Debate contribution: PSNI Data Breach Compensation

Debate contribution by Mr John O'Dowd on 21 October 2025.

MLA

Mr John O'Dowd

Party at the time

Sinn Féin

Date

21 October 2025

Type

Debate contribution (made as a minister)

Business

Question for Urgent Oral Answer

Heading

PSNI Data Breach Compensation

Assembly identifier

Official Report component 5197595

Read the official Assembly record

Text

It is regrettable that the Chief Secretary to the Treasury has declined the Executive's request for access to the reserve for costs associated with the PSNI data breach. It remains my view that the exceptional, unavoidable nature of the costs meets the conditions of our reserve claim. People and families have been impacted by the data breach, and we all need to be mindful of the effect that it has had on them. Significant information was supplied to support their case for access to the reserve. That included outlining the extremely challenging budgetary position that the Executive face and how having to meet the costs will add further to the pressures that public services are currently under. As recently as last Friday, at the Finance: Interministerial Standing Committee (F:ISC), I pressed the Chief Secretary to the Treasury on that. I will continue to press the Treasury to reconsider the decision. Executive colleagues have been kept informed of the position and remain committed to working with all Ministers to consider how that financial pressure will be managed. It is not clear when the cost will crystallise, given the ongoing legal proceedings. Once those are concluded, I will be able to consider the budgetary implications along with my Executive colleagues.

What is required from the Chamber today is unity of purpose and a unified approach to sending a clear message to the Treasury from the Chamber and elsewhere that the Executive should have access to the reserve, that the bid meets the requirements of a reserve claim and, given the substantial pressures that the Executive are under, the reserve claim should be met. There will always be a bit of party politicking in here — it is the nature of the game that we are all involved in — but, if we have a unified voice today, it will be much more beneficial to the Executive and broader public services in ensuring that the claim is met. I informed my Executive colleagues on the day that I was informed of the Treasury bid, which was 1 October. I have been working since then to get the decision overturned. I was conscious that I was meeting the Chief Secretary to the Treasury on Friday in person, and I wanted to make sure that I engaged with him then. It was my intention to inform all members of the Committee on Monday. The fact that it got into the press is not of my making. That is for others who leaked the letter. I do not know who leaked the letter to the press. That is for them to respond to, but let us have a bit of political maturity about this one and keep focused on the objective.

I thank the Member for his question. He will be aware that the PSNI was included as part of the Executive's discussions and decisions on public pay last Thursday in order to help meet the PSNI pay bid. I have also indicated and made it clear that it is my intention, as part of the three-year budgetary cycle, to make a recommendation to the Executive as part of that Budget that the PSNI's sustainability plan is fully funded. That will amount to around £200 million over a number of years. The Department of Justice submitted a business case to my Department, and it has been cleared. It meets the required criteria, and I hope that Executive colleagues will support me in that bid to fully fund the PSNI's sustainability plan.

The figure of £760 million in the Treasury letter refers to the provisional out-turns from Departments in relation to the pressures that they face. Those pressures will rise and fall as the financial year goes on. Executive colleagues and I, as Finance Minister, have a responsibility to manage those pressures, and we will continue to do so. It was unfortunate that the Treasury took that angle of approach as part of its response to me. The PSNI data breach claim stands on its own and is exceptional. It is simply not possible for us to manage that in-year at this stage. That situation has not yet crystallised, however, and I will continue to engage with Executive colleagues and make the case to the Treasury for that reserve claim to be met.

Given the fact that the claim has been turned down, what we are witnessing is further proof of the significant economic pressures that the British Government are under. Some of that, it has to be said, is of their own making. They are operating within defined Treasury rules. The margins are so tight that I am incredulous that a sovereign Government cannot access £119 million in this instance. I am not expecting any increase in spending in any area from the current Government. We will have more information in that regard when we approach the Treasury. There may be examples where it will improve funding, but, at the moment, the situation in the Treasury is so bad that we should not be optimistic about anything in terms of increased funding.

I have had no direct conversations with the Justice Minister in that regard. My understanding is, however, that the Chief Constable has admitted liability in this case. I am not directly involved in the legal proceedings, but mediation is ongoing in relation to the scale of the compensation for each officer, as well as for PSNI staff. I assume that that will take into account all the issues that the Member has mentioned in considering the impact that the breach has had on PSNI officers and staff.

The Justice Minister and I have discussed the matter on a number of occasions in person, in correspondence and at the Executive table. There have been ongoing conversations and discussions between me and the Justice Minister and at official level in my Department.

We submitted an application to the reserve claim that contained substantial information as to why we believed that it met the criteria for the reserve claim, setting out the unexpected nature of it and the uncertainty as to when the costs would crystallise. I am of the view that it meets the criteria. Unfortunately, I think that it is a financial rather than a procedural decision in the Treasury, because it is in such a stringent position, some of it through its own making and its own rules, which it has been sticking to rigidly. A strong case has been made to the Treasury in writing and verbally.

It is the best estimate at this moment with the business case that we received from the Department of Justice. I simply do not know when it will crystallise. Engagement is ongoing at a legal level. My understanding is that there is another court hearing on these matters in November. Colleagues will be aware that, when legal engagement takes place, it may take more time than was expected around these matters. I will await the crystallisation of the figure and then continue to engage with Executive colleagues on how we find the funding for it.

The Treasury position is that we should have set aside moneys for the claim on the basis that we knew that a claim had been lodged. That is somewhat contradictory to the rules under which we operate, because we cannot hold a reserve. Given the financial constraints that all Departments find themselves under, I and the Executive thought that it was only right and proper in May to issue a monitoring round and help Departments to face the pressure that they are under. That is the rationale that the Treasury has given me for not supporting the bid, although I believe that it is simply in such stringent times that it speaks volumes about the state of the economy in Britain. How will we find the funding for it? That is part of the process of discussions that I and my Executive colleagues will have to have once the figure crystallises. I am conscious that it is coming at us. I am engaging constantly with my officials about what we can do and what options are available to us, but we first have to wait for the figure to crystallise.

I will continue to press the Treasury on the matter. I will also engage with Executive colleagues on contingency plans.

However, if the Executive have to find the funding, that will lead to significant challenges for other public services. We will have to work our way through that and see how and when we can deliver the funding.

The only bid that I made as a reserve claim was for the PSNI data breach. There was no broader bid regarding other elements and pressures facing the Executive at this stage. The only response that I got was to the question that I asked, which was this: can I access the Treasury reserve to pay claims resulting from the PSNI data breach? Thus far, the answer is no.

We are adopting the approach that other devolved institutions and Whitehall Departments adopt when making requests to access the reserve. All those bodies take the same approach. It is not helpful to bandy figures around and say, "It might be this or it might be the other". It might not be any of those figures. It might be more. I have to deal with the reality that is in front of me, as do the Executive. There is ongoing mediation between representatives on both sides, and I will wait until those mediation processes are complete and a figure is given to me as Finance Minister or to the Justice Minister. The Executive will then have a job of work to do.

1,617 words. Text as published by the Northern Ireland Assembly.

Assessment

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Assessed 21 October 2026 at 13:33 UTC by jev-1.13.0 (requested as typesafe/jev) under rubric 2026.10-r9, methodology 1.9.

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