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DUP sets out plan for savings but economist labels it ‘timid’

By David Gordon

DUP plans to tackle the massive public spending challenges facing Stormont have been criticised as “timid” by a prominent economist.

The blueprint, launched by First Minister Peter Robinson, has controversially proposed a two-year freeze on Civil Service pay.

But, in common with a number of other parties, the DUP has shied away from backing the introduction of water charges.

It also says free public transport for senior citizens and free prescriptions should remain, despite the growing pressure on Government funds.

University of Ulster economist Michael Smyth said the document had been “timid” on the issues of public transport, prescription and water charges.

“In 2007, when a lot of these things were brought in, the world was different,” he argued.

“We lived in the expectation that we were going to have continuing growth in public expenditure.

“The world has changed and we will have to change with it.”

Mr Smyth also said the ongoing refusal to introduce household water charges was costing the Stormont Executive at least £200m a year.

In an article for today's Belfast Telegraph, the First Minister writes: “While there are undoubtedly pressures on the budget in the years ahead, we must not allow the progress that we have made in certain areas to be reversed.

“That is why I do not believe that we should turn the clock back in areas such as free prescriptions and free travel for senior citizens.”

The UK-wide Government spending review has cut some £4bn from the Stormont Executive’s planned expenditure levels over four years.

Mr Robinson argues that water charges should continue to be deferred and household rates bills only increased in line with inflation.

The DUP document — entitled Rising to the Challenge — proposes a two-year pay freeze for Northern Ireland civil servants earning over £21,000.

It also calls for a four-year freeze on Civil Service recruitment.

“While this is not a desirable situation, it is better than the option of compulsory redundancies and the financial and social cost that such a step entails.

“It would be expected that in any year approximately 1,000 posts would be reduced by this process,” it says.

The party is also proposing legislation to end entitlement to “one step pay progression” in the Civil Service.

This provides incremental lifts up pay scales for employees — alongside annual salary increases.

Around 24,000 work for the Northern Ireland Civil Service, while the overall public sector here accounts for over 220,000 employees. The vast bulk of these people — aside from the civil servants — are covered by UK-wide pay arrangements which are not set by Stormont.

The union representing civil servants, NIPSA, has voiced its disappointment at the DUP proposals.

Assistant general secretary Kieran Bannon said civil servants had only received a 9.2% pay lift in the past eight years while inflation over the same period was 20.5%.

“Civil servants are already treated differently to the rest of the public sector,” he said.

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