“It is not a bail out..”

On Stormont Live today the Northern Ireland Finance Minister, the DUP’s Nigel Dodds, was asked to “break down” the reported “support package of up to £8million” to local Councils amid warnings of large rates rises. The answer is in the ‘notes to editors’ in the ministerial statement – which also points out that he’ll need new subordinate legislation to finesse the figures..

1. The sums owed from all councils, as a result of the BT and MOD settlements amount to around £5.6million, the maximum that could be phased over five years. The maximum benefit to councils next year (covering actual income towards the end of the year and providing assistance with rate levels) will be up to £3.3million.
2. Councils will no longer have to pay a 3% contribution towards the cost of administering housing benefit, providing a benefit of £2.4million in 2009/10. There will also be a one off reduction in the cost of collection, of £0.6million, associated with the upgrade of LPS’ IT systems. The impact of the landlord allowance, for NIHE properties, will also be reduced, benefiting councils by around £1.6million in 2009/10. In total this represents benefits of £4.6million in 2009/10.

As far as I can tell the first step just requires the agreement of BT and the MOD. As for the second point, if the Councils don’t contribute those amounts.. who does? The landlord’s allowance is to be reviewed, but the other costs will have to be met by someone.