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Sinn Fein forced Executive to ring-fence education cash as price for spending deal, says Simon Hamilton

By Noel McAdam

Sinn Fein refused to sign off on spending plans until it was guaranteed that one of its own departments would not face budget cuts, it can be revealed.

Finance Minister Simon Hamilton said the republican party forced the Executive to 'ringfence' the education budget as the price for its agreement on spending.

The inability to make a deal had threatened to destabilise the rocky Stormont administration.

But the DUP minister insisted there was no justification for Education Minister John O'Dowd's funding to be 'ringfenced'.

It means two departments –health and education – are now protected from further reductions, despite increasing pressures on budgets after Westminster began to penalise Stormont financially for not implementing its welfare reforms.

Mr Hamilton also launched an extraordinary attack on Mr O'Dowd, saying: "The fact is that for some time now education has been run like an independent republic." And he added: "There would have been no agreement on the spending round without that (ringfencing)."

Mr Hamilton also said education was the only department which has failed to comply with an earlier savings delivery plan – even though other Sinn Fein-run departments did – and that Mr O'Dowd is acting as a "roadblock" to a review of financial procedures that he wants to conduct.

Mr Hamilton added he was hoping to have a meeting with Mr O'Dowd, although they have discussed the issues in the past.

Mr Hamilton also revealed that he had hoped to give Health Minister Edwin Poots double the allocation he received from the delayed June spending round – £40m rather than £20m – but it was also blocked by Sinn Fein.

"There is not the same concern among the general public about the education service compared to the health service," Mr Hamilton argued. "I am very mindful of the pressures facing health, which said it needed another £165m and I wanted in my original proposals to give it £40m.

"Health is never out of the headlines in terms of the difficulties it is facing and I do not think that education is under the same degree of pressure that health is.

"I am not saying that John O'Dowd does not have budget problems. All ministers do. But I think there is a feeling there is more potential for savings in education compared to health."

Mr Hamilton said he has written "in candid terms" to his Executive colleagues "telling them there is no justification objectively for education to be ringfenced".

But Mr O'Dowd replied: "I am disappointed – though not surprised by – Minister Hamilton's assertion that there is no justification to protecting the education budget. I and my party have no apology to make for protecting education from the recent budget reductions. If other ministers or parties cannot grasp the importance of education to our society then it is up to them to explain exactly where their priorities rest.

"The future success of our economy and of society here depends on there being a high quality education service that can compete with the best internationally."

Story so far

Government departments in Northern Ireland – in particular justice, employment and learning, and social development – are already implementing spending cuts of almost £78m. There could be even worse to come.

But the Executive will have to find a further £87m from the next quarterly budget monitoring round to begin to meet the cost of Treasury 'fines' on Northern Ireland's Block Grant for failing to implement welfare reform.

Questions and answers

Q. Why does the Executive need a new Budget?

A. The current Programme for Government runs out at the end of March, but the Assembly has a further year to run.

Q. Why was a plan not created for the entire period?

A. At the time it was finalised, the Assembly term had been due to expire in May next year.

Q. So what changed?

A. Elections were delayed for a year to bring the Assembly into line with its counterparts in Edinburgh and Cardiff. It also avoids a double-up with the next Westminister election.

Q. Why are education and health budgets protected?

A. They are the two biggest-spending departments and their joint protection appears to be the result of a deal between Sinn Fein and the DUP.

Q. Why is there concern over the new Budget?

A. Given the problems reaching agreement in the June spending round, it's likely the Executive will struggle to produce another overarching plan.

Q. Why?

A. The Treasury is to reduce the amount it gives Northern Ireland to make up the savings it says should have been made through welfare reforms.

Q. By how much?

A. £13m has already been taken, with a further £87m due in this financial year.

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