NI Finance Minister presses Sunak for spending flexibility and budget certainty

Stormont’s Finance Minister has pressed Chancellor Rishi Sunak for spending flexibility and certainty to both cope with coronavirus and prepare for Brexit.

Conor Murphy expressed his concern in a statement to the Northern Ireland Assembly about the “continued lack of clarity” over the upcoming spending review following the cancellation of the autumn budget.

He urged a date for the concluding of the spending review and the involvement of the devolved regions in the process.

“The spending review outcome is the first time that we would get an idea of what the overarching budget envelope will be for the Executive for the coming years. Without that information, it is impossible plan effectively,” he told MLAs.

“The delay in the spending review leads to delay in the local budget process, making it harder for ministers to plan effectively for the years ahead. This is made all the more acute by the uncertainty around Covid-19.”

Mr Murphy said he has spoken to the Scottish and Welsh finance ministers, and added that they share his concerns.

“Today, we are collectively asking the British Government to provide a full suite of flexibilities we need to manage the unprecedented ongoing uncertainty that we are facing,” he said.

Finance Minister @conormurphysf calls for greater action and fiscal flexibility from the Chancellor to deal with COVID and Brexit.

— Dept of Finance (@dptfinance) October 6, 2020

Mr Murphy said different regions may need different solutions, but for Northern Ireland he is asking for flexibility to transfer capital funding into resource budgets.

“This will allow the Executive the agility it needs to respond to changes that would materially impact public service provision,” he said.

“In addition, I am calling for the Treasury to loosen the restrictions around transferring funding from one year to the next.

“Under the current rules, any under spend over 0.6% of our resource DEL budget or 1.5% of our capital DEL budget is lost to the Executive. This restriction does not encourage good financial management and risks year-end surges of spend as departments seek to ensure budgets are maximised.”

Mr Murphy added: “The concerns that I’ve outlined are further exacerbated by Brexit. Planning for 2021 will be challenging enough without the further uncertainty surrounding Brexit – and certainly that is within the British Government to clarify.

“Some three months before the end of the transition period we do not have the clarity we need on key issues such as implementing the protocol and replacing EU funding.

“I have written to the Treasury outlining the costs of implementing the protocol and I’ve yet to receive confirmation that those costs will be met by the British Government, as they promised to do so.”