Lack of budget ‘jeopardising public services’ in Northern Ireland

The lack of a budget in Northern Ireland is jeopardising the delivery of key services, the heads of more than 50 public sector bodies have warned.

The Public Sector Chairs’ Forum, which represents public bodies across the region, has written to Northern Ireland Secretary Chris Heaton-Harris calling on him to act urgently.

The body also said its members were alarmed by the potential impact of “drastic reductions” on public services.

In the absence of devolved Stormont ministers, Mr Heaton-Harris is responsible for setting the budget, in which several departments are facing large cuts.

Permanent secretaries, who are currently running Stormont departments, have been asked to find savings.

No date has currently been set for the budget.

In the letter from the forum chair, Nicole Lappin, it is warned that an “outline financial envelope representing up to 20% reductions on 2022-23 spending has been indicated”.

It added: “Members are alarmed by the potential impact of such drastic reductions, which is exacerbated by the uncertainty brought about by the lack of a definitive budget.

“This non-strategic approach is neither practical nor cost-effective and is jeopardising our ability both to deliver key services and support their essential transformation.

“In the absence of locally elected ministers, the legal responsibility to set a budget for Northern Ireland falls to you.

“Following considerable discussion, members are therefore taking the unprecedented step of writing to call on you to act urgently and provide a strategic and manageable way forward.”

The letter continued: “Given that we are already one month into the financial year, we call on you to provide urgent clarity.”

A leaked Northern Ireland Office briefing paper recently estimated the devolved executive is losing £700 million a year by failing to charge for services like domestic water supply, prescriptions, domiciliary care, transport for the over-60s and having significantly lower university tuition fees than England.

When local ministers left office last year, Stormont was facing a £600 million black hole.

Civil servants were forced to make a range of in-year savings and the Treasury provided a £300 million advance down-payment on the current financial year’s block grant to help bridge the financial gap.

However, that £300 million will have to recouped in the current financial year.

The briefing paper estimated that £345 million could be generated by introducing domestic water charges, while raising tuition fees could bring in an additional £145 million a year.

The document said Northern Ireland is receiving 21% more per head of population than England for the period 2022-25.

DUP MP Gavin Robinson said there had to be a reform of how Northern Ireland is funded.

He said: “The primary problem is not a lack of Stormont, it is a lack of money. That is a decision made by Treasury.

“I have been warning for some time that the Barnett Formula used for divvying up the budget for the UK regions is unfair to Northern Ireland and will continue to get even worse in coming years.

“There needs to be a complete reform of the funding model.

“The Treasury contribution to fund public services in Northern Ireland is going down rather than rising.

“As an example, in England up to 2025, spending will increase by 6% but only 3.6% in Northern Ireland.”

Mr Robinson added: “The cost of providing public services for a small place is more expensive than a large one.

“We don’t benefit from economies of scale or critical mass.

“To provide vital services, we need a disproportionately larger public service, and for as long as we receive 3% of what England needs under the Barnett formula, we won’t and don’t get enough.”