Belfast Telegraph

Public spending cuts to get worse, warns Finance Minister Simon Hamilton

Public spending cuts in Northern Ireland will get much worse before they get better, the Finance Minister has warned.

In a grim assessment, the DUP's Simon Hamilton said that although the economy was starting to recover, public spending "won't do the same" and further challenges lie ahead.

He said that in real terms, Stormont will have £300m less to spend in 2015/16 than it will in the incoming financial year – and wrangling over welfare reform was making a bad situation worse.

"It is becoming increasingly clear that the next number of years will eclipse even the last four years of austerity," he told the annual dinner of the Chartered Accountants Ulster Society.

"I don't like having to issue stark warnings about the future. But I wouldn't be doing my job if I give people the impression that just because the economy is improving, public spending will automatically see the benefit."

His words come ahead of the Chancellor's Budget Statement next week and on the same day the Driver and Vehicle Agency announced the loss of 300 jobs in Northern Ireland.

The minister said there was an urgent need to change the way public services were delivered.

He said if there is a 'positive' to more years of austerity, it is that it "encourages us to focus on and face up to the choice before us".

He added: "We can choose the path that sees government protect itself by pushing the pain towards the people through crude cuts to public services. Or we can embrace the opportunity that crisis and challenge presents to do things differently."

Mr Hamilton also took a swipe at Sinn Fein for opposing welfare reform measures.

"The situation is complicated further by the immaturity of some parties in the Executive who refuse to face the reality of welfare reform.

"Northern Ireland has already lost £15m because of their lack of leadership," he said.

"Next year, the penalty will be £105m. And over the next five years it will be a cumulative total of over £1bn. At a time when we are staring at serious spending reductions, is handing money back to London responsible behaviour?"

Mr Hamilton emphasised that while reform "wouldn't be easy, it was essential".

"Change is not an optional extra. It must become a central element of government policy," he said.

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