Belfast Telegraph

Wednesday 23 July 2014

£80m will be lost unless Stormont urgently decides how to spend it

Concern: Peter Robinson

Northern Ireland will lose £80m from its Budget unless Stormont ministers agree on spending decisions within days.

And that figure does not include fines already being imposed on the Executive over the failure to implement welfare reform – which amount to more than £34m so far.

The additional £80m already earmarked for capital projects, which comes from money left unspent by a number of departments, will have to be handed back to the Treasury.

And a number of other projects due to financed out of current spending will have to be suspended or abandoned.

The ongoing delay could also throw departmental accounting procedures into chaos.

Ministers yesterday failed to agree whether, and which, departments should face cuts to their budgets and where underspends by some of the departments should be transferred.

Despite weeks of behind-the-scenes talks between the five parties, there was no official paper of proposals to be put to yesterday's Executive meeting and sources said the discussion on the issue was relatively short.

Now the DUP and Sinn Fein must begin fresh negotiations between them, with Finance Minister Simon Hamilton insisting decisions must be made "within days".

There would then have to be a further Executive meeting to ratify any agreement, probably next week, and possibly the recall of the Assembly – made more difficult by the looming Twelfth fortnight and many MLAs starting their holidays.

First Minister Peter Robinson said it would be "absurd" if the £80m for capital projects had to be surrendered to the Treasury – and admitted the failure to make decisions at yesterday's two-hour meeting had the potential for "very serious repercussions".

Justice Minister David Ford said the failure to agree had made things "very difficult" for all departments, not least his own.

"There are major concerns about the potential effects of this on all of our budgets. We need to get these decisions taken," he said.

But Sinn Fein ministers John O'Dowd (Education), Caral Ni Chuilin (Arts, Culture and Leisure) and Michelle O'Neill (Agriculture) said the proposals arising from the latest quarterly monitoring round of spending proposals were "unacceptable".

As a result of the failure to implement welfare reform, the penalties imposed by the UK Treasury so far amount to £13m by the end of the last financial year in March and around £7.2m for every month since – a total of £34.6m.

Mr Hamilton has revealed that by the next financial year, 2015/16, the penalties will rise to £9.5m every month.

Northern Ireland is now like a society living on a loan from Wonga

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