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Decision time for Northern Ministers on £128m in cuts

25-05-2010

Irish Times

STORMONT EXECUTIVE Ministers will meet on Thursday to find £128 million in public spending cuts in the knowledge that the curbs on spending announced by the British government will have far-reaching financial and political implications.

The North’s share of more than £6 billion in cuts comes on top of an existing requirement to find nearly £400 million in savings.

Peter Robinson and Martin McGuinness last night warned that efficiencies should not threaten frontline services, especially health, or jeopardise any local economic recovery.

They also warned that much worse is to come. “We are all conscious that the British government are going to announce a budget in something like 45 days’ time and we all know that the next number of years are going to be very, very difficult, so nobody should be under any illusion that the announcements made today is the end of it,” Mr McGuinness said.

They also referred to British prime minister David Cameron’s commitment to “respect” the devolved powers exercised by the regional assemblies in Belfast, Edinburgh and Cardiff.

The Stormont First Minister and Deputy First Minister, joined by Scottish first minister Alex Salmond and Welsh first minister Carwyn Jones for talks on the cuts in Belfast yesterday, acknowledged that under the so-called “respect agenda” they have been given the option by London of deferring some or all of the cuts until the next financial year.

Mr Robinson, asked if the cuts will be imposed this year, said he was minded to defer some of them. However, he added he could not be specific on the next steps until the British exchequer made clear the implications for capital and current spending programmes.

Minister for Finance Sammy Wilson said he was preparing a paper to present to Executive colleagues. He was open to the possibility of a special statement following the emergency British budget due to be finalised in London next month.

Mr Wilson has also suggested that some of the cuts could be offset by returning as-yet unallocated sums from departmental funds. However, Stormont sources last night suggested this would only amount to a small percentage of the total being sought.

“We knew [this] was coming down the line and when departments surrender money through the year, as inevitably they do, we can maybe use some of that to offset these cuts that have been imposed on us,” Mr Wilson said.

The Executive may face renewed pressure from London to review its positions on water charges, local rates and other funding questions.

Ministers have so far resisted the imposition of water charges on domestic users, claiming that this is already provided for by the rating system. They have also enforced a three-year rates freeze on homeowners. However, the British government is expected to push for more local revenues to be generated by water charges and through the reviewing of levels of domestic rates. Homeowners in Northern Ireland already pay significantly less in local taxes compared to their equivalents in England and Wales.


NORTH:S CUTBACKS: HEALTH, DEFENCE AND EDUCATION PROTECTED 

Communities and Local Government has to save £780m;

The devolved administrations that run Northern Ireland, Scotland and Wales cut £704m;

The Department for Transport will have to cut £683m;

Education ministry faces cutbacks £670m;

Departments of Health, defence and international development to make savings that will go back into their budgets;

Spending on schools will also be protected;

SAVINGS WILL BE MADE ACCORDING TO THE FOLLOWING BREAKDOWN 

£1.15bn from discretionary areas such as consultancy and travel costs;

£95m in savings on IT;

£1.7bn from delaying and stopping contracts and projects;

£170m from reductions in property costs;

At least £120m from a recruitment freeze across the

civil service for the rest of 2010-11;

£600 million from cutting the cost of quangos, non- departmental public bodies;

£520m by reducing other lower-value spend;

£1.165bn by reducing local government grants;

£704m from devolved administrations;

£320m from ending government contributions to the Child Trust Fund;

£150m from savings to the previous government’s housing pledge;

£320m from ending employment programmes;

£270m from regional development agency spending;

£80m from British Educational Communications and Technology Agency closure.

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