Stormont Finance Minister Caoimhe Archibald has flagged a shortfall of roughly £100 million due to the upsurge in national insurance contributions for Northern Ireland. Additionally, she has confirmed the appointment of a specialist to gauge the region's general level of need before the upcoming Spending Review for 2026/27.
Ms Archibald commented on the issue while addressing the Northern Ireland Affairs Committee via video link, where she highlighted that "years of underfunding" of public services "was never going to be reversed in one Budget". She emphasised to MPs the importance of effectual and proficient public service delivery, noting: "The Executive fully recognises the need to deliver public services as efficiently and effectively as possible and we are all in agreement that transformation is essential if the Executive is to put our finances on a sustainable footing," and adding, "But to be able to do that we need to have fair and stable funding."
Furthermore, she raised concerns about the hike in national insurance, revealing to the committee members an estimated extra expenditure of around £200 million for departments and their agencies for the financial year 2025/26.
She pointed out that "The Executive, like the devolved governments in Scotland and Wales, does not have the financial capacity to compensate for decisions made on reserved taxation matters," she told MPs.
"While the Chancellor has said that support will be provided for public sector employers, this is likely to fall far short of what is needed for us in the Executive, possibly in the region of £100 million.
"I’ve obviously been engaging with the Chief Secretary to the Treasury in relation to that particular point to ask for urgent clarity on the quantum of funding and to ask for these costs to be met in full, and also to appeal for consideration to be given to support for those outside central government but who support us to deliver vital public services."
Earlier this month, Sir Robert Chote, chairman of the Northern Ireland Fiscal Council, warned that the Stormont Executive faces a financial "cliff-edge" when stabilisation funding provided by the UK Government runs out. On Wednesday, Ms Archibald informed MPs that her department is developing the evidence base to demonstrate the need for a higher level of funding to inform the upcoming Spending Review for 2026/27.
As part of this, she announced that Professor Gerry Holtham, who led the Holtham Commission in Wales, has agreed to conduct an independent review on Northern Ireland’s level of need. Meanwhile, Fleur Anderson, under secretary of state in the Northern Ireland Office, told MPs earlier that the Stormont Executive has a mountain of challenges to climb, pointing out waiting times for health services and diagnosis for children with special educational needs.
She remained adamant that the necessary funding and mechanisms are in place for Stormont to address the issue. "Fundamentally transforming public services will require the Executive to own a difficult set of decisions," she stated.
"The money is there, the levers and powers are there for the Northern Ireland Executive to deliver."
She highlighted the significant financial provision: "There has been a big settlement ... with the largest settlement in real terms since the devolution, the Government providing £18.2 billion for the Northern Ireland Executive with a £1.5 billion top-up."
She emphasised the sufficiency of funds for public service transformation, urging a shift in focus from funding to implementation: "There is enough money to transform public services, the discussion now needs to move on from funding to delivery."
DUP MP Gavin Robinson raised concerns about whether the hike in national insurance contributions had been considered in Northern Ireland’s budgetary outlook. Ms Anderson acknowledged the fluidity of financial circumstances, replying: "There are always going to be changes within the year."
She also dismissed Mr Robinson's insinuation of Westminster's casual approach to Northern Ireland’s finances, asserting her awareness of the "enormous mountain that the Northern Ireland Executive have to climb."
"The main message we’re saying is not ‘you’ve lots of money, get on with it’, the main message is, ‘there are tough decisions to be made, it is a difficult climate but don’t let that stop transformation’," Ms Anderson concluded.
For all the latest news, visit the Belfast Live homepage here and sign up to our politics newsletter here.
English (United States) ·