for public servants, the cost of energy and so on—some of them are universal and apply across the board in the United Kingdom, but given the size of the public sector in Northern Ireland even a Barnett consequential does not fully compensate for the increase in costs that the Northern Ireland Administration faces. Those are the kind of issues on which I hope we can have continued discussion with the Minister in future.
Colum Eastwood (Foyle) (SDLP)
I promise not to make as many final points as were made in the previous speech. Listening to some of the contributions, one would almost think that Brexit was a bad idea for the people of the north of Ireland, given all the consequences. We do not have any influence or representation any more in the European Union, and I could think of one or two ways in which we could remedy that.
At the last election, the Conservative party in Northern Ireland secured 0.03% of the vote, but today the Conservatives are setting a Budget for the Departments and the people of Northern Ireland. They are doing so because the Democratic Unionist party will not go into government and take control of the Department of Finance and set a Budget for the people of the north of Ireland. The argument from the DUP seems to be, “Sure, we can’t fix everything, even if we do go back into government. There is no magic wand.” As a harsh critic of the DUP-Sinn Féin Government over many years, I can say that it is impossible to fix everything—absolutely, Stormont could not fix everything, but it is the job of public representatives to roll their sleeves up, get in there and try. It is like a Pontius Pilate concert—“nothing to do with us”—with hands being washed all over the place. The reality is that a Budget has been set by the Conservative party, which has absolutely no support in Northern Ireland, because the DUP will not go into government, although it could go into government tomorrow morning if it wanted to.
The Minister—a man I often agree with—made a clear point: there is no connection whatsoever between the negotiations that are going on between the European Commission and the British Government and the formation of a Government in Northern Ireland to deal with the problems that we face. Anybody who says otherwise is lying to themselves. In my view, the issues around the protocol will be resolved, but it is vital that a core part of that resolution respects the fact that we now have a fantastic opportunity, because of the protocol, to trade into two markets unencumbered—an opportunity that no one else has. Indeed, the Secretary of State is in America right now, selling to American companies.
Paul Girvan
We would not be where we are today if the DUP had not come out of the Assembly. Europe and everything else would have floated along quite happily and we would have been left to drift forever. We were told day in, day out, “We’re talking about this. We’re talking about that,” but we were getting nowhere. We had to do something, and this was the only opportunity.
Colum Eastwood
The hon. Gentleman is absolutely right: we would not be where we are today were it not for the actions of the DUP. And where are we? We have people dying in their homes because ambulances are not coming in time. We have people on trolleys for over 24 hours in every hospital in Northern Ireland. We have an Education Department that is being cut to ribbons by this Budget. We have people from my constituency emigrating every day because they cannot find work. Will that all be solved by the Executive in the morning? No, it will not, but it is our job to try. That is the whole point of representative democracy. That is the whole point of devolution. That was the whole point of the Good Friday agreement—that people who disagree with each other can come together and thrash out agreements to get things done. It is difficult and it is tough, but it is what we are supposed to do.
I welcome the conversion of the right hon. Member for East Antrim (Sammy Wilson) to levelling up areas that need it most. I will extend an invitation to him now to visit Foyle, because my experience of previous Executives is that they did not do an awful lot of levelling up there.
Sammy Wilson
The hon. Gentleman continually raises this issue—sometimes taking a whining approach as well—but under the Executive I remember money going to the airport at Londonderry, Altnagelvin hospital getting the cancer centre and money being allocated for the road from Londonderry—
Sammy Wilson
I am thinking only of my own experience. Actually, the road was cut because the Irish Government said they were not going to make their contribution to it.
Colum Eastwood
It is interesting that people in Derry are entitled to some Government funding—thank you very much! My constituency has the highest unemployment, the highest claimant count and the highest household overcrowding, and it has five of the 10 most deprived areas in Northern Ireland. Maybe some work was done, and maybe some money was spent outside the Greater Belfast area, but it has not had the impact that some might claim.
If people think it is good enough or acceptable just to say that we will throw a few quid at people in Derry—people who have been left behind—after many decades, they are absolutely wrong. The New Decade, New Approach agreement was referenced earlier, and this Government have a responsibility for some of the commitments in it. I think of the expansion of Magee—there is still no funding for that from the Government. There is the Brandywell stadium—there is still no funding for that from the Government. And there is the Northlands addiction centre—we have had promise after promise, but the money is still not in a bank account.
Frankly, I find it difficult to watch people jumping up from their seats and giving excuse after excuse as to why it would not make any difference if we were in government, when people are literally dying on trolleys right now because they cannot get access to the health service. We are abdicating our responsibilities as elected representatives for the people.
Sir Jeffrey M. Donaldson
The hon. Member consistently attacks the Democratic Unionist party, but might I remind him about the history of his own party? When people were dying on the streets of Northern Ireland in their thousands, his party refused to take its seats at Stormont and participate in a functioning Assembly for very many years. He will argue there were valid reasons for that, but he should at least respect that if we are going to sort out our problems in Northern Ireland, Unionists also have an entitlement and a right to have valid reasons not to participate in institutions when they feel that their rights have been undermined and diminished.
Colum Eastwood
That is astonishing, given the fact that we had the Sunningdale agreement, where we had people working in those institutions. They were brought down, frankly, by people associated with the right hon. Gentleman’s political party and other Unionists. That accusation thrown at the Social Democratic and Labour party for not wanting to make institutions work is coming from someone who walked away in the dying hours of the negotiations to bring about the Good Friday agreement. That agreement had to be brought about because the three strands—the three sets of relationships—had to be recognised. We could not have an internal settlement in Northern Ireland without north-south institutions and institutions that recognise the east-west dimensions to our relationships as well, and it is absolutely ridiculous to state otherwise. We now have people in the DUP using the Good Friday agreement as a reason why they cannot go back into government. It is absolutely astonishing, it is wrong and it is an attempt to pull the wool over people’s eyes.
We all, in all our communities and constituencies, should recognise that the European social fund, for example, has gone. That was £40 million into communities, supporting 1,700 jobs and activity right across every single community. The British Government are proposing to give us half of that back, even though they told us that we would not lose a single penny as a result of Brexit. That is 800 jobs in the community and voluntary sector gone. We have councils across Northern Ireland right now considering massive rates hikes, which will put more pressure on ratepayers and small businesses, and it will mean that workers in those small businesses, many of whom are already on the breadline, will lose their jobs.
We also have an opportunity missed today—I think the right hon. Member for Lagan Valley (Sir Jeffrey M. Donaldson) and every other political leader in Northern Ireland will agree with me on this, because they all signed a letter about it—to implement the organ donation law known as Dáithí’s law. The Government missed the opportunity, and I ask them to revisit that. The work done by young Dáithí, his whole family and the people around that campaign deserves support from this Government.
I also put on record my condolences to Alex Easton, his whole family and his family circle. It is an awful tragedy to happen to anyone, and I cannot imagine what that family is going through.
We have proposed a change to the rules around how a Speaker would be elected, which I think could get the Assembly back up and running and at least see Committees meeting. It will not see an Executive up and running, but that is down to a political decision by the DUP. The DUP tells us that the basis of the Assembly is consensus—well, not in my experience. I do not remember an awful lot of consensus in the Assembly in the nine years I was there. The principle of consent is the basis for the Good Friday agreement, and it is a very different thing.
I am saying, as an Irish nationalist who thinks that all these economic and social outcomes will be better in a new Ireland—I think we will get there sooner than some people think, and I thank some of the people sitting to my left for that—and who wants to bring about constitutional change, that the principle of consent is sacrosanct. It is not going anywhere, and it is not changing. This pretence that we have been taken out of the United Kingdom and nobody noticed is the basis of the boycott of the Executive, but I must have missed the victory party, if we are now all in a united Ireland. I did not notice.
Colum Eastwood
No, I am not being childish. The DUP’s argument is that this is a constitutional rupture and the people of Northern Ireland have been taken out of the United Kingdom. That has been said twice by DUP Members in this debate, and it is simply not true. If that is what they want to tell people, it is a very strange way of being a Unionist.
My view is that the Assembly is there to deal with all the problems we have in the health system and the education system. I want to see a united Ireland, and I will work to make that happen, but I have to convince enough people and we have to have a referendum, and that is when the principle of consent comes into play. The two things should not be conflated. A political decision has been made by the DUP, and there are consequences for it. My view is that the DUP has to own those consequences.
Gavin Robinson (Belfast East) (DUP)
As you know, Madam Deputy Speaker, it is customary to say that it is a great pleasure to follow the previous speaker—in this case the hon. Member for Foyle (Colum Eastwood)—so may I thank him for the comments that he made about Dáithí’s law, which makes that convention easier to abide by? I agree with him wholeheartedly, and I thank him for his sincere remarks about our former colleague Alex Easton, the independent Assembly Member for North Down. In such harrowing and tragic circumstances, those remarks will be appreciated by him and by all those around him.
I do not think that there is any need to delve into some of the squabbling of the past 10 minutes, but I place on record my appreciation for the comments of the shadow Secretary of State, the hon. Member for Hove (Peter Kyle). He rightly identified the huge failure on the part of the Government to deal with or grasp the issues presented to them in the six months following the September 2021 speech at La Mon in which my right hon. Friend the Member for Lagan Valley (Sir Jeffrey M. Donaldson) outlined clearly, in intelligible terms that anyone could understand, how the protocol was fraying the strands of the Belfast agreement. The more those strands fray, the more likely it is that they will snap.
We should not need a history lesson in this Chamber to know that in New Decade, New Approach an agreement was struck that dealt not only with police officer numbers, but with the fact that Northern Ireland had been removed from the United Kingdom’s internal market. A commitment was given to restore Northern Ireland’s place within the United Kingdom’s internal market. If that commitment had been delivered, we would not be where we are today. If the warning that the shadow Secretary of State has highlighted had been heeded at that stage, steps would have been taken to ensure that we did not end up where we are today.
I had to smile when the Chairman of the Northern Ireland Affairs Committee, the hon. Member for North Dorset (Simon Hoare), said that we get fed up with him. He then had more to say, but I agreed too early, so I apologise for that. However, he has stood at the vanguard of those who have dismissed and demeaned the legitimate political concerns that have been raised—not post the Northern Ireland protocol, but during its passage through this House and in all the tumultuous years that led up to that point. It was clear as day: we did not support it in October and November 2019, and we did not support it when we came back in January and February 2020.
It is clear as day that when Northern Ireland is removed from its integral place within the United Kingdom, without the consent of people in Northern Ireland; when a situation is created in which Northern Ireland Assembly Members are no longer able to vote, speak or shape laws that attach to trade; when a huge cost is placed on consumers across Northern Ireland and product choice and availability is removed; when there is an attempt to subvent that at a cost of £358 million over the past two years, or some £460,000 a day, for the trader support service in order to ameliorate the bureaucratic requirements associated with the protocol, with grace periods in place; and when people have the temerity to talk about a cost of living crisis, without recognising the huge costs placed on consumers and businesses in Northern Ireland because of decisions taken by this House, there is a problem.
I am extraordinarily sorry to say that this is the second time that as Members of Parliament here we are having to set a Budget for the people of Northern Ireland. That should not be the case. The issues should have been grappled with much earlier. The Chairman of the Northern Ireland Affairs Committee indicated that civil servants cannot make decisions, but we passed the Northern Ireland (Executive Formation etc) Act 2022 in this House last year. Section 3 of that Act makes it very clear that civil servants are empowered to make a decision even when it has not been put to the Executive, if
“it is in the public interest”.
Am I suggesting that that is an ideal situation? No. Am I suggesting that it could not be better? No. Would we like to be in Stormont, shaping our own destiny? Absolutely we would, but we should not suggest, as has been suggested, that decisions of public importance on life-and-death issues—decisions that are in the public interest—should not or cannot be taken. They can.
That is why I have raised with the Minister of State, on a number of occasions, an issue around Grenfell cladding, as but one example. The hon. Member for Belfast South (Claire Hanna) will know that she benefited from Grenfell moneys in her constituency because a building there had an ACM cladding system. In my constituency, buildings have non-ACM cladding, for which the Executive have not yet created a scheme. I am not talking about money that the Executive need to get from Whitehall—they already have it. In March 2020, I got letter from the Finance Minister saying that the money had been reallocated because we did not have a scheme, and yet in one complex alone in my constituency there are 474 apartment owners who know that their building is made from materials that need to be remediated. They also know that, two years ago, the Executive got money from Whitehall to remediate that building. They cannot sell their properties. They cannot get an EWS1 form. They cannot borrow against their properties. They are stuck until the scheme is delivered. We are talking about remediating cladding that is a fire safety issue.
Mr Steve Baker
The hon. Member makes his point with great force on behalf of his many constituents. Since last week, when we met and discussed the subject and I wrote to him, my officials have confirmed with Northern Ireland civil servants that a scheme is under development. I know that he will continue to champion his constituents on this issue and I will continue to be in touch with the Northern Ireland civil service on this point. Obviously, we do need to see progress on that.
Gavin Robinson
I thank the Minister. I appreciated the correspondence, which he copied to colleagues as well, and I appreciate him looking at this. The scheme that was referred to his officials has been under development for well over 12 months now. The scheme envisages a Whitehall Department—it will remain nameless—which is already administering the scheme in England, administering the scheme on our behalf in Northern Ireland as well. Yet, even though we passed legislation in the Northern Ireland (Executive Formation etc) Act 2022 last autumn, officials are still suggesting that, when the scheme is developed, they cannot do anything because they need the Executive to agree it. I was grateful for the clarity in that legislation last autumn that that is not the case and that it need not be the case. It is in the public interest that officials should advance that in the absence of functioning institutions at Stormont.
I raise that as just one discrete issue to highlight how things must move on. Policies must progress. When money has been attributed by Westminster to Northern Ireland for that specific purpose, when the Executive have accepted that there needs to be a scheme, and when there is a blatant need for people who are trapped in their homes or for fear of fire safety issues, it needs to happen.
I mentioned that this is the second time that we have considered a Budget Bill in this place. I want us to cast our minds back to the last process. In that, the Treasury started off with the new regional rate for Northern Ireland at something extraordinarily ridiculous like 18%. I see that one official who was scarred by that process has returned for a second go. However, 18% was absurd. We had to engage significantly with the Treasury on that. In those discussions with the then right hon. Member for Runnymede and Weybridge, now Lord Hammond, it was clear—this is the importance for this debate—that we cannot just keep on with the same funding system for Northern Ireland. I invite the Chair of the Northern Ireland Affairs Committee to have an inquiry on that specific point.
There is absolutely no point in either today setting a Budget and thinking things will get better tomorrow or establishing an Executive and believing that it will all be okay. The Northern Ireland funding system does not work. The Northern Ireland funding system will only get worse. The Minister enjoyed saying that Northern Ireland gets a 21% premium above his constituents in Wycombe, but if we are honest about the figures, his constituents are outbid by a 30% premium for households in London, 20% for those in the north-east of England and 20% for those in the north-west of England. All those individuals do better in funding per household than the affluent south-east of England.
Northern Ireland has a disproportionately larger public sector, even though it has a smaller population, because there needs to be a critical mass to provide services. We have higher levels of deprivation; the hon. Member for Foyle mentioned it, and parts of my constituency, west Belfast and other urban environments are in exactly the same position. Rural deprivation is also disproportionately higher than in other parts of the United Kingdom. That all goes back to the Barnett formula from 1979; the Northern Ireland Affairs Committee should grasp the issue. When we engaged with the then Chancellor of the Exchequer, there was a recognition of that, but if someone were to ask the Treasury today whether there is a problem with how Northern Ireland is funded, it does not seem to have any legacy knowledge of that discussion.
Importantly, it was agreed in New Decade, New Approach that a Northern Ireland Fiscal Council would be established to consider how Northern Ireland is funded and the sustainability of our funding system. That has been established and it has published incisive reports that are ignored. If they are not ignored, they are picked up only because people are interested in newsworthy items about Brexit or about the potential for water charges. People are missing the core element of those reports, which is the recognition that, if we do not systematically change how Northern Ireland is funded, the situation will only get worse.
In January 2023, the Northern Ireland Fiscal Council considered the long-term projections for the Northern Ireland block grant. It was 29% of the premium that we received in the 1970s and it has fallen sharply since.
Simon Hoare
If the hon. Member would like to set out in a short email or letter to the Committee the scope of the inquiry that he envisages and the reasons that underpin it, I will take that to Committee colleagues in the not-too-distant future and see what, if any, progress we can make on it, because he makes a valid point.
Gavin Robinson
I am grateful to the hon. Gentleman.
It is what is known as the Barnett squeeze: it started off at 29%, it was 25% in 2002 with the Northern Ireland Executive, and it is currently sitting at 21%. Over the next 50 years, it will be 6%. That 6% higher sounds great, but it is not when we assess the relative need of people in Northern Ireland and the disproportionately higher level of public services. The pay parity issue in 2019 and 2020, when nurses went on strike for the first time in the UK in Northern Ireland, illustrates the point entirely: pay awards were being agreed in England, but the funding was not being sent to Northern Ireland to pay nurses the money that they deserve.
In September, the Northern Ireland Fiscal Council was as clear as it could be when it said that, by 2030, Northern Ireland will have public spending below relative need. The tensions we hear about today, and the pain we experience in individual aspects of public services, indicate that we are quickly getting to the point where we cannot provide the public services that people in Northern Ireland need at the funding levels that we have. In the next spending cycle from 2022 to 2025, Northern Ireland will see a 3.6% increase in spending, but in England, there will be a 6% increase. The squeeze will get worse.
I say all that not to be boring—I do not like economics; I do not find it that interesting—but because it is crucial. In Northern Ireland, the headlines will be, “Parliament rushes through a Budget Bill.” The Bill is a snapshot in time that crystallises what has happened over the last 10 months, determines what will happen for the rest of the financial year and sets out projections for the next six months. It misses the fundamental point, however, that unless there is a total and earnest recalibration of how Northern Ireland is funded, the situation can and will only get worse. With or without an Executive, and with or without a protocol, this will only get worse, and public services in Northern Ireland will stall. They will stall and get to a point where it is irretrievable. As an elected representative who believes in raising issues that are of huge importance to the people I have the privilege of representing, I cannot let this evening pass without raising those fundamental issues.
Ian Paisley (North Antrim) (DUP)
It is a pleasure to follow my hon. Friend the Member for Belfast East (Gavin Robinson) on this matter. At the outset of my speech, I also refer to the very kind comments made about our colleague Alex Easton. In the course of today’s events, he has sent a little text message thanking colleagues for their kind messages. The unbreakable heartache he must be going through will be unfathomable to most, and we leave him in the care and grace of his God and saviour at this time.
Turning to the less solemn issue of the Budget in Northern Ireland, which this House is passing, I chided the Minister earlier that no doubt he would say that, if we had a functioning Executive up and running in Northern Ireland, the Budget at Westminster would not be necessary and everything would be much better. Legislating for the Northern Ireland Budget Bill at Westminster is of course a mark of the failure of the Government to create the conditions to help restore the Executive. The Democratic Unionist party cannot do that on its own, despite the childish comments from some that, if the DUP just got over the protocol, this thing would be sorted out. If it were that easy, most of us agree it would have been sorted out, but it is not, because there is a problem here that has to be addressed.
It is now two years since the protocol came into effect and the Government have still failed to fix the problem of the protocol. I remember the first debate in the House back in the new year, in January, after the protocol had come into effect. I said then that within a week it was clear that the operation of the protocol would be an unmitigated disaster for Northern Ireland and we should move immediately to trigger article 16. I was told that that was premature and, “Don’t be silly, that cannot be the case.”
It has taken two years for the penny to drop. Among the architects of the protocol, even Leo Varadkar in recent days has indicated his regrets at signing up to it. Former Taoiseach Bertie Ahern was in the House at the Northern Ireland Affairs Committee today and again said that this matter has to be resolved. Thankfully, the chorus has started to change. My hon. Friend the Member for Belfast East is right to single out the shadow Secretary of State for Northern Ireland, the hon. Member for Hove (Peter Kyle), for, I think for the first time from the Dispatch Box, making it clear that Unionists have actually got a point here, and sooner or later that point has to be addressed.
Six months after I gave my comments in 2020, in a Command Paper, the Government accepted that the
“combination of serious economic and societal difficulties, along with the obvious diversion of trade, would justify”
triggering article 16. That was 18 months ago. We are in what is called the can-kicking phase of the protocol’s existence, with the can just being kicked down the road and nothing actually being done, when all the evidence clearly suggests things should have been done years ago. They were flagged up. There was no excuse not to do them—they were flagged up and should have been done years ago.
A further year on, with no substantive action having been taken and following the understandable and inevitable collapse of the Northern Ireland Executive, the Government introduced the Northern Ireland Protocol Bill, claiming the legal justification of necessity. In international law, the doctrine of necessity requires “grave and imminent” peril, yet a further six months and more have passed and the Northern Ireland Protocol Bill appears to be stalled in the other House.
I know the Secretary of State and the Minister of State, and indeed others, want the DUP to put hope over bitter experience and take this Government on trust and restore the Executive before the protocol has been fixed, but the Minister of State will know that it is not going to happen. I have referred to his comments on 23 October when he set the standard; it is a very good and high standard and it has to be met. The Government have got to deal with Unionist demands on the protocol. Those are not just my words but the Minister’s words, and I appreciate his echoing them. There is no point in the Government’s complaining about legislation for a Northern Ireland Budget in this House given that they have failed to address the problems of the protocol over the past two years, when they have had ample opportunity to do so. I hope they will address them now.
I do not criticise the Government for legislating on this matter. I want His Majesty's Government to govern. I do not want them to manage; I do not want them to hold the ring until something better comes along. There will be things with which I disagree and there will be things that I oppose, but it is the Government’s job to govern for our region of the United Kingdom when devolution is not in operation. I therefore do not criticise the Bill on that point of principle, but I believe it has taken far too long for the Government to act, and as a result the public sector finances in Northern Ireland have continued to deteriorate. We need to address that as a matter of urgency.
The options do not get any better if the inevitable is delayed. The time and the personal political credibility of the Government were wasted when they were playing around saying that there would be another election. That was the time for them to act immediately. They should have acted when the leader of my party pulled the First Minister out of government, but it is not a matter of 20 days or so but a year since that happened. The Government have had a year in which to do something about this, not just since the election but well in advance of it. A great deal of time was wasted over that year when the Government were not grappling with the issue.
As my colleagues have already pointed out, devolution of itself does not generate money, with the exception of the rate take. It is important to guard against the idea that an Executive would be an answer to many of the serious challenges faced by public finances. That is not abrogating responsibility; it is a statement of fact. We should not pretend that the Executive is a solution to all our problems. The mere fact that devolution does not produce money is one indication of that. Ironically, spending in Northern Ireland will probably be higher this year in the absence of an Executive—because the Secretary of State was able to secure flexibility from the Treasury—than it would have been if the Executive had been in place. This comes at the cost of next year’s Budget, which I think will be a worry for many people.
There are three points that I want to leave with the Minister. First, the Budget does not deliver on NDNA commitments. As some of my colleagues have already observed, NDNA spelt out the need for a sufficient increase in resources to allow the number of police officers to rise to 7,500, but the Budget does absolutely nothing to achieve that. In passing the cultural legislation, the Government placed reliance on the purported implementation of the NDNA agreement, but the Budget flies in the face of that approach when it comes to policing, which is something that will affect everyone in Northern Ireland.
Secondly, the Budget fails the children of Northern Ireland. It is one thing to set a challenging Budget at the beginning of a financial year, but it is quite inappropriate to impose damaging and undeliverable cuts in the final months. I think that all Northern Ireland Members—and, I hope, the Government—have received copies of a letter that was sent jointly and uniquely, for the first time, by the chief executive of the Council for Catholic Maintained Schools, the chief executive of the Controlled Schools’ Support Council, a chief executive in the Irish sector, the chief executive of the Catholic Schools’ Trustee Service, the chief executive of the Governing Bodies Association Northern Ireland, the chief executive of the Northern Ireland Council for Integrated Education, and the chairperson of the Transferor Representatives Council. That letter spells out very clearly that the authors
“question the lack of parity”
between Northern Ireland and the rest of the United Kingdom. They ask:
“Why is the education of a young person in NI valued less than those in England, Scotland and Wales?”
My right hon. Friend the Member for East Antrim (Sammy Wilson) went into that in some depth. He has significant knowledge, having for a long period headed the section that set the exams in Northern Ireland. I am delighted for Scottish kids. They get the equivalent of £7,600 per pupil. In Wales it is about £6,600, and here in England it is £6,700. Northern Ireland gets £6,400. There is a significant decrease in the moneys available to help children in Northern Ireland, and that crisis is not addressed by the Budget that this House and this Government are presenting to us this evening.
Gavin Robinson
To add to that, I outlined the difficulties of the squeeze over the next three financial years, which will see £2,000 taken from the spend of every household in Northern Ireland. That is almost 10% in public spending off every household in Northern Ireland over the next three years.
Ian Paisley
I thank my hon. Friend for putting that on the record. It is clear that this Budget and the squeeze that he identified—set by this House—leaves the Northern Ireland education system facing a funding crisis that will affect every child and young person, not just this year and next year but for years to come.
The third point I want to leave with the Minister is that this Budget makes next year’s Budget even more difficult. I touched on that in my earlier comments on being able to get money out of the Treasury. Though it was not highlighted in the Secretary of State’s November statement, this Budget is balanced only by robbing from next year’s Budget. That will make it even more difficult for any new Executive to agree a Budget, given the cost of living crisis and wage pressures. In the absence of reforms or additional funding, it is difficult to see how next year’s Budget will be credible at all.
At the outset of his comments the Minister thanked the various permanent secretaries in Northern Ireland for taking on a very difficult task. It should be pointed out that the various permanent secretaries in Northern Ireland have described this Budget as grotesque. They are not happy being left to carry the can. We find ourselves in a constitutional netherworld where the Secretary of State dips in and out of devolved responsibilities formally and informally in a manner that is frankly unacceptable. That has been referred to by former senior civil servants as an affront to the democratic process.
Although Parliament has the right to legislate for Northern Ireland in the devolved field, it is only in very narrow and carefully defined circumstances that it has the power to take executive decisions. We have seen the Government taking legal powers to intervene in areas such as abortion law and the implementation of the protocol, but not to tackle hospital waiting lists or Dáithí’s law, as raised by the hon. Member for Foyle (Colum Eastwood), to allow Northern Ireland’s new organ donation laws to take effect.
Many will question the political morality of the choices that the Government have made and the right to do that, but it is equally unacceptable, in the absence of direct rule, for the Minister to make Northern Ireland civil servants answerable to him. Direct rule is a legitimate choice for the Government to make in the absence of devolution. It is not a choice that we are asking them to make, but indirect rule where the Secretary of State seeks to wield power without taking responsibility is not acceptable. It puts civil servants in an intolerable position. They are expected to make the cuts but do not have the authority to bring forward the reforms. I go back to my first point to the Minister: govern, do not manage. That is the job and that is what should be done. I hope that the Government will act now. There is an old saying that if you break it, you fix it.
By signing up to the protocol, the Government broke the institutions first created by the Belfast agreement. Rather than asking Unionists in Northern Ireland to do the politically impossible, the Government should face up to their own responsibilities. The Budget will pass this House tonight, but very soon the constitutional no man’s land must come to an end. Either the Government should fix the protocol so that new arrangements can be supported by Unionists as well as nationalists, or they should take responsibility for decision making in Northern Ireland in a way in which they can be held accountable properly and thoroughly by this House.
Stephen Farry (North Down) (Alliance)
The Bill is essentially about giving legal effect to the Budget policy statements and the allocations made by the Secretary of State back in November. In practical terms, there is relatively little that we can do retrospectively tonight about what has already happened, but this is an opportunity to make wider points about funding, and to look ahead.
These decisions come late in the financial year, and in the absence of a formal Budget statement from a devolved Executive, bodies are essentially operating in a vacuum. That has led to some very unfortunate overspends, and has inhibited the capacity of Departments and agencies to plan ahead properly, and to use their scarce resources with maximum efficiency and effectiveness. That has real-life consequences. It is certainly my contention that having an Executive very much matters to the wellbeing of those in Northern Ireland, and to our finances. The notion that it does not really matter whether we have an Executive is a major fallacy.
Obviously, the lack of an Executive is linked to the protocol. I promised myself that I would not mention the protocol, but as it has come up, I will make a few comments on it. My party recognises that the protocol brings a degree of economic friction. It creates a new interface within these islands, and it interferes with some sense of identity in Unionism. We recognise the problems of the protocol, but my frustration is that people charged ahead with Brexit without really considering the implications for a shared, interdependent Northern Ireland, but we are where we are. As for the way forward, we want a pragmatic solution. If we turn the protocol into a constitutional test, I fear that we will not find a way forward. For us, the key issue is maintaining dual market access—access to both the wider UK market and the European Union market. There has to be some recognition that that means adherence to certain aspects of EU law and ultimately, in some respects, being in the jurisdiction of the European Court of Justice. That aside, we are extremely open-minded about where we go; as long as solutions are mutually agreed with the European Union, legal, sustainable in the long term, and work for the business community, we will give any outcome a warm welcome.
There has been reference made to the moneys involved in the trader support service. I would rather that the money was not spent on it, but it is recognised that the money does not come from our block grant; it is money that the UK Government are spending, so there is not a trade-off between that spending and what we can do ourselves in Northern Ireland.
There are clear implications for Northern Ireland from the current lack of a budgetary framework, most particularly for health. Night after night, healthcare professionals call for an Executive to be put in place to provide a framework for decisions. Everyone recognises that there is no silver bullet, and no magic money tree, but an Executive would at least provide a framework for decisions to be taken, and provide for some degree of planning, which is crucial when resources are scarce.
Reference was made to education, and the almost impossible task of finding £100 million of savings with two months to go in the financial year. I am the first to recognise that there are massive inefficiencies in our education budget, but they should be unlocked over time. Finding those savings in a short period will not work at all.
In a different universe, a devolved Executive would continue to function in Northern Ireland, and it would now be considering its Budget policy for 2023-24, rather than tidying up the end of 2022-23. Indeed, the 2023-24 Budget would be part of a multi-year Budget that allowed for longer-term planning and clarity on available resources. Furthermore, that Budget could be linked to a programme for Government, and fully aligned with a range of strategic objectives for the transformation of Northern Ireland. That alignment is highly desirable at the best of times, but is absolutely essential at times of financial stress and struggle. There is a clear example in the Department of Health, in which we all recognise that there has to be some degree of transformation. In particular, we need to invest in building up certain staff teams, to tackle the issue of waiting lists. However, if the Departments and the trusts are only getting their allocations quite late in the year and do not even know what they will get next year, they do not have the confidence and clarity to make those investments. That is just one example of a massive opportunity cost in not tackling those waiting lists, which I stress are the worst in the United Kingdom: we hear a lot about the health crisis across the UK, but on all those indicators, Northern Ireland is that bit worse.
While this Bill does include a vote on account, which allows Departments to spend legally at the beginning of the incoming financial year, it does not give clarity on what they will have to spend over that 12 months, so they cannot make longer-term allocations or plan properly. We need to see a Budget decision-making process for the next financial year, taken—preferably—by a functioning Executive that is restored in the near future, or by the Government, if they have to do that instead. That has massive implications for where we are going and for our governance, but at some point we have to recognise that that is the price we pay for not having functioning devolution, to provide some degree of certainty for those in our public services who are trying to do their best on behalf of all the people of Northern Ireland.
I tend to agree with the Minister that previous Executives have squandered opportunities to reform our public services, but that is not the entire story. It is also important to recognise that, as the hon. Member for Belfast East (Gavin Robinson) has set out, the size of our block grant in Northern Ireland is set to be squeezed in real terms over the years ahead, not only through the Barnett squeeze, but due to the fact that our basic allocation is being reduced because—for reasons that I will not labour at this stage—the wider UK public finances are in a difficult situation. We heard announcements from the Chancellor of the Exchequer in the autumn about how that would be managed over the coming years, but we are part of that wider framework and suffer as a consequence.
While recognising that our finances are unsustainable, I will highlight one area that my party has been keen to stress: Northern Ireland is wasting a lot of resources, which could otherwise be spent on investing in our economy and improving public services, on managing a divided society. There are many good reasons to overcome the segregation and division and to build a shared and integrated society, but finance must be one of them. Various estimates and reports over the past years have put the cost of trying to manage a divided society at between £400 million and £800 million per annum. That comes with major opportunity costs, as I have said.
Those costs occur in four particular areas. First, there are the direct costs of policing riots, other civil disturbances and parades, distortions to policing from the security threat and repairing damaged buildings and facilities. Secondly, there are costs associated with the duplication of goods, facilities and services implicitly for separate sections of our community. That includes most clearly what happens with schools in different sectors, but also the spatial distribution of GP surgeries, jobcentres, community centres and leisure centres.
Thirdly, there are hidden costs, which impact on the environment in which Departments and agencies operate and include pressures on the housing sector, for example, from demographic imbalances and a sense of territory, with various implications for people’s mobility depending on where they are housed. Fourthly, there are lost opportunities for economic activity and tax revenue and for investment in tourism and job creation.
Beyond those costs, there is a compelling case for transforming health. The Northern Ireland Fiscal Council produced a useful report on that in the past year, which people should read and consider. Obviously Northern Ireland has higher health needs than other parts of the UK, so health spending will always be higher in Northern Ireland than elsewhere, but none the less the report points to inefficiencies in how our health sector is run and operated. There is a challenge for a returning Executive to genuinely tackle that and, in doing so, to improve health outcomes. This is not about cuts for the sake of cuts; it has to be about rebalancing how we spend our Budgets to get better outcomes.
Another clear example is the scandal of double funding between schools and further education, which amounts to scores of millions of pounds every year. Given that Northern Ireland does not have a proper 14-to-19 framework, we end up with schools trying to retain pupils post-16 by offering a whole range of vocational courses, even though the further education system is a much better place to offer such courses. Schools also get two years’ worth of funding per student in years 13 and 14, but if a student is not performing sufficiently well in the school’s eyes, they are asked to leave rather than stay and bring the school’s results down in the artificial league tables, so they end up going into the FE sector and effectively repeating a year. That is just one example of money needlessly being spent when it could be better invested elsewhere.
My wider fear is that public finances in Northern Ireland are on a burning platform. Some retired civil servants have talked openly about the fact that £1 billion-worth of pressure is building up in the system, but our Budgets are shrinking and the longer-term trajectory is smaller, smaller, smaller. Without the time, space and opportunity to reform and transform, all we will see is cuts, cuts, cuts. That means that we will end up with worse health and education systems, we will not invest in skills and, indeed, we will not meet our obligations to invest to mitigate climate change. What we will see, essentially, is managed decline and stagnation, and that simply lets Northern Ireland down.
We have to find some means of breaking this vicious cycle. I know that we have had past packages in relation to Stormont House, including Fresh Start and New Decade, New Approach. Some very searching questions and challenges have to be raised as to why those have not been properly addressed and why promises have not been fully delivered. I am not directing that at the Government; the question why that has not been the case is also one for the Northern Ireland parties. I appreciate that there will be a certain degree of scepticism in the Treasury whenever I say this, but I do not think we have any alternative but to think through how we can talk about the development of a longer-term plan for Northern Ireland, involving a restored Executive and the Treasury, and how over the next five to 10 years we can make Northern Ireland a financially sustainable society and, in the process, improve our public services and economy.
I am conscious that we are coming up to the 25th anniversary of the Good Friday agreement in a couple of months. That agreement has transformed Northern Ireland in many respects and we are very grateful for that, notwithstanding the current problems and controversies. Many people have reflected on the fact that perhaps Northern Ireland has not been transformed fully in terms of social and economic opportunities and in terms of investments. People are talking about looking forward to some form of prosperity decade; we need to think about that.
There is an opportunity, if we can get ourselves past the immediate blockages, for the Government, the parties and a restored Executive to try to work in partnership to hammer out some sort of plan and break the cycle. I believe that there is a compelling overarching argument for doing that. I am keen for myself and others to elaborate on that over the coming weeks, and it is important that we use tonight as an opportunity to set out our initial thoughts on the potential way ahead. This will be based on investing to save; we cannot unlock and change Northern Ireland without some investment coming in from the outside. Others will be entitled to hold us to account for all of that. With that cheery thought on what could be an exciting future for us if we can get past the hurdles, I will end my comments.
Carla Lockhart (Upper Bann) (DUP)
It is a matter of deep regret that this Budget must be brought through this House and not the Northern Ireland Assembly and Executive. As a devolutionist party, we in the DUP strongly believe that the budgetary process in Northern Ireland ought to be put forward by those elected to make decisions and provide local scrutiny and accountability, yet we are in what can only be described as a very serious situation, which is not helped by the ongoing denial of its gravity by Members of this House. In this debate, we have heard the naive and rather vacuous posturing of some Members across the House who have laid the responsibility for the institutions not being operational at the door of my party and called for the immediate restoration of Stormont.
Let me make one thing clear: we are in this unsatisfactory situation because of the decisions made by this Government. We are in this position because the party of government decided that its unity, as it imploded over Brexit, was more important than the economic and constitutional unity of the United Kingdom, and Ministers openly admit that.
The Government know that this situation is of their making. The leader of my party, my right hon. Friend the Member for Lagan Valley (Sir Jeffrey M. Donaldson), in trying his utmost to avoid this situation, gave the Government and the EU ample time and opportunity to find a new way forward that would command the consent of the Unionist community, and in doing so restore the foundations on which power sharing is built. Members know that until that consent is in place, there will be no restoration and no Stormont Budgets. It is time for people to get real about the magnitude of the situation and the urgency for new, comprehensive solutions to be found.
There is another reason that the Bill is before us today. We ought not forget that the Budget process in Northern Ireland started in October 2021, and in the time and space that my party provided for solutions to the protocol, there was ample time for the then Finance Minister, Conor Murphy, to prepare a Budget agreement, yet he failed to set a Budget and we are now reaping the consequences. His approach to setting a Budget was to promise millions when the coffers were empty. When Sinn Féin was peddling fallacies, the black hole in our Budget was getting darker.
Let me home in on the figures and how the Government are approaching allocations, starting with allocations to the Department of Health. The Secretary of State has aggressively pursued the provision of abortion services in Northern Ireland against the wishes of the people of Northern Ireland, as was evidenced by the consultation held by his predecessor, the right hon. Member for Great Yarmouth (Brandon Lewis), during his time as Secretary of State; yet while local health trusts are being compelled to provide these services, no additional money has been provided for them to do so.
Instead, with A&E departments overwhelmed with pressures to the point of complete meltdown, with a lack of care packages available across Northern Ireland to help people return home safely and free up capacity in hospitals, and with children enduring appalling waiting lists for speech and language therapy, for instance, to unlock their participation in this world, we now have the additional pressure of providing abortion services within existing budgets. There is no local mandate, no local scrutiny and no local accountability for that decision. I ask the Minister to advise which service currently provided by our crumbling health service ought to be cut to provide that service. Perhaps in his winding-up remarks, he can outline which service he would cut.
Let me turn to concerns about our education system. For too long, our schoolchildren have been the poor relation in terms of spend per pupil in the UK, and this Budget outlines a continuation of that disparity. I see no justification for funding inequality. Surely the education of a child in Banbridge, Portadown or Lurgan is of equal value to that of a child in Banbury or Portsmouth. We hear a lot from this Government about levelling up; surely it is time for levelling up in our classrooms. Our education system simply cannot take ongoing underinvestment, as has been made abundantly clear to the Government by the Education Authority and various school bodies. That issue has been much discussed today.
Since Stormont has been in abeyance, the Government have legislated to spend what limited resources are available to provide unwanted abortion services and unnecessary cultural and language provision that will cost millions, at a time when our schools are running deeper deficits, our healthcare system is in need of emergency care, and our households are set to face huge hikes in household rates. Of course, an even greater cost is the unnecessary and seemingly bottomless pit of money that is being made available to support the functioning of the Northern Ireland protocol. The Treasury has confirmed that the trader support service, which helps companies deal with the paperwork generated by the protocol, has cost the taxpayer £318 million in just over two years. That is £436,000 per day, or £18,000 per hour.
That £436,000 per day could employ 10 highly experienced nurses for a year. The protocol paperwork costs the salary of 10 highly experienced nurses every day—it is really important that we stress that point. That is 7,300 nurses. How transformative that money could be for schools, hospitals and roads in Northern Ireland, rather than facilitating an unnecessary border that divides Northern Ireland off from the rest of the UK. It is time for this Government to find real solutions to the protocol, so that we once again see decisions such as these taken and scrutinised by locally elected politicians, held accountable by local people.
Paul Girvan (South Antrim) (DUP)
There is a programme on Radio 4 that I listen to from time to time called “Just a Minute”. To be honest, Mr Deputy Speaker, you are going to get a little bit of hesitation, repetition and deviation this evening—you have already had quite a bit of them so far.
Mention has been made of the costs of the Northern Ireland protocol to the block grant—of the moneys that are having to be spent out of the public purse to fund a system that has been imposed upon the people of Northern Ireland by not only this Government, but Europe, trying to protect what they want—but little mention has been made of the costs of the protocol to the businesses that are trying to operate in such a bureaucratic system. Many of them have had to change their axis of trade from buying goods in the United Kingdom to buying them from the Republic of Ireland, with all goods coming in through the Republic of Ireland to Northern Ireland. There has been a marked increase in direct trade between the Republic of Ireland and France, to such a degree that a number of additional ships have been put on, direct from the Republic to Cherbourg in France.
That change has had a marked effect on businesses in Northern Ireland, but it is also affecting businesses on the GB mainland, many of which have come to the conclusion that the bureaucracy involved in implementing the trade agreement that we supposedly have is causing such a problem that it is not worth their while trading with other businesses in Northern Ireland. That is something that needs to be recognised. I have been contacted by businesses that are based in Conservative Members’ constituencies, saying that they cannot supply Northern Ireland. They are having difficulties not just because of the cost to them, but because of the hassle they have with the likes of the trader support service.
Mention has been made of how much that service has cost to date, but that is only one aspect of it. There is also the enforcement section, with millions of pounds involved in that. There is the digital assistance scheme, and the millions that are involved in bringing that forward. In total, the costs are £530 million. That is the figure to date, not to the end of the financial year; that is not the projected figure through to March. As has been outlined, that money could be spent very effectively within our civil service—I am using the overall name of the civil service, which includes all Government Departments. Efficiencies probably need to be found—let us be truthful about that. We are not working with a bottomless pit. Everyone seems to think we have a money tree, but it does not exist. Unfortunately, with this Chancellor and some of the decisions that have been made lately some people are starting to think that it does. As a consequence, the Government will never be thanked for what they have done and what they have given. Let us be honest: they are going to be punished by the public, who seem to listen to a narrative that is, “Give us more because we need it all.” This is not going to work out beneficially.
Mention has been made of moneys that are within the current overspend within Departments. We heard that there was a projected overspend of £660 million, but that was drawn back and it ended up at £330 million. I am glad to hear it has been reduced to that amount, but it is important to note that that £330 million will come out of next year’s Budget, to balance the books. That area needs to be considered. Those who have not been acting within the parameters of the budgets that were set or are supposedly to be set have allowed overspends, which are going to have to be met. My hon. Friend the Member for Upper Bann (Carla Lockhart) alluded to the fact that we had no Budgets being brought forward and agreed. We could have been dealing with this matter whereby all Departments or all parties had looked at a Budget that they had agreed to, but unfortunately that is not the case.
I think about what is actually happening. Many people talk about the block grant but they keep forgetting about AME—annually managed expenditure—funding, which comes directly to pay for budgets such as those relating to those on benefits and to pensions. All aspects relating to those who have retired from the civil service are receiving funding topped up by AME funding and those who are living on benefits are getting AME funding. That is an area where we do not look at the overall Budget. I will give a clear example: people who are waiting for an operation. In the UK and in Northern Ireland, people wait for a hip replacement but it might be sitting years down the line. By the time they get their hip replacement, they have lost their job, are living off benefits and are at an age where they cannot get back into work. Several other European countries adopt a very different angle in funding towards their health system, in that if people cannot get their operation, the Health Department will pay their wages. Sometimes that might wake people up to doing something about it. Ultimately, we put everything into silos instead of looking at the overall picture.
The rebalancing of our budgets is an area we really should be focusing on and ensuring that we do it correctly. My hon. Friend the Member for Strangford (Jim Shannon) mentioned the agency nursing aspect. That is one area within health where we are burning money and we are not getting the outcomes for it. That is not just a Northern Ireland issue; it needs to be grasped on a UK-wide basis to ensure that we are getting bang for our buck. The waiting lists are growing, yet we are spending more of our money. We are spending more of our block grant on health and the outcomes are worse, so something is seriously wrong. It is not just Bengoa that is the problem, because the same problems exist in mainland GB as are happening in Northern Ireland.
We will support this Bill this evening, on the basis that we know it allows spending to go forward for next year. There was a change in the Bill to allow for a figure of up to 95%; it used to be that we had to make a judgment where we were allowed to spend up to 60% within a small period of time. Within the Bill a provision has been included to allow us to spend up to 95%—more than £17.4 billion—of the existing Budget at the present time. That is something we need to look at, because I for one do not believe that we will have an Assembly set up before March in time to put in place a Budget for next year. I think that we will be back here discussing the Budget in this House, because unless the protocol is resolved, we will not be back in the Northern Ireland Assembly.
There is no point in trying to beat us up and saying that we will be brought to another election, although we were threatened with that. I am getting the clear message that that is not going to resolve all our problems. Everyone thinks that it is a wand that can be waved and that everything will be hunky-dory as soon as the Assembly and the Executive are brought back, but we cannot and will not be going back in. The Chair of the Northern Ireland Committee talked about why we came out of the Executive, but in fact there was no movement before we came out. Everyone was telling us that this was like the laws of the Medes and Persians and that not one jot or tittle could be changed, but I can hear different messages coming out today. I hear those who were the greatest advocates of driving forward the protocol and of its rigorous implementation now saying, “Well, maybe we got that wrong; maybe we do need to make some changes.” This is not just about change; we want our constitutional position within the United Kingdom single market to be retained, and not to be protecting the single market of the EU or to be subject to the European Court of Justice. That is the message that must go forward, because this debate should not be happening here. If all those things had been addressed, this Budget would have been addressed in the Northern Ireland Assembly.
Claire Hanna (Belfast South) (SDLP)
Like other Members, I regret that we are considering this Bill in this place in this way. I regret the lack of scrutiny, innovation and imagination that can come from Budgets being done in this way, and I regret the lack of shame from some about the collective failure that we are again foisting on the people of the region. There is definitely a sense of “same stuff, different day”, because it is worth saying that the way public spending is overseen in Northern Ireland is nearly always convoluted and untransparent. I joined the Finance Committee in Stormont in 2016, and when I was trying to get my head around the process I think had to go seven or eight years back to find a textbook Budget year. The process is so far from transparent as to put people off even understanding what we are doing.
It is also worth saying that this is not a Budget in the way people would understand the use of that term, in that it is not a list of political priorities. Again, that is increasing the cynicism among citizens about our ability to spend on things that matter to them and our ability to address the short-termism and the ingrained lack of responsibility-taking that unfortunately characterises Stormont for many people. Nowhere is that clearer than in health, where many years of this sort of stop-start governance and can-kicking has left that service and the people who deliver it for us in a really parlous state.
No party is without fault in that regard, but the two largest parties deserve the most opprobrium for walking off and staying off the job in late 2016 after the Bengoa report created a little bit of shared purpose and the little bit of hope that we could possibly reform services. What we are doing instead is allowing little bits of the national health service to fall down one by one, bringing all of the downsides of reform and none of the upsides. Just one example of that is the closure of a rehabilitation ward at Whiteabbey Hospital. It is a successful rehabilitation facility and it makes no clinical sense to remove it; its closure will send patient blockages back up the system for each one of those beds that is not reopened due to a lack of decision making. As well as the failures in those people’s lives and the pressures that that builds in the staff who are delivering the services, it will make it harder to achieve buy-in and confidence in health reform in subsequent years when we finally get back to working properly, because people associate the reforms only with closures and not with the enhanced services that they can bring. We know that there are challenges across the services, including waiting lists. Yes, people have said that they are bad everywhere, but they are far worse in Northern Ireland. GP services are facing an existential crisis, and deepening levels of mental ill health are engulfing many parts of the service.
We know that it is not just in health that we are failing people. If the climate targets that we finally agreed in the dying days of the last Assembly are not mainstreamed and given effect through Budgets and plans, they are not going to mean anything. The labour shortages that employers across Northern Ireland are facing are not going to be mitigated by, for example, parents, and particularly women, coming back to work, because there are no Ministers in place to finally get a grip of childcare. Adults with some vulnerabilities but who have plenty of ability to work will no longer be supported by the many European social fund projects. They will fall by the wayside in a crude Darwinian process that seems to be happening at the moment. Projects are failing, and we will have to see which ones survive. Without ministerial intervention, we will keep exporting thousands of students because of a cap on numbers, to say nothing of the challenges in schools that many colleagues have raised.
The hon. Member for Belfast East (Gavin Robinson) touched on an issue that underpins all of this. As I say, yes, I am prepared to share the responsibility of failures over decades of devolution, but we cannot ignore the austerity that has been imposed on Northern Ireland, as on other regions, over the past decade and a half. No one pretends that devolution is perfect, but we have to —and our party certainly does—imagine a much better way to run our public services than being dependent on a little bit of a hand-out and being tethered to a vision of an economy that is related to Brexit, deregulation and threadbare public services. The SDLP does not believe that it has to be that way, even when we are operating within devolution. The Chairman of the Select Committee, the hon. Member for North Dorset (Simon Hoare), said that it was our job to do the bits that we could. To paraphrase Wesley: “You do all the things you can in the places you can for as long as you can.” It is probably simpler than that. Woody Allen said that 80% of success is just about turning up, and that is something that devolution is failing to do.
The SDLP has tried to make the constitutional set-up work, and will continue to do so, but it is not the limit of our ambition. Members have given all the reasons why devolution cannot work. They have mentioned the trader support service and the cost that that imposes on the Budget—not the Northern Ireland Budget, but the Budget from the Treasury. That is another cost of Brexit, but they fail to mention the £1.3 billion in increased exports from Northern Ireland to the Republic that have been achieved as a result of the protocol. We would want to caution them: if you take away even the status quo, even the possibility of cut-and-paste devolution in the UK, you have to be aware that people will look at other ways to meet their basic needs. As I have said many times before, and as Hume said, if you ask for all or nothing in governance, you often end up as nothing. We are prepared to work with anyone who will work with us to try to make some lemonade out of the Brexit lemons that we have been handed. There are opportunities and options, and there is space for compromise, both in the EU-UK talks and in the Executive when we finally have Members there.
Mr Deputy Speaker (Mr Nigel Evans)
We come to the last Back-Bench contribution, from Mr Shannon.
Jim Shannon (Strangford) (DUP)
The good book says that the last shall be first and the first shall be last, so I am happy to speak, whenever it may be—and in this House that is nearly always last. However, that does not take away from my comments, and it is a real pleasure to add some Strangford commitments and comments in relation to this essential Bill.
The difficulty with the Budget is not a new problem, and it is not a DUP problem, despite what has been said by some colleagues in this place and in the media. The problem is that the then Finance Minister, Conor Murphy, was unable to find agreement within the Executive. He was unable to do so not simply because the funding was tight, but because he was allocating it to political aspiration projects, rather than to nurses, postal and health workers, and teachers in the classroom.
We all understand that money is tighter than it has ever been, and we cannot ignore that. I have constituents who have trained for eight years or longer to get their early years qualifications, only to learn that their 17-year-old daughter can work for Lidl and get paid more than them. Sometimes it is hard to understand how that works— a person trains, qualifies and does well, but they get less than their daughter.
It is tough for these people to make ends meet, and they are having to cut their cloth to suit them. We have to do the same, but the first cut must not be to our schools, and I commend the shadow Minister, the hon. Member for Hove (Peter Kyle), for saying that. Many others have latched on to that—in fairness, the Minister of State referred to it as well—but it is a massive issue. Institute for Fiscal Studies analysis shows that, since 2009-10, spending per pupil has been consistently highest in Scotland and lowest in Northern Ireland. In 2021-22, spending per pupil was estimated to be £7,600 per pupil in Scotland, but only £6,400 in Northern Ireland. What is the reason for that?
The additional funding in the Chancellor’s autumn statement is restoring pupil spending to 2010 levels in real terms, yet under the Barnett consequential we are not able to do the same in Northern Ireland. How is that appropriate? Why does wee Rosie Murray in my constituency deserve £1,200 less in educational support than her cousin, wee Rosie Murray in Glasgow? She does not, and she must not be discriminated against because of her nationality. The disparity is quite clear; there is something wrong with the system. My hon. Friend the Member for Belfast East (Gavin Robinson) was here earlier, and he referred to Northern Ireland’s Barnett consequential reducing almost every year.
I have had representations from all education sectors—from the controlled sector as well as the Catholic maintained sector—begging me to make it clear that the Budget must not be used as a whipping post for political gain. Our children have not yet recovered from covid closures, and now their education and their future are at risk of being sacrificed due to the refusal of the EU to do the right thing and the refusal of this House to take the EU on. I am a great believer in the idea that money spent on education and children today is money well spent on giving them a chance tomorrow.
I could find an easy way to cut costs without affecting quality of life or increasing the price of goods: do away with the protocol. We cannot ignore the fact that the protocol costs so much, and if those moneys from the Treasury were spent in Northern Ireland, they would make a big difference.
I received an email only this morning from a local supplier who asked me to make this comment. He is being chased by His Majesty's Revenue and Customs for the duty costs of purchasing artificial flowers from a supplier on the mainland—that is an extra cost because of the Northern Ireland protocol—and I do not mean mainland China; I am talking about a company based not too far from this House. Members should let that sink in for a second. The protocol, which gives no accountability, no representation and no benefit to Northern Ireland constituents, ensures that the flowers my constituent buys cannot be sold at £1 a bunch, as they are here, to lay on a grave, but cost £1.25—a 25% charge because he is from Northern Ireland. The protocol means not only that excise duty paid in the UK costs the customer more, but that HMRC spends man-hours chasing up bills that should not be in place and never should be paid.
Where can we get the moneys from? Everybody has referred to that issue. We in the DUP have an opinion, and others have too. That brings us to the trader support service, which deals with the costs and the customs. The cost of the TSS was estimated at £340 million until the end of 2022, with another £113 million for 2023, giving a grand total £453 million up to the end of this year—or approximately half a billion, to round it off. Those are the savings that could be made, and they could have an incredible impact on health, education and prosperity in Northern Ireland. Nor do the figures take account of the additional money that our businesses are spending on trying to do the right thing, the cost of which naturally has to be passed to the customer. It is little wonder that local businesses are unable to put their wages up to help their staff; they themselves are barely surviving.
Approximately half a billion pounds could easily be saved in the Budget by doing what this House promised: passing a Bill to deal with the protocol. What a difference half a billion pounds could make to education or to the NHS. Perhaps it would allow our nurses to be paid the same as the mainland nurses. What possible justification is there for cutting NHS budgets and education spending when we seem happy to throw money away for no purpose other than to facilitate the EU’s grudge against us?
What has been the total cost to the public purse of recruiting and training veterinarians to fulfil the requirements of the Northern Ireland protocol since 1 January 2020? That is another cost of the Northern Ireland protocol that does not need to be paid—another potential saving for Northern Ireland. The Government say that
“DAERA reported in August 2022 that a total of £15.3 million capital, £16.4 million resource and £1.7 million depreciation has been expended on the provision of the infrastructure, IT systems and personnel for the work necessary to carry out the required SPS checks at Northern Ireland’s Points of Entry as a result of the implementation of the Northern Ireland Protocol.”
Again, those are savings that we could make and that we could use for the benefit of Northern Ireland.
That is not even the full picture. As we are not implementing the full scheme, the costs will be even greater. These millions could already have made a difference. We could have provided support to farmers to buy new, more efficient and eco-friendly farming aids with all the money from that scheme, the digital assistance scheme, the mutual enforcement scheme and the scheme for temporary agri-food movements to Northern Ireland—all schemes that are at best unnecessary and at worst morally wrong and divisive.
Last week, with my hon. Friend the Member for Belfast East and other representatives, I had a Zoom meeting with Roisin Coulter of the South Eastern Health and Social Care Trust, who outlined very clearly what the costs and impacts on health services will be. As the shadow Secretary of State said, cancer waiting lists are the worst in the whole of Europe; Roisin outlined that point last week and told us that waiting lists for cancer services are the longest that they have ever been. She also referred to other health issues.
We recognise clearly that something needs to be done about pressures on A&E. In my intervention on the Minister of State, I mentioned agency staff, who cost 30% more than nurses on the equivalent pay grade. We should be employing more nurses and paying them the correct wage: that would be cheaper than paying agency staff, and it is something that I would particularly like to see if at all possible.
To those who point to this restrictive Budget as the DUP’s punishment for obeying the clearly held view of the people of Northern Ireland, I say this: we will be in our seats within a day of the protocol being eradicated and reason and common sense prevailing. We will be in our seats, taking our positions to make tough decisions as soon as we can do so, but that will not happen until the Government and the EU come to a decision that satisfies the tests that we have set out. Those tests are not the result of obstinacy or political point scoring; they are tests that the people we represent have told us, through wide-ranging engagement, are the red lines for Unionism.
The hon. Member for Stone (Sir William Cash) has referred to this: the Northern Ireland Protocol Bill is sitting in the House of Lords like the Mary Celeste—it seems to have got lost there. We need it to come back from the House of Lords so that we can move it forward.
The hon. Member for Foyle (Colum Eastwood) referred to Dáithí’s law, which I fully support. I have always supported the organ donation opt-out process: I supported and sponsored the private Member’s Bill about it that the then Member for Coventry North West promoted in this House, and I supported the proposal back home. Others whom I know quite well did not support it then, but they all do today, which is good to see. If we can pass the Identity and Language (Northern Ireland) Act 2022 and the abortion legislation in this House, we can do it for Dáithí’s law as well. I urge the Government to grasp that; perhaps the Minister can give us some indication.
Those who consider overriding democracy and the Good Friday/Belfast agreement, and allocating positions to those who will take their seats, do so in the knowledge that they are saying that Unionists have no place in Northern Ireland and that democracy is dead. Be mindful of the statements made which will be deadly serious in Northern Ireland. For some in this Chamber, Unionism may be nothing more than a pain, but we have a mandate and our people have spoken. The requirements from this place are clear and simple, and must take place soon.
I understand that we are here under protest to decide on something that we did not want to decide on, because the Assembly should be doing it, but if this place has to decide, let us ensure that it does so equally and fairly. If laws can be brought in for other things, they can be brought in for that. Savings can and should be made.
Tonia Antoniazzi (Gower) (Lab)
I send prayers and condolences on my behalf and that of the Labour party to Alex Easton MLA, his family and friends, and the community of Bangor. I also take the opportunity to welcome a new life, as Doug Beattie is now a grandfather. I welcome his granddaughter Skyler to the world.
As my hon. Friend the Member for Hove (Peter Kyle) said, we will support the Bill so that public services in Northern Ireland can continue to function. Although we recognise the need to pass these measures, the lack of scrutiny time afforded to them cannot be the new norm. If the continued absence of a functioning Assembly and Executive in Northern Ireland causes more matters that should be before Stormont to be discussed here, the Government must outline how they will ensure that there are opportunities for proper scrutiny and how they will involve voters in Northern Ireland, whose voices have been diminished through political failures.
As many hon. Members have said, I hope that this is the last time that we will need to discuss what should be devolved business in the Chamber. Although I welcome the Government outlining progress on the protocol negotiations, I urge them to share with the House progress on the negotiations as soon as possible.
I am pleased that the Secretary of State has included ringfenced funds for abortion services within the Bill to ensure that women have access to essential healthcare, but I share the concerns of clinicians and patients that women’s healthcare in Northern Ireland is falling by the wayside. Northern Ireland has the longest NHS waiting lists for gynaecological care in the United Kingdom, which forces many women to seek private healthcare to receive treatment for conditions such as endometriosis, which causes debilitating pain and can affect fertility. Even women who reach the top of the waiting list in Northern Ireland cannot access the same expertise as other women across the UK, because there is currently no fully British Society for Gynaecological Endoscopy-accredited endometriosis specialist centre in Northern Ireland, but there should be.
Unfortunately, that is not a unique situation, as we have heard. The Chair of the Northern Ireland Affairs Committee rightly raised the concerns of organisations with a lack of funding to support women in Northern Ireland. He knows that I am a doughty campaigner for the rights and protections of women in my constituency and in Northern Ireland. I have visited Belfast and Lisburn Women’s Aid and spoken at its conference, and I fought for the homeless services for women in Belfast to be retained. I have also spoken to the International Committee of the Red Cross, Informing Choices NI, Amnesty International and others.
What all those issues have in common is that they are a result of political failure, which requires political solutions to solve it. I recognise the work of civil servants in Northern Ireland in ensuring that public services have continued in the absence of the Executive, but it is neither fair nor appropriate that decisions on the allocation of budgets and the priorities of public spending are made by those civil servants. When services are already falling so far behind acceptable standards, to seek simply to keep things running represents a grotesque abdication of responsibilities from political leaders. While we support this Bill, I will finish my words there.
Mr Steve Baker
With the leave of the House, I am glad to respond to the debate.
First and foremost, I join other hon. Members in offering condolences to Alex Easton, whose parents Alec and Ann tragically died in a fire in Bangor earlier today. I know the whole House will want to put on record our shared sorrow at this news, and to thank the emergency services who attended. At the same time, I am delighted to congratulate Doug Beattie on the birth of his granddaughter Skyler. I am sure we will be able to find a couple of copies of Hansard to send on to the families.
I am grateful to the Opposition for their comments; When opening the debate the hon. Member for Hove (Peter Kyle) said that we were right to prioritise restoring power, and I am grateful to him for that. He asked for an update on the negotiation, which I will give in a moment. We are all agreed that Stormont should be restored—I think that has been a universal theme. The Secretary of State and I have met a wide range of stakeholders and, though of course we are in an undesirable position, we are confident that we have listened to a range of views as we have participated in reaching these decisions with Northern Ireland’s civil service.
Turning to the protocol, as hon. Members know, it has always been our preference to resolve the issues through talks. The Foreign Secretary and Vice-President Maroš Šefčovič speak regularly and Government officials have technical talks. The Foreign Secretary and Vice-President Šefčovič spoke on Monday 16 January and have agreed that rapid scoping work should continue, which we are very pleased about.
We welcome the agreement reached recently on the EU’s access to UK IT systems that provide live information about what goods are moving across from Great Britain to Northern Ireland. That agreement has provided a new basis for further constructive discussions with the EU to come to a negotiated solution on the protocol. We are of course proceeding with legislation, but I would like to take a moment to elaborate on the situation we face.
It is sometimes impressed upon me by some of the harder-line Unionist commentators that we should simply tear up the protocol. I am not sure what political world they think we operate in—I am not talking about Members of this House, but some individuals outside it. The world is rather more complicated than that. Ministers do not have unfettered power to tear up treaties, nor should they. That is why we proceed with the Northern Ireland Protocol Bill.
On the point about border posts, the reality is that we are in the happy position where legitimate interests on both sides are now being recognised: the legitimate interests of the EU and Ireland to have their market protected—that is what the border posts are for, even in the circumstances that the Protocol Bill has to become an Act and be used—and the legitimate interests of Unionism and Unionists. I put on record my heartfelt thanks to the present Taoiseach, Mr Varadkar; I know I will not be thanked by some Unionists for that, but he has had the statesmanship to move his position and recognise the legitimate interests of Unionism. I am grateful to see Opposition Members nodding; it is very good news.
Given the position we are in, where we are very willing to recognise the legitimate concerns of the EU and Ireland and they are increasingly willing to recognise the legitimate concerns of Unionism, this is a moment when we ought not to goad one another. I have fought hard enough in this place over Brexit, but we are tantalisingly close to recognising that we are friends and partners and that we can look after one another’s interests and go forward in the spirit of goodwill.
I encourage everyone, rather than rehearsing the arguments and grievances of the past, to look to a future that is tantalisingly close to being very positive, with a deal that we can all accept. With that in mind, I want to say gently to those of us who fought for Brexit, those of us who are Unionists, that when a deal comes—I do believe it is when, but there is a lot to be done—if that deal is acceptable to the Eurosceptic cause and to Unionism, we are all going to have to sell it to people. It will be no good to just denounce border infrastructure, which is there for the red lane, to protect the interests of the EU. Denouncing what has been done, when we have the green lane and arrangements for unfettered access within the UK, will not be enough. I mean that most sincerely, because if one thing has come home hard, even now—I think I have always known it, given when I joined the Royal Air Force—it is that even after 25 years of the Belfast/Good Friday agreement giving us some welcome peace, the politics of Northern Ireland, as hon. Members from Northern Ireland know better than me, is not to be taken for granted.
The politics of Northern Ireland is a grave thing; too many graves. That has been realised across the European Union. People realise that it is a post-conflict society with, as we have heard, an enforced coalition between the two poles of debate on the pre-eminent constitutional question that caused the conflict, so things are not to be taken lightly. That is why I am happy to put on record my admiration for the current Taoiseach and his predecessor, Mr Martin, with whom I get on well. I look forward to meeting Mr Varadkar. On the protocol, we are tantalisingly close to a success of which we can all be proud and then move on. Let none of us do anything to spoil the prospects of that success.
I turn to the overall points made about spending. Notwithstanding what was said about the Barnett formula and so on, which we support, it must be said that per head public spending in Northern Ireland is the highest of any region of the UK at 21% per head more than the UK average. The Northern Ireland block grant is at record levels, averaging some £15 billion a year over the next three years. On top of that, if we look at the new deal for Northern Ireland at £400 million, city deals at £617 million, the New Decade, New Approach financial package at £2 billion and the forthcoming Peace Plus at £730 million, that adds up to about £3.5 billion of extra funding. That is reflective of Northern Ireland’s special status. But it cannot really be said that Northern Ireland is in any sense neglected.
I will make three points about the process by which we came to the Budget. First, it has been drawn up as a result of intensive engagement between our officials and the Northern Ireland civil service. We are grateful to officials on all sides. The Government have also taken on board many representations that we received in correspondence and in person.
Secondly, I stress again that we believe this overall Budget is a fair and appropriate settlement that reflects the key pressures facing Northern Ireland. I mentioned per-head spending, and I will not repeat myself. Thirdly, it has been said on many occasions that the Bill does not preclude a functioning Executive from making changes to the Budget allocations, should one return. Of course, we are beyond the point at which it is possible to restore the Executive without an election so we would have to legislate. We all fervently hope that the Executive could be restored without an election, and the Secretary of State is considering all his options.
I turn to the important point about the PSNI made by the leader of the DUP, the right hon. Member for Lagan Valley (Sir Jeffrey M. Donaldson). As the right hon. Member will know, its main budget is allocated by the Northern Ireland Department of Justice. The Budget gives the Department of Justice a 3.1% uplift on its 2021-22 budget. In addition to the block grant, the UK Government provide the PSNI with the additional security funding that it needs to tackle the substantial threat that we face from Northern Ireland-related terrorism. The UK Government contribution for 2022-23 will be £32 million
Sir Jeffrey M. Donaldson
I do not dispute the Minister’s figures—my point was not about those figures and I was not challenging them—I was simply pointing out that, in relation to New Decade, New Approach, there was an agreement to recruit additional police officers to bring us up to the level that was agreed way back when the Police Service of Northern Ireland was formed. It was clear that the Treasury would provide the additional funding required to ensure that those extra officers were recruited. My point is simply this: that has not happened.
Mr Baker
I am extremely grateful to the right hon. Member for clarifying that point. I will write to him on that. The PSNI is close to my heart, and I am extremely grateful to all the people who work for the PSNI for everything that they do to keep us all safe.
The Opposition spokesman the hon. Member for Hove, the right hon. Member for East Antrim (Sammy Wilson) and the hon. Member for Foyle (Colum Eastwood) all talked about education funding. According to information published by the Treasury, identifiable public spending on education stood at £1,759 per head in Northern Ireland for the 2020-21 financial year. That compared to £1,428 per head for the UK as a whole over the same period. That was 23% higher than the UK average. That reflects our commitment to Northern Ireland and to education.
The Department of Education projected significant levels of overspend, but this Budget has actually delivered an increase in education spending of just under £300 million. We recognise that pressures above that level of increase will require difficult decisions to be taken, but we believe that those decisions are deliverable within the legal framework that we have set out in the Northern Ireland (Executive Formation etc) Act 2022 and the accompanying guidance.
I was grateful to the hon. Member for North Down (Stephen Farry) for his point about efficiency savings that could be made in education. My goodness, yes there are some. Again, that integrated education could even be a question in the 21st century is extraordinary to me. There are certainly savings to be made. That level of additional funding represents around a 12% increase on the previous year, excluding the additional funding allocated for covid. That really is as much as could be afforded in the light of the £660-million black hole that we were facing. Overall, that demonstrates just how unsustainable Northern Ireland finances have become and the need for reform.
The hon. Member for Gower (Tonia Antoniazzi) mentioned women’s healthcare, particularly the misery of endometriosis. Once again, this is a shocking situation to be in. The hon. Member for Belfast South (Claire Hanna) talked about the lack of collective shame. In this day and age, we should be ashamed of the state of public services in Northern Ireland. For far too long we have been just grateful for peace and have not done enough to highlight across the whole of the UK what needs to be done to serve the people of Northern Ireland because, my goodness, they deserve good services.
This Budget provides £7.28 billion in funding for the Department of Health. That is an increase of £228 million on 2021-22 spending, which included significant covid-19 funding. It is an increase of £786 million compared with last year’s funding, excluding the one-off covid uplift. As with education, there will be difficult decisions to take on health. Decisions on the reform of healthcare will be difficult. The Bengoa report, as we have discussed, should be carried forward. Too many years—six—have gone by without progress. We need to see Executive return as soon as possible.
I will make one more point before I conclude. I responded to the hon. Member for Foyle in an earlier debate on the addiction rehabilitation centre. I can tell him that the Government stand ready to respond to a proposal submitted by the Executive. I know it is frustrating; I am frustrated because I want to give him the answer he wants. We are waiting on that Northern Ireland Department of Health business case.
Colum Eastwood
I am extremely frustrated, as the Minister knows, because this has been going on since the New Decade, New Approach and beyond. We have people dying every single day of addiction-related conditions. Can I press him on one issue that was raised by me and other colleagues, which has a total support across political parties in the Northern Ireland? It is Dáithí’s law on organ donation. Will the Government do something to address that wrong, and to follow through on what had already begun when we had an Assembly and an Executive?
Carla Lockhart
I associate myself with the remarks about Dáithí’s law and trying to ensure that that proceeds. The Minister noted that he was on his final point: can he first bring some clarity around the abortion issue that I raised? What services would he advocate being cut for abortion services to be provided in Northern Ireland? Will there be new money made available from the Treasury to facilitate the abortion services that have been forced on the people of Northern Ireland?
Mr Baker
As the hon. Member well knows and does not like, we were forced under law to bring forward abortion services because this House legislated. She may recall that I was in the Lobby with her voting no. That was because I did not want to see the devolution settlement trespassed upon. It is my belief that women in Northern Ireland should have access to abortion services. That is because I think that the law as it stands for my constituents in Wycombe and in England is about right, leaving as it does room for conscience in the earlier stages of pregnancy.
What I would say to the hon. Member is that the law required us to move forward. I know she does not like it, but money has been allocated as set out in the Budget, and the memorandum is available. We just have to move on. I am well aware that people will find that challenging, but the Secretary of State has done the right thing in complying with the law.
I will finish by saying that there has been a great deal of unity across the House on the pressing need for the Budget and the pressing need to transform and improve public services for the people of Northern Ireland. The hon. Member for North Down mentioned managed decline in his remarks. I am clear, as I know he is, that managed decline is not good enough for the people of Northern Ireland. As we approach the 25th anniversary of the Belfast/Good Friday agreement, and as we approach hopefully getting a deal on the protocol and therefore restoring the Executive, it is incumbent on all of us in our different and respective positions to work out how to better serve the people of Northern Ireland and deliver a Budget that not only works for them, but that transforms public services so that Northern Ireland can be a real beacon for the whole UK.
Question put and agreed to.
Bill accordingly read a Second time; to stand committed to a Committee of the whole House (Order, this day).
Northern Ireland Budget Bill
Monday 23rd January 2023
(1 year, 3 months ago)
Commons ChamberRead Full debate Northern Ireland Budget Act 2023 Read Hansard Text Read Debate Ministerial Extracts Amendment Paper: Committee of the whole House Amendments as at 23 January 2023 - (23 Jan 2023)
The First Deputy Chairman of Ways and Means (Mr Nigel Evans)
With this it will be convenient to discuss the following:
Clauses 2 to 16 stand part.
That schedule 1 be the First schedule to the Bill.
That schedule 2 be the Second schedule to the Bill.
Mr Steve Baker
What I propose to do, given the wide-ranging debate we have had, is to canter briskly through the provisions made in the Bill. Clauses 1 and 2 authorise Northern Ireland Departments and other specified public bodies to use resources amounting to £26,656,975,000 in the year ending 31 March 2023. Of that sum, £24,242,977,000 is authorised for use for current purposes and £2,413,998,000 is authorised for use for capital purposes.
Clauses 3 and 4 authorise the Northern Ireland Department of Finance to issue the sum of £21,487,341,000 out of the Consolidated Fund of Northern Ireland for this financial year.
The estimates in schedule 1 set out the allocations for the sums provided for in clauses 1 to 4 between each of the Departments and listed public bodies, as well as the purposes for which each Department and public body may use those funds. I know that two amendments were tabled but not selected in relation to the remediation of cladding, and we discussed that earlier. I hope that the hon. Member for Belfast East (Gavin Robinson) accepts what I said.
A separate Northern Ireland main estimates document will be provided to give further detail beyond the summaries set out in the schedules. That will be prepared and laid as a Command Paper in the Libraries of each House. I expect it to be laid before the end of the financial year. Separately, we have provided the supplementary memorandum, which provides more detail to right hon. and hon. Members.
Clause 5 provides for authorised temporary borrowing by the Northern Ireland Department of Finance, up to approximately half of the sum issued out of the Consolidated Fund of Northern Ireland under clause 3. This is a normal safeguard against the possibility of a temporary deficiency arising in the Consolidated Fund, and any borrowing authorised under this clause is to be repaid by 31 March 2023.
Clause 6 authorises Northern Ireland Departments and other listed public bodies to use the income they receive from the specified sources listed in part 3 of their schedule 1 estimate.
Turning to clause 7, the authorisations provided for in clauses 1 to 6 supersede the previous authorisations in the Budget Act (Northern Ireland) 2022 and other legislation. To give effect to them, clause 7 allows the authorisations in the Bill to be treated as having effect from the beginning of 1 April 2022.
Clauses 8 and 9 relate to a vote on account. Clauses 8 to 12 look ahead to the next financial year, and provide for similar authorisations in that year as those set out for the current year in clauses 1 to 5. Clauses 8 and 9 authorise the use of resources by Northern Ireland Departments and other listed public bodies, amounting to £17,404,266,000 over the course of the financial year ending on 31 March 2024. Of that total, £15,835,528,000 is authorised for use for current purposes, and £1,568,738,000 is authorised for use for capital purposes. The authorisation is for a vote on account of 65% to allow public services to continue to be delivered in the first half of the next financial year. Given the continuing political uncertainty in Northern Ireland, the vote on account is greater than usual—65% instead of the normal 45%.
The vote on account does not imply the setting of a Budget for 2023-24 for the Northern Ireland Departments. Its purpose is to allow the use of resources so that services can continue to be delivered, pending the consideration of a Budget Act for the full 2023-24 financial year.
Clauses 10 and 11 authorise the Northern Ireland Department of Finance to issue the sum of £14,154,737,000 out of the Consolidated Fund of Northern Ireland during that period. The authorised purposes for which the resources and sums referred to in clauses 8 to 11 can be used during that period are set out in part 2 of schedule 2.
Clause 12 authorises temporary borrowing by the Northern Ireland Department of Finance in the next financial year, to be repaid by 31 March 2024. Clause 13 provides that the Bill will have the same effect as if it were a Budget Act of the Northern Ireland Assembly, and clause 14 repeals provisions of other legislation that have been superseded by this Bill. Finally, clauses 15 and 16 are on interpretation and the short title of the Bill. I hope that helps the Committee to understand the Bill.
The Second Deputy Chairman of Ways and Means (Sir Roger Gale)
I call the Opposition Front Bencher.
Tonia Antoniazzi
I do not want to repeat too much of what was said on Second Reading. The Labour party has been clear: we accept the need for this Budget, which allows Northern Ireland Departments financial certainty. We have not tabled any amendments, as any change in allocations between Departments at this stage is likely to clause more complications than solutions.
I put my thanks on the record to all the officials who worked on the Bill. It cannot have been easy to pull it together in the time available. I understand that the Government had conversations with the Northern Ireland Fiscal Council before setting the Budget. I do not want to stray out of order, but it is good that the council is involved and that it will publish a report on what we are agreeing today.
Clause 13 sets out provisions enabling the Bill to take effect as though it were a Budget Act of the Assembly. We have highlighted challenges that Departments have said that they will face in trying to stick within the limits set out in the Bill. It would be much better if the Bill were being discussed in the Northern Ireland Assembly, so that it could receive the scrutiny that it deserves.
Question put and agreed to.
Clause 1 accordingly ordered to stand part of the Bill.
Clauses 2 to 16 ordered to stand part of the Bill.
Schedules 1 and 2 agreed to.
The Deputy Speaker resumed the Chair.
Bill reported, without amendment.
Third Reading
Mr Steve Baker
I beg to move, That the Bill be now read the Third time.
I am grateful to all Members for supporting the expedited passage of this legislation, and I am very grateful for the accommodation made to do so, for all the reasons given. I rise principally to express my thanks to everybody who has participated in the House, including the Front Benchers for their constructive role as critical friends. I also want to place on the record the Government’s appreciation to the House authorities, especially the Clerks who guided us, as ever, in expert fashion.
We would like to thank as a Department again the superb Caroline MacBeath in the Office of the Parliamentary Counsel for the expert fashion in which she and colleagues have drafted this Bill with Northern Ireland counterparts in the Office of the Legislative Counsel, so my thanks to all of them, and also to officials in the Department of Finance in particular. I again want to thank officials in the NIO and across the Northern Ireland civil service, especially the permanent secretaries, for their work together in coming up with this Budget.
I thank colleagues and officials in the Government Whips Office for their support and assistance—[Interruption.] Give him a job? It is too late. Where am I?
Mr Baker
Thank you. It has been a busy day and I am grateful that there is some levity, but I would like to finish by saying that we did not want to have to pass this Bill; it is not a Bill that the House wanted to have before it.
In closing my Third Reading speech, and thanking everybody for making this possible so that public services can go ahead in Northern Ireland, I refer to what I said at the end of my Second Reading speech: we are going to need to do better in Northern Ireland, and I know that all of us in this House will play our part in making that happen.
Sir Jeffrey M. Donaldson
I simply rise on behalf of my party to thank the Minister and his officials in the NIO for the work they have done on this Bill. I want to thank Jayne Brady and Neil Gibson in particular, and their colleagues across all the Departments in the Northern Ireland civil service.
To be honest, we would much prefer that these decisions were being taken by Ministers in the Northern Ireland Executive. I assure the Minister, in response to what he said earlier, that if the UK Government do their bit and deliver a deal, an outcome or legislation here at Westminster that resolves the problems and difficulties created by the protocol and that meets our seven tests, we will not be found wanting. We will ensure that Ministers are appointed to the Executive not only to get on with the job, but to address the real issues that need to be addressed to enable better and more effective delivery of public services in Northern Ireland, to reform of our public services in Northern Ireland, and to drive forward the growth agenda to develop our economy, because we want prosperity to be the mark of Northern Ireland for the future.
We will need the Government’s help with that; we will need the Government to help deploy the levers that will be required to transform our economy. I do not want Northern Ireland in the future to be dependent on the Treasury to fund our public services to a far greater level than the other parts of the United Kingdom. I want Northern Ireland to stand on its own two feet; I want Northern Ireland to prosper and our economy to grow. But to do that, and to see the institutions restored, we need to resolve the issues around the protocol, and the sooner that happens the better.
I thank the Minister for the contribution he and his colleagues are making in that endeavour, but I say again what I said at the weekend: let us not have half measures; let us get this job done, get it done right, and get it done once and for all so we can move forward together.
Peter Kyle
This is the first time I have served under you in the Chamber, Mr Deputy Speaker, and it is a pleasure to do so. I share the Minister’s gratitude to those who made today’s proceedings possible; their hard work was much welcomed by us all.
As the right hon. Member for Lagan Valley (Sir Jeffrey M. Donaldson) just said, the circumstances are quite clear. He reiterated them once more, talking about the seven tests and assuaging perceived challenges. Labour has said for some time that those challenges are negotiable. Now that the House here in Westminster has been detained in dealing with the issues that should be dealt with in Northern Ireland, and this Bill has passed, I hope that the extra time available to the Minister is put to good use in assisting whoever is responsible for these negotiations on a daily basis—in the Foreign, Commonwealth and Development Office, his Department or any other part of Government—to ensure that we get the deal across the line and get Northern Ireland moving again. I will not detain the House any further.
Gavin Robinson
I know that if I had attempted to discuss my new clause in Committee, I would have been asked to sit down, but I want the Minster to take away the sense of feeling in the debate about the precarious sustainability of Northern Ireland’s finances in the longer term. I also recognise that the hon. Member for North Dorset (Simon Hoare) has indicated his willingness to engage on the issue.
Some information provided by the Minister demonstrates the danger of falling into the trap of seeing inflation rises and saying, “Yes, we can say it is the most money Northern Ireland has ever had in this year and any previous year”; if the gap continues to narrow and public services get to the stage where they simply cannot function, there has to be a recognition that there is a better way of doing things and financing our public services.
Question put and agreed to.
Bill accordingly read the Third time and passed.
Northern Ireland Budget Bill
Tuesday 24th January 2023
(1 year, 3 months ago)
Lords ChamberRead Full debate Northern Ireland Budget Act 2023 Read Hansard Text Amendment Paper: Committee of the whole House Amendments as at 23 January 2023 - (23 Jan 2023)
Northern Ireland Budget Bill
Tuesday 7th February 2023
(1 year, 3 months ago)
Lords ChamberRead Full debate Northern Ireland Budget Act 2023 Read Hansard Text Watch Debate Read Debate Ministerial Extracts Amendment Paper: Committee of the whole House Amendments as at 23 January 2023 - (23 Jan 2023)
The Parliamentary Under-Secretary of State, Northern Ireland Office (Lord Caine) (Con)
My Lords, before I begin my comments on the Bill itself, I once again place on record my gratitude to your Lordships for considering this important Bill on a heavily truncated timetable. I recognise that we should be doing so only in exceptional circumstances. As I go through my remarks this evening, I hope noble Lords will agree that this Bill meets, and indeed goes beyond, that high threshold.
In moving this Second Reading, I once again speak with a strong sense of disappointment. At the Second Reading of the Northern Ireland (Executive Formation etc) Bill 2022, I said:
“No Government would want to be in the position in which we find ourselves today. It is clearly not a satisfactory state of affairs.”—[Official Report, 5/12/22; col. 22.]
That sentiment still applies as I stand before your Lordships this evening. It is also a sentiment shared, I would venture, by the noble Lord, Lord Hain, and my noble friend Lord Dodds of Duncairn, who have tabled regret amendments to the Second Reading Motion. With their permission, I will not seek to pre-empt what they might say when they come to speak to their amendments. Instead, I will endeavour to listen carefully to what they say and respond in my wind-up speech later on.
The Government are bringing forward this legislation because Northern Ireland has been without a fully functioning Executive since February 2022 and without a fully functioning Assembly since after the May Assembly elections in the same year; as a result, it has not been possible to set a budget. His Majesty’s Government stepped in shortly after 28 October last year, when Northern Ireland Ministers formally left their posts, and we subsequently worked with the Northern Ireland Civil Service to set a budget for 2022-23. I place on record my gratitude to those in it for all their hard work.
My right honourable friend the Secretary of State for Northern Ireland and I set out the budget allocations for each Northern Ireland department in a Written Statement which I placed before your Lordships’ House on 24 November 2022. The purpose of this Bill is to put those allocations on a legal footing. Setting this budget was not an easy task. Northern Ireland departments and Ministers who were, up until 28 October, in post had not been operating within confirmed spending limits and had not implemented plans to deal with looming overspends. As a result, we found ourselves facing an unenviable £660 million black hole in the finances—subsequently reduced, through discussions and agreement, to £330 million.
In facing this situation, we have, in what I would describe as the best traditions of a one-nation Conservative Government, prioritised spending on health and education, with an overarching objective of protecting the most vulnerable. This budget therefore increases education spending by just under £300 million and delivers a £786 million increase on non-Covid-related health spending. I suggest that these are not insignificant sums. We are acutely aware of the difficult decisions that now have to be taken in relation to health and education, and right across the spectrum in Northern Ireland, to live within this budget but the Government believe that, in the very challenging and difficult circumstances in which we find ourselves, it is a fair outcome.
Clearly, consideration will now need to be given to a sustainable and strategic budget outlook for the financial year 2023-24. If the Executive have been restored in time to set a budget for 2023-24, the UK Government will continue to work constructively with executive Ministers, including on a sustainable budget that delivers for the people of Northern Ireland and supports economic growth. However, if the Executive have not been restored, we are working closely with the Northern Ireland Civil Service to prepare for next year’s budget. I assure the House that the Government’s priority for that Budget will be to deliver a fair outcome for all taxpayers and citizens in Northern Ireland.
The pressures on Northern Ireland’s finances did not arise overnight. Many noble Lords will recall that both the Stormont House and fresh start talks in 2014 and 2015 were, in large part, driven by the need to deal with the Northern Ireland Executive’s finances. The Northern Ireland (Stormont Agreement and Implementation Plan) Act 2016 included provisions to introduce further transparency around the budgetary process, including requiring the Finance Minister to set out how any draft budget would not exceed the money allocated to the Executive from the UK Government. Despite this, the Government still inherited a budget halfway through the year with, as I said earlier, a projected overspend of some £660 million, reduced to some £332 million following work between my officials and the Northern Ireland departments. Notwithstanding that, the situation is still, however, unacceptable and the unsustainability of Northern Ireland’s finances cannot continue.
I should point out that there are some who would have us believe that the main problem is that the UK Government have somehow starved Northern Ireland of cash. I would of course strongly refute that argument. Spending per head in Northern Ireland is already the highest of any region in the United Kingdom. In the spending review of 2021, which set the block grant for three years, Northern Ireland received record levels of financial support—the highest since the restoration of devolved government in 1998-99. Funding per head in Northern Ireland is some 21% higher than the United Kingdom average.
It would therefore be simplistic in the extreme to say that the issues facing Northern Ireland as we stand here today are simply down to a perceived lack of money. Rather, the difficulties in which Northern Ireland departments now find themselves are the result of difficult decisions not being taken—not just this year, but in successive years before it. I would add that that situation was of course not helped by the lack of a functioning Executive and Assembly between 2017 and 2020. The Bill before the House will place the budget that I outlined on 24 November last year on to a legal footing. It will allow departments and other listed public bodies to continue to deliver public services into the first half of the 2023-24 financial year, through a vote on account.
I turn briefly to the individual clauses. Clauses 1 and 2 will authorise Northern Ireland departments and other specified public bodies to use resources amounting to £26,656,975,000 in the year ending 31 March 2023. This includes cash items such as payment of salaries, the purchase of goods and services, and investment in the construction of new capital assets, as well as non-cash items such as the depreciation of existing assets and making provision for future liabilities. Of that total sum, £24,242,000,000 is authorised for current purposes and around £2.5 billion is authorised for capital purposes.
Clauses 3 and 4 will authorise the Northern Ireland Department of Finance to issue nearly £21.5 billion out of the Northern Ireland Consolidated Fund for this financial year. This is a lower figure than the resources authorised in Clauses 1 and 2 because departments do not require cash for depreciation costs, provisions and other non-cash items.
Clause 5 will authorise temporary borrowing by the Northern Ireland Department of Finance, up to approximately half of the sum issued out of the Northern Ireland Consolidated Fund under Clause 3. This is a normal safeguard against the possibility of a temporary deficiency, and any borrowing authorised under this clause is to be repaid by 31 March this year.
Clause 6 will authorise Northern Ireland departments and other listed bodies to use the income they receive from the specified sources listed in part 3 of their Schedule 1 estimate. The authorisations in Clauses 1 to 6 supersede previous authorisations in the Budget Act (Northern Ireland) 2022 and other legislation. In order to give effect to that, Clause 7 allows the authorisations in the Bill to be treated as having effect from the beginning of 1 April 2022.
Clauses 8 and 9 authorise the use of resources by Northern Ireland departments and other listed bodies amounting to some £17.5 billion over the course of the financial year ending on 31 March 2024. Of that total, nearly £16 billion is authorised for current purposes and around £1.5 billion is for capital purposes. The authorisation for this is a vote on account at 65%, to allow public services to continue to be delivered into the first half of the next financial year. This is greater than usual: 65% instead of 45%. The vote on account does not imply the setting of a budget for 2023-24; its purpose is to allow the use of resources to ensure that services can continue to be delivered, pending the consideration of a budget Bill for the full financial year.
Clauses 10 and 11 authorise the Northern Ireland Department of Finance to issue just over £14 billion out of the Northern Ireland Consolidated Fund during that period. Clause 12 authorises temporary borrowing by the Northern Ireland Department of Finance. Just as borrowing during the current financial year must be repaid before the end of the current year, any borrowing during the next financial year under this clause must be repaid in full before 31 March.
Clause 13 provides for the Bill, if passed, to have the same effect as if it were a budget Act of the Northern Ireland Assembly. Clauses 15 and 16 are minor and consequential.
I will make a short statement on legislative consent. Clearly, we have been unable to secure a legislative consent Motion from the Northern Ireland Assembly given that it is currently not sitting—indeed, if it were, I would hope we would not have needed the Bill at all. But the continued absence of the Assembly and the Executive means that we have been left with no other option but to take action here.
I express my thanks again for the ongoing hard work of the Northern Ireland Civil Service, which now has a responsibility to ensure that Northern Ireland departments live within the budget limits set out in the Bill. I recognise that this is not easy and will require difficult decisions. People in Northern Ireland rightly expect to see those decisions taken at Stormont, and I agree with them. I state again my continued disappointment that, as a Government, we are having to step into Northern Ireland affairs and intervene in this way. I look forward, as I think do noble Lords across the House, to the restoration of the Northern Ireland Executive and Assembly at the earliest opportunity. However, until a functioning Executive return, the Bill will allow public services to continue functioning and help to protect public finances in Northern Ireland. I therefore commend it to the House.
Lord Hain
As an amendment to the motion that the bill be now read a second time, at end insert “but this House regrets the continued failure of the political parties in Northern Ireland to agree to form an Executive; and calls on His Majesty’s Government to introduce legislation that introduces new rules for executive formation in Northern Ireland, such that any political party eligible to join a power-sharing Executive, but which refuses to do so, will have withheld from it (1) its Assembly party funding, (2) the salaries of its Members of the Legislative Assembly (MLAs), (3) the salaries of its MLAs’ staff, and (4) MLA office and travel expenses”.
Lord Hain (Lab)
My Lords, I particularly welcome that the noble Lord, Lord Empey, is in his seat. I wish him and his family all the best. I thank the Minister for moving Second Reading. I fully support his Bill in these circumstances.
This amendment is procedurally unusual and puts down a marker only in order to highlight a deeply troubling gridlock in Northern Ireland’s self-governance that is relentlessly ravaging the very foundations of the Good Friday agreement. From 2007, when a settlement I helped to negotiate under Tony Blair brought the unlikely duo of Ian Paisley senior and Martin McGuinness to share power, there was a decade of DUP/Sinn Féin- led self-government as stable as Northern Ireland was ever likely to get. That was then collapsed by Sinn Féin for three years. Now, post Brexit, Stormont has again been collapsed, this time by the DUP, for over a year. I hope that the current UK-EU negotiations over the protocol will resolve that, but I am not sure they will.
Meanwhile, public support for the carefully negotiated system of self-government is in danger of collapsing completely in the midst of the worst cost of living crisis for generations, the NHS in Northern Ireland facing a worse crisis than anywhere else in the United Kingdom—costing lives—and other manifestations of dysfunctional public administration causing serious problems.
This amendment does not point fingers or apportion blame. Any political party has a right to refuse to serve and to use that as leverage. The problem is that the political architecture necessary to achieve the Good Friday peace accord requires cross-party government, so a refusal to serve collapses everything and amounts to a veto. There has to be a cost for doing that, and my amendment would impose one, not so much as a penalty but more as a deterrent.
I fully understand why the DUP believes it was betrayed by Boris Johnson and the noble Lord, Lord Frost. No doubt Sinn Féin believes it had good grounds for collapsing Stormont in January 2017. But this amendment stipulates that, if any party did that in the future, it would lose the millions of pounds that come with doing the jobs that the vast majority of the electorate in Northern Ireland rightly expect it to do. At current levels, that would total over £5 million for the DUP alone and a similar share for Sinn Féin. I urge the Government to consider legislation to that effect.
A situation in which one party or another can simply walk away and paralyse Northern Ireland’s self-governance because it does not get its way is anti- democratic. This issue will have to be addressed by the Government if the devolution settlement, which was so hard won, is to survive. I urge the Minister and his colleagues in the Cabinet seriously to consider this. I beg to move, although I will not seek to divide the House at the end of the debate.
Lord Dodds of Duncairn (DUP)
My Lords, I will speak to my amendment to the Motion and make some more general comments about the budget the Minister has brought forward. I join with the noble Lord, Lord Hain, in his remarks about the noble Lord, Lord Empey, and his family. I offer him our best wishes at this time.
It is important to remember how we got to this sad point, because we certainly believe that the budget for Northern Ireland should be set in the Northern Ireland Assembly in Stormont. It is a matter of deep regret that we find ourselves in this position this evening because the Government brought forward the Northern Ireland protocol and continue to implement it, albeit with significant grace periods and other measures that have not been fully implemented.
For the purpose of context, we should remember that, when the Executive ceased to function in Northern Ireland, the Sinn Féin Finance Minister, Conor Murphy, had been working on a budget from October 2021 to the spring of 2022. When he brought forward a budget, he failed to find any other party in the Northern Ireland Executive, which discussed the matter, to agree to it. So nobody should run away with the idea that having the Executive and the Assembly back will lead to some kind of wonderful outcome as far as the budget is concerned, because Sinn Féin brought forward a budget which was rejected by all the other parties—that was the state of play when the Assembly and the Executive finished. I remind your Lordships that at the start of 2017, Sinn Féin again held the Finance Minister position and the then Minister and his colleagues collapsed the Assembly and the Executive and refused to bring forward a budget for Northern Ireland, even though we were facing a very short timescale. It is important for context that your Lordships are aware of those points.
On the amendment to the Motion in the name of the noble Lord, Lord Hain, I fail to recall that any such amendment was brought forward at any point during the three years when Sinn Féin collapsed the Executive. Indeed, I asked the Library to check how many vociferous statements had been made by members of the Northern Ireland Affairs Committee, Northern Ireland spokespersons, people who take an interest in Northern Ireland, and Front-Bench spokespersons, and I found very few examples of them being prepared to come out and say, “Sinn Féin is at fault for the collapse of the Assembly”, or to seek any kind of punishment or redress. Instead, it was dressed up in all sorts of talk about the parties needing to come together. So it is interesting—and it will not be lost on unionists in Northern Ireland—that we have this approach to unionist parties, at a time when unionists are making the point that they cannot operate a protocol which is injurious to the union, the very thing we are there to defend and promote. The purpose or import of the amendment to the Motion would be, in effect, to expel a party from the political process: it would have no resources for offices, no staff and no salaries—nothing.
It is interesting, again, that when Sinn Féin refused to take their seats in the other place, extraordinary efforts were made to ensure that they received all the benefits of office, including salaries and staff. They even get a parliamentary allowance; it is not Short money, but it is actually looser than Short money and can be spent on all sorts of political promotion, courtesy of the UK taxpayer. Not a word is said about any of that; there is silence. That too is not lost on unionists.
The fundamental reason we are in this position this evening is the Northern Ireland protocol. The Minister said that he was disappointed about the lack of a functioning Executive, but I thought he would have mentioned the protocol and the disappointment we all feel in the unionist community in Northern Ireland—and, indeed, people beyond that—at the damage done by the protocol over the last few years. To suggest that we should now, in effect, expel parties—including the main unionist party—from the political process in Northern Ireland, which is the real import of the suggestion of the noble Lord, Lord Hain, is a fundamental rewriting of the Belfast agreement. We are that told that it is important to have all these safeguards for the agreement, but the very things that are now being suggested are completely undermining any basis on which the Belfast agreement, as amended by St Andrews, is predicated. People talk about protecting the Belfast agreement, but they are quite happy to jettison at the first opportunity the fundamental requirements of the agreement when it suits them. When the rules come up with a result they do not like, they then change the rules. Yet we are told that the protocol is necessary to protect the agreement.
I have set out in the amendment to the Motion the reasons why the Bill is, unfortunately, necessary and why the Northern Ireland protocol, in our view, has to be replaced. It is incompatible with the Belfast agreement, as amended by St Andrews; it breaches the principle of consent; it undermines the three-strand approach of the political process in Northern Ireland, which has been the basis of people’s approach to the Northern Ireland situation for many years; and it undermines the cross-community voting mechanism. The idea that we have any kind of democratic consent in the Northern Ireland Assembly to the protocol, many years after it was implemented, but only on the basis of a majority vote—the only vote of any significance, which cannot be held without a consensus, or which is capable of being turned into a consensus with a cross-community vote—again undermines the agreement. It is undemocratic.
It is important to spell this out, because anyone listening to this debate, having heard the Minister outline the position, would think, “It is all just some arcane dispute between the Northern Ireland parties in Belfast; if only they would get their act together”, but it is far more fundamental than that. The Northern Ireland Assembly, if restored, will be denuded of powers to legislate over vast swathes of the economy: agri-food, manufactured goods and so on. VAT will be applied differently in Northern Ireland from the rest of the UK. We have already seen some of the outworking of that in the Budget Statement by the former Chancellor, now Prime Minister. State aid rules are applied completely differently, as we are under the EU regime. What self-respecting elected representative of the Northern Ireland Assembly, of whichever party, wants to celebrate and argue for a situation where they are deprived of the ability to make laws in over 300 areas of legislation that, rightfully, are mainly devolved to the Northern Ireland Assembly, but reserved to Parliament in some cases? It defies logic, it is not democratic and it is contrary to the New Decade, New Approach agreement, the basis on which the devolution settlement was restored in 2020 and which committed to the restoration of the United Kingdom internal market.
As has been illustrated in the court action taken by the noble Baroness, Lady Hoey, among others, the protocol has breached the Acts of Union themselves. Of course, we will no doubt hear more about that tomorrow in the Supreme Court. The Government have vigorously defended the argument that the Acts of Union have been subsumed or derogated from to accommodate the Northern Ireland protocol.
For all those reasons, unionists who have any concern whatever for the future of Northern Ireland, or indeed anyone who is concerned with democracy and the betterment of the people of Northern Ireland, should have concerns about the protocol. Over many months before the Executive ceased to function, when the Democratic Unionist Party actually held the position of First Minister, we warned that we were coming to the point where we had to have some progress on these issues—and eventually that came to a head, as we know. Other noble Lords will no doubt talk about the costs of the trader support services, the digital assistance scheme and the movement assistance scheme, and all that. Taxpayers are paying out almost half a billion pounds—£500 million—and that is purely taxpayers’ support to help people fill in forms digitally, and all the rest of it. That sum could be in this budget, but it has been diverted to deal with the complications of the protocol. That is before adding in the costs to business and all that—and those of us who sit on the Protocol on Ireland/Northern Ireland Select Committee will have heard from companies such as Marks & Spencer, which has spent up to £30 million setting up facilities for moving goods to Northern Ireland. That is just one company. These are extraordinary amounts of money—£500 million on that alone will go a long way to helping some of the problems that we have in Northern Ireland with education, health, policing and so on.
I hope sincerely that we can make real, significant progress towards finding a solution to the protocol problem. The Government have laid out their position in the Command Paper of July 2021, and the Explanatory Memorandum for the protocol Bill said very clearly what needed to be done to have a permanent, sustainable solution. I hope that the Government will hold firm to those commitments. They were not made by the DUP; they were not tests set by us. These were statements made by the Government of what needed to be done, and they cannot easily be put forward and then retracted. Indeed, the current Prime Minister, Rishi Sunak, when he came to Belfast, at a meeting in Bangor when he was running for the leadership, committed to the objectives of the protocol Bill. We will measure what comes out of the talks against those commitments and against our seven tests.
If we are hearing, as we seem to be, that we will be left in a situation going forward where we will still be under EU jurisdiction and EU laws, with the oversight of the European Court of Justice at arm’s length, or whatever it is, that gross breach of sovereignty, as I have already outlined, will be something that unionists cannot accept. We are entitled to be part of the United Kingdom, to have our laws made by our elected representatives and to have internal trade of the United Kingdom flow freely between all parts of the United Kingdom. So we have to have something that will work, going forward.
Some of the talk about green lanes and red lanes and all the rest of it means different things to different people. It seems to us that it is very much based on the proposals put forward by the European Union last October. It could be that it has moved on from that—but we should remember that, even if we solve the issue of red and green lanes and all that, it does not get to the heart of the problem of the differences in terms of divergence and diversion of trade, and the problems that will exist if you have a lot of the laws of Northern Ireland being made by a foreign political entity in its interests, and not in the interests of Northern Ireland, and with no say or vote by anyone in Northern Ireland. That cannot be sustainable going forward.
If we find ourselves in a position whereby the Government do not hold fast to their stated position and the commitments that they have made to the people of Northern Ireland and that they have made about the sovereignty of the United Kingdom and the free flow of trade within the UK internal market, we will be in a position of looking to the longer term governance of Northern Ireland without an Assembly and an Executive. That is unfortunate, but it will be the reality of the situation.
There may be attempts, as we have heard already, to chuck out the Belfast agreement, St Andrews and all the rest of it. I would suggest that that is a very dangerous course to embark on—a very dangerous course to embark on. We need to work to try to restore those institutions, but on the basis of agreements that are already there. As we heard previously from the Dispatch Box and on the Front Bench, the only means of making changes to the current arrangements is by a sufficient consensus of unionists and nationalists to make those changes, and anyone who suggests that you breach that fundamental principle of political decision-making and institution-making in Northern Ireland is going down a very dangerous path, as I said.
So what should happen? We cannot have a return to the situation where, over a long period, civil servants are left to run Northern Ireland, even with so-called guidance. We cannot have years of stasis with no political guidance. This is the Parliament of the United Kingdom. Ministers in His Majesty’s Government are responsible for the good governance of Northern Ireland. Indeed, I think that those words were part of a previous election manifesto commitment of the Conservative Party, where it was made clear that, in the absence of devolution, it is the responsibility of the Westminster Government to make decisions—decisions that will be accountable, whereby we can question and query and hold Ministers to account. Civil servants cannot be put in that position; it is unfair to them and to the people of Northern Ireland.
The choice is not between having no Executive and therefore no Government. There is an alternative—we can have government—and it is up to the Government here to take on that responsibility. I have to say that some people may say that that means that there is decision-making from London as opposed to Belfast, but, over recent times we are already seeing a constant working against the devolved settlement, in any case. We have seen it with abortion regulations and with the legacy proposals, and we have seen it with changing the voting mechanism for the protocol. We have seen it most recently in relation to the statutory instrument due to be brought forward soon in relation to border control posts. All those are devolved issues, yet the Government decided to intervene. So they are already doing it, but it seems that they pick and choose which areas to override the devolved settlement on. So what I am saying is that we cannot go back to the situation where civil servants are running Northern Ireland; we have to have a situation where there are accountable Ministers, if not at Stormont then here.
It is important that these matters are explored in detail, and they have to be explored in this House in this Parliament by the representatives of the people of Northern Ireland.
Baroness Ritchie of Downpatrick (Lab)
My Lords, first I offer my support and the support of these Benches to the noble Lord, Lord Empey, Lady Stella and the family at this time.
The debate on the Second Reading of the budget Bill should be happening in the Northern Ireland Executive and Assembly following approval in the Executive; it should not be happening here. But I suppose those words are self-evident. All parties in Northern Ireland have to take devolution and power sharing seriously and see it as a duty and obligation to represent everyone on a fair and equal basis. I support this Bill as it deals with the financial necessity for the people of Northern Ireland. Other necessities have already been referred to, along with the positive outcome required to the UK/EU negotiations on the protocol and the restoration of our political institutions.
There is no doubt that we in Northern Ireland face challenging political circumstances, where the political institutions to which people have been elected are lying dormant due—and I say this in the kindest possible way—to the disproportionate opposition from the DUP over the protocol to the hurt that is being caused.
Reference has already been made to the fact that this is not the first time the institutions have lain dormant: it happened in 2017, when Sinn Féin brought down the institutions. Again, that was disproportionate and unacceptable. Both actions do nothing to assist the body politic or communities in Northern Ireland which are facing a constant, piercing cost of living crisis, as is characterised by the budget under debate this evening. They have ongoing problems with health waiting lists and inadequate funding for our police and education services. Nobody is served by the policies of abstentionism, as currently practised by the DUP in the Assembly, by Sinn Féin previously in the Assembly and by Sinn Féin in the other place. I believe that no political principle is worth withholding participation in democratic institutions or not allowing them to function properly.
My noble friend Lord Hain’s amendment reflects in many ways the frustration, anxiety and weariness of many people and communities throughout Northern Ireland about the lack of political institutions operating to their full potential. The amendment of the noble Lord, Lord Dodds, as I thought it would, reflects the DUP’s opposition to the protocol. I just gently say that the DUP, along with the ERG, supported a hard Brexit which the people of Northern Ireland did not vote for. The majority voted to remain within the EU, the protocol is a consequence of Brexit, and the problems emerged on leaving the European Union. But let us leave that aside, because we could cast lots across the Chamber about the benefits and disbenefits of the protocol.
I know the Minister met with the dairy industry in Newtownards and was given presentations by Dr Mike Johnston and senior representatives of Lakeland Dairies. They showed quite clearly, as they showed me when I met them back in November, the benefits and difficulties and challenges presented by the protocol Bill. When members of the protocol sub-committee were in Newry and Belfast, we heard evidence in Newry about how it benefits, in a financial way, the cross-border economy, while we heard evidence in Belfast from the haulage industry about the problems and challenges of the protocol, but I hope that those challenges and difficulties are currently the subject of negotiations. I ask the Minister to provide us with a little update on those negotiations: are they in the tunnel or near the landing zone? I hope they will lead to a resolution of the current difficulties and a restoration of the institutions.
But we are dealing with a budget Bill and we have strange political circumstances: we have an indirect form of direct rule. The budget is for this financial year, which will expire in four or five weeks, and Permanent Secretaries are facing funding decisions within their own departments over spending priorities. The budget is being set by a Conservative Party, despite little electoral support in the region, because of the political circumstances of Northern Ireland. While the Bill includes a vote on account for the upcoming financial year, it does not provide clarity on the resources that Northern Ireland departments will have available over the next financial year, which is just a short time away. Undoubtedly this leads to an inability to plan, which has significant implications for the delivery of public services.
For example, the Department of Health does not have the necessary confidence and clarity to invest in staffing teams to help deal with waiting lists, which are some of the worst in the UK. Many people in Northern Ireland, and maybe some in your Lordships’ House, are waiting to access those waiting lists for surgical and other types of medical, clinical procedures. As we discuss the budget, it is worth remembering that the UK is the only nation in the G7 whose economy will shrink in 2022-23, according to the International Monetary Fund. Have the Government any reason for this? Has the analysis carried out by the IMF been shared by the Treasury with the Northern Ireland Office?
I will take a little snapshot on health. Spending on the transformation of the ambulance service is urgently required. GPs are facing an existential crisis: they are doing more and more work to ease the pressure on our hospitals, but there is not the money to enable them to do so. Mental health figures for Northern Ireland are some of the worst in the UK and Ireland, some of which is attributed to the legacy of the Troubles. A commissioner has been appointed to deal with this and he developed a strategy, but now the plan cannot be funded. An above-inflation pay increase is required for our nurses and, as far as I know, nurses in Northern Ireland of comparable grades, qualifications and training receive less in their salaries than those in the same categories here in Britain.
I support the Bill. I deeply regret that we find ourselves in circumstances where we are discussing these issues. I hope there is a resolution to the protocol negotiations and a restoration of political institutions that will enable people who are elected by the people of Northern Ireland to the Assembly to form an Executive, to make recommendations around that executive table for budget allocations and for the Assembly to debate and agree the Bill, which would be given detailed scrutiny in committee and on the floor of the chamber. I just regret that we are discussing this, not the people whom we elect to do it on our behalf in Northern Ireland.
Northern Ireland Budget Bill
Tuesday 7th February 2023
(1 year, 3 months ago)
Lords ChamberRead Full debate Northern Ireland Budget Act 2023 Read Hansard Text Watch Debate Read Debate Ministerial Extracts Amendment Paper: Committee of the whole House Amendments as at 23 January 2023 - (23 Jan 2023)
Baroness Foster of Aghadrumsee (Non-Afl)
My Lords, I refer noble Lords to my register of interests, in particular the fact that I am a member of the board of governors of Enniskillen Royal Grammar School and that a member of my family is a serving member of the Police Service of Northern Ireland.
I begin my contribution in perhaps an unexpected way. I pay tribute to all those who have made Northern Ireland the place it is today: an innovative, exciting place to do business, with a well-educated, energised population looking to the future and living in what I think is the most beautiful part of the United Kingdom.
Some of us got involved in politics to advance Northern Ireland within the United Kingdom and to protect it from those who sought to destroy it. That is the context in which I make these remarks. It saddens me greatly that we are where we are, but I believe we need to refocus on what we can achieve if and when the protocol’s intrusion on the Belfast agreement is resolved.
We have been told that the Northern Ireland protocol was designed to do two things: protect the internal market of the European Union and the Belfast agreement. It has been hugely effective in the first of those, to the point that you cannot get a sandwich across the border, but it has had the opposite impact on the Belfast agreement, as indicated in the amendment from the noble Lord, Lord Dodds of Duncairn. The protocol has undermined, misrepresented and inserted words and phrases into the Belfast agreement, and left us with a breakdown in the delicate balance created by it 25 years ago.
The European Union’s response to all this has been to put its fingers in its ears and its head in the sand. In an echo of David Cameron’s negotiations prior to the referendum in 2016, the answer to any challenge is “more Europe” and, in our case, “more protocol”. For decades, the European Union just ignored the Irish constitutional claim on Northern Ireland—part of another member state. Now, it does not just ignore the plain fact that it is interfering in an independent third country, the United Kingdom, but actively pursues interference in the United Kingdom’s internal market.
Minister, when will His Majesty’s Government realise that the European Union does not respect the constitutional position of Northern Ireland within the United Kingdom as per the Belfast agreement? What actions are His Majesty’s Government going to take to educate the European Union on the constitutional position of Northern Ireland? What actions have His Majesty’s Government taken to educate the European Union about the actual contents of the Belfast agreement, as opposed to those made up, which have apparently taken hold? And when will His Majesty’s Government honour the commitment in New Decade, New Approach to protect the internal market of the United Kingdom?
All these answers would help inform the return of devolution, but the return to devolution is when the real challenges actually begin. The Minister of State speaking in another place said that the pressures on the Northern Ireland finances did not happen overnight. He is absolute correct. In 2016, the then Health Minister Michelle O’Neill, received a review of the Northern Ireland health service by a team led by Rafael Bengoa. The report made it clear that unless there was reform, health service need would continue to grow as a percentage of the block grant. We were told that reform was not an option but a necessity. Despite that warning, Sinn Féin collapsed the Executive in January 2017 and we were without devolved institutions for not one, not two, but three years as Sinn Féin refused to deal with real and meaningful pressures on everyday citizens. Health service need did indeed continue to grow, while Sinn Féin kept government down in order to achieve additional language rights. Regarding the amendment moved by the noble Lord, Lord Hain, I note that, as the noble Lord, Lord Dodds, has already commented, there was no pressure to have Sinn Féin back in government during the three years when there were huge pressures, particularly on our health service. I remember it very well.
Another reason for the huge deficit in the Northern Ireland finances referred to by the noble Lord, Lord Caine, is that no Sinn Féin Minister of Finance has ever succeeded in presenting a Budget which other parties could support. Given the nature of mandatory coalition in our devolution in Stormont, Finance Ministers have to look for support and consensus on the Budget that they bring forward. Every other coalition Finance Minister was able to achieve that, but no Sinn Féin Minister was able to—neither Máirtín Ó Muilleoir nor Conor Murphy.
Those of us who live in local government areas controlled by Sinn Féin know only too well of their actions when they are in the lead. Last month, in Mid Ulster District Council they even blocked a letter to His Majesty The King, such is their hatred for all things British. So I say very deliberately that if devolution is to return, real, sustainable power-sharing will require a complete change in attitude from Sinn Féin. Consensus and collaboration are not ideas which come easily to them. Noble Lords should not forget that the then Deputy First Minister, Michelle O’Neill, currently styling herself as “first Minister for all”, blocked the victims payment to innocent victims of the Troubles until the matter was ruled upon by the High Court in Belfast. Just let that sink in: blocking a payment to innocent victims of the Troubles. I listen to Ministers in the other place saying that devolution should return, implying that that will solve all the governance problems in Northern Ireland, but unless and until Sinn Féin embraces power-sharing, I am afraid the problems will remain.
Turning to matters in the Northern Ireland Budget Bill, on policing, under the New Decade, New Approach agreement of January 2020, Police Service of Northern Ireland numbers were to increase to 7,500. As this Budget takes hold, the chief constable has indicated that the number of officers will fall to 6,700, making the service the smallest it has ever been. As the Northern Ireland population continues to grow, our police service diminishes. Workload is increasing and police numbers are reducing, meaning policing is smaller, less visible, less accessible and less responsive, with slower investigations, reduced services to victims and, of course, knock-on delays in the criminal justice system. Service to the public is under threat.
Individual police officers will be under even more pressure from a welfare and well-being point of view, and I am sure the Minister knows that cost of living pressures are already biting on a number of the more junior police officers in our service. Many are having to take second jobs, something completely unheard of in past days, to make ends meet. It is absolutely incredible.
While government is investing in more officers in England and Wales—and recruitment is increasing in the Republic of Ireland, I understand—in Northern Ireland numbers are decreasing to their lowest ever level. It is simply unsustainable. Even during the worst times of the Troubles, policing happened right across Northern Ireland. Now, “many rural areas have virtually non-existent police forces”—not my words but those of an experienced officer who recently spoke to the Police Federation of Northern Ireland.
The Minister knows Northern Ireland probably better than any other government Minister, having spent a long time there in various guises; he knows its geography. I want him to really think about this and to give a commitment to those of us who live in rural areas in Northern Ireland that, regardless of where you live, you will be able to have effective and sustainable policing. It is very worrying. The federation is very concerned about what is going on at the moment, and it is important that Members of this House hear those concerns.
Turning briefly to education, I am proud that we have the best results in the United Kingdom. That does not happen by accident; I pay tribute to our leaders, teachers and governors across Northern Ireland, and of course to the hard work of our brilliant young people. Northern Ireland has invested in our young people, and our investment record shows that many of our foreign investors are impressed by the level of education and ability available to them when they come to invest in Northern Ireland. However, that is all at risk if the education budget goes ahead in the manner suggested by this Bill. We will be damaging our most successful system. Most importantly, I am concerned that we will be damaging our young people as well.
No one should shy away from reform or savings anywhere in public service but, as the Minister knows, when some in government try to bring forward reform in Northern Ireland, it is usually blocked by those who are afraid to make the argument to their voters. I regret that, because much more reform should have taken place. We could have begun the change to our health service in a planned and open way in 2017, but that was not done for the reason I have already referred to—the collapse of the Executive for three years due to the action of Sinn Féin. Noble Lords should remember that when they make their contributions today.
In closing, I regret the necessity for this Bill. I say this to the Minister as gently as I can: I very much look forward to His Majesty’s Government giving the citizens of Northern Ireland the same rights as those in the rest of the United Kingdom.
Baroness Hoey (Non-Afl)
My Lords, I totally support everything the noble Baroness said about the need for more financial support for policing. Our police force in Northern Ireland has very different pressures from those in the rest of the United Kingdom.
We are here again, late at night, discussing Northern Ireland with more or less the same people we see at every debate. I sometimes think that if only the Conservative Party—sorry, the Conservative and Unionist Party—and the Labour Party had spent much more time over many years taking a genuine interest in Northern Ireland, getting properly organised there and standing for election, we might be in a very different position. The Labour Party does not even allow candidates to stand in Northern Ireland; yet, from all over, it keeps telling people in Northern Ireland what they should or should not be doing. That is important to stress.
I am disappointed in the amendment from the noble Lord, Lord Hain, who I count as a friend from long years of knowing him. It says to me that he no longer supports the Belfast/Good Friday agreement; the amendment is clearly completely against the spirit and words of the agreement in relation to cross-community support. I point out gently, as has been pointed out already by the noble Lord, Lord Dodds, that I did not see much pressure coming from the Labour Party during the three years that Sinn Féin was not in the Assembly. I did not see Motions to change the Belfast agreement or take the salaries away from those who would not take their seats. I support what the Minister has done to reduce the salaries of the elected MLAs; that was perfectly sensible, as I think the parties themselves recognise, but what the noble Lord, Lord Hain, is suggesting goes much further than that. Elected members of Sinn Féin, who say they have a mandate not to take their seats in the other place, still get huge amounts of money. They fly back and forth at the taxpayers’ expense. They do not get salaries but they get huge office expenses, which they use for campaigning, as has already been said. I wonder whether the noble Lord, Lord Hain, would similarly support stopping Sinn Féin’s money, since they refuse to take their seats.
They say they have a mandate—well, the DUP has a mandate. Whether your Lordships like it or not, the DUP has a mandate to stay out of the Assembly and the Executive until such time as the protocol has been sorted. It is simple. The Government have known for a very long time that it is devolution or the protocol. You cannot have both. The Minister probably realises that. What we do tonight we are doing because we have the protocol and we do not have an Executive to put a budget through. I of course support the fact that we are doing this, and I support quite a lot of the elements of the budget. I believe that this is an opportunity for His Majesty’s Government to look at some radical changes to what is happening in Northern Ireland.
As has been said before, even if the Executive were back tomorrow, the huge problems that exist are very unlikely to be solved in the way that we would like to see, because of the way the Executive work, the way the Finance Minister can decide how the money will be spent and the fact that there has to be agreement. The fact that the previous Finance Minister did not get a budget agreed by any of the parties is symbolic. As the noble Lord, Lord Dodds, has said, we cannot go on like this forever, with the way things are going with the European Union. We will get a decision tomorrow in the Supreme Court. Even if the court refuses to rule out the protocol, it will probably say things that, hopefully, will show again that the Government have broken the Act of Union; they have admitted that in the courts in Northern Ireland. They have subjugated the Act of Union; that is where we are today.
I hope the Minister will say how long he thinks we can go on in this situation. In my view, there will not be an Executive or Assembly until the protocol goes. That is what people are beginning to realise. It is definitely not going to happen until we see real sovereignty being taken back, and Northern Ireland back as an integral part of the United Kingdom. As Sir William Cash said very expressively and well last night on a television programme in Northern Ireland, how could any Government anywhere in the world give away—basically—a part of their own country, ceding power as we have done to the institutions of the European Union?
We will have to come up with some other solutions that do not mean coming back every month with a Bill to do something else. At the moment, it seems that Ministers decide what they will and will not allow to happen, but we want to see that in a much more systematic way. Perhaps it is time that we returned to the system of legislating, as we did in the past, by Orders in Council. At the moment we have these erratic emergency Bills coming through to which the Government very rarely accept changes, but, despite past criticism of the limited time given to Orders in Council in both Houses of Parliament, and of the fact that an order was unamendable, it would be far preferable in terms of good government to return to that system, as well as making much better use of your Lordships’ time here. Legislating in that way would allow Northern Ireland’s separate body of law to be updated when necessary, instead of many years later than needed.
It is worth recalling what used to happen before Stormont reappeared spasmodically. There were an average of 20 Orders in Council every year until 2006-07. In the last 15 years there have been only six, yet there have been numerous Northern Ireland Bills. Those six orders were exceptional measures to introduce the welfare reform that involved universal credit—Stormont Ministers were not willing to be seen to legislate in that area so they asked Westminster to do the needful—and another one reformed the sexual offences law. I cannot help but think that this buck-passing is what happens with the current legacy Bill. I think we have all forgotten, because it is convenient to forget, that the five local political parties oppose the legacy Bill but previously they sent it to Westminster because they could not agree on any way forward for themselves.
We have to face up to the fact that this House and the other House have become the legislature for Northern Ireland. It is time that the noble Lord, Lord Caine, started to convince Ministers and the Prime Minister that we cannot go on like this, and that there is a need to put in an extra couple of Ministers for Northern Ireland and beef up local government. Over many years, people have argued against devolution and said that integration was the way forward. People sometimes say that the train has gone too far to be pulled back, but we might need to look at whether what we are doing now is going to be sustainable in future. Sufficient integration on a transitory basis until the Assembly is back needs sensible government consideration.
Money is getting through now—practically everyone who was entitled to it now has the energy money—but we need radical change in how we deal with our finances in Northern Ireland. Some bad financial decisions have been taken in Northern Ireland over the past two or three years. Sometimes, because one side gets something, the other side then has to get something, and the two things come together but it is not actually the best way to spend money for people in Northern Ireland.
We should use this opportunity—although I am sure no one will want to say it is an opportunity—to look seriously at what we are doing at this moment and how we can make the changes now that will mean, should the protocol go and the Executive come back, there is a better footing to make things better in Northern Ireland generally for all its people.
Lord Rogan (UUP)
My Lords, this is a debate that I truly wish we were not having at this late hour today. I apologise to the House for my coughing and hoarseness; I have a problem with my throat.
As I said in this House just a few days ago, we cannot be one United Kingdom while the Irish Sea border remains in place. I sincerely hope that the ongoing negotiation with Brussels will lead to its imminent removal.
With the greatest respect to the Minister, who I know feels greatly and deeply about Northern Ireland, this budget should not be set by him and his colleagues here in Whitehall. These are decisions that should be made by local Ministers in Northern Ireland, elected by local people for local people. Even in the relative absence of terrorism—I use the word “relative”—the people of Northern Ireland are currently living through one of the most difficult periods that I can remember, and I have been around for quite a long time.
The Consumer Council has produced figures which showed that, between January and March last year, the Province’s lowest-earning households, with an average annual income of £12,200, had just £29 per week left after paying their bills and living costs. The Northern Ireland Statistics and Research Agency estimated that, in April 2022, 316,000 citizens in Northern Ireland— I repeat, 316,000—were living in relative poverty. That was when inflation had reached 9%; it has stayed above that level ever since and currently sits at 10.5%. Meanwhile, the energy crisis was yet to really take a grip and the interest rate stood at 0.75%. It is now 4%. This is the reality of life at the moment.
Individuals and families need our help. They need support. They need local politicians to stand up for them to give them a voice. Yet in Northern Ireland we have neither an Executive nor a functioning Assembly in place, so responsibility for the welfare and future of local people is now in the hands of others.
I had concerns about several areas of the Government’s budget proposals when they were published in a Written Ministerial Statement last November. The noble Baronesses, Lady Foster and Lady Hoey, both alluded to this but it is worth repeating. It was in the field of education that my worries were and remain most profound. The Written Ministerial Statement said that
“significant reductions in current spending trajectory levels”—[Official Report, Commons, 24/11/22; col. 16WS.]
on education would be required to “live within budgetary controls”. In other words, that means cuts to school budgets.
Last week, the BBC reported that the Education Authority in Northern Ireland had been asked to model cuts of up to 10% to its 2023-24 budget, amounting to hundreds of millions of pounds. The Education Authority had previously said that it expects more than half the schools in Northern Ireland to be in the red by the end of next month. It also warned of a school maintenance backlog of some £500 million. This situation is not just untenable; it is also devastating to the prospects of Northern Ireland’s young people. We need our young people to receive the best possible education. Not only will that enable them to fulfil their personal potential; it will encourage them to build successful careers in Northern Ireland and make a positive contribution to the local economy, rather than moving elsewhere. I appeal to the Minister to please use his good offices to put their future first.
Another area facing potentially catastrophic cuts is policing, which the noble Baroness, Lady Foster, alluded to most eloquently. Briefing his officers just a few days ago, PSNI Chief Constable Simon Byrne said that the force would have a funding shortfall of £80 million by next month, with larger shortfalls to come in the years ahead. He added:
“By March there will be 309 fewer Police Officers and 115 fewer staff, a reduction of nearly 6%. We will then have 6,699 full-time officers. This is 800 officers fewer than the commitment made in the New Decade New Approach Agreement and the lowest officer numbers since the Police Service of Northern Ireland was formed.”
As I mentioned, terrorism has not gone away. In reality, the situation on the ground remains dangerous, with the shadow of paramilitarism still looming large, including constant threats to police and prison officers. With Northern Ireland’s population growing we need more officers, not fewer. We also need high-quality officers, but implementing such damaging cuts and increasing already overheavy workloads will surely make policing a less attractive career for young persons.
I place on record my disappointment at the outcome of the levelling-up fund’s round 2 bids for Northern Ireland. The Assembly and Executive’s return now looks unlikely in the short term, and the budget proposals we are debating show little slack in their current form. As such, it is hoped that round 3 of the levelling-up fund will be much more generous to community projects in Northern Ireland, including an impressive bid from Coleraine Football Club, than round 2 sadly proved to be.
It is a matter of deep regret that the Northern Ireland budget is being dealt with in this manner tonight. It is the subject of two short parliamentary debates, allowing minimal scrutiny before the funds come under the control of unelected civil servants back in Belfast. That is no criticism of those officials, who I am sure will do a professional job. However, this is a situation that neither they nor the people of Northern Ireland should find themselves in. We have been here before. It is my earnest hope that we never find ourselves in this position again.
Lord Bew (CB)
My Lords, I support this Second Reading and thank the Minister—the noble Lord, Lord Caine—for his careful and detailed introduction. He delivered it with such calmness of tone that, once or twice, I wanted to say something that I am sure he is well aware of: that the crisis in the public finances in Northern Ireland is acute. I fully respect his observation that the Government intend to look after education and health in particular but, at the moment, the shortfalls look remarkable in those areas, and we may have to look at other ways of raising funds. But that explanation of how we have got here was totally fair.
We have two regret amendments. Although that of the noble Lord, Lord Hain, does not directly do so, it implicitly follows a line of argument that has been increasingly common in the last few weeks: that the behaviour of the DUP means that we should call into question the whole structure of the Good Friday agreement. That is exceptionally dangerous, and I am very glad that Rory Montgomery—one of the key Dublin officials at the time of the negotiation of the agreement, and recently its lead official in negotiations with Europe—has pointed out that this would be extremely dangerous and risky. The DUP has a mandate for its action, which is legitimate within the terms of the Good Friday agreement and the way it operates. This is very frustrating, and I fully respect the frustration with it of the noble Lord, Lord Hain—but it is legitimate. Any attempt to move away from the agreement would be remarkably destabilising.
I very much agree with the argument of the noble Baroness, Lady Foster, that the EU has to come to terms with its commitments to maintain the Good Friday agreement. In recent days, the EU has acknowledged that there were unforeseen consequences. The big and obvious elephant in the room in that respect is that the institutions of devolution and the Good Friday agreement are down. As Rory Montgomery said, a particularly narrow Irish version of the Good Friday agreement was unfortunately internalised by the EU in the early stage of these negotiations, and in some ways we are still trying to unpeel all that.
The Bill depends on a functioning democratic deficit, if I can put it like that. This is very hard for the departments and the Permanent Secretaries in Northern Irish departments: they have been drawn into making decisions that they should not have to make, especially in very difficult circumstances—there is no doubt about that or that you can just about get away with it in the short term. But it is a functioning democratic deficit. I absolutely accept that the EU has to come to terms with the democratic deficit, and increasingly the signs are that people now acknowledge this in a way that they did not when, for example, the first iteration of the withdrawal agreement—the Theresa May document —made no mention of the Northern Ireland Assembly at all. Now the question changes: the Northern Ireland Assembly must be part of the resolution of this democratic deficit question, but it is very difficult to do this. But at least it is acknowledged on all sides that, in this area, something has to be attempted that was not even attempted in the first phase of this negotiation.
In that sense, the democratic deficit cuts both ways. There is a point at which there will have to be consideration. It is absolutely true that there is democratic deficit regarding the function of the protocol at present in Northern Ireland, but it is also true—and it probably cuts into more serious areas of public life for ordinary individuals—that there is a democratic deficit as regards how the Assembly is not operating. That is a political choice of the DUP, and what it has attempted to do so far is entirely legitimate within the framework of the Good Friday agreement. None the less, the democratic deficit question cuts two ways, and that is a responsibility of moderate politicians; we can no longer throw that question away.
Briefly, in defence of the Permanent Secretaries, the red and green scheme was not the EU’s idea—as the noble Lord, Lord Dodds, suggested in his important speech, most of which I agreed with—but came from the Northern Ireland Permanent Secretaries. The idea of the red and green lanes, if we get them back, was originally broached in 2017 from the higher reaches of the Northern Ireland Civil Service. Clever as its members are, they should not be asked to make decisions which should be made by the Assembly—the noble Lord, Lord Hain, is right on that point. It will not be magical, and everything that has been said tonight about the inadequacies of the Assembly’s previous functioning is true—I say that while looking at four former Ministers of the Assembly. None the less, we ought to have a proper, functioning and democratic Assembly. To get that, we need the United Kingdom Government to live up to their commitment under the Good Friday agreement, the very beginning of the international agreements, to deliver equality of esteem, which they have done for the nationalist community with the recent Irish language legislation in this House. However, the long-term aspirations of the unionist community on the protocol also require a response from the United Kingdom Government.
Lord McCrea of Magherafelt and Cookstown (DUP)
My Lords, in the other place, the Minister, Steve Baker, when introducing the Bill, said:
“In the absence of an Executive, the Government stepped in to set a Budget … Setting the Budget was not an easy task.”
He went on to suggest that DUP voters, on the whole,
“will be devastated by the consequences of not having the Executive up”
to deal with the issues before them. I am somewhat bemused by so many politicians and Times commentators constantly telling my colleagues and me what DUP voters want, while, at the same time, showing that they are unwilling to listen to the authentic voice of unionism, as demonstrated constantly through the ballot box over and over again. Unlike other parties, the DUP stays close to its electoral base and honours the promises it makes in an election manifesto.
The Minister in the other place went on to say that, in the light of the Chancellor’s Autumn Statement, His Majesty’s Government
“are acutely aware of the difficult decisions that now have to be taken in relation to health, education and right across the spectrum in Northern Ireland to live within the Budget.”
He also said that
“pressures on Northern Ireland’s finances did not happen overnight. Successive former Executives … failed to put finances on a sustainable footing. As a result, the Government inherited a Budget halfway through the year with an overspend of some £660 million. That is unacceptable”.
However, he failed to say that, while numerous problems were facing practically every department within Stormont’s competence, to resolve those required the relevant Finance Minister to present a budget which departments could work from. Sadly, Sinn Féin Finance Ministers, when the Executive was functioning under their stewardship, were unable to bring forward a budget that any of the other major parties could sign up to. The most recent Finance Minister, Conor Murphy, set a budget promising millions when he knew that the coffers were empty—peddling promises to satisfy his political aspirations, yet knowing full well that the black hole was getting deeper.
The chairman of the Northern Ireland Affairs Committee in the other place also said that
“we were hearing … a growing sense of worry and anxiety about the impact on the quality of life and on outcomes in health, education and housing for ordinary people in Northern Ireland”.—[Official Report, Commons, 23/1/23; cols. 773-75.]
To this I say, “Yes, we are.” No one can be satisfied with the failure to tackle the numerous problems that we face with crumbling infrastructure, with hospital waiting lists at an all-time high, not being able to see a doctor even when life and death issues are at stake, and with operations being cancelled, as well as the education of our children being seriously undermined, and so on. The list of problems goes on and on.
However, Simon Hoare is tone-deaf to anyone expressing the growing sense of anxiety and worry felt by the unionist population, who feel that they have been treated as third-class citizens by their own Government because of the iniquitous Northern Ireland protocol, which was agreed between London and Brussels deliberately over their heads. Unionists will not permit us to be treated like an EU colony. We shed our blood to maintain our British heritage, and will not accept the constitutional position within the United Kingdom being swept away by foreign Governments in their efforts to constantly appease republicans.
Another serious shadow hangs over this debate, with the amendment proposed by the noble Lord, Lord Hain, the substance of which is to threaten the unionist electorate through their politicians that, if they do not obey his diktat, their legitimacy will be cast aside as if we were under some communist regime. Let me sound a word of caution to the noble Lord, Lord Hain, who as a former Secretary of State ought to know better. If he is presenting this amendment with the blessing of His Majesty’s Opposition to his colleagues as well, this is playing a dangerous game and the stakes could not be higher. He is playing silly political games at a most sensitive time in Northern Ireland. This amendment may have received applause in Connolly House, the headquarters of the Provisional IRA in Dublin. Indeed, it could even have been drafted in Connolly House, when you read it—but I find its contents insulting to the ordinary unionist voter and a direct challenge to democracy. Does he really think that the DUP would be willing to sell the constitutional future of our Province for a paltry 30 pieces of silver?
It is interesting that, while Sinn Féin brought down Stormont and would not enter an Executive for three years, the noble Lord did not present such a proposal to your Lordships’ House, but rather did everything in his power to get all the concessions demanded by Sinn Féin granted to it to get it back into the Executive. Now he wants the Government to give an ultimatum to unionist elected representatives: “Get in without having your legitimate democratic concerns dealt with, or else we will bypass you completely or sweep your elected representatives to the side.” I say to the noble Lord that the unionist electorate are not to be treated as if they were dirt under somebody’s feet or regarded as irrelevant. The noble Lord can therefore no longer be considered to be an honest broker for any further negotiations. I am surprised that he did not go the whole way by telling unionists that, if they were unwilling to be compliant with his demands, they will no longer be allowed to vote at any further Assembly election. But perhaps that is reserved for a future occasion.
Note also that Sinn Féin has lifted many millions of pounds from British taxpayers, even though the MPs have never attended one sitting at Westminster—but not a cheep from the noble Lord. I think that I can recall that there were those on the Labour Benches that were willing to remove the necessity to swear allegiance to Her Majesty the Queen to get Sinn Féin on to the green Benches of the other House.
The DUP on numerous occasions raised genuine concerns, indeed concerns felt by all unionists in the Province, about the Northern Ireland protocol from its position within the devolved Administration, long before it withdrew from the Executive. There was a long window of opportunity in which to resolve these issues before the Executive collapsed, but this was missed or thought not worthy to be granted serious consideration. Europe was so belligerent that it was not willing to remove one jot or tittle from the agreement, at the behest of Dublin. The Assembly works on the basis of consensus, yet the basis of its functioning properly was destroyed.
The protocol has damaged Northern Ireland’s position within the United Kingdom and the economic prosperity of our people. The Assembly is expected to administer laws that have not even been created by this Parliament, never mind the Assembly itself. Some 300 areas of law, including our ability to trade with the rest of the United Kingdom, must be determined by a foreign political entity, the EU. Yes, laws are imposed on Northern Ireland without scrutiny, nor any accountability for them. The democratic deficit is alarming, but we are to suck it up and get on with it. Unionists are not willing to tolerate this any further, and only an honest dealing with the situation will be accepted.
Even in the light of the talks that are going on, I say to the Minister, for whom personally I have respect, that no underhand, cobbled-together deal between Brussels and London behind the backs of unionist representatives will gain acceptance within the unionist population. It is time for the Government to get real, face the dilemma they have created and treat Northern Ireland as what it is; an integral part of the United Kingdom with equal rights as enjoyed by all others within the union.
Coming to the budget itself, the allocation of resources is totally inadequate and will only place every department in extremely difficult positions, facing difficult choices. The recent additional energy and inflation pressures have greatly exacerbated the problems. In the DfI, the allocation will have a serious impact on road maintenance, street lighting, et cetera—indeed, the already unfit nature of many minor roads will get a lot worse; they are already in a deplorable condition. In the Department of Justice and policing, it is envisaged that an operational shortfall of some £80 million in this financial year will but increase to £106 million next year and £132 million in 2024-25. Police numbers have fallen to 6,669 this year, and next year, this is to continue downwards to 6,433, with a further reduction to 6,193 police officers in 2024-25. Is this acceptable?
This is inconsistent and contrasts with the uplift programme in England and Wales, which has been allocated an uplift of more than £2 billion across three years, including funding to grow police officer numbers by a further 20,000 members. This year’s allocation will impact, with a reduced vehicle fleet and damaged and broken vehicles waiting longer for service and repair. It will also lead to deferred building and maintenance work on a crumbling estate. This is happening in spite of a firm NDNA commitment by His Majesty’s Government to provide adequate resources to allow police numbers to rise to 7,500. The implications within the community are serious, with fewer police on the beat. Indeed, by March 2023, there will be 75 fewer neighbourhood police officers, 96 fewer detectives investigating murder, terrorism, drugs and organised crime, 97 fewer officers in our operational support department and 115 fewer police staff across a range of roles. This is not acceptable.
In education, there is a significant funding gap and the Education Authority is concerned about the growing unprecedented pressures facing education. There has been chronic underinvestment in education and representatives of all schools have written to the Secretary of State warning that there is a crisis in education funding. Spend on education per pupil in Northern Ireland is below that in England, Scotland and Wales, and half of our schools are projected to be in financial deficit at March 2023. In Scotland, 2021-22 spend per pupil was £7,600, but in Northern Ireland it was 6,400. Following the 2022-23 budget settlement announced by the Secretary of State in November 2022, the Education Authority was directed to identify a range of proposals in response to the £110 million funding gap which was being forecast at that time. A number of proposals are being considered to make savings, including reductions to services, but these are judged to lead to highly unacceptable and detrimental risks to our children and young people.
However, the substantial pressures that the system is currently facing will increase in pace. As a result, the financial position will be even more challenging in 2023-24. Reducing expenditure on the day-to-day running of schools will have an impact; it will impact on special educational needs support, transport, catering and, ultimately, the educational experience and outcomes of our up-and-coming generation. A flourishing education system is vital for the future health, well-being and economic prosperity of our wider community. We urgently need to invest in an ambitious programme to transform special educational needs services and develop and grow early intervention support, thereby reducing our reliance on statutory services, to ensure that all our children can lead happy and fulfilled lives. The budget before us today does not permit this to happen. We are moving backwards, not forwards.
Finally, I will look briefly at health provision in the Province. Waiting lists in Northern Ireland are the worst in the United Kingdom. Waiting times for a cancer consultation have risen, in many cases at an alarming rate. Even though the largest part of our total budget is allocated to health, our outcomes are falling. Care packages are in chaos and the number of agency staff across the service is increasing. The costs are astronomical. The glaring need to train more nurses, doctors and consultants is surely evident, but it has not been tackled. Six years on from the Bengoa report, we are yet to see the proposals delivered. If my memory serves me right, all major parties in the Northern Ireland Assembly signed up to the implementation of this report, but the situation lies stagnant. With such consensus, there is no need for government to delay action any longer in taking forward these reforms.
There was no cross-party support for the present abortion laws forced on the people of Northern Ireland, but the Ministers of His Majesty’s Government did not care—they declared, “It must be done, and done swiftly”. This also happened with legislation for same-sex marriage and the Irish language. In spite of opposition, the Government ploughed full steam ahead. Of course, these were at the behest of Sinn Féin; we know that, over the years, successive Governments have removed every obstacle to appease the party that was in league with the boys with the guns. Even though all of these had implications for creating a deeper hole in Stormont’s finances, time was of the essence, and where the finances would come from did not really matter. It was not worthy of consideration—just do them and let the budget pay for them, even to the detriment of other essential services.
In recent times, successive Secretaries of State for Northern Ireland have been happy to dip in and out of matters that were within the full competence of the Northern Ireland Assembly, but on an occasion requiring urgent action to alleviate suffering and anxiety within the community, they washed their hands in a Pilate fashion. The same applies to the appeal to have Dáithi’s law implemented. I trust that the Minister will tell his colleagues that, in light of the fact that the Assembly will not be functioning any time soon, action on important issues facing the community should be acted on and the necessary legislation should be brought forward to make a difference to the everyday lives of the people of Northern Ireland.
Lord Morrow (DUP)
My Lords, when you speak at this stage of a debate, there is not a lot left to say. I think some noble Lords, including the noble Baroness, Lady Foster, have been reading some of the material that I have been reading. So, while I have it all here, I will not repeat it, because that might take away from it.
I was very struck by the noble Baroness, Lady Ritchie, saying that the DUP was reacting disproportionately to the protocol. Well, I say to her that, when you tamper with the constitution of any country, having given a prior understanding and agreement that there will be no change without consulting the people of that country, you are asking for trouble—and that has happened in our country.
I am sure that as your Lordships have listened, you now have a fair idea of what is causing the severe hiatus in Northern Ireland. It is, of course, the Northern Ireland protocol. The Minister here should not be delivering this budget Bill. There is not one of us on these Benches who want it that way; we would prefer that it was done in Northern Ireland, by Northern Ireland Ministers. But the protocol is the wrecking ball that landed the Executive and Assembly in total chaos. We have to say, without any degree of satisfaction, that they will not be coming back until the protocol is dealt with. The sooner the Government apply themselves earnestly to that task, the sooner there is a chance that we will see the return of some semblance of democracy in Northern Ireland. We say to the Government this evening: please get your act together and deal with the protocol, and then the Minister will not be here at some future date delivering a budget Bill.
Delivering a budget Bill with a mandatory coalition is not a straightforward exercise by any stretch of the imagination. My own party held that position at one time, and Sinn Féin has held it, but the remarkable difference was that when my party, the DUP, held it, we were able to have consensus and get a finance Bill through the Assembly, but Sinn Féin could not get that. It is not just that Sinn Féin could not get it with the DUP; it could not get it with any of the parties, even the wonderful Alliance Party. That party could not agree to it either. The SDLP, I understand, could not agree to it, and the Ulster unionists could not agree to it. Any other party with any degree of influence in the Assembly could not agree to it, so it is not just that the DUP is being unreasonable.
The noble Lord, Lord Hain, above any other Peer in this House, should have a clear understanding of how difficult it is to get consensus and how to bring things on board. I have to say to him very directly that what he has put down this evening is the very way to wreck the whole show. I do not know whether he speaks for the Labour Party tonight. I know that the noble Lord, Lord Murphy, will speak a little later and clarify whether the noble Lord, Lord Hain, is speaking for the Labour Party with this amendment. However, he did go on to amend it slightly, saying, “No, I’m not going to move it to a vote, but I am warning you here tonight: if you don’t behave yourselves over there and don’t join the diktat, this is what will befall you”. It has been well articulated that this was never said during Sinn Féin’s three years of holding government to ransom.
I remember distinctly the howls from the Lib Dems—not those who are here tonight, I might add; I have a distinct memory of who they were, but they are not in their places tonight. We did not bring government down, but the onus was put on us, and they said to us at that time, “Can you not get on and get government done?” No, because we were not holding it up. I do accept, of course, that we are now, because of the protocol. The protocol has to be dealt with. If there is no other message that gets across tonight, I hope at least that those who have stayed for this debate will go home with a clear message: the protocol is the problem.
As I speak this evening, I do so in the knowledge that the Minister is a strong supporter of the police and of law and order. However, I must say that if the resources are not available, the police cannot deliver the service on the ground. The one bedrock and stability of any country is law and order. If you do not have law and order, you have very little. If you want to talk to us about the lack of it, and if you have a couple of hours after this debate, we will go through it all with you. We have endured 30 years of recklessness, murder and mayhem—but none of us wants that to revisit Northern Ireland ever again.
I had much to say on policing but the noble Baroness, Lady Foster, and the noble Lords, Lord McCrea and Lord Rogan, have stolen my thunder. All the facts and figures they have given, I have here too. I will spare your Lordships the repetition—I can see you thinking, “Thank goodness for that!”
The budget the police have been landed with will determine a smaller, less visible, less accessible, less responsible police force. I ask the Minister please to take that into account. I know that he will; I know that he cares about these things and about Northern Ireland, as passionately, sometimes, as we do. However, the impact this will have on the police force will be catastrophic.
Your Lordships will be pleased to know that I have nearly finished, but I want to refer you to what Liam Kelly, the chairman of the Police Federation for Northern Ireland, said in today’s paper:
“The difficulty we have in the police is that we have no choice but to accept it. We can’t take industrial action. There is no other process for us. We get what we are given and we are expected to be grateful for it on every occasion … Over the last ten years policing salaries have gone backwards. The starting salary [for a student officer] before this £1,900 uplift was just over £21,000, and our probationer officers were on just over £24,000.”
Yes, £24,000 is a lot of money, but not for the risks that police have to take, and they do have to take immense risks, even in what has already been described here as relative peace. Mr Kelly continued:
“It would take a police officer five years to get to £30,000. In the Northern Ireland context, and the threat to them on and off duty … there is no incentive for officers to stay in service and put their lives on the line when they are not being paid properly.”
As my noble friend Lady Foster mentioned, he said that the police are increasingly going to
“do other things for a lot less stress and hassle.”
Our health service is creaking at the hinges. Our education system, which produces excellent results far ahead of other regions of the United Kingdom, has to be financed properly if we are going to have an educated people who will take our country forward in the future.
Lord Weir of Ballyholme (DUP)
My Lords, given the lateness of the hour, I will try to curtail my remarks. The Minister will be delighted to hear that I will try to ensure that he can finish proceedings on the Bill by midnight, or 12.30 am at the latest.
Much has been said about the amendment of the noble Lord, Lord Hain. Despite a certain amount of backpedalling by the noble Lord to try to appear even-handed, it seems to many of us a fairly thinly veiled, one-sided attack on the position of unionists. [Interruption.] I hear chuntering from a sedentary position; as I said, it was thinly veiled. The position, I suppose, stands in contrast to the silence over a three-year period with regard to Sinn Féin, and over a 40-year period regarding its allowances in the Palace of Westminster. If someone tried effectively to bribe noble Lords or threaten them with the removal of salary, I think all would have the integrity to say no to that. I say broadly on behalf of the unionist community that no unionist or other person of integrity will be bribed, blackmailed or browbeaten into reducing or giving up strongly and passionately held principles for the sake of a few pounds. There is a very clear message there. Frankly, the amendment is ill judged.
Drawing from the budget Bill itself, three lessons can be learned. First is the importance of political stability. If we have learned anything over the last 25 years and beyond, it is that political stability in Northern Ireland can work only when we have the buy-in of both communities. Frankly, that will not happen until we see the replacement of the Northern Ireland protocol. It is not simply a matter of tinkering around with the implementation of it but of dealing with the fundamental problems: the democratic deficit; the lack of accountability; and the fact that, from a divergence point of view, Northern Ireland would be tied into regulations which are not simply going to be a problem on day one but will get greater and greater as time moves on. That is not simply a constitutional threat; it will be economically damaging to Northern Ireland.
At the moment, Northern Ireland is effectively being treated as a colony of the European Union. I appreciate that there are many in this House who will take a much more optimistic and sympathetic view of the EU than many who would be sympathetic to my views. If, out of generosity, we take that at face value and believe that the EU is trying to operate in the best interests of Northern Ireland, a benign colony is still a colony. That is what we need to address with the protocol. It is disappointing that we are in this position because up to this point there have been missed opportunities and wasted time.
It is eight months since the First Reading of the Northern Ireland Protocol Bill. It is 19 months since the Government’s Command Paper on the subject. It is just over three years since the Government, in the restoration of Stormont under the NDNA, gave a commitment to restore Northern Ireland’s place fully within the United Kingdom and the UK internal market. We cannot afford a situation in which we have another facade, where we produce any form of deal, but one which does not solve the problems.
The second lesson to be learned in relation to the budget is that there is a dire need—not just in Northern Ireland; it is a wider lesson for the whole of the UK—for public sector reform. We have seen in Northern Ireland the proposals of the Bengoa report. Within education, I and my successor brought forward the independent review on education. It is important that we all have the political courage to reform public services. Sometimes that will be painful for us but the key goal is the best possible delivery for all our citizens. Against that, there is a caveat: public sector reform does not come instantaneously and quite often comes with a price tag upfront. It is not an instant solution but nevertheless we must grasp it.
The third lesson is that we need to see public services that are adequately and fairly funded. Against the backdrop of the cost of living crisis, public services are very much falling behind. Mention has been made on a number of occasions of how generously Northern Ireland is treated in its finances. The same point could be made about a range of regions. However, as I am sure that Scottish and Welsh colleagues will testify, the convergence that happens because of the Barnett squeeze means that the figure reduces each year. We have reached a tipping point in which the objective needs of Northern Ireland, and indeed of other regions, are greater than what is being provided in finance.
Nowhere is that more acute than in education. That is why recently all four main Churches in Northern Ireland and all the major educational sectoral bodies warned of the situation we were being put in and that the Education Authority is so concerned about where the budget will be for next year. It was quite foolhardy of the Government to seek £110 million of savings in a three-month period from the Education Authority.
The cost of living has hit education so hard because around 90% of funding for education goes on necessary wages. Whatever efficiency savings you make, you cannot have a classroom without a teacher in front of it. As pressure for wage inflation builds up across the UK, it increases the burden. Much of the rest of education funding is on statutory responsibilities and legal entitlements, such as special educational needs, school transport and free school meals. As such, the room for manoeuvre is very limited in education. To keep its head above water in recent years, education has had to rely on in-year monitoring rounds to plug the gap. With pressures applying more and more on other departments in Northern Ireland, that money is simply not available.
The Minister of State in the other House highlighted how generously education was funded and referred to the additional amount that Northern Ireland had compared to the rest of the UK. But let me give one statistic. We have a very young population in Northern Ireland, and the number of state school pupils per head is 26% higher than in the rest of the United Kingdom. That highlights the level of pressure there. I ask the Minister—and I ask for a written reply, given both the time and the level of detail—if he can directly outline from government figures the level of funding per pupil for each jurisdiction of the UK, the level of statementing for each jurisdiction and the level of SEN spend, which is a legal statutory requirement. Given the additional need, can he tell me the number and percentage of pupils on free school meals in different parts of the United Kingdom?
It is undoubtably the case that we are facing a very dangerous situation for education in Northern Ireland. Education is the driver of Northern Ireland’s future. It is key to the economy and to skills, but above all education is the one intervention in people’s lives that can make all the difference. It is a great game-changer for our children, and if we do not invest in our education we will be in a dire situation. I have outlined a range of interventions in this speech that will need to happen or else we will head into a terrible crisis—not simply for education but for the whole of public services within Northern Ireland.
Baroness Suttie (LD)
My Lords, this has been a wide-ranging if slightly depressing debate. Given the hour, I shall be very succinct in my response. This debate should of course not be taking place here in Westminster. Like many speakers, I very much regret that it is not taking place in the Northern Ireland Assembly. In that regard, I fully agree with what the noble Lord, Lord Hain, actually said—as opposed to what was thought in advance that he might say—even if I do not agree with all of his amendment.
It is now a full year since last February, when the Executive collapsed, and this Bill, however regrettable, is necessary to secure continued delivery of public services in Northern Ireland. However, we are primarily discussing, post fact, things that have already been decided. If an Executive had been in place in Northern Ireland, they would have been planning the budget for the coming financial year to March 2024. As I understand it, Clauses 8 and 9 of the Bill authorise a limited amount of spending for that time period. As the noble Baroness, Lady Ritchie, asked, I would be grateful if the Minister could confirm when he concludes how this will work in practice.
As other noble Lords have said, tough decisions will have to be made, particularly on health and education. It is very difficult, and indeed not appropriate, for civil servants to make many of these decisions. We have heard powerful speeches from many noble Lords about the state of healthcare provision and education in Northern Ireland. Healthcare in particular is something about which we should all be concerned. If an Executive had been in place, they would not have found an instant solution but they could have provided the framework for key and difficult decisions in the months ahead in Northern Ireland.
I feel that one of the most tragic things about the lack of an Executive is the inability to plan and move society forwards in Northern Ireland. The debate this evening has perhaps shown quite how much the debate is about looking back, not forwards. My honourable friend Stephen Farry MP made a very powerful speech on this during the debate on the Bill in the House of Commons last month.
The cost of trying to manage a divided society, and from duplication of facilities, is estimated at between £400 million and £800 million per year. This is money that could so usefully be spent on health, education and other public services. But, as other noble Lords have said, measures to reduce wasting limited resources in Northern Ireland would require brave political leadership and strategic planning. This cannot be carried out in the absence of a functioning and stable Executive.
I will say a little to the Minister about fast-tracking and transparency. I am sure that everybody who has taken part in this debate will agree that the scrutiny process on the Bill is very far from ideal. Obviously the vast majority of us hope for a workable deal on the protocol and a return to a functioning Executive in Northern Ireland. But, in the continued absence of both, can the Minister say whether thought is being given to allowing greater transparency and political input to the budgetary process, perhaps through allowing the Select Committees on Northern Ireland in both Houses to play a greater and timely role?
Finally, we have heard four speeches this evening from the noble Lords of the DUP. The noble Lord, Lord Bew, made a very interesting speech about some of the implications of the continued absence of an Executive. I say respectfully to the noble Lords sitting opposite that it is now nearly nine months since the elections to the Assembly last year, and it is very hard to see how this continued stalemate is serving anyone, least of all the ordinary people of Northern Ireland and the Northern Ireland business community, who continue to face such uncertainty. Most of all, in my view, it does not serve the political interests of Northern Ireland to be missing a strong voice from the Northern Ireland Executive at this critical time.
Lord Murphy of Torfaen (Lab)
My Lords, it has been a long night and a difficult debate on difficult issues. I begin by wishing the noble Lord, Lord Empey, who is not in his place, and his family all the very best in the weeks ahead. He is a very old friend: I have known him for 27 years. I hope all goes reasonably well.
We support the Bill; we cannot do anything else. Without it, there is no money or Government in Northern Ireland. But, obviously, we wanted the budget to be decided by the elected representatives of the people of Northern Ireland, in Northern Ireland, in the Assembly, with a Northern Ireland Executive. For a place that has roughly 2 million people, twenty-seven thousand million pounds is a lot of money.
While I understand the arguments made by the Minister, and the Minister of State in the other place, that there have been financial difficulties in Northern Ireland—of course there have, and I do not want to comment on individual Ministers or parties in Northern Ireland—it is not the whole story. After all, as a Labour Party Opposition, we would argue that, in Wales, Scotland or Northern Ireland—or England, for that matter—there have been 10 years of underfunding for our public services. If you look at the budget of Wales or Scotland for comparison, they too will argue that they do not have enough money—to pay their nurses in the current dispute, for example. Of course, recent economic circumstances have not exactly been very happy. The tightness of the Budget that the current Chancellor of the Exchequer has to impose because of the utter inadequacy and incompetence of Ms Truss and her Government means that there are difficulties there too.
On a more technical but important level, some of your Lordships have mentioned the Barnett formula, which I had to live with for 20 years as a Minister for Wales and for Northern Ireland. It is inadequate and there is a Barnett squeeze, but I will say this: the Barnett formula has been changed for the people of Wales, in terms of the different formulae to deal with poverty and all the rest of it. Were that change in the mechanism by which the block grant operates to be transferred to Northern Ireland, it would receive £150 million more than it currently does. That is worth looking at. If the Minister cannot comment in his winding-up speech, I ask him to come back to me.
As the Northern Ireland Fiscal Council has said, inflation, pressures on pay and the pandemic have all meant that financial pressures in Northern Ireland have been considerable. The other very interesting point that this serious and important council has made over the past couple of weeks is that the financial problems the Minister described could have been addressed very differently had an Assembly been functioning. There are no Ministers to look at the way their departments are funded. A departmental Minister in Northern Ireland —there are at least four former Ministers here, and, of course, a former First Minister—would look at their budget every day. I was the Finance Minister in Northern Ireland for two years. My job was to be unpleasant with my colleagues, as all Finance Ministers are. My noble friend Lady Smith will testify to my unpleasantness on financial matters. We would intervene and say, “You shouldn’t be spending there”, or, “You should look at your budgets there”, and so on. But there is no Finance Minister in Northern Ireland. There is no scrutiny by an Assembly. Not one single committee of Members of the Assembly can get together to scrutinise the budget. There are no normal procedures, so if you do not have an Assembly and an Executive then your financial pressures will be even greater.
Every single Member of your Lordships’ House from Northern Ireland has quite rightly looked at the problems that public services face there. The obvious one is the health service. It is indescribably bad because of a lack of money and a lack of reform. Your Lordships have quite rightly mentioned the importance of education in Northern Ireland. If noble Lords were to look through New Decade, New Approach in detail, as I did this morning, they would see the number of projects that require financing and the number of issues that are really important public services, from capital spending to revenue spending in Northern Ireland. It is absolutely immense.
However, we should not expect British Ministers to resolve these issues. We are in a sort of no man’s land, with neither direct rule nor rule from Belfast; we are somewhere in the middle. It is the worst of all worlds, in some respects, because when we were direct Ministers— I was called the direct ruler by another party in Northern Ireland; I never felt that I was a direct ruler when I was there, but that was what they called me—I did not want to rule in Northern Ireland. I wanted the people of Northern Ireland, through their elected representatives, to take decisions. Why should a Welsh MP go across the Irish Sea and tell the people of Northern Ireland how to spend their money? No—of course that it is for them to decide.
The resolution of all this is the restoration of the Executive and the Assembly. I fully understand why they are not being resurrected, because of the difficulties around the Northern Ireland protocol and, indeed, the quite proper assertion by the unionist community that you need consensus right across the board to achieve progress in Northern Ireland. Of course that is not there, but at the same time it is important to understand that nationalists and people who support the Alliance Party might feel differently. The answer is that we have to get a resolution across all that.
My noble friend Lord Hain has introduced his amendment. He does not intend to put it to a vote. It is not Labour Party policy—a number of your Lordships asked that. It is the personal view of my noble friend, but it expresses his frustration, as all of us are expressing our frustration, at the lack of progress. We cannot complain that our schools are crumbling, our hospitals are not working and that proper attention is not given to waiting lists unless we are prepared to govern, and there is no proper Government in Northern Ireland at the moment, and the resolution has to be there for negotiation.
I am in Brussels tomorrow to talk about the Good Friday agreement and undoubtedly this issue will come up there. Where are we with those negotiations? I know it is a secret and we are not supposed to talk about it, but we ought to be told if they are talking and if some sort of progress has been made in Brussels. It is a twofold negotiation as well. It is not just between the United Kingdom Government and the European Union. There should also be simultaneous discussions—and proper, structured ones too—between the Government and the Irish Government, if you like, as they are co-guarantors of the agreement, with all the political parties in Northern Ireland. There has to come a time when, eventually, we will have to decide about all these issues—but will we decide them by 10 April? It does not look like it at the moment. I hope we can, but the only answer is proper, intense negotiation with proper attention to these issues. We cannot allow this to drift any longer.
The Parliamentary Under-Secretary of State, Northern Ireland Office (Lord Caine) (Con)
My Lords, before I reply to the debate, I associate myself with all the comments that have been made about my noble friend Lord Empey—and he is very much my noble friend. I have known him since the 1980s, and he was one of my two supporters when I took my seat in your Lordships’ House. I think we all wish him and his family all the very best.
I thank all those who have taken part in this evening’s debate. If I can begin on a note of consensus, I think it is clear across the House that there is agreement that most noble Lords would prefer that these decisions were being taken in Stormont, not here in Westminster. I think there is also a consensus that we want to see the institutions in Northern Ireland restored as quickly as possible, although there might be disagreements about how we get there and what might need to be done. I am pleased that most noble Lords recognise that it is the right and responsible thing for His Majesty’s Government to intervene in these matters and take legislative action on a budget for Northern Ireland in order to maintain the delivery of public services.
I went over at some length the background and context for the setting of the budget and said something about the process for the setting of the budget in my opening comments and, at the risk of not rising to the challenge of my noble friend Lord Weir of Ballyholme to keep us here until half past midnight at the earliest, I will resist going over all those points again.
I shall speak first to the two amendments to the Motion that have been tabled. The first one is in the name of the noble Lord, Lord Hain, the former Secretary of State for Northern Ireland. I understand the frustrations with the current situation that have led him to table his amendment. He will not be surprised to hear that His Majesty’s Government cannot accept it. What he is putting forward would involve significant changes to the process of Executive formation in Northern Ireland at a time when the priority of the Government is to get those institutions back up and running, and his amendment could be perceived, as I think it was by a number of noble Lords behind me, as tilting the playing field significantly against one party, which might have the effect of frustrating our objectives.
As the noble Lord will be fully aware, it is essential that any changes to institutional arrangements in Northern Ireland require “sufficient consensus” right across the community—that is the phrase used. This approach has underpinned political negotiations and discussions in Northern Ireland since the spring of 1996 and, of course, these were the rules under which the noble Lord would have operated at St Andrews in 2006.
One of the consequences of the noble Lord’s amendment would be to make it more difficult for any political parties in Northern Ireland that might wish to go into opposition. Arrangements for opposition were included in the Stormont House agreement, the Fresh Start agreement and New Decade, New Approach. I am sure it is not his intention, but the wording of his amendment would make it difficult for any party to take up that option—which I think the SDLP has already signalled that it would do if the Assembly came back.
On MLA pay, I recognise that the noble Lord, when he was Secretary of State in 2006, proposed at one point to withdraw all the salaries from Members of the Assembly. The current Secretary of State has cut MLA pay by 27.5%. The cut came into effect on 1 January and applies to all Members of the Assembly equally. The Government are mindful that MLAs do perform certain functions. However, we keep the situation under review, and in that spirit I trust that the noble Lord will be prepared to withdraw his amendment.
I fully understand the sentiments behind the amendment in the name of my noble friend Lord Dodds of Duncairn, as well as the arguments put forward in support of it by the majority of noble Lords who have spoken in the debate. I am sure he is fully aware of my views on this subject, both as a Back-Bencher in 2019 and as a member of the European sub-committee on the protocol, on which I served with him before I was appointed to this role.
As the noble Baroness, Lady Ritchie of Downpatrick, said, there are of course sectors for which the protocol is working well. She referred to my recent visit to Lakeland Dairies and my meeting with the Dairy Council; I am very glad she keeps tabs on my meetings and progress across Northern Ireland. In their conversations with me, they were very clear that the EU single market access provided for in the protocol by the current arrangements are not just desirable but essential for their businesses. As I said during the debates on the protocol Bill, we are committed to preserving those elements and advantages.
At the same time, however, the Government are well aware of the damaging impacts that implementation of the protocol has had, both in Northern Ireland and in Great Britain. If I can summarise the effects in this way, it has led to a diversion of trade, it has disadvantaged consumers, it has led to increased burdens on business—as we heard from a number of noble Lords—and of course it has created political instability, as evidenced by the fact that we are having this debate here because we have had no functioning Northern Ireland Executive or Assembly for much of the past year.
In short, as my noble friends Lord Dodds of Duncairn and, if I can refer to her as such, my noble friend Lady Foster—I think this is the first time we have debated together in the Chamber since she joined the House; I am very pleased she is here—made clear, and I agree with them, a protocol designed to avoid a hard border on the island of Ireland and protect the 1998 agreement in all its parts is now placing that agreement under severe strain at a time when we are about to mark its 25th anniversary. For those of us in your Lordships’ House who have been consistent in our support for that agreement since 10 April 1998, that is not a very comfortable position to be in.
It is therefore imperative that, while preserving aspects of the protocol that work, we are able to remedy or fix those that do not. Noble Lords are well aware—some of these issues were raised this evening—from our extensive debates on the protocol Bill, that the Government have put forward a number of detailed proposals, including the so-called green and red channels, to which noble Lords referred earlier, so that those goods entering Northern Ireland from Great Britain and which will never leave the United Kingdom will not be subject to the checks on goods that will enter the European Union single market. Again, in direct response to a number of comments that have been made, we are also clear that any resolution to the protocol must deal with issues around governance and with the democratic deficit that it has created.
As has been said many times, the Government’s clear preference is for a negotiated settlement with the EU on these matters. I am sorry to disappoint the noble Baroness, Lady Ritchie of Downpatrick, and indeed the noble Lord, Lord Murphy of Torfaen, but I cannot give more detail or comment on what is currently being discussed with the European Union or indeed any of the speculation that has appeared in recent weeks in certain newspapers—other than to say that we very much hope that agreement can be reached; that is our focus. If that is not the case, we are clear that we will take forward the legislation to ensure that we have the powers to take whatever action is necessary to resolve these matters. Let me be very clear: we need a solution that respects the integrity of the EU single market, the integrity of the UK internal market and, of course, Northern Ireland’s position as an integral part of our United Kingdom. I do not think I can be any clearer than that.
On the debate itself, I have set out the context and background for the budget. In his concluding remarks, the noble Lord, Lord Murphy of Torfaen, referred to a lack of money and 10 years of so-called austerity. I generally like to agree with the noble Lord on most things, but on this I remind him, as I said at the outset, that spending per head in Northern Ireland is already the highest in any UK region. In 2021, the spending review settlement gave Northern Ireland record levels of funding. Indeed, the Fiscal Council to which he referred said at the time that the settlement would have enabled the Executive to set three-year budgets giving far greater certainty than we have had in recent years.
I will quickly read out some of the things that we have done in addition in the last number of years. In 2013, just before we brought the G8 to Northern Ireland, we made available £300 million in additional borrowing power through the building a prosperous and united community package. We invested almost £2 billion in additional spending power for Northern Ireland as a result of the Stormont House agreement of 2014. We invested a further £500 million through fresh start, £2.5 million of financial support and flexibility through the confidence and supply agreement in 2017 and, more recently, over £3.5 billion through the new deal, city and growth deals, PEACE PLUS and the New Decade, New Approach financial package, which the noble Lord referred to earlier. The noble Lord mentioned the large number of commitments in that document. Every six months, I publish an update on progress—actually in response to a request from his noble friend, the noble Lord, Lord Coaker, when we were going through previous legislation. He can track the progress of the implementation of those commitments through that.
In response to my noble friend Lord Rogan, we are investing over £250 million through the Levelling Up Fund, the UK Shared Prosperity Fund and the Community Ownership Fund. On levelling up specifically, ultimately those are decisions for the Department for Levelling Up, Housing and Communities, but I will make sure that my noble friend Lady Scott is aware of my noble friend’s comments.
I am conscious of time. The debate ranged over a number of issues, particularly health, education, policing and the current governance arrangements for Northern Ireland. I reiterate the top line: health has received an extra £768 million and education an extra £300 million, and the Department of Justice has received an uplift of around 3.1% in this Budget. In addition to the money through the block grant that is spent by the Department of Finance, noble Lords will be aware of the Government’s ongoing commitment to additional security funding, which is around £32 million this year and helps the Police Service of Northern Ireland to combat the ongoing threat of terrorism.
I therefore dispute some of the assertions made about this Budget, but it was of course drawn up through discussion with the Northern Ireland Civil Service, and a number of the priorities to which noble Lords have referred will be matters for the departments to determine, not the Northern Ireland Office. I am conscious that a number of detailed points were put to me during the debate about individual allocations. With the indulgence of the House, rather than detain us until a very late hour, if noble Lords will permit I will write in detail on each of the issues raised today.
On governance and Civil Service decisions, I made it clear during the passage of the executive formation Act before Christmas that this is not a long-term solution or fix. Of course noble Lords would expect me to say this, but the priority is Executive formation and getting institutions back up and running. In direct response to the noble Lord, Lord Murphy of Torfaen, of course we need a plan. My noble friend has had a number of round tables with the Northern Ireland political parties in recent weeks, and I fully expect those to continue shortly. So we are engaging and doing everything possible to try, alongside negotiations with the EU, to talk to political parties in Northern Ireland with a view to ensuring that, should we be successful in our discussions with the EU, we can bring about the restoration of the institutions that most of us in this House want to see. On that note, I draw my remarks to a close.
Lord Hain (Lab)
My Lords, my speech was written days ago. I did not rewrite it; it said exactly what I intended to say, although some critics seem to have imagined that I was trying to say something else. I was not speaking for the Labour Front Bench nor claiming to; I was speaking as a former Secretary of State for Northern Ireland who cares deeply about Northern Ireland and is desperately worried about the implications of yet another suspension for the democratic legitimacy of the carefully constructed politics of Northern Ireland, and for the voters of Northern Ireland—younger ones especially, who have become increasingly cynical about politics. We have to be extremely careful about that.
I enjoyed listening to the speech by the noble Baroness, Lady Foster. It was good to hear her speaking with such authority and expertise as a former First Minister, and I look forward to hearing much more.
The noble Lord, Lord Dodds, was, as always, an able and persuasive advocate of his unionist cause. He is right that no such Motion, amendment or anything else was tabled when Sinn Féin collapsed the Executive. All I can say in mitigation is that I did not think this was going to become a habit, which is what concerns me. Also, in 2006 I not only threatened to withdraw salaries, expenses and funding for the parties, but gave notice under employment law to all employees in the Executive of Assembly Members that unless we made progress, which we did at St Andrews, that would all be withdrawn. That was applied to every party and was not discriminatory.
Nobody wants to chuck out the Good Friday agreement, least of all a former Labour Secretary of State, since we negotiated it. My participation in the 2007 settlement between the DUP and Sinn Féin, primarily, cemented that into self-government.
At no time have I attacked the DUP for its stance over withdrawing from the Executive. You will not find me criticising the DUP anywhere in Hansard—in the House of Lords reports—or in broadcast or media interviews. I understand its position and why its members felt the protocol was a betrayal of the unionist cause. Where I have been critical is that this whole mess was created by Brexit, and by a hard Brexit. Noble Lords would expect me to say that, as an unadulterated remainer, but I did warn about it. I was always worried about this kind of consequence and that is why I agree, as I think we all do, that the priority now is to get a deal with the European Union on the protocol and resolve all the issues. To use Jeffrey Donaldson’s phrase, we should sort the protocol; I agree with that.
We have to ensure that this current impasse does not become some kind of permanent, ongoing thing. That is the danger in having repeated collapses of the Executive. Next time, it could be Sinn Féin for some reason or other; it has done it before and could do it again. We have to be extremely careful to construct an agenda by consent. If that needs an amendment to the Good Friday agreement, it would have to be by cross-party consent, of course. That may not be possible but we cannot have these repeated collapses of the Administration. That was the purpose of this amendment, which is why I moved it, but I am now happy to withdraw it.
Lord Dodds of Duncairn
At end insert “but this House regrets that the bill is necessary given the imposition of the Protocol on Ireland/Northern Ireland which (1) is incompatible with the Belfast Agreement, as amended by the St Andrews Agreement, because it breaches the principle of consent, undermines the three stranded basis of the political process in Northern Ireland and cross-community voting mechanism of the Northern Ireland Assembly, (2) is undemocratic given that the laws in Northern Ireland are made by a foreign political entity in its interests with no vote by any elected representative of the people of Northern Ireland, (3) is contrary to the New Decade, New Approach Agreement by giving effect to a customs and regulatory border that divided the United Kingdom, and (4) is injurious to Northern Ireland’s constitutional position as part of the United Kingdom”.
Lord Caine (Con)
My Lords, I thank once again all noble Lords who have participated this evening. I place on record my sincere gratitude and thanks to the Northern Ireland Civil Service for the way in which it has co-operated with His Majesty’s Government, and to my own officials in the Northern Ireland Office for their incredible hard work in putting together a budget for Northern Ireland in these very difficult circumstances. I am sure I speak for the whole House in hoping that we will not have to be in this position ever again.