Debate contribution: Northern Ireland Fiscal Council Bill: Consideration Stage

Debate contribution by Mr Matthew O'Toole on 5 May 2026.

MLA

Mr Matthew O'Toole

Party at the time

Social Democratic and Labour Party

Date

5 May 2026

Type

Debate contribution

Business

Executive Committee Business

Heading

Northern Ireland Fiscal Council Bill: Consideration Stage

Assembly identifier

Official Report component 5524529

Read the official Assembly record

Text

I am very pleased to speak today, and because I am in the slightly unusual position of being both the Chair of the Committee and the mover of the majority of the amendments, I will speak first as Chair of the Committee, and then I will move on and give a detailed view of the amendments that are before us today, if that is amenable to the Principal Deputy Speaker and Members. It is very important legislation, and I am pleased to have been the Chair of the Committee that scrutinised the Bill.

I beg to move amendment No 1:

I will give the Committee's view first. To be clear, the Committee has scrutinised the Bill overall, and it has not given a view on the amendments that are in my name or anyone else's name. The Committee has done other scrutiny that I want to outline to the Assembly for its benefit more generally. The Bill is unusual not because of its length or complexity but because of its clear importance. It is not every day that we legislate to put a body into law. The Bill places the Northern Ireland Fiscal Council, which has been in operation since 2021, on to a statutory footing following commitments made in the New Decade, New Approach agreement. It is an important piece of legislation, which provides a clear legislative framework for the council's functions. The Committee undertook very detailed scrutiny of the Bill. It sought written evidence from key stakeholders, carried out online surveys, commissioned research and took extensive oral evidence from a range of organisations, including economists, academics, the Scottish Fiscal Commission (SFC), the Irish Fiscal Advisory Council (IFAC), the OECD, the Northern Ireland Audit Office (NIAO) and the NI Fiscal Council, as well as the Department. I place on record my sincere thanks to all those who contributed. Their evidence was invaluable to our rigorous scrutiny of the Bill. The Committee specifically considered the issues in accordance with the OECD principles for independent fiscal institutions, which are transparency, integrity, accountability and effective governance. I thank the Department's Bill team, who worked very closely with the Committee. The Bill comprises nine clauses and two schedules, which I will briefly run through and highlight the issues raised by the Committee. Clause 1 establishes the NI Fiscal Council as a statutory body. There has been widespread agreement that they think the council on a statutory footing is an appropriate and necessary step. It supports the council's authority, credibility and permanence and aligns Northern Ireland with established international practice. Clauses 2 to 6 set out what the council is there to do. They place clear duties on the council to assess the Executive's Budget and examine the sustainability of public finances. That work is particularly important, given current pressures on public finances. Clause 2 sets out the council's main functions to examine and report on public finances, including statutory duties to publish a Budget assessment report and a fiscal sustainability report alongside any other reports that the council considers appropriate. Clauses 3 and 4 provide the detail on those reports, including the purpose of the Budget assessment report and the distinction between that report and its thematic fiscal sustainability reports. In carrying out its scrutiny, the Committee gave careful consideration as to whether the council should have a formal role in forecasting whether an assessment should take place. The Committee has not tabled amendments, but, clearly, members have taken a view on that, and I will move amendments later in a different role. Clause 5 enables the Department of Finance to confer additional functions on the council. That received particular scrutiny. The Committee sought and received assurances that any such changes would be subject to consultation, including with the Fiscal Council, and would require Assembly approval. The Committee also secured extremely important clarification in the Bill's explanatory and financial memorandum (EFM) that the Committee for Finance will be included in the consultation process. I thank the Department for its willingness to address that question. The Committee also examined issues relating to independence, transparency and accountability. It welcomed the explicit provision in clause 6 that the council is not subject to direction or control and must act transparently, objectively and impartially, aligning with the OECD principles of independence and non-partisanship. The Committee considered matters relating to reporting, timing and engagement with the Assembly across clauses 2 to 6. It secured a number of assurances and clarifications related to the explanatory and financial memorandum, and I thank the Department for working with us on that. We have had important clarifications to the explanatory and financial memorandum that will strengthen and clarify accountability, when it comes to the Finance Committee — usefully, we had ourselves inserted into the EFM — and to the Assembly more broadly. The Committee is therefore content with clauses 1 to 6. I will turn to schedule 1. Much of the Committee's scrutiny focused on whether the governance framework provides sufficient assurance of the council's independence in practice. In particular, the Committee examined appointments, access to information, reporting, transparency and funding. The Committee recognised that amendments to the governance arrangements for the Fiscal Council could have wider implications. Such changes may set precedents for other arm's-length bodies, creating an unintended ripple effect, which the Committee was keen to avoid. For that reason, the Committee approached its scrutiny with caution, mindful that amendments specifically related to governance could have unforeseen consequences. For example, had we made substantive amendments to how the governance arrangements work, they could have had unintended consequences for other arm's-length bodies. However, we investigated in detail the transparency of appointments arrangements, including concerns about perceptions of independence. We sought clear assurances that appointments would be made in line with the Commissioner for Public Appointments code of practice and be subject to a skills audit, as well as securing clarification in the explanatory and financial memorandum that the Committee will be kept abreast of any changes to council membership. It is really important that we get that. It is important that we clarify that the Fiscal Council is not simply reporting to the Executive but, in fact, that it may have difficult things to say about Executive policy. It needs to be able to have the independence to say those things to the public and to this Assembly. The Committee also considered the council's right of access to information and noted the council's evidence that access to information has not been an issue to date. It welcomed provisions underpinning transparency, including the requirement to publish data statements, and secured clarification that those statements will also be provided to the Committee for Finance. That is really about baking in that independence. In addition, the Committee welcomed confirmation that memoranda of understanding are already in place with Departments and the Northern Ireland Office and will be reviewed once the provisions are placed on a statutory footing. Schedule 1 also makes provision for an annual report and external reviews. The Committee placed emphasis on the importance of strong Assembly engagement and the visibility of the council's work, and the Department agreed explanatory and financial memorandum amendments, confirming that both the annual report and external review reports will be shared with the Committee for Finance in addition to the Department.

Funding arrangements also received significant scrutiny, including the fact that the council's costs are included in the Department's estimates and that accounts are audited by the Comptroller and Auditor General. The Committee explored what those arrangements mean for independence and transparency, including the value of clear Budget lines and the importance of funding stability over the longer term. That is absolutely critical, because the Fiscal Council cannot be genuinely robust and independent if there is any doubt over its funding. We got clarity from the Department on that, but it will be for future Finance Committees and, indeed, all Members of the Assembly and external observers to ensure that the Fiscal Council is funded transparently and in a way that allows it to do its job. Clearly, the Fiscal Council, by the nature of its job, has to say things that are occasionally difficult for an Executive and for the UK Government, and, indeed, for other bodies to hear.

Schedule 2 makes consequential amendments that place the council within existing administrative audit frameworks, enabling it to operate as a statutory body. Throughout our scrutiny, we have sought to ensure that the Bill strikes the right balance between independence, accountability and flexibility, while remaining mindful of potential effects on other arm's-length bodies. We welcome the Department's engagement, particularly its willingness to provide assurances and amendments to the explanatory and financial memorandum that are particularly important. The Minister may want to touch on those in his winding-up speech, because we need to ensure that the Committee is kept informed, including direct receipt of council reports, membership notifications, data statements, consultations on regulations under clause 5 and copied accounts. Subject to the EFM amendments being made, we are satisfied that those are satisfactory, but obviously we want to see them made. Having completed our scrutiny, the Committee supports and has consistently supported the Fiscal Council Bill. Placing the Fiscal Council on a statutory footing is an important step in strengthening fiscal transparency and independent scrutiny in Northern Ireland. I will now speak in my personal capacity as mover of all but one of the amendments. I apologise: some of them are in the name of Matthew O'Toole, and some are in the name of the leader of the Opposition. Please do not read anything into that. It does not mean that some are better than others or that I like some of them more than others. It is just a quirk of the timing with which they were submitted. A lot of what I do as leader of the Opposition is in the spirit of robust political challenge and holding the Executive to account. Often, I do that in a robust way, and sometimes it is not comfortable for parties in the Assembly Chamber. Sometimes it is not that comfortable for me, because I have to stand up and do it by myself and get all the heat. However, today's amendments from me are genuinely about trying to build a consensus around how we improve governance in Northern Ireland. They are not attempts to score party political points nor to embarrass or pressurise a future Executive, because, however future Executives are structured — I hope that we continue to have future Executives, difficult as it is to govern this place, and I recognise that — we should all be looking for ways to improve the way that we do government. Our amendments to the Fiscal Council Bill will enable us to improve policy outcomes. If done right, they will improve the quality of the policy debate in the North. Whatever your political perspective — whether you are unionist or nationalist; whether you are on the left or the right; whether you, like me and many of us in the Chamber, are geeks about fiscal and economic policy or whether you do not give two hoots and simply want your public services to work better — this is about improving governance with better policy debate, better scrutiny and better accountability. That will seem a bit techie, but it is really important. I will go through the amendments. I am happy to take questions. I am mindful that we will break at 1.00 pm. I hope that I will have finished by then, but I do want to be generous in taking interventions or clarifying points for people, because I am keen that, hopefully, we can pass at least some of the amendments and build a consensus on improving policy making. Amendment No 1 inserts in clause 3 the requirement or the opportunity for the Fiscal Council, in its budget assessment report, for:

"consideration of the extent to which the proposed budget"

— that is, Budgets published by the Executive. I will not get into debates about the current Budget situation or where that is, because I am not sure that that is particularly useful for this debate. I want to talk about us doing better budgeting more generally. This amendment would allow:

"consideration of the extent to which the proposed budget is aligned with the most recently agreed Programme for Government required under section 20(3) of the Northern Ireland Act 1998".

The Northern Ireland Act requires a Budget and a Programme for Government of the Executive. We can have debates — I am sure that I will, at some point, have angry debates about the quality of the Budget, the absence of the Budget or the Programme for Government or whatever — but, theoretically, no one can dispute that we need the Budget to be aligned to the Programme for Government. However, I do not think that even the most optimistic observer of this place, going all the way back to 1998 — this is not about one or two specific political parties; this is about all of us, including my party — could claim that every Budget that has been agreed by this place, when we have been up and running and have agreed Budgets, has been aligned to the Programme for Government. We think that giving the Fiscal Council the power or, in fact, the obligation to assess the extent to which a Programme for Government is being delivered or reflected in a Budget is, frankly, a no-brainer. There was always a legislative question, and the Minister may come on to ask me about it. I am not predicting what he or other Members might say, but one might say that the Fiscal Council can do that anyway. It is true that there is a degree of flexibility in the legislation, but there is not endless flexibility. The Bill drafters make certain choices about what they include and what they do not include. For example, the Budget assessment report has to include:

"consideration of the extent to which public revenue in Northern Ireland is enough to meet planned expenditure".

That seems sensible and obvious, but those words did not have to be included. Bill drafters have included those words so that the Fiscal Council knows that we expect it to report on that and to give the public of Northern Ireland and MLAs a clear sense of whether there is enough money to meet planned expenditure. That is an obvious thing. It is no less reasonable to ask that the Fiscal Council report on whether that is aligned to the Programme for Government and how well that is being delivered. My amendment does not say that it needs to be an entirely free-standing report; in fact, it simply has to be included in the Budget assessment report. It does not say that it needs to be 50 pages long, five lines long or five words long. It simply says that there should be:

"consideration of the extent to which the proposed budget is aligned".

There is deep frustration among the public around delivery. Again, I will be careful, as I do not want to spend my remarks today scoring points — I will have plenty of other opportunities to do that, and I will take those opportunities — but it is simply about giving the Fiscal Council a clear mandate to report on how well the Executive are delivering. I could go through a range of things and say that they are not delivering on this or not delivering on that: that is not what this is about. This is about giving the Fiscal Council the best possible opportunity or the best possible mandate to do its work and to give the public in Northern Ireland a clear sense that someone is properly scoring and costing what is in the Programme for Government. Some of that work falls to the official Opposition. Not to challenge the Speaker's decision on amendments taken, but we had hoped to have party political costing, including for the official Opposition and for all parties, as a requirement of the Fiscal Council. That amendment has not made it to the Floor. I am not making any commentary on whether that is the right or wrong decision, but part of the scrutiny role of political parties or the Fiscal Council is about giving us the power to properly assess how well the Programme for Government is being delivered. It is clear that the public have profound concerns about delivery here. The most recent LucidTalk poll is fairly shocking in respect of the level of trust. Giving the Fiscal Council that power does not mean that it has to devote all its energy to it, but it is a hugely useful addition to its responsibilities. It would improve the work that we do, because those of us who are fortunate enough to be able to form an Executive will, when a Programme for Government is being designed after the election — hopefully, this time next year, in a year and a bit, people will be sitting down to thrash out a Programme for Government with clear, measurable outcomes — be able to say, "We will be measured against this, so we need to be sure that we will be able to deliver the things that we are going to put in the Programme for Government". It is not unreasonable for any party that that stuff is deliverable and can be measured. I am willing to hear objections as to why that is wrong. I genuinely hope that other parties and Members across the Chamber can support it. It is not about putting anybody on the spot; it is about us doing our job in constructive opposition as constructively as we can. That is amendment No 1. I suspect that I will probably not get through them all before lunch, but it is not me being loquacious in that regard. I had to go through them in some detail.

That was about amendment No 1. I am not speaking to clause 1; I am speaking to amendment No 1. Amendment Nos 2 and 3 are mutually exclusive, as you said, Madam Principal Deputy Speaker. Both of those are on the Marshalled List because I want to have a genuine debate. We had a debate at the Finance Committee, though we did not come to a hard and fast view. There was some scepticism and some interest. I do not want to misrepresent the views of the Finance Committee. I am speaking on my own account; others can speak for themselves. There was a genuinely useful discussion. Critical to our work as representatives in the North, whether you are unionist or nationalist, left or right is the extent to which the things that we do are geared not just towards counting the money that comes in and goes out, though that is critical and a big part of the Finance Minister's job, but towards improving people's prospects and our economy and making sure that economic outcomes are properly part of policy decisions. One of the frustrations that the Minister clearly has and that probably every previous Finance Minister has had, as well as anybody who observes politics, is that the devolved financial settlement is very much geared towards money in and money out. That means that the debates, including the contributions from people like me in my role as leader of the Opposition, sometimes become about saying, "Why are we not spending money on this?" and, "The UK Government are not funding us to the right level". Both of those debates are critical, but we often miss the third leg of the stool, which is the economic output. "Economic output" does not mean growth in a narrow sense; it can mean living standards, jobs and a range of other issues.

I do not want to make that promise on behalf of the Fiscal Council. There is a reasonable level of cynicism about the open-book exercise. Frankly, I think that it is a ridiculous document. There was a fairly jaundiced agenda from the Treasury. Certainly, having the Fiscal Council has already improved the debate here in the past five or six years. I hope that my amendments will improve the quality of debate even further. To be clear, amendments Nos 2 and 3 — am I going to be interrupted for lunch, Madam Principal Deputy Speaker?

Absolutely, Madam Principal Deputy Speaker.

3,413 words. Text as published by the Northern Ireland Assembly.

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