Debate contribution: Budget 2025-26: Reports

Debate contribution by Mr John O'Dowd on 8 April 2025.

MLA

Mr John O'Dowd

Party at the time

Sinn Féin

Date

8 April 2025

Type

Debate contribution (made as a minister)

Business

Committee Business

Heading

Budget 2025-26: Reports

Assembly identifier

Official Report component 4919983

Read the official Assembly record

Text

Thank you, a Leas-Cheann Comhairle

I welcome the opportunity to participate in the debate on the Finance Committee and NI Fiscal Council's reports on the 2025-26 Budget. First, I thank the Committee and the Fiscal Council for the detailed work that they have carried out in developing their reports, and I thank Members for their contributions to the debate. As you are aware, I was here yesterday, giving an oral statement on the final Budget 2025-26, which was agreed by all Ministers on 3 April. It is my intention to return to the Assembly in mid-May for a full debate on the final Budget. I will turn to the Finance Committee's report. It provides a useful summary of the issues reflected in the draft Budget. I am pleased that it refers to the extensive engagement with my Department, which, I hope, the Committee found useful. I welcome the Statutory Committee's recognition that there is considerable pressure on the public purse and that difficult decisions will need to be made in a challenging fiscal environment. Much of that has been reflected in today's debate. Despite the challenges, it is important that we recognise that the Budget that was agreed last week provides some £19 billion for public services and infrastructure. The Finance Committee report identifies a number of common themes across all Statutory Committees, about which we have heard from Chairs and Deputy Chairs today. As I outlined yesterday, this is the last year in which I intend to bring forward a single-year Budget. The second phase of the spending review will be announced in June and will set out the Executive's resource funding envelopes for 2026-27 to 2028-29 and capital envelopes for a further year to 2029-2030. I intend to bring recommendations to the Executive for a multi-year Budget in line with the period of the spending review. Multi-year Budgets will be a game changer and will enable Departments to plan on a longer-term basis, bringing greater efficiency and effectiveness, but they will not solve all our financial problems. The five-year departmental sustainability plans will be a step forward, putting Executive finances on a more stable footing. The Budget that I presented to the House yesterday was the first step, earmarking funding specifically for Programme for Government priorities. Of course, delivering our priorities is not just about additional allocations; it is about how existing departmental budgets are spent. It is vital that existing funding is directed towards the agreed priorities. To help measure that work, work is under way to align departmental spending areas to PFG priorities, and that information will be published as soon as possible, following the receipt of all departmental information. We will use the final Budget spending area financial data in that analysis. However, this is the first time that we have linked baseline expenditure with the PFG. The information will be published and will be subject to appropriate caveats. I will turn to the Fiscal Council report on the draft Budget for 2025-26, which was helpful in informing consideration of the Budget. That report also highlighted the continuing difficult financial circumstances and challenging decisions for this year and into future years to maintain sustainable public finances and provide stable, high-quality public services. The Fiscal Council suggested a number of interventions that could, in principle, mitigate budgetary pressures. All those things have to be considered. Some have already been ruled out, by me and other Ministers, but others are more feasible. In setting the regional rate, the Executive had to be conscious of the impact on households and businesses. We had to carefully strike the right balance between raising income and limiting increases as much as possible, and we had to recognise the ongoing challenges for households and businesses. In my view, the uplift for domestic and non-domestic properties that was agreed for 2025-26 achieved that balance. The Executive are committed to looking at options to deliver efficiencies, generate revenue, enhance borrowing powers and explore the potential for more fiscal powers. It will be for Ministers to make plans to live within their final 2025-26 allocations and make savings through efficiencies in order to fund higher priorities. In addition, the outworking of the Executive's Budget sustainability plan will help to drive efficiencies in the Budget process as well as in Departments. The Budget improvement plan is a significant pillar of our future work plan. My predecessor, Minister Archibald, approved and published a high-level road map for the Budget improvement plan and put in place a series of measures to improve the overall Budget process. That road map sets out short-term actions and areas to be developed over the longer term. The focus of the short-term actions has enabled some positive progress in relation to the 2025-26 Budget, including improved equality information and more user-friendly supporting documents, but I would welcome input on ways in which the process can be improved further or feedback on what has been completed to date. My Department has also published a high-level road map that sets out key elements in the development of longer-term five-year departmental plans. The road map covers short-term actions and key actions over the medium term that will facilitate Departments in progressing the development of five-year financial sustainability plans, the intent being that those will be in place in this calendar year. Now that a 2025-26 Budget has been finalised, I intend to formally commission those plans in the coming weeks. The Executive's focus must be on wider Budget sustainability, and we must also look at how we can do things better, improve efficiency and focus on desired outcomes. While income generation will be part of the decision, it must be based on the economic and social context and the need to deliver the public services that our citizens expect. The Budget sustainability plan committed the Executive to the completion of a strategic review of income generation measures. It will be for all Ministers to consider the appropriate income generation measures for their Department, and, obviously, Committees will play a vital role in that as well. Work on the strategic income review will commence shortly. That will allow Ministers the time and opportunity to consider their spending envelope and income generation measures for the 2025-26 financial year before contributing to the review. It will also allow time to consider new income generation measures and alternative funding sources and assess how other funding sources can be maximised, with the review ideally to be completed in advance of the multi-year Budget's being set later this year. I welcome the contributions from the Committees today. As I said in a debate yesterday, the work of the Committees in this place is not properly recognised or valued, and Committees are not given the credit that they deserve. As we continue with a very challenging budgetary outlook, the work of the Committees will be vital in ensuring that we deliver the public services that our public expect from us.

1,157 words. Text as published by the Northern Ireland Assembly.

Assessment

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Assessed 21 October 2026 at 12:21 UTC by jev-1.13.0 (requested as typesafe/jev) under rubric 2026.10-r9, methodology 1.9.

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