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Finance minister Mairtin O Muilleoir wants power to borrow money from Treasury

New Finance minister Mairtin O Muilleoir wants the Treasury to grant the Northern Ireland Executive the power to borrow money.

Borrowing powers are currently restricted to borrowing up to £200m a year, up to a ceiling of £3bn.

Mr O Muilleoir said that he wants to "break free from the shackles of London" to allow the Executive to invest more in housing and education.

The discussion followed the first meeting of the new executive after the DUP and Sinn Fein chose their ministers and departments.

Speaking on BBC Northern Ireland's The View on Thursday, Mr O Muilleoir said: "I was speaking to the chief secretary at the Treasury department today and I have asked for an urgent meeting.

"I think there are two major issues, and I think that the DUP would agree with us.

"One is that we don’t have enough flexibility around our budget. Belfast City Council can borrow more money than the government. I don’t know how much money we need to borrow but what I know that I want the power to borrow to invest in new homes. It is a priority for me to expand Magee campus."

When asked about how much he wanted to borrow, he added: "It’s not the quantum, it’s the ability. I want to remove the shackles of London. It would be impossible to know how much but we need the right as an executive to be able to borrow money.

"The second argument is the austerity budget, cutting the budget, cutting the bloc grant, heaping maximum pain on the poor is not helping the economy, it's counter-productive."

Executive colleague Peter Weir, who was named as the Education minister by the First Minister on Wednesday, said that he supported Mr O Muillieoir making enquiries with the treasury.

He said: "We want to ensure that whatever resources we’ve got, we’ve got the best bang for our buck. In terms of the detail of how we approach that, I think the executive will have to work that out collectively.

"It’s about trying to deliver for the people of Northern."

However, speaking on BBC Radio Ulster, DUP MLA Sammy Wilson said that although it is "perfectly legitimate" for the Finance minister to ask for additional borrowing powers, he needs to do more to spell out what the money will be used for.

He said: "I totally agree that it is a good idea to build 10,000 new homes but if you are going to borrow, you have to be sure that you then have the revenue stream to pay it back. What Mairtin O Muillieor needs to spell out, is that if he wishes to borrow and if the Treasury allows him to do so - and I doubt very much that they will -  how will the money be paid back?

"Let’s not come up with solutions that appear to be easy on the surface and then when we find out afterwards that there are hidden costs. I think if you are going to go into a new policy like this, you’ve got to be aware of all of the consequences."

UUP MLA Philip Smith said he was "shocked" at the suggestion. The UUP and SDLP chose to form an official opposition at Stormont.

The Strangford MLA said: “The new Finance Minister is only in the door and is now proposing further debt as a solution to our financial problems.  If he is planning this as a way forward he needs to be very clear with the public as to how he intends to recoup the money that will be required to be paid back.

“We have already incurred high levels of debt – higher per head of population than Scotland – so the Minister needs to outline how he intends to make any additional borrowing affordable.

“We are now paying the price of previous indecision from the Executive and their failure to implement reform of the health service, education and the Civil Service.  

“Any money borrowed needs to be invested in infrastructure projects, not keeping our head above water.  We can’t get into a situation where we are using the money that is supposed to be for the mortgage to instead buy groceries.”

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