We have no cash to fund a recovery, says Murphy
Financial prospects look bleak as Minister announces draft budget
FINANCE Minister Conor Murphy has announced a “difficult draft budget” and admitted that he does not have enough funding to deliver economic recovery following the Treasury’s spending review.
The Executive’s response to Covid-19 has been allocated £538m, compared to more than the £3bn received last year.
Seventy per cent of that funding — £380m — will go to the Department of Health, with £30.6m for the Department of Education to help low-income families and £700,000 towards higher education.
Major infrastructure projects such as the A5 and A6, along with Casement Park, will secure £1.75bn of capital spending.
But the Sinn Fein minister said: “It is difficult and effectively a standstill of our 2020-21 budget position.
“With increased demands on public services, and taking account of inflation, it will be a challenge merely to deliver existing services at their current levels.
“I recognise for most departments the draft budget outcome represents flat cash settlement, which will mean effective reductions once increased costs and demands on services are taken into account.
“Choices will have to be made, public services will have to be prioritised.”
Funding for welfare reform mitigations, and for special education needs, has been prioritised.
However, Mr Murphy said Northern Ireland Secretary Brandon Lewis had not confirmed several previously agreed financial packages worth £254.4m in the 2021/22 financial year.
These include funding from the confidence and supply deal, city deals and New Decade, New Approach money.
He said this meant they could not be formally allocated as part of the draft budget.
“I hope that the Secretary of State will confirm these important funds in time for them to be incorporated into a final budget in the coming weeks,” he added.
While Stormont has the option of increasing revenue through the regional rates, Mr Murphy said it had opted not to do so.
“This financial year we reduced business rates by 18% and froze domestic rates. Next year we intend to freeze the regional rates for both households and businesses,” he said.
There is continuing stalemate between Stormont and Westminster
over the compensation scheme for Troubles victims.
Mr Murphy said London should fund the payments — which could cost £800m — because the legislation was passed at Westminster.
But in a statement last night, the NIO said the Secretary of State “has always been clear” that Stormont must fund it.
Ulster Unionist leader Steve Aiken said Mr Murphy’s draft budget failed to adequately support the health service. He added: “It is also very concerning that the draft budget doesn’t include provision for the Victims’ Pension Scheme. This will cause dismay in the wider community.
“Are victims going to have to go back to court again to force (Stormont) to pay innocent victims what they are owed?
“The Executive must make urgent moves to ensure that innocent victims get the payments which they deserve.
“The fact that this budget is being proposed without a programme for government shows the degree of dysfunctionality that still exists at the core of our government.”