Extra money ‘falls short’ of funding NI services

Stomont’s finance minister has welcomed extra funding announced for Northern Ireland in the government’s Autumn Budget, but said it “falls far short” of what is needed.

Included in the plans announced by Chancellor Rachel Reeves on Wednesday is an extra £370m, which is to be used in two ways.

The Department of Finance said £240m would be used for day-to-day spending, and £130m would be used for capital.

However, John O’Dowd said the Stormont Executive would “only receive £18.8m in addition funding” this financial year.

“This falls far short of what is needed to support the delivery of frontline public services,” he said.

The Sinn Féin minister also welcomed the lifting of the two-child cap on means-tested benefits and increases in the minimum and living wage, describing the plans as “important steps that will support our lowest-paid workers”.

But he said the freezing of income tax thresholds “will hit working families who will have less disposable income to spend in our local businesses”.

“The chancellor had an opportunity to ensure those with the broadest shoulders carried more of the burden – but she didn’t go far enough,” he added.

O’Dowd also said there was little in the budget to “support economic growth and for small to medium businesses”.

“Despite calls to support our hospitality industry by reducing the VAT rate – these calls went unanswered,” he said.

“The budget further strengthens the need for fiscal devolution.

“My department will now intensify work to progress this.”

Speaking to reporters, O’Dowd said tax revenue “has to be done in a fair and equitable way” and that those with the “broadest shoulders should carry the biggest burden”.

He added: “I don’t think the chancellor’s got it right in this budget.”

The minister said there were “definitely winners” from the budget, but “those who are losing can least afford to lose”.

Looking ahead, O’Dowd said he planned to share a draft multi-year budget for Stormont with executive ministers “before Christmas”.

The Democratic Unionist Party (DUP) MP Sammy Wilson called the budget “unfair” for those on lower incomes, adding that about 75% of those not paying tax will now have to pay due to the freezing of tax thresholds until 2031.

“Only last year the Chancellor recognised that freezing thresholds beyond 2028 would “hurt working people,” the East Antrim MP said.

“This results in more people paying tax or paying it at a higher rate.”

Wilson also described the budget as a “missed opportunity” to increase thresholds to reflect the impact of inflation.

“Growth in the economy, which is essential for bringing down government spending on benefits and bringing up government revenue from taxes, cannot be achieved by heaping taxes on those in work, and the businesses which create jobs and growth,” he added.

The Northern Ireland secretary said that over the last two years, Northern Ireland has received an extra £1.7bn in funding.

Speaking to BBC News NI’s Red Lines podcast, Hilary Benn said the Budget would be ultimately positive for many families in Northern Ireland who will “see an increase in their income”.

However, Benn stressed that Stormont needed to take more decisions to help raise additional funds.

“Northern Ireland gets more funding per head for health than England,” he told Red Lines.

“In Northern Ireland, a lot of people are waiting more than a year to see a consultant for the first time.

“So, the question everyone should ask is how come, with more money per ahead, the waiting lists are so much worse in Northern Ireland than they are in England? That is about the way in which you structure and organise the system.”

The secretary said there is a need for “transformation”, so people in Northern Ireland can get decent public services.

“There has to be political will to take decisions,” Benn added.