Northern Ireland could miss out on cut of £1.4bn 4G windfall
Northern Ireland might not see a penny of a £1.4bn windfall from the sale of the 4G radio spectrum.
The Government has said the cash would be receipts that need not trigger extra cash for the devolved nations.
It came as 4G technology was made available to consumers in 10 UK cities yesterday, including London, Cardiff and Glasgow.
Belfast is one of six cities that will have access to the service by the end of the year.
A reserve price of £1.4bn has been set for when the 4G spectrum is auctioned by the broadcast watchdog, Ofcom.
Under the complex Barnett Formula, devolved nations are given extra funding to compensate for new government investment in England. This prompted SDLP MP Margaret Ritchie to ask whether any “consequential” payments would arise from the 4G windfall.
Danny Alexander, the Chief Secretary to the Treasury, said: “The Barnett formula applies to public spending allocation, not to general government receipts. Therefore no Barnett consequentials will arise from the sale of the 4G spectrum licence.”
Ms Ritchie said: “I was very disappointed by the minister's answer. I was led to believe that there would be Barnett consequentials. We want to boost the economy and stimulate spending, so it is important that we are able to use money from the sale of the 4G spectrum.”
Nigel Dodds, the DUP’s leader at Westminster, said: “We will be watching this like a hawk.”
He said: “If and when this money comes to be spent, certainly we shall be seeking Barnett consequentials for that.
“We shall be shouting from the rooftops, as it’s clearly the sort of thing Northern Ireland should be benefiting from.”
The Barnett formula is often the cause of disputes between the Treasury and the devolved nations. A high-profile example came with the London Olympics, which were initially deemed to be ‘UK-wide investment’, thus needing no compensation for Northern Ireland, Scotland and Wales. After a long-running row with the Treasury, a settlement was finally reached last year.