UK Government confirms £3.3bn spending settlement for restored Northern Ireland Executive
The UK Government has written to the NI Minister of Finance outlining the detail of the spending settlement worth in excess of £3.3 billion
The UK Government has today (Tuesday 13 February) written to the Northern Ireland Minister for Finance setting out the full detail of the spending settlement worth in excess of £3.3 billion.
The significant, fair and generous spending settlement will allow the Northern Ireland Executive to stabilise public services, better manage public finances, increase opportunities for improved infrastructure and investment, pave the way for transformation of public services, and enable the delivery of a pay award (2023-24) to public sector workers.
The letter to Dr Caoimhe Archibald confirms that the UK Government package will:
- Provide a needs-based factor in the Barnett formula to be set at 24% from 2024-25. This reflects the different levels of need in Northern Ireland and ensures Northern Ireland receives the right level of funding for its public services into the future;
- Stabilise public finances with over £1 billion of funding made available;
- Tackle the acute situation that the health service in Northern Ireland faces by providing £34 million for hospital waiting lists;
- Enable flexibilities on debt repayment to support management of general pressures;
- Provide funding in 2023-24 to help address public sector pay;
- Increase the spending power of the Executive to pave the way for transformation by repurposing over £700 million of existing and new UK Government funds; and,
- Increase the Northern Ireland Executive’s annual capital borrowing limit by 10% in 2024-25 which will then increase annually in line with inflation.
In addition, the UK Government has committed to open discussions with the Executive on a new Fiscal Framework for Northern Ireland.
The UK Government remains determined to support the Executive to unlock the opportunities that this package presents. The package therefore contains built in commitments to ensure progress at pace for the people of Northern Ireland. This includes publishing and implementing a plan to deliver sustainable finances - including delivery of a balanced budget for 2024-25 by raising a minimum of £113 million through locally generated income as outlined in discussions in December- as well as publishing a comprehensive and costed long-term strategic infrastructure plan setting out priority areas for action and how it will support prosperity and growth. It will be for the Northern Ireland Executive to determine if they will consider a different course of action as part of their sustainability plan to deliver the public services that Northern Ireland needs.
Welcoming the letter, Secretary of State for Northern Ireland Chris Heaton-Harris said:
“This package tackles the immediate budget pressures facing the restored Executive and allows it to take action to rapidly stabilise public services, while increasing opportunities for investment and improved infrastructure.
“It also paves the way for vital transformation of public services, and will deliver well-deserved pay awards for public sector workers.
“It is now for the Northern Ireland Executive to use this significant financial package to take forward the vital work of public service transformation and the commitment to deliver sustainable finances - ensuring better outcomes in the day to day lives of the people in Northern Ireland.”
For a summary of the financial settlement see Summary: Financial Settlement between the UK Government and the Northern Ireland Executive