Debate contribution: Provisional Out-turn 2023-24 and June Monitoring 2024-25

Debate contribution by Dr Caoimhe Archibald on 1 July 2024.

MLA

Dr Caoimhe Archibald

Party at the time

Sinn Féin

Date

1 July 2024

Type

Debate contribution (made as a minister)

Business

Ministerial Statements

Heading

Provisional Out-turn 2023-24 and June Monitoring 2024-25

Assembly identifier

Official Report component 4498902

Read the official Assembly record

Text

You were giving me heart failure there; I thought that I had the wrong folder. Thank you for the opportunity to make a statement on the outcome of the 2023-24 provisional out-turn and the Executive's June monitoring exercise. I have carefully considered whether the June monitoring round should proceed during the pre-election period, and my view is that that process represents normal and routine Executive business. There is also an urgent need to provide certainty to Departments, and even a short delay presents risks. Not proceeding could have resulted in Departments taking decisions that would not have been needed had an additional allocation been confirmed. Proceeding as we have done allows for proper Assembly engagement without the need for the House to be recalled during recess. Before turning to the current year, I will update the Assembly on the 2023-24 provisional out-turn and the resulting carry-forward under the Budget exchange scheme. Tables accompanying the statement set out the provisional out-turn position for each Department. Members will recall that, owing to the funding provided from the reserve in 2023-24 as part of the financial package, the Executive are unable to carry forward any resource departmental expenditure limit (DEL) underspends. To minimise the risk of funding being lost, the Executive agreed an overcommitment of £14·1 million based on anticipated departmental underspends, which allowed an additional allocation of that amount to the Department for Infrastructure. As a result of that action, the departmental resource DEL underspend of £19·3 million was reduced to £5·2 million. Adjusting for a reduction in anticipated regional rates income and removing earmarked funding that must be returned to the Treasury results in a small overspend of £0·5 million in non-ring-fenced resource DEL. That small overspend is offset by a late Barnett consequential of £41·6 million that the Treasury exceptionally agreed could be carried forward to 2024-25. Therefore, no resource DEL funding has been lost due to underspends, and the £41·1 million is being carried forward into 2024-25. The usual Budget exchange limits apply to all other expenditure categories. On conventional capital DEL, £9·1 million will be carried forward, reflecting departmental underspends and central adjustments and including £1·6 million of late Barnett consequentials. On financial transactions capital (FTC), although the total underspend is £10·8 million, the Budget exchange scheme allows only £0·6 million to be carried forward into 2024-25. The remaining underspend of £10·2 million is not lost but rather reduces future liabilities, as my Department has agreed with the Treasury that any FTC underspends can be used to offset the required repayment of 80% of allocations. Ring-fenced resource DEL may be used only for non-cash depreciation and impairments costs; it cannot be used to fund other services. Due to Budget exchange limits, only £8·6 million can be carried forward into 2024-25. It should be noted, however, that, of the total underspend of £443·4 million, some £373 million relates to student loan impairments and is mainly a result of the funding model used by the Treasury rather than of underspend by the Department.

I will now turn to June monitoring. First, I will address commitments made by the Executive in agreeing Budget 2024-25. Members will recall that Budget 2024-25 set aside £25 million for actions relating to a childcare strategy. Since then, the Executive have agreed the Education Minister's proposals to utilise that funding, which will be transferred to the Department of Education as an earmarked allocation. The Executive also agreed in Budget 24-25 that £1·6 million of capital DEL late Barnett consequentials would be provided to DAERA for Lough Neagh initiatives. That earmarked funding will also be provided as part of the June monitoring round. Given the funding available for allocation, Budget 2024-25 concluded with all resource and capital DEL allocated and £21·3 million of unallocated financial transactions capital. The agreement of the interim fiscal framework resulted in an additional £23·9 million from the application of the 124% adjustment factor to the spring Budget. While Barnett consequentials from Westminster Main Estimates will not be confirmed until they have been introduced in Parliament, on the basis of previous indications, I have anticipated £185 million resource DEL from that source. There is a risk that the amount ultimately received could be lower. However, given the pressures facing Departments and the need to provide them with any additional funding as early as possible in the financial year, I am content that that is an acceptable risk. Not doing so could result in Departments taking actions that are not required, thereby causing further detriment to our public services. Combined with carry-forward from 2023-24, an adjustment for an error in comparability factor and reduced requirements, that has resulted in £257·9 million of resource DEL, £59·1 million of capital DEL and £23·6 million financial transactions capital being available for allocation in this monitoring round. Under legislation, the salaries of statutory office holders are met directly from the NI Consolidated Fund. However, Budget cover is still required and must be funded. The Department of Justice requested an additional £1·1 million for judicial salaries, which will be provided in this round. Members will be aware of the ongoing issue of the Education Authority (EA) pay and grading review. I have been working collegiately with the Education Minister, and I thank him for the positive work that he has done to find a way forward for the workers. I am pleased to advise that £43·7 million will be provided for that in the June monitoring round, which will allow the staff, some of whom are amongst the lowest paid but play a vital role in supporting our children and young people, to move onto the new pay scales from the start of the financial year. The Executive have also committed to provide funding for a non-consolidated recognition payment in lieu of back pay to eligible staff in 2025-26. That will be funded from the repurposed funds in the financial package. However, utilisation of the funding for that purpose will occur only if the Treasury does not agree to my request to reprofile funding from the financial package. Having taken account of those two issues, the Executive had £213·1 million resource DEL, £57·5 million capital DEL and £23·6 million financial transactions capital available to address pressures. Given the pressures identified in the Budget, it will come as no surprise that the resource and capital bids in this monitoring round far outweigh the level of resources available. For every £1 that we had to allocate for day-to-day funding for public services, we had six times as many demands, with bids totalling some £1·27 billion. Similarly, for every £1 that we had to spend on capital, we had nine times as many demands, with bids in excess of £520 million. There is simply not enough funding available to do all the things that we wish to do. I have been pressing and will continue to press the Treasury for better funding for public services, but, until that happens, the Executive must live within the funding provided to them. As Members will be aware, delivering a balanced Budget for 2024-25 was a requirement of the financial package. Any overspend this year would automatically be deducted from next year's block grant, making an already challenging year even more difficult. I am sure that we all want to avoid that position. I hope that the allocation of over £200 million resource DEL to Departments will help to mitigate some of the worst impacts. Full details of the bids and allocations are set out in the tables that accompany the statement, but I will highlight a few specific resource DEL allocations. The Department of Agriculture, Environment and Rural Affairs will receive £4 million for bovine TB programme delivery and an earmarked allocation of £1·5 million for the environmental improvement plan, which is aimed at addressing the water quality issues at Lough Neagh. The Department for the Economy will receive £2 million for the inescapable pressure of the shortfall in the higher education teaching grant. The Department of Health will receive a general allocation of £121 million resource DEL to help to address funding pressures, with a further allocation of £0·9 million to enable it to fund additional healthcare training places in physiotherapy, occupational therapy, social work and nursing. In addition to earmarked funding for the EA pay and grading review, the Department of Education will receive a general allocation of £29·5 million to address a range of pressures relating to the Education Authority and schools, including supporting special educational needs provision. The Department for Communities will receive £10 million resource DEL to deal with a range of pressures, including increased demand for the discretionary support Supporting People programme, as well as for homelessness interventions, which will support some of the most vulnerable. The Department will also receive £0·5 million specifically for the arts to provide funding to that important sector. An allocation of £35 million resource DEL has been made to the Department of Justice to help to address a range of pressures across the Justice family, including a pressure that is associated with an increased PSNI pension contribution. The Department for Infrastructure will receive £6 million resource DEL to help it to meet a range of pressures, including increased personal injury claims and higher surface water drainage costs. The Executive Office will receive earmarked allocations of £1·5 million resource DEL to enable the Communities in Transition programme to extend its contracts up to March 2025 and £0·5 million for central good relations. Finally, £0·6 million resource DEL has been allocated to the Department of Finance to allow critical work on the planning and preparation for the next census to be carried out. The Executive have agreed capital DEL allocations totalling £57·5 million. Those include £10 million to the Department for Communities for the cladding safety scheme and £20 million for new-build social housing. Delivering on our housing targets is crucial given the demand for homes, and I will continue to work constructively with Executive colleagues on that important issue. I met the Communities Minister last week and encouraged him to consider whether greater use can be made of the available FTC in order to increase the supply of social housing, building on the schemes that the Department currently has in place. I gave him my commitment that my officials will work constructively with his on that. An allocation of £15 million has been made to the Department of Education for minor works, including for special educational needs and urgent health and safety works. An allocation of £12·5 million has been made to the Department for Infrastructure to help it to avoid having to pause critical infrastructure projects. Only minimal funding was available for ring-fenced resource DEL, and, historically, further funds are received later in the financial year. The Executive have agreed not to meet any of those pressures at this time but will revisit them in future monitoring rounds. All financial transactions capital bids of £3·2 million have been met, leaving £20·4 million of unallocated FTC. I ask all Departments to consider how that available funding can be utilised. To increase transparency, the statement is accompanied by tables outlining the detail of changes to departmental budgets. Further tables will be published on the Department of Finance website in due course. Under the heading "Technical Adjustments" in the attached tables are various Treasury-earmarked funding streams and Budget cover transfers from Whitehall Departments.

Those reflect areas such as tackling paramilitary activity, the immigration health surcharge, new deal funding, the NI protocol/Windsor framework, city and growth deals and Fresh Start funding for shared education and housing. In total, those amount to £161·3 million in resource DEL, £2·9 million in ring-fenced resource DEL and £120 million in capital DEL. It is clear that all Departments are under significant financial pressure. That is evidenced by the vast quantum of bids far exceeding the funding that we had available to allocate. Indeed, the Education, Health and Justice Departments all submitted bids totalling more than the overall amount that we had to allocate. Within the constrained finances available, the Executive must strive to balance funding pressures across all Departments. While the Executive do not have the funding to do everything that they might wish to do, today's allocations of over £300 million across resource and capital DEL will help to alleviate some of the pressures that Departments face. Working together, we will be better placed to meet the challenges that we face head-on. I want to work with all my ministerial colleagues to have one voice in making the case for more investment in public services. I have been making the case for increased levels of funding in public services and will continue to do so. I commend the June monitoring outcome to the Assembly.

2,124 words. Text as published by the Northern Ireland Assembly.

Assessment

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Assessed 21 October 2026 at 10:49 UTC by jev-1.13.0 (requested as typesafe/jev) under rubric 2026.10-r9, methodology 1.9.

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