Belfast Telegraph

Welfare delays 'cost £2m a week in fines' off block grant

By Liam Clarke

Delays in introducing Welfare Reform are costing the Northern Ireland economy about £2m a week in fines off the block grant.

Senior sources said that is the formula used to measure the cost of delay. The budget crisis deepened this week when Sinn Fein unexpectedly withdrew its support for the welfare reform bill.

The five Executive parties met yesterday and broke up without agreement on ending the logjam. But the first ministers said they had made progress in an earlier meeting which lasted five hours.

Mr Robinson said that there was "a long way to go". Mr McGuinness said he was hopeful.

Observers expect the stand-off to go beyond the General Election on May 7 as Sinn Fein will want to test out the new Government unless it gets what it wants now.

The crisis began on Monday when Martin McGuinness, the deputy First Minister, said that his party would not support the passage of the bill that afternoon.

Sinn Fein also raised a petition of concern, with support from the Greens and the SDLP, ensuring the measure could not pass.

This leaves a half billion pounds black hole in the budget, said DUP Finance Minister Simon Hamilton, throwing 2015-16 spending plans into chaos as it depended heavily on government grants and flexibilities which involved a £700 million loan from the Treasury.

"In government-speak this is called planned and deliberate overspending. I'm only surprised the Treasury has not come in before this," a top civil servant said.

Things may come to a head in June when unspent funds, if any, are transferred from one department to another. Civil servants can then step in to ensure compliance by top-slicing budgets should there be a shortfall.

Already there are signs of Government preparing to store the process. Theresa Villiers, the Secretary of State, will next Wednesday make a last-ditch attempt to settle things before the election when she meets the parties. She is willing to stay over Thursday too if things look promising.

She will fly to Washington tomorrow for St Patrick's day, before returning to Belfast to try and revive the talks, but no party we spoke to was optimistic of success.

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