Stormont in 'substantive negotiation' about budget with UK government

Northern Ireland Executive parties had rejected an initial £1.1bn package over three years that was offered on Monday.

1d ago 6 min 0

Image source, Getty

Image caption, Northern Ireland Executive parties had rejected an initial £1.1bn package over three years that was offered on Monday

Political correspondent, BBC News NI

Updated 1 hour ago

The Stormont executive is now in a "substantive negotiation" with the government on additional money to break the budget deadlock, Finance Minister John O'Dowd has said.

He was speaking after ministers met the Northern Ireland Secretary Sir Chris Bryant on Friday morning as an increased offer was made to the executive of £1.5bn over the next three years.

O'Dowd said he did not believe that the talks need to go on for "weeks", adding that he and others had been pressing the Treasury for months to come to the table.

On Monday, Sir Chris visited Stormont and made an initial offer of £350m per year over the same period to help stabilise the executive's finances - a £1.1bn package.

Executive parties rejected that and said the government would need to increase its contribution in order for Stormont to balance its books this year.

It is believed that the majority of the money for each year would be available to the executive for day-to-day (resource) spending, with some money required to be set aside for longer-term (capital) projects.

Image source, PA Media

Image caption, Finance Minister John O'Dowd said he did not believe that the talks need to go on for "weeks"

Speaking on Friday afternoon, O'Dowd refused to be drawn on the specific details of the offer, but said he had "no doubt" ministers would still face challenges in managing their departmental finances even if a settlement is reached.

He said formal discussions with the government would continue next week and that he believed the issue could be resolved "very, very quickly".

He said the executive could set a budget, but "it has to be fair, it has to be sustainable and we haven't reached that point yet".

O'Dowd said the current published financial pressures facing Stormont departments were around £1.6bn, adding: "So we have a bit to go."

Earlier he told BBC Radio Ulster's Talkback programme that: "There have been financial challenges in the past... it was pointed out to the government then that there needed to be an annual, baselined funding settlement to the executive."

O'Dowd and other Stormont parties have repeatedly said Northern Ireland would have an additional £1bn to £3bn a year to spend if they were funded in the same way as Wales or Scotland.

He said it was incumbent upon the government to provide Stormont with finances to develop a multi-year plan.

Stormont's Education Minister Paul Givan said there had been revised financial offer from the government on Friday, but "there is a significant gap between what is now being offered and where we need to get to".

"If the Secretary of State believes that he can just say, 'this is all you're getting', he is asking the impossible of the executive," the minister told BBC Radio Ulster's The Nolan Show.

Image source, PA Media

Image caption, Education Minister Paul Givan said the executive should "not be rushed" in terms of signing up to a financial deal

Givan added that, if what is being asked of Stormont is impossible to deliver, the executive will have have to ask the Treasury for more money by the end of the financial year.

He said that, if the Treasury decline the request, Stormont is in "uncharted territory".

"A budget that is inadequate means cuts," he warned.

Following the passing of a deadline in August, Stormont officials were given legal powers to spend up to 95% of last year's funding in the absence of ministers agreeing the budget.

Last week, Prime Minister Andy Burnham pledged to get the Stormont government functioning properly with a budget.

Image source, PA Media

Image caption, On Monday Sir Chris Bryant visited Stormont to make an offer to the executive

No formal deadline has been set in the talks with Westminster, but Number 10 is due to publish its budget on 28 October so there is an expectation from some Stormont sources that any financial settlement should be agreed before then.

Alliance assembly member (MLA) Kate Nicholl said her party had urged the government to make reform of the Stormont institutions a condition, as part of any overall deal on the budget.

Ulster Unionist leader Jon Burrows said the executive was discussing "significant" sums of money, but also refused to be drawn on an exact figure.

He said there was an aspiration to agree a budget soon, but it needed to be done properly.

SDLP MLA Matthew O'Toole, Stormont's leader of the Opposition, said with every day that passes without a budget, public services are suffering in Northern Ireland.

'Fix the baseline'

Image source, Reuters

Image caption, First Minister Michelle O'Neill says Westminster "need to fix the baseline"

The executive has repeatedly said it cannot agree a budget for this financial year without extra support from Westminster.

Speaking after meeting the secretary of state on Monday, First Minister Michelle O'Neill said the executive was now in a "negotiation" with the government.

"We get to this juncture time after time, crisis point after crisis point - they need to fix the baseline.

"If they throw a few pounds on the table and walk away we'll end up back in this scenario."

DUP leader Gavin Robinson said the initial offer from the government "falls well short of even some of the pressures in one department, let alone across the Northern Ireland Executive".

"Anybody who says we just need to get on and agree this can explain the cuts that will come as a consequence," he added.