Extra £24 Million Funding Available For Stormont

A much needed extra £24 million of funding has been made available for Stormont and has been released immediately. How this will be allocated will be decided by ministers who I am sure will be strongly debating that their particular department gets a piece of this top-up funding. The funding will go alongside the package that Stormont received as part of the £3 billion devolution restoration deal in February.

Amount Of Funding Going Forward An Unknown Quantity

Once this funding package comes to an end in 2026 the government in Westminster will create more funding for Northern Ireland, but the amount will be an unknown quantity until they have carried out UK-wide spending review.

A review has been welcomed by Finance Minister Caoimhe Archibald, who in an article on the BBC News website is quoted as saying:

“Following intensive and constructive negotiations I welcome Treasury’s agreement to reviewing the approach to funding the Executive at the relevant Spending Review.

“This firm commitment from Treasury starts to address our concerns over a funding cliff edge once the financial package comes to an end in 2025/26.”

Public Spending Per Head Higher In NI

This excellent article by BBC News NI economics and business editor John Campbell ends with the following points which are worth noting. He writes:

‘Public spending per head in Northern Ireland is higher than in England as it costs more to deliver public services of the an equivalent standard to a smaller population.

‘The UK government has endorsed the view that Northern Ireland is currently being funded below its objective level of need.

‘Independent experts on the Northern Ireland Fiscal Council have estimated that Northern Ireland needs about £124 per head for every £100 per head spent in England.

‘Northern Ireland is estimated to have now fallen below that level to about £120 per head, when the one-off impacts of the funding package are excluded.

‘The government has agreed to top up any funding allocations by 24% as a way to get back to the assessed level of need.

‘It has also committed to review the size of the top up if credible independent analysis makes the case that it should be higher than 24%.

‘The Executive wants the Stormont budget to be given a new baseline which will take it back to the level of need in one jump.

‘There is an acknowledgment that would only happen in the context of a UK spending review which is due to happen shortly after the general election.’