EXTRA £660m FOR NI
BROKENSHIRE HOPES BUDGET BOOST WILL AID TALKS PROCESS
DEVOLVED ministers should be taking key decisions on Northern Ireland spending, the Secretary of State has said.
James Brokenshire was speaking after the region was allocated an extra £660m in yesterday’s Budget.
Chancellor Philip Hammond announced £540m for infrastructure here over the next four years. Day-to-day spending will also increase by £120m, although when inflation is taken into account it will mean a reduction in real terms.
Mr Brokenshire urged Stormont’s politicians to resolve their differences so they could return to making “local decisions for local people”.
“At the moment, as we all know, Northern Ireland is being run by the Civil Service,” he said.
“They have been doing a tremendous job in maintaining public services and ensuring that things do continue.
“What we want to see is an Executive in place, an Executive that is able to harness the benefits of the Budget that the Chancellor has announced today, to make those local decisions for local people.”
In a speech lasting more than an hour, the Chancellor gave a sobering assessment of the economy, saying it is expected to grow more slowly than previously thought.
Putting measures to tackle the UK’s housing crisis at the centre of his Budget, Mr Hammond said he was scrapping stamp duty for the first £300,000 spent by first-time buyers, a saving of up to £5,000. The cut will apply to buyers in England, Wales and Northern Ireland.
Locally, the Budget also included a review on tourism VAT and short haul Air Passenger Duty (APD), fulfilling a promise by the Conservative Party as part of its confidence and supply deal with the DUP following June’s snap election.
The Chancellor also announced a consultation on a city deal for Belfast. This would allow the city to have powers to create economic growth, help businesses grow and decide how public money should be spent.
However, SDLP leader Colum Eastwood said it was “a disgrace” that Mr Hammond did not announce a similar deal for Londonderry. The Chancellor also:
Set out plans to hike road tax for diesel cars.
Set aside £3billion to prepare for Brexit.
Addressed concerns about the impact of Universal Credit.
But in a sign of the economic difficulties facing the UK, Mr Hammond said the Office for Budget Responsibility had downgraded growth forecasts across the next five years.
Labour leader Jeremy Corbyn condemned the Budget, saying it was a “record of failure with a forecast of more to come”. He cited falling wages and added that economic growth in the first three quarters of this year was the lowest since 2009.
The Chancellor’s room for manoeuvre has been limited by grim economic forecasts from the OBR as a result of the UK’s poor productivity.
The OBR now expects to see GDP grow 1.5% in 2017 — down from the 2% forecast in March — 1.4% in 2018, 1.3% in both 2019 and 2020, before picking back up to 1.5% in 2021, and 1.6% in 2022.
Borrowing is forecast to be £49.9bn this year — £8.4bn lower than forecast at the Spring Budget — and will fall every year to £25.6bn in 2022-23 — “its lowest level in 20 years”.
As a percentage of GDP, debt will peak at 86.5% this year before falling to 79.1% in 2022-23 — “the first sustained decline in debt in 17 years”.
Despite the tight finances, Mr Hammond set out a series of spending measures including an emergency cash injection for the NHS, with £350m to cope this winter.
He also indicated extra money could be available if the cap on NHS staff pay rises is lifted and set out plans for a £10bn programme of capital investment until 2022.
But Mr Hammond also acknowledged that “the NHS is under pressure right now” and announced £2.8bn of funding up to 2019-20.
However, there was no mention of social care, the issue at the heart of the Tory election campaign’s troubles.
Critics from across the Commons have put pressure on Mr Hammond to act on universal credit and in response he announced a £1.5bn package, including the removal of the seven-day waiting period applied at the beginning of a benefit claim.
The National Living Wage will rise 4.4% from April from £7.50 an hour to £7.83.
There was good news on booze as the Chancellor said most duties would be frozen but he revealed there would be an increase for high-strength “socalled white ciders”.
Smokers were also hit with an extra 1% duty on hand rolling tobacco this year on top of the normal annual duty increases. For motorists, the Chancellor confirmed the annual fuel duty rise for both petrol and diesel would be cancelled again.
But drivers of new diesel cars will face higher taxes unless their vehicles meet the toughest emissions standards. For air travellers, Mr Hammond announced another freeze on shorthaul duty and long-haul economy rates, funded by an increase in tax on premium class tickets and private jets.