It’s time to take notice of the unsustainable way NI is financed

East Belfast MP Gavin Robinson has highlighted that in the next three years, some £2,000 will fall from per household public service expenditure for Northern Ireland in real terms.

He wants to start the debate on the unsustainable way that Northern Ireland is financed.

By Gavin Robinson MP

Belfast East

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When Simon Byrne outlined the stark reality for policing last week, society noticed. An £80m in-year shortfall; frontline cuts for an essential public service, leaving us with the smallest police service in its history.

It could easily be filed as a headline story befitting the general state of play for Government today or the wider economic situation generally – but that would be a huge mistake.

The stark impact on day-to-day policing is worthy of further exploration but my motivation for writing this piece is that we will all continue to suffer if we pigeon-hole the PSNI situation as either ‘a one-off’ or easily fixed.

Each and every public service is in the same position. Keeping hospitals running, schools educating, buses buzzing and roads worthy is becoming an increasingly difficult task.

Of course, the answer is easy, right? How often have you been told that if only an Executive was in place tomorrow, our troubles would be over. If the protocol was sorted, all would run smoothly.

No, the general party-political, short-term snipes you suffer through on a daily basis are now so superficial, they are contemptuous. Be in no doubt, the protocol needs to be resolved. At a cost of £18k an hour for needless bureaucracy, it’s an encroachment we can ill afford. Nor will I ever dismiss the benefits of democratic, locally accountable government. For me, it isn’t a luxury. It’s essential and we need to get it restored on firm foundations, but locally elected ministers will be as hamstrung financially tomorrow as civil servants are today.

When Westminster passed Northern Ireland’s budget last Monday, I spent considerable time outlining these issues but I forgive you for not noticing!

For those who manage news, it’s easier to kick the thing you like least than focus on the complex, uninspiring detail. I take no joy in sharing the uncomfortable reality that the financial pressures we face today will only get worse.

Four years ago, during a similar budget setting process in Westminster, colleagues and I had a frank exchange with the then Chancellor, Philip Hammond, about the unsustainable nature of how Northern Ireland is financed.

Following that, we secured the creation of a Fiscal Council for Northern Ireland during the New Decade, New Approach process and although their work is authoritative, excellently researched and easily accessible, the time has come for us all to take notice.

To put it simply, the cost of providing public services for a small place is more expensive than a large one. We don’t benefit from economies of scale or critical mass. To provide that service, we therefore need a disproportionately larger public service, and for as long as we receive 3% of what England needs under the Barnett formula, we won’t and don’t get enough.

In 2019/2020 when RCN staged their first strike in their 100 year history, they did so under the banner of pay parity — the consequence of Northern Ireland receiving less, year on year, than their equivalents in England. Nurses raised the issue, but it applies across the board. During the 2022-2025 Westminster budget cycle, public spending in England is set to grow by 6%, but a stilted 3.6% in NI.

In the next three years, some £2,000 will fall from per household public service expenditure for Northern Ireland in real terms.

It should be obvious that we can’t sustain that trajectory. At the very least, an attempt to retrofit services and our expectations could only follow the most unpalatable of choices.

Worst of all, the Barnett formula does not work on the basis of assessed need. In 1979, we received 129% of England’s spend per head.

Today, it sits at 121%, less than Scotland and the squeeze will continue.

In sharing this, I want to start the debate. The negative trajectory can and must be changed, but that will only happen when we see, acknowledge and deal with the danger.

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