Northern Ireland can set its own priorities for spending cuts, but cannot avoid Osborne’s axe

Only a dyed in the wool  political bigot could deny that the new Conservative-Lib Dem coalition has made an impressive start. In just a few days, they‘ve shown what a proper programme for government can look like if it’s made by politicians actively engaged in it, rather than fighting old battles. Anyone who doubts the continuing importance of Westminster should think again. 

 NI MPs should be relieved they don’t have to shore up a rickety Labour-led coalition with  unrealistic  spending demands that would have infuriated  the majority of English in all parties  and weakened their own position long term. Unity among NI politicians is all very well but blind resistance over NI’s share of new Chancellor George Osborne’s £ 6illion deficit reduction plan amounts to a declaration of impotence. The Executive should prepare its own programme to protect priorities over and above the existing £370 million already cut. Water charges cannot be far off. During the election campaign Peter Robinson predicted a further reduction of £200 million. This is unlikely to be the last.

There may be  a few consolations in the emergency July budget. Health spending in England is to be ring fenced and a pupil premium to help poor families is promised. As the programme for government puts it

 ” arrangements that will protect those on low incomes from the effect of public sector pay constraint and other spending constraints; and protection of jobs by stopping Labour’s proposed jobs tax”.

While NI controls much of its own spending, it is funded in line with English priorities. This allows the Executive to spread the burden of cuts according to its own priorities,  but not avoid them. The real crunch will come when the numbers are revealed in the comprehensive spending review in the autumn. 

On the Belfast stop of his lap of honour, David Cameron must spell out the impact of a succession of cuts amounting to £163 billion for the UK as whole. NI leaders shouldn’t sit back passively and leave it all to him. But they should also sup with a long spoon with SNP Scottish First Minister Alex Salmond who is organising a campaign of resistance to the new cuts.

Alex has his own agenda, which is to boost his faltering independence campaign by setting up the Tory led coalition to take the blame over as many of Scotland’s ills as possible.  The coalition in turn is calling Alex’s bluff by promising to implement the Calman report to give Holyrood 10p in the £ income tax and other limited powers. These could be on a ballot paper along with independence. But in hard times, who really wants taxation powers – “fiscal autonomy?”

No one with any sense st Stormont.

 From Alex Samond’s  letter to David Cameron

In my discussions with the Conservative and Liberal Democrat shadow chancellors before the election, I secured commitments from both that there would be no further reductions in the 2010-11 Scottish budget beyond those that have already been announced.

We therefore expect the UK government to honour the plans in place for Scotland’s public services this year. There are other specific areas of the Scottish budget, for example guaranteed access to end-year flexibility and access to a jobs fund, which are of importance.

The Scottish government is also clear that an incoming UK government should undertake that no change would be made to the current system of financing devolved government without consultation and agreement with the devolved administrations.

In the discussions referred to above with the shadow chancellors, one was able to give this assurance. One was not. In the interests of a constructive relationship between our governments, I hope it will be possible for you to confirm this assurance.

As I said, I am copying this letter to the deputy prime minister, and also to the first ministers and deputy first ministers of Wales and Northern Ireland.

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