Saturday 24 February 2018

20,000 public jobs to be slashed - Stormont

Northern Ireland's First Minister Peter Robinson and Martin McGuinness Deputy First Minister. Pic Frank Mc Grath
Northern Ireland's First Minister Peter Robinson and Martin McGuinness Deputy First Minister. Pic Frank Mc Grath

Michael McHugh

Around 20,000 jobs are to be slashed from Northern Ireland's public sector following a political deal to safeguard powersharing.

The posts will go over the next four years after money was set aside in Stormont's budget for a voluntary exit scheme and freeze on recruitment.

An extra £27m has been set aside to mitigate the worst impact of welfare reform during the next financial year, finance minister Simon Hamilton said.

A dispute between Sinn Fein and the Democratic Unionists over the issue had caused deadlock in the devolved institutions.

A total of £40m has been set aside for dealing with the past, which includes new mechanisms for investigating past violence, and building a united community.

Ministers have moved swiftly to agree a budget following last month's Stormont House Agreement after weeks of intensive talks between the five main parties hosted by the British and Irish governments.

Mr Hamilton said: "In many respects, the most difficult decisions on public spending have yet to come.

"No one wants cuts, but I believe that in agreeing this budget we have done the right thing.

"We have accepted the realities facing us and have done what we can to protect and support what is most important to our people."

The final budget makes additional allocations of more than £150m, most of it following changes announced last autumn to how Northern Ireland's public sector is funded by Westminster. Schools, the health service and a government jobs agency to encourage foreign direct investment are among those to benefit.

Striking a budget was a key precursor for the implementation of many aspects of the recent Stormont House political deal on a range of long-standing disputes surrounding power-sharing.

It means the Government at Westminster can press ahead with legislation to devolve the power to set corporation tax levels to the Executive.

Mr Hamilton announced a range of measures for 2014/15 including an extra £204m for the Department of Health and an extra £65m for the Education Department.

An extra £20m has been allocated to meet pressures on the Police Service of Northern Ireland (PSNI) as it deals with a severe threat from dissident republicanism and £20 million to help universities and colleges build a skilled workforce.

In October the head of Northern Ireland's Civil Service warned the Treasury that it was on track to go into the red by the end of this financial year.

First Minister Peter Robinson had said arrangements for devolved government at Stormont were no longer fit for purpose.

A deal was announced just before Christmas after weeks of discussions at Stormont.

Most of Northern Ireland's smaller parties voted against the budget but it was passed with support from the DUP and Sinn Fein.

The country is more dependent on the public sector than other parts of the UK for job creation.

Mr Hamilton said: "The Executive continue to consider the detail of this reform and restructuring plan but it builds upon the five Executive parties' submission to HM Government during the recent Stormont House negotiations which outlined our agreement to reduce the public sector workforce in Northern Ireland by 20,000 posts over the next four years through a combination of measures such as a voluntary exit scheme and recruitment freezes."

The Agreement allows local politicians to borrow up to £200 million to pay for a voluntary exit scheme in 2015/16, yielding an estimated £500 million annual budget saving after the scheme has ended by 2018/19.

Penalties have been imposed by Westminster for not implementing welfare reform and massive costs could have been incurred if Northern Ireland had been forced to create its own system for distributing benefits, the DUP had warned.

Most of the extra money has flowed from changes to the amount received from the block grant, a consequence of extra money allocated to the NHS in England.

Mr Hamilton said: "Despite allocating an additional £150 million in this budget, it would be a misjudgment to believe that we can take our foot off the pedal of reform.

"A better budget than we might have dared to imagine six months ago does not mean that difficult decisions can be avoided."

Key points in the budget include:

:: An additional £204 million for the Department of Health to help protect frontline services, a 3.4% increase on last year;

:: An extra £65 million for the Education Department on top of that already allocated in an earlier draft budget to alleviate pressure on classrooms;

:: The Department of Enterprise, Trade and Investment received £3 million for job creation agency Invest NI;

:: The Department for Regional Development will receive £5 million for bus services in towns and road repairs;

:: The Office of the First Minister and Deputy First Minister is to receive £1.5 million for victims' services;

:: A total of £10 million has been allocated to a shared education and housing scheme called Together: Building a United Community.

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