The Assembly – struggling to face cuts reality

In the interests of Slugger’s ” better politics campaign”, I sat through the on line coverage of the special Assembly debate on the cuts. (Note the lack of a full report on the MSM). MLAs were united on three things: that the British government had broken their promises, that MLAs themselves had to unite to do something about the cuts ; and three – and this one wasn’t deliberate – that no one had much of an idea what that  “something” might be .

Along with his unity call, Gerry Adams invoked his attendance at funerals.

The Tory Government have also reneged on the St Andrews commitment to £18 billion for infrastructure. That is entirely and absolutely unacceptable, and we need to face up to that.

Among the provisions most likely to be affected are mental health services, which are under pressure already. Last week, in the constituency of West Belfast, four young people are suspected of having taken their own lives. I was at one of the funerals, and I called to each of the wake houses.

Costed proposals by Sinn Féin would realise almost £1·9 billion in combined savings and new revenue

People who are very well paid need to have their earnings capped. We believe that MLAs should take the lead and accept a 15% reduction in salary. That should also apply to the top layer of civil servants

We propose that the four major banks in the North should contribute to a development bond of £400 million over the next four years. The credit union movement could also contribute to a social fund. The Housing Executive and our Executive have the power. The Housing Executive could be authorised to borrow money to fund social housing needs.

Who does he suppose would buy the bonds which is a form of debt?

 

David McNarry of the UUP was equally united – but in his own special way, at Gerry Adams’s expense. For those who don’t know, this form of unity is an Assembly characteristic.

The Sinn Féin president reassumed his personal prejudice and exposed his shallow inadequacies when he said that, by indicating how people here should live, the Chancellor had shown the awful ignorance of a Tory Minister. Let me remind him how glad people here, and those in Brighton, Manchester, Canary Wharf and across the United Kingdom, are to be allowed to live.

This is all about Executive accountability — no sulks, no solo runs, no promises that we cannot deliver. It is all about protecting jobs and saying to people that things are going to be very tough

 First Minister Peter Robinson was glacially furious as he laid out the extent of Westminster’s ” broken promises”  first made by Gordon Brown. He sounds as if he’s spoiling for a fight with David Cameron

In his statement, he  ( Brown)  specifically indicated that it was a guaranteed settlement, which included £18 billion for capital expenditure….It seems to have been forgotten by everybody up to now that, at the moment at which £18 billion was guaranteed for capital expenditure, policing and justice was not devolved and there was no prospect of it being devolved.

Therefore, the £18 billion capital was to be made available for the existing Departments, not including policing and justice. It was to be made available from Government resources; it was not to include the reinvestment and reform initiative (RRI) loan capability or money that we would get by way of asset disposal or any other source. We were to get £18 billion over 12 years for our capital expenditure. Indeed, the trajectory of the money that came to us in the years that followed was in line with that commitment, without the add-ins that the Government of today are now attempting to include.

..Not only do we have a clear breach of the £18 billion, but they have disappeared the capital money for policing and justice. The settlement on policing and justice gave specific guarantees about certain matters; the police college was one and the prison another. Our allocation was set not only for the £18 billion, but that the capital budget for policing and justice would take account of us at least being able to deliver those specific projects. All of that has gone.

There is also a breach regarding our access to the reserve. Initially, our access had been unqualified; it was simply if there was a large requirement for additional funding that was unforeseen

Furthermore, there has been a breach in relation to end-year flexibility (EYF). The Government breached that very easily: they have ended EYF… In the general terms of EYF, we had over £300 million sitting in our EYF stock. The Government are ending EYF; that money is lost to Northern Ireland. That is a huge chunk of money that, by moving it from revenue to capital, could have helped us to deal with some of the reductions that are taking place in that area.

The First Minister persists with detailed and direct charges which Westminster denies. This is not about complex accounting. It must be cleared up. But does Peter really believe that the coalition was going to pay NI the equivalent of over two year’s extra budgets at a time when cuts averaging 25% were being imposed everywhere else? And does it really help to treat the post- St Andrew’s finance package like a legally binding document a new government under new circumstances cannot touch?

In the debate, one obviously sceptical speaker was his own Finance Minister Sammy Wilson, winding up in more senses than one.

Nobody has specified what they mean by resistance — [Interruption.] Sorry. [Laughter.] That is the first person to get knocked on the head. There will be a few more before the debate is over. Just stay clear, because it could get worse…

The First Minister outlined some of those this morning: the commitment to the £18 billion and the money that was committed to policing and justice. Of course we should talk to the Government about those issues because promises were made and should be honoured. Nevertheless, the core of our Budget has been determined by a formula that we did not negotiate and for which the Secretary of State had no responsibility. Once other Departments had their spending set, that formula fed a certain sum of money to Northern Ireland.

If anyone really thinks that the whole of the United Kingdom’s spending is going to be looked at again by the Chancellor, who said that he made his announcement last week to calm the money markets and to make sure that we do not get into the same situation as Greece and Ireland, he or she is living in cloud cuckoo land. The Chancellor will not do that; he will not even hint at doing it, because that would send the money markets, which he has been trying to calm, into a flurry. For that reason, we have to live with reality.

SDLP leader Margaret Ritchie was prepared to live with reality, starting with an admission that .the revenue cut is comparatively small

 On current expenditure, we will face a cut in real terms of 7% by the final year of the CSR. Departments could well be tasked with finding savings of less than 2% per annum overall, and, whilst that will be very difficult, that is the political and financial reality. There could well be voluntary redundancies, whereby people leave and retire. Therefore, we have to look at possible ways to protect those in public sector jobs.

On the capital expenditure side, regardless of what smoke and mirrors the Secretary of State uses to sustain an unsustainable argument

First, the Executive may have to find sufficient savings in current expenditure to permit a significant transfer from day-to-day spending into capital in order to pump-prime our infrastructure and our capital side, and, secondly, we have to genuinely prioritise capital budgets

She was the first to discuss the welfare cuts which in practice are not devolved to Stormont.

That brings us to annually managed expenditure, where the damage is really being done. The Northern Ireland share is not far off £500 million. However, what makes this situation iniquitous is that the money does not come out of the Northern Ireland block, where we could all protest about budget cuts. It comes directly out of the pockets and purses of benefit recipients. David Cameron claims that that is fair and that the Government have done the right thing in the right way. I do not think that they have done the right thing in any case, but they most certainly have not done it in the right way. There is unfairness in child benefit. What about snatching the mobility allowance that is payable to people in residential care? Do the Government want people to walk to hospital appointments? Those large-scale welfare cutbacks have little to do with the laudable desire to help people move out of benefit dependency and into the dignity and self-sufficiency of gainful employment.

Chris Lyttle for the Alliance party looked forward to longer term ” shared future” savings

Like it or not, political posturing has wasted money and opportunities to improve the efficiency of public services in this region. We needed RPA, we need ESA, and we need reform of arm’s-length bodies. Without that, we will continue to fail the public, who expect the Assembly to make decisions that will help our society by delivering improved opportunities for education, jobs, health and support for the most vulnerable people

The Alliance Party would prioritise actions that will find savings through building a shared future. In the context of real financial pressure, the luxury of wasting money on maintaining a divided society cannot be tolerated, and, although it will take time to realise those savings, it is critical that we make a start now. The Alliance Party estimates that addressing the cost of division can lead to savings of around £1 billion a year. Specifically, there are considerable economic and social benefits to be achieved through the sharing of education

The social partnership that appeared to be so successful in creating the Celtic Tiger was recommended by Damian O’Loan of the SDLP, with a possible public sector pay freeze in mind.

We need partnership in here and the bigger social partnership of the business sector, the trade union sector and the community and voluntary sector all working together.

I must refer to our public sector workers, because the debate about what is about to happen and whether we need freezes or pay cuts at certain salary levels could easily turn into an assault on our public sector and could demoralise the very sector that we need to deliver the services that we want. We need to bring public sector workers on board

Dawn Purvis, now Independent was  all for continuing Northern Ireland exceptionalism, ( even though NI is not straightforwardly the poorest UK region)

Although some in London have grown weary of hearing it, Northern Ireland is a special case. It has a small economy that is struggling for growth, and the cuts are not fair. Living standards here are about 80% of the UK average; employment is below the UK average; and a higher proportion of those of working age here have no academic qualifications. Furthermore, the employment that we do have tends to be in sectors that have moderate or lower wages. Our population relies more on welfare benefits; our housing stock is in worse shape than that in the rest of the UK; and we experience higher levels of fuel poverty.We are at a very different starting point for the introduction of these cuts.

The DUP’s Simon Hamilton, eager perhaps for the DUP’s own growth potential, had a word for that neglected body of people in Northern Ireland, the squeezed middle.

The people most worried about the future in Northern Ireland are not the elderly or the middle-aged, who have may have experienced recession before and be worried about their jobs or their families; it is the generation of people aged 25 to 34. Thirty-two per cent of that grouping fear for the future and are having difficulty paying their finances.

That generation that should have been full of hope and least impacted by the Troubles. They should have had the most potential to grasp hold of peace and prosperity, but instead they fear for the future in Northern Ireland. It is easy to understand why. Many of them are mortgaged to the hilt, some are in negative equity and some of them cannot find a mortgage at all. They tend to have young families, so there may only be one income coming into the house. They are also, by and large, very well educated, but there is a dearth of graduate jobs. Many of them are shackled with student debt.

To be fair, politicians everywhere in the UK are only now turning to how the spending review is to be implemented in detail. While it is the privilege of opposition to continue challenging them in principle, it is the business of government to implement the cuts with maximum ingenuity and minimum pain. Just to remind them, the Assembly parties have to face up to greater challenge of being in government now.