When is a Billion quid really worth £30 million?

When it’s the amount of the deal done by the Conservative Party with the DUP, that’s when.

Today the parties announced the terms of reference and the financial package that will underpin their confidence and supply agreement. There’s been widespread shock and anger amongst Parliamentarians and the great British public that these upstarts from Ulster are getting their paws on a £1 billion notes.

But are they really? Is this new money at all? More importantly, is it money that wouldn’t have gone to the north anyhow?

I am not an accountant but I can count. Nor do I have the skills to launder money through various pots to hide its true source or destination. But I can add and subtract and I do know how much I earn and how much I owe. And that’s why the numbers just don’t add up to me.

In her speech outside Downing Street, Arlene Foster said: “We welcome this financial support of £1 billion in the next two years as well as providing new flexibilities on almost £500 million previously committed to Northern Ireland.”

Writing in the Belfast Telegraph, economist David McWilliams has described the deal as “nothing more that a subsidy junky’s shopping basket.” So let’s take a peek in the basket, shall we?

Ok new flexibilities – that just means £500 million can now be spent in places other than where it was allocated. It’s not new, so we can ignore it for the purposes of our sums.

First up was infrastructure funding of £400 million, a huge chunk of which will go towards the York Street Interchange Project. Isn’t that the same York Street Interchange that former Infrastructure Minister Chris Hazzard secured commitments from the EU to match fund? So match funding means that Westminster was always going to stump up for 60% of the costs of EU funded infrastructure projects, whether in direct funding or as part of a deal that might be agreed this week in Stormont. The British Treasury had already vowed to cover any EU funding shortfalls for projects signed off before Brexit. Sure, the DUP stole a march on the other parties in getting a written commitment on the funding today, but it was always going to happen anyhow and we already knew about it. Move along, nothing new or surprising to see here.

Likewise the £100 million over 5 years to fund areas of severe deprivation: this is the Social Investment Fund Mark 2 and also would most likely have come about following a deal at Stormont. Our politicians have become accustomed to negotiating in the payoff on any political deal.

In addition we have £150 million on high speed broadband, £200 million on health service transformation, £50 million on mental health services, and £100 million on immediate pressures in health and education. That’s the other £500 million right there on the credit side.

So £500 million that the north would probably have gotten anyhow and £500 million of other money; still a good deal, right?

Except on the debit side is that big £470 million of funds committed to future payments under the Renewable Heating Incentive scheme. Yes, RHI hasn’t gone away, you know.

There is no plan in place to address the financial commitments given under the scheme and, to date, no legal way identified for the Executive to withdraw from it. There is also no Westminster guarantee scheme to prop it up.

If you offset that liability against today’s announcement of funding – half of which would probably have come to the north anyway in one guise or another – then you’re left with a reality of only £30 million in tangible economic benefit.

That’s not a lot of money for supporting a government for up to five years.

Looks to me like somebody had been sold a pup.