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Esmond Birnie

Stormont funding a case of crumbs, welcome though they are, moving from plate to plate

Esmond Birnie


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Three times a year, any money left unspent by Stormont departments gets thrown into the common pot before being divided out by the Finance Department in monitoring rounds

Three times a year, any money left unspent by Stormont departments gets thrown into the common pot before being divided out by the Finance Department in monitoring rounds

Three times a year, any money left unspent by Stormont departments gets thrown into the common pot before being divided out by the Finance Department in monitoring rounds

We've had a number of stories recently regarding funding public spending in Northern Ireland. Yesterday's announcement of the results of January monitoring is a much smaller, less dramatic affair but still significant.

Three times a year, any money left unspent by Stormont departments gets thrown into the common pot before being divided out by the Finance Department in monitoring rounds. On this occasion money was surrendered because preparation for a no-deal Brexit could be paused. Similarly, there was less than expected spending on welfare reform mitigation and housing benefits. Justice also gave up some money as did agriculture, thanks to less spending on bovine TB.

The Department for the Economy had less than expected spending relating to the Presbyterian Mutual and there was also less spending on waste management.

But what of the 'winners'.

Perhaps the big break with previous patterns was the fact that very little monitoring money went to health - though this is probably because that department will now get assistance through other sources. There is £1m to compensate victims of contaminated blood.

The biggest 'gainer' is education, including £19m for educational pay and £10m for special education. There is £4m for further education.

The Finance Minister has also judged that the Assembly will need a further £900,000, now it has returned to full operation.

All told, a total of nearly £42m has been reallocated. In everyday life an enormous sum, but compared to total annual spending of over £11bn what we are seeing is the movement of some crumbs from one plate to another plate around the table of the public sector. In fact, during previous periods of devolution, a probably unrecognised achievement of the NI Civil Service was that the extent of under-spends became smaller. An implication of that was that less was available to go into the monitoring process.

Helpfully, the information provided by the Department of Finance includes some sense of how much money was bid for by various departments. As might be expected, much more was being asked for compared to the amount actually available. The amounts being asked for by higher education, schools and for street lighting and gritting, for example, far exceeded what could be granted.

The Finance Minister also pointed to one area where he has an unusual problem. He would like to spend more on Financial Transactions Capital - a process whereby government invests through loans and equity in the private sector - but so far available projects have been thin on the ground.

In summary, monitoring represents a useful exercise in recycling relatively small amounts of public money which might otherwise have to be returned unspent to the London Treasury. Many worthwhile causes are supported - at least in the short run.

Monitoring by its nature cannot resolve issues of how to sustain funding over the long-term.

Nor does it deal with the big picture question of the gap we now have between aspirations and resources.

Dr Esmond Birnie is a senior economist at Ulster University

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