Permanent secretaries asked to find savings ahead of budget for Northern Ireland

Permanent secretaries in Stormont departments are being asked to find savings ahead of Northern Ireland Secretary Chris Heaton-Harris setting a budget.

It is understood that in order to protect spending within the Department of Health, some other departments will face cuts of up to 10%.

The Northern Ireland Secretary will be responsible for setting a budget for the region at Westminster in the absence of local ministers.

Senior civil servants have been running departments since last October.

Mr Heaton-Harris said he would set the budget when the “to and fro” with permanent secretaries was completed.

He said: “I’ve asked them a whole host of questions about how money is spent in Northern Ireland, what indicative spending could look like.

“But it’s pretty obvious what it’s going to be because there’s a sum of money that comes from the block grant that was set in the UK budget and then there’s a limited amount of revenue that comes from regional rates and the like, and that is the sum of money we have to spend in Northern Ireland.

“I will set a budget when I’ve finished the to and fro with the permanent secretaries.”

It is understood that Mr Heaton-Harris has already been presented with data by the heads of the Stormont departments but has asked permanent secretaries to clarify options for savings.

That process is likely to take around two weeks.

The savings will include paying back a £300 million overspend from the previous financial year.

The scale of some cuts to public services required by the forthcoming budget will require decisions currently beyond the legal power of permanent secretaries.

This would potentially require new legislation to be  introduced by the Secretary of State to enable him to direct the officials to make cuts.

It is also understood that Mr Heaton-Harris has asked civil servants to look at more long-term issues such as workforce planning and options for revenue raising.

DUP MP Gavin Robinson said there had to be a recalibration of how Northern Ireland is funded.

He said: “The Treasury contribution to fund public services in Northern Ireland is going down rather than rising.

“As an example, in England up to 2025, spending will increase by 6% but only 3.6% in Northern Ireland.

“The cost of providing public services for a small place is more expensive than a large one. We don’t benefit from economies of scale or critical mass.

“To provide vital services we need a disproportionately larger public service, and for as long as we receive 3% of what England needs under the Barnett formula, we won’t and don’t get enough.”

Mr Robinson added: “Unless there is a total recalibration of how Northern Ireland is funded, the situation will only get worse.

“With or without an executive, and with or without the (Northern Ireland) Protocol, Barnett will only lead to our budgetary pressures getting worse.

“Public services in Northern Ireland will stall and get to a point where it is irretrievable.

“For decades Northern Ireland’s infrastructure was in stagnation and as a result it needs mammoth investment which we cannot afford yet to stand still means houses and factories struggle to get built.”