Northern Ireland hitting budgetary crunch point, warns permanent secretary

By on 31/01/2018
Stormont Castle, the seat of the devolved Northern Ireland Executive, which was suspended in March 2017 (Image courtesy: Ross).

A budget for Northern Ireland needs to be set before Thursday 8 February, the head of the province’s civil service has warned.

Northern Ireland Civil Service permanent secretary David Sterling said that the 2018-19 budget must be set before the start of parliament’s two-week recess on 8 February in order for departments to plan their services for the coming financial year. The year-long period without elected ministers in post is, he argued, “totally unprecedented and I don’t think it’s acceptable”.

Sterling was giving evidence to the Northern Ireland Affairs Committee’s inquiry into the democratic and devolutionary deficit in Northern Ireland last Wednesday, as power-sharing talks resumed between Sinn Fein and the Democratic Unionist Party (DUP).

Northern Ireland secretary Karen Bradley is due to update MPs on the progress of the latest talks on 7 February.

Responsibility without power

The coalition administration led by the two parties collapsed in January last year, following a row over a renewable heating scheme, and the civil service has been left in charge of public services since March.

“It would be incredibly difficult for us if we don’t get a budget by 8 February,” Sterling said. “The minimum that we would need would be some clarity from the secretary of state about what the allocations for individual departments would be, if there is no executive at the beginning of the next financial year.”

“By the end of March, we will need to have supplementary estimates for 2017-18 and a vote on account for 2018-19, which would provide certainty to departments about the money that is going to flow to them,” he added.

Missing decisions

David Sterling, interim head of the Northern Ireland Civil Service (Image courtesy: Michael Cooper/ The Executive Office).

Ministerial decisions are also needed on how to use the £1bn extra funding provided to Northern Ireland under the confidence and supply deal struck between the DUP and Theresa May’s minority Conservative government, Sterling said.

Services affected by the absence of ministerial direction over the past year include the replacement for a health and social care board and implementation of a new suicide prevention strategy, he said.

Getting the province’s voice heard in the Brexit talks is also a “huge issue”, with ministerial input needed to formulate policy in the best interests of Northern Ireland. “We will have about 500 pieces of legislation to process on the back of the EU Withdrawal Bill,” Sterling warned.

He said the current situation in Northern Ireland is unique, despite periods of devolution and direct rule in the past. “We have never had a period of one year with no ministers at all, and I am surprised that we have managed to survive as long as we have,” he said. “To me, it is totally unprecedented and I don’t think it’s acceptable, to be frank.”

Mandate required

Sterling defended the decision to spend only £20 million out of £50 million allocated for health and education in 2017-18 from the confidence and supply money. “We drew that down to address particular challenges in the health and education sector this year,” he said.

“However, our conclusion was that the pressures faced in both those sectors next year was of a different order of magnitude and that therefore we would not draw down the full £50 million this year. Instead we would seek agreement from Treasury to carry that forward to next year and our expectation is that we will draw down the full £80 million there.”

DUP MP Ian Paisley said the cash is “cherry-on-top” money and the public want it to be spent. “It’s additional,” he said. “It’s already into five specific areas. Spend it. What’s the reluctance to spend the money?”

But Hugh Widdis, permanent secretary in the Department of Finance, said the cash cannot be spent by a department until it has been appropriated in Northern Ireland – which in turn cannot be done until a budget has been set.

Direct rule looms

Karen Bradley, secretary of state for Northern Ireland (Image courtesy: UK Home Office).

In a surprise move on 24 January, Sue Gray, director general of the Cabinet Office’s Propriety and Ethics Team, was appointed permanent secretary to Northern Ireland’s Department of Finance. She replaces Widdis, who was filling the role temporarily and returns to his post as departmental solicitor and head of the NI Government Legal Service.

Gray, who many pundits regard as one of Whitehall’s most powerful civil servants, is among several new senior appointments at the NICS, fuelling speculation that the government may be preparing for direct rule.

The government’s efforts to get the Northern Ireland Assembly and the coalition administration operating again have achieved little over the past year, and its leverage over the DUP has declined dramatically since the 2017 general election left Theresa May dependent on DUP votes in the House of Commons. Indeed, a restoration of direct rule could leave the DUP able to shape Northern Ireland policies through its enormous power in Westminster – a factor which has reduced the unionists’ interest in restoring the Northern Ireland Executive, and their readiness to make concessions to their opponents in Sinn Fein.

So new Northern Ireland secretary Karen Bradley is faced with a task that defeated her predecessor, yet she has few of the tools and levers that he enjoyed. With civil servants required to deliver public services but lacking any democratic mandate to do so, it appears that the province is inching inevitably towards a restoration of direct rule from London – bringing the risk that republicans will begin to disengage from the political process.

About Liz Heron

Liz Heron is a journalist based in London, who specialises in international news. She worked on daily newspapers for 16 years, reporting extensively on both general news and education. She was Education Editor of the South China Morning Post in Hong Kong and has contributed to a wide range of British media including The Independent, The Guardian and the BBC.

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