Belfast Telegraph

Whole agreement at risk - Villiers

All aspects of the Stormont House Agreement will be put at risk if the latest political row over welfare reform implementation in Northern Ireland is not sorted, the Secretary of State has warned.

Theresa Villiers also made clear the Government would not be offering any money to resolve the bitter dispute between Sinn Fein and the Democratic Unionists over the extent of Stormont funded top-up payments to benefit claimants.

But Ms Villiers insisted the unexpected crisis that has rocked the powersharing institutions - after Sinn Fein dramatically withdrew support for welfare legislation ahead of a final vote yesterday - did not spell the end for the landmark Stormont House deal struck between the five Executive parties and the British and Irish governments in December.

As well as a commitment by the local parties to introduce the UK Government's welfare reforms after a two year impasse, the Stormont House Agreement gave the Executive access to a £2 billion financial package from the Treasury, primarily in the shape of extended borrowing powers.

The deal also paved the way for the devolution of corporation tax to the region and the setting of a sustainable budget for 2015/16. It also established new mechanisms for dealing with the toxic legacy of the Troubles.

Ms Villiers said the Government was looking closely at all elements of the agreement in the wake of yesterday's shock developments in Belfast.

"Unless we get this resolved then we are in a pretty serious situation because the other aspects of the Stormont House Agreement are put in jeopardy," she said.

"But I think the situation is certainly retrievable but it will require work from all five parties and I will be closely engaged on this too."

She added: "If resolution of this question isn't found then all aspects of the Stormont House Agreement are at risk. But it's certainly not impossible that we can resolve this question."

Sinn Fein withdrew support for the Welfare Reform Bill after accusing the DUP, its main partners in the Executive, of backtracking on an alleged commitment that top-up protection would be offered to all benefit claimants going forward, not just existing ones.

The DUP vehemently denied that commitment was part of a deal between the five parties struck at Stormont Castle in the days before the Stormont House Agreement was hammered out.

Sinn Fein believe around £200 million extra would be needed to cover all claimants.

Ms Villiers today insisted the financial issue was one for the region's politicians to resolve and made clear the Government would not be offering any money for top-ups.

Welfare reforms in Northern Ireland have already been delayed by over two years, primarily due to Sinn Fein's reluctance to sign up to measures it claimed would hit the most vulnerable.

The row appeared to have been resolved in December's Stormont House deal when the Executive parties agreed to offer additional financial assistance to claimants from its own pockets.

The same welfare reforms that proved controversial in Great Britain were to be brought into Northern Ireland - among them the so-called bedroom tax, the £26,000 cap on benefit claims, Universal Credit, and the replacement of Disability Living Allowance with Personal Independence Payment.

But the key difference was that parties in Northern Ireland had agreed to introduce a number of new schemes to ensure additional financial support was directed to those set to lose out by changes to the benefits system.

Twenty four hours after trading angry accusations of bad faith, DUP First Minister Peter Robinson and Sinn Fein Deputy First Minister Martin McGuinness today flew to the USA today to make a joint pitch for business investment in Northern Ireland.

Ms Villiers said the Government would not make any snap decisions on the future of the agreement.

"Rushing to judgement and pulling the plug on everything is not something we are contemplating at the moment but we'll look seriously at how we best try to move things forward," she said.

"We don't want to exacerbate the situation or raise tensions but obviously we need to reflect carefully on the consequences of the decision made by Sinn Fein yesterday."

Ms Villiers, who chaired the exhaustive Stormont House negotiations, said the Government's position had always been, and would remain, that it would not fund a more expensive welfare system in Northern Ireland than elsewhere in the UK.

"If Northern Ireland wants a more expensive welfare system then they need to fund that out of the block grant," she said.

In regard to corporation tax, Government legislation to enable the devolution of the power to set rates locally is currently passing through Westminster.

Ms Villiers said the Government had not decided whether to proceed with enactment in the wake of Sinn Fein's announcement.

But she stressed that even if the law was passed there was still a commencement clause, meaning the Executive would have to prove it was on a firm financial footing before the chancellor switched the "on/off" button to formally transfer the responsibilities.

"We haven't taken a final decision on whether the legislation proceeds or not but, even assuming it does, this question will need to be sorted out and resolved before devolution actually happens in practice," she said.

Ms Villiers confirmed that Treasury penalties for non-implementation would continue to be collected every day that passed without welfare legislation being passed.

The Executive is set to be hit with a £114 million bill from the Treasury this coming financial year, having already shouldered around £100 million in penalties for the last two years.

"I am afraid one of the consequences of the Sinn Fein announcement yesterday is a very direct financial one on the Executive because it means basically every day that the welfare reforms aren't implemented that's another day of the short-fall payments having to be made, so that is one of the unfortunate consequences of the decision that has been made," she said.

"It makes it all the more important to try to knuckle down and see if there is a way through this."

The Northern Ireland Secretary predicted that "clarification and reassurance" over how the top-up schemes would operate could calm the situation.

She insisted Northern Ireland's leaders had overcome more difficult problems in the past.

"It is a set back, there is no doubt about that, but it does not mean the end of the road for the Stormont House Agreement," she said.

"It is certainly a bump in the road but in Northern Ireland this is a recurrent event. An agreement is one thing but actually 80% of the work is implementation.

"There are plenty of setbacks as the implementation process goes forward. Up to now Northern Ireland's political leaders have always found a way through - so I think they are capable of doing that this time round too."

Ms Villiers has held talks with Mr Robinson and Mr McGuinness on the phone and this afternoon met the leaders of the SDLP, UUP and Alliance parties to discuss the crisis.

SDLP leader Alasdair McDonnell has called for a special Assembly committee to be set up deal with the welfare reform issue.

"There can be no more backroom deals," he said. "The public need honesty and certainty, both of which have been in short supply.

"No more spin, no more double speak and no more U-turns. That will be our approach and others should join us."

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