John O'Dowd
Upper Bann · Sinn Féin · Northern Ireland
“As I set out in response to the previous question, we have in place the vacant property rate relief scheme and the small business rate relief scheme, which are very successful. I set aside £10 million in the draft Budget for small business rate relief to be invested.”
“I am particularly keen to hear from those impacted by vacant commercial units and especially about how any phased increase can be implemented in a sustainable way that is fair, proportionate and sustainable within the tax system.”
“I outlined my intent to take that approach in my statement on 18 November, alongside the fact that reform of rating policy should support growth, make better use of property and ensure that the system is fair, proportionate and aligned with wider economic objectives.”
“The accelerator will operate alongside our highly successful Back in Business scheme, which has helped to bring over 100 vacant high street properties back into use since May 2024. Those issues have been the subject of considerable interest and comment in the Assembly, and it is right that we grasp the nettle now.”
“There are no circumstances in which a hard border would be good for the people of Ireland; it would not be good for anyone. Those who suggest that are being naive at best and dangerous at worst, in the sense of not understanding this society. <BR /> <BR />Rural communities along the border are one and the same.”
“This announcement represents the next step in that. That said, I also put on record my intention to strengthen support for small businesses. In that vein, £10 million has been set aside in the draft Budget to broaden the impact of the small business rate relief scheme in order to increase the number of businesses that can benefit from it.…”
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“Some of us agree that it was a bad Budget for those who work. Others were out welcoming it last week, so they were.”
“There are differences of opinion across the Floor on the issue, but we have to reach agreement on it.”
“Yes. I have already presented a paper to my Executive colleagues on that, and I intend to intensify engagement with the Treasury on it. If there is one thing that the Budget made clear to me it was that the Executive, the Assembly and this society will have to take greater control of their taxes. I will use the simple example of VAT. The rate of VAT has been set elsewhere; it does not meet the needs of the business community and workers in this society. For example, hospitality here will lose out as a result of the difference between a higher rate of VAT here and a lower rate across the road in the border communities. <BR /> <BR />We will have to get serious about it. I have, as I said, brought a paper to my Executive colleagues, and my engagement with the Treasury will intensify.”
“Do you want to follow the example of your sister party, the Labour Party, and tax low earners? That was the Budget that you welcomed last week. The Budget that you welcomed last week taxes low earners.”
“The Chancellor's Budget was last week, and the Executive have not met since then. I will bring a multi-year Budget once I have had the full opportunity to analyse the implications of the Budget and all the returns thus far from my Executive colleagues. I will bring that Budget to my Executive colleagues before the Christmas break. They will then have to decide whether they agree with the draft Budget, and it may require more analysis, because it is the most important decision that the Executive will take. <BR /> <BR />The Member talks about revenue-raising measures. The Member keeps raising the matter, so which revenue-raising measures would he like to bring forward? Whom does he want to tax and how? Whom do you want to tax?”
“Somebody said something from the Back Benches. I am not sure what it was. <BR /> <BR />I will be bring a multi-year Budget to my Executive colleagues.”
“I am about to tell you want I am doing, if you would —”
“The Member seems to have changed his tone since last Wednesday and Thursday. I listened to him and other SDLP representatives who were out on the airwaves welcoming the Budget and challenging the Executive, saying that everything and anything was the Executive's fault. It is good to hear, now that, over the weekend, you have had the chance to properly analyse the Budget, you taking the opportunity to say, "Hold on. The Budget is not that good. We should not have been out praising it, and we should not have been pointing the finger at the Executive for all the woes in this society".”
“The autumn Budget falls far short of what is needed to support the delivery of front-line public services. While the autumn Budget presents challenges to us as an Executive, there is no doubt in my mind that, by working in partnership, we will be better placed to meet those challenges head-on. I stand ready to play my part in supporting workers, families and businesses, first and foremost by putting forward a multi-year Budget that is focused on doing what matters most.”
“There is not sufficient funding to do all that we would want to do or to provide any Department with the level of funding that it will have requested. Agreeing a multi-year Budget in a mandatory coalition will mean that there will have to be give and take on all sides. <BR /> <BR />The statement has provided Members with an overview of the implications of the autumn Budget. While additional funding for public services is always welcome, it must be viewed in the context of a marginal increase only, with demand and the cost of delivering services exponentially rising. While there are elements in the Chancellor’s statement to be welcomed, the Chancellor has neither gone far enough to invest in public services nor helped to boost our economy.”
“I will shortly bring forward a multi-year Budget for Executive agreement, one that will shape our public services for the years ahead. That will give Departments the certainty that they need to plan for the longer term and make much-needed transformational change in the delivery of our public services, despite the Chancellor's not providing the investment required to accelerate the pace of change. The multi-year Budget will, of course, present challenges, not least because the quantum of funding falls short of what we had hoped for. As I said last week, this is one of the biggest decisions that the Executive and the Assembly will make between now and the end of the mandate, and it is important that we get it right. We need to be realistic.”
“In my view, the Budget is another illustration of why we need greater powers locally to ensure that our tax system takes account of our circumstances. Having greater fiscal powers would allow us to make different choices, to change behaviours, to spur economic activity or to generate income for public services in a fairer and more progressive way. My Department will intensify work to progress a full fiscal framework that will include consideration of additional tax powers. I am fully aware that Members will have different views on that, but I believe that we can work together and use the evidence base provided by the independent Fiscal Commission to agree where greater control over fiscal powers could deliver real benefits. <BR /> <BR />While I would have wanted a different outcome from the Budget, it gives us funding certainty.”
“Instead, it primarily feathers the nest for the headroom that, the Chancellor thinks, is needed within the fiscal rules that she set, all to appease the financial markets.”
“That is a key barrier to economic growth here. <BR /> <BR />I have consistently made the point to the Westminster Government that taxes should be fair, proportionate and progressive, with those with the broadest shoulders carrying the greatest burden. In my view, this Budget represents a missed opportunity to make the tax system more progressive, to significantly increase investment in public services and to deliver the stimulus that is necessary for our economy.”
“That will only increase the existing disparity that is already faced by our local sector. A reduction in the VAT rate is crucial so that hospitality businesses here can compete on a level playing field in the all-Ireland economy. <BR /> <BR />The Westminster Government have also failed to make significant improvements to the application of inheritance tax on our local farming community. While the Chancellor has announced that the £1 million threshold for the family-farm tax will be transferable between spouses, that is, in my view, insufficient to protect our family-farming sector. Nor did the Chancellor take the opportunity of the Budget to address the lack of resource funding for the local growth fund, which enables the community and voluntary sector to support those who are furthest from the labour market to get back into work.”
“The Treasury’s own analysis shows that the cap is expected to affect more than a quarter of basic-rate taxpayers who are using the scheme. <BR /> <BR />The Chancellor also made a number of changes across a suite of other taxes, including increasing tax rates on dividends, property and savings income; an increase in duties on gaming and betting; and a new electric vehicle excise duty, among other measures. <BR /> <BR />Unfortunately, the Chancellor has missed the opportunity to improve the tax system through measures that had been called for locally and, in particular, by not changing the rate of VAT for our local hospitality sector. In the South, hospitality VAT is currently 13·5%, and the Irish Government have announced that, from July 2026, it will reduce to 9%.”
“Since income tax thresholds were first frozen in April 2021, thousands of low-paid workers have been dragged into paying tax for the first time, while others have been pulled into higher tax bands. As a result of the measures in the Budget, the Institute for Fiscal Studies has said that, in 2030-31, a basic-rate taxpayer will pay £220 more tax a year, while a higher-rate taxpayer will be charged £600 more a year. That freeze could also affect our pensioners. Pensioners who have income in addition to the state pension could pay more tax as a result of threshold freezes. <BR /> <BR />The Westminster Government’s decision to cap National Insurance contributions on salary sacrifices into pension schemes will also hit workers.”
“<BR /> <BR />The measures that have been announced will result in the British Government’s tax take rising to an all-time high. Yet, despite the Budget resulting in an additional £26 billion being raised by 2029-2030, it is extremely disappointing how little additional funding is being provided to the Executive. For public services to be delivered, you need tax income. I am not arguing against collecting tax revenue, but it must be done in a fair and equitable way. Those with the broadest shoulders should carry the biggest tax burden. I do not think that the Chancellor has got that right in this Budget. <BR /> <BR />The Chancellor’s decision to freeze income tax and National Insurance contribution thresholds until 2030-31 represents a stealth tax, which will impact on workers and their families.”
“<BR /> <BR />It is unquestionable that our public services are facing increased demand and increased pressures, with increased costs to deliver the services that people rely on. The announcement provides just £18·8 million in 2025-26. While I anticipate that Westminster’s spring Supplementary Estimates will provide some modest additional funding uplifts for 2025-26, the exact amount remains uncertain. What is clear, however, is that it will not come close to addressing the level of pressures that the Executive are facing this year. Each Minister must strive to improve efficiency in the delivery of our public services, ensuring that every pound of funding delivers maximum value. All Departments must continue to take all necessary actions to manage their overcommitments and to reduce any overspends in this financial year.”
“While I welcome the additional £370 million of Barnett funding that was announced, the Chancellor could, and should, have gone further. The allocation provides some £240 million for day-to-day spending over the four years from 2025-26 to 2028-29 and £130 million for capital investment over four years from 2026-27 to 2029-2030. While that may sound like a substantial allocation, the reality is that, when taken over the four-year Budget period, it falls far short of what is needed. The additional funding that has been provided will not undo the damage that has been caused by years of British Government underfunding of our public services and is insufficient to plug current and future funding gaps.”
“<BR /> <BR />However, the Chancellor's decision to freeze income thresholds will impose an additional tax burden on thousands of workers and their families. That will limit their ability to cope with the rising costs of living and reduce their spend in local businesses. I am disappointed that there was not more support in the Budget for businesses. That was a missed opportunity to allow us to grow and support our local economy. The Chancellor has neither gone far enough to invest in our stretched public services nor taken steps to support economic growth. I will outline today what the Budget means for our public finances, the impact of the tax measures that were announced and my next steps as Finance Minister to support our public finances and public services in the time ahead. <BR /> <BR />First, I will turn to our public finances.”
“Thank you for the opportunity to update Members on the implications of last week's autumn Budget for our public finances and our society. <BR /> <BR />I have been clear, inside and outside the House, that delivering quality public services and creating conditions for economic growth are key priorities for me. Ahead of the Chancellor's Budget, my consistent message to the Westminster Government was that we needed a Budget that supported workers, families and small- and medium-sized businesses. I welcome the removal of the two-child limit, which will help to lift thousands of children here out of poverty. That was the right, if not long overdue, decision to make. I also welcome the Chancellor's decision to increase both the minimum wage and the living wage. Those important steps will support our lowest-paid workers.”
“The Education Minister delivers the childcare policy on behalf of the Executive. The Executive have, from almost a standstill start on that and other areas of child support, invested £55 million in the past financial year. I will make proposals to the Executive about increasing that over the next three-year budgetary period to assist in further support being delivered to hard-working families.”
“I have made representations in writing and verbally to the Chief Secretary to the Treasury on that for the very reasons that the Member outlined. It is important that we support hard-working families with the cost of childcare. That is a way in which the Treasury can assist. As the Member will know, the Executive have invested quite significantly in that field. I would hope that that investment would continue through the multi-year Budget.”
“We want to bring forward a piece of legislation that is workable and that, in particular, protects the rights of those people who feel as though they have been disadvantaged thus far.”
“Yes. The requirement for a change in legislation or the introduction of legislation in that area is driven by that need. There is a feeling, which is coming through in some of the initial evidence reports that were done on the matter, that property owners in shared accommodation are at a disadvantage. They certainly feel as though they are at a disadvantage. In some cases, the evidence backs that up. If we are going to bring forward legislation that is aimed at protecting the rights of property owners or those who rent in shared property facilities, as with all things that relate to changes to legislation, we have to balance the rights of the other side of the equation. That legislation will be open to inquiry and debate in the Chamber and elsewhere.”
“Given that we are at the start of that process, I do not think that we will be able to change legislation in this mandate. However, I hope that we will leave the groundwork and a lot of preparatory work available for the next mandate so that legislation can move quite quickly.”
“That legislation needs to be updated, and I have asked officials to look at it to see whether we can make meaningful progress in updating it, whether that is in this mandate or at the start of the next mandate.”
“We have progressed changes to the policy to try to make it simpler and easier for the community sector to access unused property that it believes can be brought back into community use for the benefit of the community. I continue to engage with elements of the community that raise questions with me and enquire about that. We are continually looking at how we can improve it. There is a piece of quite outdated legislation — I think that it dates back to 1931 or 1933 — that somewhat ties the Executive's hands in that the property has to be disposed of without any loss of benefit to the public finances, which, on the face of it, is sound. However, it is about how you measure loss to public finances.”
“It is vital. It is estimated that the Executive and their agencies own land that is comparable in size to County Armagh. We have to use a lot of that land and property for the delivery of required services, and it is used regularly. However, in that portfolio is land and property that, in my opinion, we should dispose of in a managed way and, when those capital receipts come back in to the Executive, we can reinvest them into modern infrastructure for the delivery of public services. It is vital that each Department has a strategic management plan.”
“The Member know my views on inheritance tax. It is an unfair taxation policy, particularly here. I do not want to interfere in individual cases, but I want to be assured that the policy and legislation are being adhered to fairly. As I have said, I deal with a number of Members' correspondence cases, some of which relate to historical land cases. My response to my officials is that they need to reassure me that everyone is being treated fairly. Ongoing engagement and negotiations should therefore continue, and the land agent appointed by the landowner should engage fully with LPS to try to reach a settlement that is agreeable to all sides.”
“It is important that LPS remain independent in the matter and that there be no ministerial interference in setting land valuations. LPS plays an independent role. It engages with agents appointed by landowners. Understandably, there will be a negotiation in such scenarios to reach agreement on the price of land. There will be expectations on the side of the landowner and expectations on the side of the LPS, but, as Minister, I should not directly intervene.”
“In my role as Minister with responsibility for the Civil Service, however, I will ensure that, where lessons need to be learned, they will be learned, and that, where we have to make improvements, improvements will be made. I have no qualms about doing that. As I said earlier, whether they are from the report on COVID or from the report on the renewable heat incentive scheme, we, collectively, have lessons to learn.”
“I am not aware of any bonus scheme for senior civil servants. I think that it came to an end a number of years ago. <BR /> <BR />It is easy to take potshots at the Civil Service. It does make mistakes. There are errors made and lessons to be learned. Learning, skill sets and all those sorts of things need to be reviewed. At the end of the day, however, civil servants, 99·9% of the time, are out there delivering public services, engaging with Ministers and Committees and trying to do their best to improve the lives of all the people whom we serve. Do you know why they do that? It is because they are stakeholders. They live here. They use the services here. Their children use the services here. Their parents and grandparents use the services here. They are therefore stakeholders in our society.”
“There are a number of reports to be studied, the latest of which is the inquiry report. Its recommendations deserve to be studied closely, and I will play my part in responding to any recommendations that relate to the role of the Civil Service. There are lessons for us all to learn from the COVID experience, and I am committed to working with others to ensure that those lessons are learned.”
“If allocating half a billion pounds, connecting 5,000 properties to waste water treatment works and the Infrastructure Minister engaging in a legislative process on developer contributions amounts to doing nothing, I do not know what world the leader of the Opposition is living in. <BR /> <BR />Again, if there is a suggestion in one of the quite thin documents that he produced that does not involve the introduction of domestic water charges or the privatisation of NI Water, I am happy to listen to it.”
“<BR /> <BR />I am open to suggestions from the Member. He has now ruled out water charges, which is good. If he has any other suggestions that do not involve water charges, I am happy to listen to them. The Member told me earlier this afternoon that he had produced a number of documents. Perhaps there is a suggestion in one of those.”
“The Member will be acutely aware that NI Water receives around half a billion pounds annually in public funds. That is stage 1 of the plan. Stage 2 is that we have seen significant additional investment in NI Water as a result of a strategic use of monitoring rounds. We have connected over 5,000 homes to waste water infrastructure in the past two years and have plans to move beyond that number. There is another part of the plan. The Member is aware that the Infrastructure Minister is bringing forward legislation on developer contributions. I believe that that legislation is at Second Stage. I thought that that Bill had had its First Reading and been introduced in the House, but maybe the consultation is coming to a close. The Infrastructure Minister will be able to confirm what progress there has been in that regard.”
“The Member is aware of my position on fiscal powers. I outlined it again this afternoon during a debate on the Budget. That is on record. The Executive's ability to continue to mitigate the impacts of decisions by the British Government is very restricted. It will obviously be a decision for the Executive when I bring my Budget proposals to them, but every pound that we spend on mitigating the British Government's detrimental decisions is a pound that we cannot spend elsewhere. Therefore, we have to balance all those decisions. The final decision on the way forward will be one for the Executive.”
“My officials are engaging with them, and there will be another meeting this Thursday. I updated the Executive this morning and I have committed to updating Executive colleagues following Thursday's meeting.”
“Given the lateness of the engagement from the Whitehall Departments and the NIO, the responsibility for that transition rests with them.”
“Yes, there has been direct engagement about that. My officials, on behalf of other Departments and using information received from other Departments, are engaging with the Ministry of Housing, Communities and Local Government and the NIO about a transition. However, this has to be constantly recorded: as far as Whitehall officials are concerned, the SPF is finished and the transition was last year. They are now moving on to a different programme, so, as far as they are concerned, whatever happened in the past is in the past. Our view is that the SPF was quite successful here and achieved many of the goals that we wanted it to achieve and that there should at least be a transition from that to the new programme.”
“I have to wait for the announcement tomorrow. There may be Barnett consequentials as a result of that announcement, although I am not expecting a significant amount of Barnett consequentials. Once that is announced and I have the information directly from the Treasury — I also require information from our own Departments — I will be in a position to present the Executive with a monitoring round paper. I want to do that as quickly as possible. That will be a separate paper from the Budget paper, but both are aligned and should be cognisant of each other. When I have all the data that I require, I will not waste any time in presenting that to the Executive for a decision.”
“I want to see the Treasury and the Government recognise that and give us the tools to do it.”
“That is important in supporting hard-working families out there to help meet the costs of childcare. The two-child benefit cap has been raised time and time again. If the Government were to deal with that, they could lift millions of children across these islands out of poverty. Why would you not make that decision? That is my view on that. Another specific issue here is the local growth fund. There was a decision in England and Wales to use the local growth fund to regenerate town centres and villages. That is worthy in itself, and I have no difficulty with it, but we supported the previous Shared Prosperity Fund (SPF) through different schemes, largely resource, which mainly and strategically helped the people who were furthest away from the workplace to get back into work.”
“I, along with the Finance Ministers from Wales and Scotland, attended the Finance: Interministerial Standing Committee (F:ISC) meeting in October. We had wide-ranging discussions about the Budget, how Westminster interacts with the devolved institutions and how, sometimes — quite often, it has to be said — decisions are made in Westminster that have no true reflection on the reality of life for people here and how we run public services. Two examples of that are the National Insurance hikes, which had a significant detrimental impact on Departments here and elsewhere; and the family farming inheritance tax issue, which was another decision made in Westminster that has significant impacts here, perhaps more so than in other places. <BR /> <BR />As I said, I directly asked the Westminster Government about tax-free childcare.”
“Each time that a Minister makes an announcement about a project, it would be worthwhile for people to ask, "If you're funding that, what are you not funding?". That is not to criticise the Minister or to open the Minister up to ridicule. The reality is that, when you make a choice, there are two sides to that choice.”
“The Member can be assured that my press release states exactly what I have done, because it sets out what engagement I have had with the Chief Secretary to the Treasury. I hope that that satisfies the Member in that, when he reads the press release, he realises that the Minister is doing what he says that he is doing. <BR /> <BR />As for working with the Communities Minister, I will work with all Ministers in supporting them to deliver effective and efficient front-line public services. What decisions individual Ministers make for their Departments are, by and large, for individual Ministers within their funding envelopes. When Ministers make decisions or choose to fund project a or project b, they have to be conscious that, if they fund project a or project b, they are not funding project c or d.”
“I would encourage the Chancellor to do the right thing and use the autumn Budget to help hard-working families by increasing the tax-free childcare threshold; reversing the two-child cap, recognising the harmful impact that it has on families and that it increases the level of child poverty; backing hospitality businesses by making changes to the VAT rate; and supporting the community and voluntary sector by changing the approach to the local growth fund. <BR /> <BR />As the cost-of-living crisis continues, I have consistently urged the Chief Secretary to the Treasury to avoid further austerity measures that would place an unfair burden on people, businesses or public services. The Treasury has an ideal opportunity tomorrow to support public services, workers, families and small- and medium-sized businesses.”
“With the Speaker's permission, I intend to answer questions 5 and 8 together. <BR /> <BR />The autumn Budget tomorrow must be used as an opportunity to support workers and families. I recognise the scale of the financial challenge that the Westminster Government are facing, but investment in public services is key to growing the economy. <BR /> <BR />Economic growth and improved public services cannot be achieved without meaningful investment. The Chancellor has political choices to make.”