Simon Hamilton
Strangford · Democratic Unionist Party · Northern Ireland
“I have emphasised to the Member and the House before, that, whilst I accept that those are not good enough — that is why we have been developing the plan — there are alternative technologies in place that can present opportunities for those who just cannot get acceptable speeds.”
“I thank the Member for his intervention. There are some initiatives that I believe will help and act as a driver to improve broadband access. One such intervention is the broadband universal service obligation (USO), which is being taken forward by Her Majesty's Government.”
“I thank the Member for his question. However, he is conflating two issues. I wrote to his party leader, and indeed to all Assembly party leaders, before making the announcement that I did last week about wanting to publish the details of the businesses in receipt of the non-domestic RHI scheme. It was my intention to do that tomorrow.”
“<BR /> <BR />The Chancellor, in his autumn statement, made some more funding available for telecommunications, and my Department is studying that and seeking to avail itself of that to the fullest possible extent.”
“In addition, my Department is managing a contract for the delivery of the superfast rollout programme, which, by 31 December, will provide access to superfast broadband with speeds of at least 24 megabits per second to a further 38,000 premises, both business and residential, across Northern Ireland, including in the Newry and Armagh cons…”
“I signalled the intention to do this a few weeks ago. The Member and the House will know that inspections of all installations would have taken place over the 20-year lifetime of the RHI scheme.”
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“That is another question that would be better directed at the Minister of Education. <BR /> <BR />I had conversations with the Minister of Education, as I met all Ministers leading up to agreement of the Budget. I understand that the Minister is bringing forward pressures of £160 million. There had been a reduction by under £100 million in the draft Budget, and there was roughly another £60 million of pressures. If the Member and I were to pore over all the pressures, we might not agree with the Minister of Education that all were legitimate or that the totality was legitimate in view of the cost pressures on that Department. Very clearly, the allocation of £60 million, which was the lion's share, as I described it, of the additional money will go some way to helping the Minister.”
“That puts a different complexion on borrowing from what there might have been without that payback from the voluntary exit scheme.”
“We have also been able to capitalise some costs around the Northern Ireland Civil Service equal pay claim and bring forward a rescue package for the Presbyterian Mutual Society. Again, that could not have been done without the ability to borrow that money. Although there is the cost of repaying the annual interest of around £3 million to £4 million per £100 million borrowed, it is significant — this has, I think, changed the Executive's approach to borrowing — that the £700 million flexibility through the reinvestment and reform initiative (RRI) to borrow specifically for a voluntary exit scheme will save around £60 million for every £100 million that we spend. Half a billion pounds will therefore be saved as a result of that £700 million.”
“Some picked up the point after the Budget statement last week that the Executive are now borrowing around £1·8 billion. On the face of it, that is a lot of money. If you do a per-head-of-population calculation, you find that it compares unfavourably with the other devolved Administrations in Scotland and Wales. The first point that is worth noting is that Scotland and Wales would like to be able to borrow more, particularly Wales. I met the Welsh finance Minister earlier this month. Her Administration are allowed to borrow only £400 million. She would like to borrow a lot more than that and is actually quite envious of our ability to borrow up to £3 billion. <BR /> <BR />The £1·8 billion that we have borrowed to date has financed infrastructure projects that otherwise we would not have been able to finance.”
“As the Member and the House know, in spite of what is a much better Budget than the draft Budget that we thought we might have been able to bring forward, there are still huge pressures moving forward, not least in the education sphere. It is important that the projects that come forward also help us to save some money.”
“There was a call from the Minister of Education last year for projects to come forward. Some of them have passed muster and are now receiving capital funding not just for this year but for future years. <BR /> <BR />It is important that one of the criteria that we apply to the additional funding is that it is capable of saving us money. Whilst there are other objectives in shared education in bringing children from different backgrounds together to be educated in the one place, we cannot lose sight of the fact that the money is there to help us to save money in the longer term. In that sense, the shared education projects must not only be of good social and educational value but save us money in our Budget.”
“I take it that the Member is referring to the additional allocation of capital spend for shared and integrated education. Of course, his party's Ministers at the Executive voted against the increase in the allocation to the Department of Education over and above the draft Budget allocation. <BR /> <BR />The boost of £50 million a year over the next 10-year period, which, I think, is very welcome, is specifically for shared and integrated education projects. We are still working through with Her Majesty's Government the test that would be applied to those projects to make sure that they met the criteria for being genuine shared and integrated education projects. That is important as we take these forward. A lot of good shared education schemes are starting to work their way through the system.”
“Even though that Department would be perceived as one of the winners — if I can use that phrase — in the Budget, I know that the Minister of Health, who, I think, will be in the House later to answer questions, would be the first to say that, in spite of getting an additional £204 million, this is still a departmental budget that, because of demand and changing demographics, is continually under pressure even over and above a 3·5% increase.”
“That represents a 3·4% increase. The Executive took, I think, the right decision in protecting DHSSPS's budget — not completely but around 95% of it — by protecting front-line health and social services provision. That includes the Ambulance Service trust as one of the, I think, six trusts. It has been afforded a degree of protection. It a matter entirely for the Minister of Health to decide where he spends the additional allocation that he has received.”
“As the House will be aware, the Health Minister has received additional spending next year of £204 million over and above his allocation for 2014-15.”
“That is exactly the sort of project and scheme that I wanted to see coming forward through the change fund and is exactly the sort of scheme that the House should be supporting.”
“<BR /> <BR />There was an uplift of £63 million for the aggregated schools budget and the Minister then further topped it up by a reallocation in his own budget to take it to £80 million. The Member's party voted against that in the Executive. It has a chance tomorrow, with a debate on the Budget, to rectify that position and to support the increase in the education budget. <BR /> <BR />We have also further boosted the Department for Employment and Learning's budget with allocations of around £35 million proposed in the Budget. Some of those are successful change fund bids, one of which is deliberately for 14- to 16-year-olds who have issues and problems with educational achievement. That is a joint project between the Department for Employment and Learning and the Department of Education.”
“There is clearly no desire in the House to see anyone condemned to the sort of educational underachievement that the Member outlined, and I think that we would all accept, from whatever quarter in the House, that whilst Northern Ireland has a very good education system and that many come through it with the highest of qualifications and can convert those qualifications into a good university education, university degrees and into well-paying jobs, there are some who unfortunately slip through the net. We should all be deeply concerned about that, and it is one of the reasons why I was pleased last week to boost the Department of Education's allocation in the Budget.”
“It also confirmed the capital and resource flexibilities sought in the 2015-16 draft Budget; increased that to allow a further £100 million of reinvestment and reform initiative (RRI) borrowing to be used to fund a voluntary exit scheme; provided an additional £100 million of RRI borrowing for capital projects; and provided the flexibility to pay the £114 million welfare reform penalty from capital. The impact of the Stormont House Agreement on 2015-16 has been incorporated into the Budget 2015-16, which I announced on 19 January.”
“Mr Deputy Speaker, with your permission, I would like to answer questions 1, 4 and 7 together, as they relate to the impact of the Stormont House Agreement. <BR /> <BR />The Stormont House Agreement provided up to £500 million over 10 years of new capital funding to support shared and integrated education. That funding will have an impact on the education budget. Individual projects must be agreed between the Executive and the UK Government. In addition to £50 million for shared and integrated education projects, the Stormont House Agreement provided up to £30 million in 2015-16 for bodies dealing with the past.”
“If I can get Executive agreement, which I have yet to secure, that is a fund that I want to take forward using the dormant accounts money that has been sitting unallocated over the past number of years. There is about £5 million unallocated to which I hope that we can, in the same way as with the investment fund, leverage in another £5 million to take it up to a fund of £10 million. That will go, I hope, as loans to organisations in the third sector, whether they be faith-based organisations, community groups, charities or social enterprises, to allow them to continue to invest in the work that they do to help us in government deliver services, particularly to those who are hard to reach in our society.”
“It is important that, even in a time when we are facing Budget reductions, we still continue to focus on that long-term objective of lowering corporation tax. That is why you will see a 10% increase in the DETI budget. That is to allow it to continue to do its work, a lot of which is about working now to ensure that investments are secured in future years. Additional money has been allocated specifically to skills development, while money has been given back to universities and colleges so that they can continue to create that pipeline of skilled workers that our economy needs now and will need in future, after the devolution and lowering of the corporation tax rate.”
“The Budget does not do anything specific on corporation tax. It will affect our Budgets most directly in future years, when, as a result of the Azores ruling, we have to ensure that we are not receiving any benefit for it and have to pay whatever the cost of devolving the powers is. My best estimate is that that will not hit until after their devolution, which I very much welcome. I have not had a chance in the House to welcome the fact that the Government have published the legislation to allow the power to be devolved to the Assembly. It will be at least 2017-18 before we will see the Budget hit with a reduction in public expenditure to pay for lowering the rate of corporation tax. <BR /> <BR />What the Budget does do for corporation tax is that it starts to prepare the way for it.”
“If that had been the case, we probably would not have needed to reform just as aggressively as we are going to now, but I am glad that, however we have got there, the Executive have now agreed and are at the same place across all the parties on the need to reform and restructure, whether that be through a voluntary exit scheme, the greater use of shared services, the OECD review or the use of my Department's public-sector reform division. All Departments are now moving in the right direction on that, and there is unanimity across Executive parties that this is what we should be doing and need to be doing in the next number of years.”
“It is for them to explain why they continue to do so when they cannot back a Budget, which, on balance, in the circumstances that we are in, is a good Budget and represents a good deal for the people of Northern Ireland. <BR /> <BR />On the pace of reform, we should have in the past more quickly embraced the need to reform. Having run as a Conservative in the last general election, the Member will remember how we were promised that the economy was going to turn around, the deficit would be slashed and everything would be hunky-dory from about this time on, but that, of course, has not been the case.”
“I certainly have a view on it, but it is probably not my place today to start lecturing those parties that are in the Executive — I have probably lectured them enough already — but that continue to adopt what could be characterised as a cynical position, where they vote against the Budget, knowing that it contains difficult decisions and tough choices. They are in the luxurious position of being able to vote against it, in that they know full well that their vote is not required to carry it. Then, Pontius Pilate-like, those parties can wash their hands of its worst effects. If something that people do not like happens next year as a result of the pressures that Departments are facing, they can say that it is nothing to do with them. <BR /> <BR />All the while, however, as the Member regularly points out, they remain in the Executive.”
“<BR /> <BR />However, we could do our best, within what we could afford, to mitigate some of the worst effects of welfare reform in Northern Ireland, and that is where agreement was reached across the parties. Would we have liked to do more? I am sure that we all would have. However, in the circumstances, the agreement that was reached, which will be outlined in more detail by the Minister for Social Development in due course, will show that we have been able to achieve something in Northern Ireland that builds upon the GB system but which far surpasses what has happened in England. It is the envy of my counterparts and Ministers in Scotland and Wales; they would be very pleased to have the flexibilities that we have, and the package of measures that we are able to implement, through the use of some of our own Budget.”
“<BR /> <BR />Whilst I accept that welfare reform will not be a good thing for everybody in Northern Ireland — I do not want to get into the arguments about how welfare reform can actually be good for some people in Northern Ireland because it will encourage them back into work and simplify our system of benefits, which can be complex and complicated for a lot of people, including Members — the Executive did not have the means to fill that hole, whatever the cost, and a lot of work and various ranging estimates were done on what the cost would be. The Executive simply could not have filled that hole and, at the same time, have to develop an IT infrastructure to pay benefits in Northern Ireland. That was simply not affordable.”
“I do not think that it is a concession on my part to accede to the point that this is a Budget that is built upon moving forward with welfare reform. Unfortunately, we still have to contend with the penalties, which are the price of unnecessary obstinacy over the past number of years and which have cost the Executive £100 million when we can least afford it. We are, at last, agreed, as Executive parties, on a way forward on welfare reform. As I said to Mrs Kelly, the detail of the basis on which we are moving forward on the package of measures will become clear over the next number of weeks.”
“It is a flexibility that was hard fought and hard won during negotiations, and having it in place will allow us to do things in the reforming and restructuring of our public sector that, otherwise, we would not be able to do. If we had not had access to that flexibility, we would still have the cost of a voluntary exit scheme but not the source of fairly cheap finance to allow us to do that in an affordable way.”
“Significantly, and this changes the scenario somewhat, now that we have the flexibility to spend £700 million of our RRI to capitalise the cost of a voluntary exit scheme, that will reduce our pay bill by about £0·5 billion every year from 2018-19, when the money has been spent. Savings will start to be realised from next year. <BR /> <BR />So, in terms of spending it, and with the very small interest repayments on it, it is a good investment, as it will allow us to get our public finances back on to a sustainable and long-term footing. It will also help us to deal with the need that will arise where you have less money being spent on public services and where you do not need as many people to deliver those services.”
“To date, we have borrowed about £1·7 billion, and the Member is right: that will go up to north of £1·8 billion. In the past, I have expressed concerns about continuing to borrow for infrastructure investment and the amount of revenue payments that have to be made, not just for our RRI payments but for PFI and PPP projects. The total that we are paying out of our resource budget, which is the part of our Budget that is under pressure, is about £60-odd million a year. Obviously, we would rather not have to pay that back, but that money is paying for improvements to our infrastructure. That is what the investments have done in the past.”
“This is probably not the place to get into too much of the detail on that. I am happy to correspond with the Member in more precise detail about it. I can say that the Member is not far off in the total figure of debt that the Executive have. The Executive have a facility to borrow up to £3 billion through the RRI scheme.”
“We will therefore receive back half that penalty and will be able to use it in year. So, we have made that overcommitment, which I think is prudent. That does not, unfortunately, bring back the £100 million that has been lost to date because of the SDLP and Sinn Féin's inability to move forward earlier on welfare reform legislation. I will leave the detail of what is in the package of measures to the Social Development Minister who, I hope, will bring welfare legislation to the House in the next couple of weeks.”
“I did not include in the statement that there will be a slight change to how the Treasury will handle that. In the current year, the Treasury will take the penalty out mid-year, but this year it is taking it out at the start of the financial year, so we are losing £114 million from our starting position. That adjusted our draft Budget position and had to be dealt with. Obviously, we are able to deal with the entirety of that through capital budget. The Executive have agreed to deal with half of it through a capital-to-revenue switch, and the other half we have dealt with as an overcommitment. We believe that, now that there is agreement across the House — including by the Member's party — to take forward the welfare reform legislation with adaptations to suit Northern Ireland, legislation will be in place halfway through the year.”
“I encourage the Minister of Education, as I encourage all Ministers, to continue to do that type of work on an ongoing basis. <BR /> <BR />The Department of Education had a piece of work on standards done by the OECD, which is obviously carrying out its review of the whole of the public sector in Northern Ireland. In a situation where 65% of our Budget goes on health and education alone, the OECD would not be conducting a very good review if it did not, as well as concentrate on health, also do some work with education. I am keen to encourage that. The Minister sits on my Executive subcommittee on improving public services, which is taking forward the OECD work, as well as other reform measures.”
“You will not get much disagreement on this side of the House for the need to conduct such an assessment, as we would in any Department. I hope that Ministers, irrespective of what party they belong to, want to ensure that the money the Executive allocate to them through the Budget process is spent as efficiently as possible. The Minister of Education is obviously in the middle of reforming, in the sense that he is reducing to one the number of education boards in Northern Ireland. I hope that that yields savings and greater efficiencies as we move forward. I think that there are a lot of areas in which work can be done. I discussed with Mr McKinney what the front line in education is. Whilst playing an important role in the overall system, clearly, savings can be made in school meals and in some aspects of school transportation.”
“Whilst it is maybe not viewed by many as the most important thing that we fund as an Executive, it is obviously important as part of our overall tapestry of the arts and culture. It is something that we are able to have and say that we have here in Northern Ireland and it supports the economy in a broad sense. That is something that I am very pleased to be able to announce today. We will continue to work to ensure that there is a longer-term strategy to save the orchestra.”
“I am glad that the Member has raised this issue because it allows me perhaps to expand more than I was able to in the statement. There is only one allocation, which is the January monitoring allocation, to the Ulster Orchestra. I understand that it should be sufficient to get it through its current financial problems, which have been well publicised. It does not deal with the longer term. I can assure the Member and those across Northern Ireland who are interested, not least the orchestra itself, that we will continue to work with DCAL. DCAL is in the lead on this in bringing forward a longer-term sustainable plan. There are many ways in which I think we can do that. We are looking at some options that have arisen, even in the last few days, that would allow the orchestra to move forward on a more sustainable footing.”
“He will put a further £80 million into the aggregated schools budget, which, as I understand it from the figures that have been handed to me, will do a lot to relieve the pressures that various principals and boards of governors across Northern Ireland and in all constituencies were coming forward and talking about. That is sufficient enough investment to ensure that the worst of what was being talked about for the next academic year will not now arise.”
“I have enough to do doing my own job. I will not take on responsibility for the Education Minister or indeed for any other Minister. The £63 million allocation, which I was happy to propose and which the Member's party voted against in the Executive last week, will go a long way to relieving a range of pressures, not least those pressures on the classroom. As I outlined in my response to Miss McIlveen's question, the Education Minister has written to me today to outline how he will move the Education budget from draft budget to final budget position.”
“We need to see some of those bigger projects, particularly regeneration projects, coming forward and seeking FTC as an option to finance them.”
“That is why we created the investment fund; not just because it is absolutely a good thing to do in the longer term but because it is a vehicle by which we can spend FTC on an ongoing basis if it becomes available in-year. <BR /> <BR />I do think that other Departments need to come forward with more projects. A lot of the projects that have been taken forward have been because of the impetus and drive that is coming from my Department. There are some exceptions. For example, DETI has been very good in bringing forward various small FTC-ready projects. Other Departments need to step up to the plate. The private sector itself — the very people for whom FTC was designed — also needs to come forward with more projects. I have seen a few coming through the system that have been small in nature.”
“I join the Member in welcoming the allocation to the Ulster University of additional financial transactions capital. In some ways, whilst I welcome it, it is worrying at the same time — not worrying in and of itself, because I think that it is a very good, fantastic project that will breathe renewed life into that part of North Belfast and will reap benefits for the whole of Belfast and Northern Ireland, but worrying because, with FTC allocations of around £100 million over the past number of years, the Ulster University — I need to get used to calling it that now — will have accounted for close to three quarters of our total FTC allocations. Clearly, it will not, on a continual basis, require FTC to soak up this new source of capital that we have.”
“Not only does that support our economy, through being able to get goods to market more quickly, but it helps people in local areas to get about more easily and provides a boost for our economy through the employment it brings to local firms that are doing that work. I hope that some of the allocations made in the January monitoring round and the allocations made for next year can continue to allow that to happen.”
“I thank the Member for his question. I commend him for his work as Chair of the Regional Development Committee in the job he has been doing along with the other Committee members in exposing some of the waste and inefficiency in the Department for Regional Development. We have been told by the Minister that there are untold pressures being faced; so severe that the lights cannot be kept on. <BR /> <BR />I agree with the Member. We should never forget, as far as the investments made in our roads infrastructure are concerned, the sizeable investments not just next year but this year. In the last four years, we have spent over £400 million on our road maintenance programmes, which included, in the year before last, a record investment for one year.”
“<BR /> <BR />It ill behoves the Member and, indeed, her party to come forward — as undoubtedly they will today and in future times — and demand more for health, and that more money be given to health, and not come forward in the Executive, where it matters, with a single solitary alternative as to how we might finance health or find more money for health, education or whatever it might be. When the Member is criticising what we are giving to health in this Budget, she needs to bear in mind that her party and her Minister did not come forward with an alternative proposal on where more money might be found for health.”
“The Health Minister would be the first to say that he would like to have had more money coming out of this Budget, but I think he understands, appreciates and is mature enough to realise that that is not possible. Indeed, he welcomed the extra £204 million he has received, whilst acknowledging that he could have used more. <BR /> <BR />It is not wrong for us to expect our trusts to continue to make efficiencies and savings on an ongoing basis. I admire the fact that the current Minister and, indeed, his predecessor, have been able to release, over the last four years, close to half a billion pounds back into the front line of health due to eroding inefficiencies in the system.”
“This Budget shows that there is a commitment on the part of the Executive to those key services that every single one of us, and most of our constituents, would judge as being key services, which are health, with an additional £204 million, and a boost of over £60 million for the education budget compared with its draft Budget position. <BR /> <BR />Of course, we would like to have seen more going into key services. We would like to see more going to the front line, however that is defined, but our position was not helped. In the face of very difficult circumstances, I think I have made a good fist of it.”
“The Member's point is not unreasonable. His party has an amendment for debate later in the week on this matter. Defining the front line has been a difficult problem and will remain so. We all understand, in our own heads, what the front line and core services are. There can be difficulties in decoupling that completely, with the need to have some degree of management and administration to make what happens on the front line — in the classroom, the hospital or wherever — actually happen. I think it is difficult to define.”
“<BR /> <BR />The allocation to the police comes from the Minister himself highlighting particular problems in the policing budget and the Chief Constable, whom I met, outlining the pressures that his service — our service, I suppose — would face next year if it did not get additional support. I am happy to be able to allocate £20 million. It is not all that the Chief Constable was looking for — I think he was looking for closer to £27 million or £28 million — but he has assured me that it will allow him to continue with his plans for police recruitment next year and to ensure that some of the worst effects of reductions on the policing budget and how it affects people and public safety will certainly be lessened considerably.”
“It is specifically an allocation of a further £20 million for the PSNI budget, as opposed to the whole of the Department of Justice. It is deliberately so, because there are other significant pressures, as the Member will know in his capacity as Chair of the Justice Committee, particularly around legal aid. It is not that I do not recognise that the Minister of Justice has a pressure in respect of legal aid. Whether we like the idea of spending more on legal aid than the rest of the United Kingdom or not, it is still a monetary pressure that his Department faces, and it needs to be dealt with. I have offered my support to the Minister in bringing forward means and measures that would deal with at least some of the pressures in respect of legal aid, and I am sure the Committee will hear that in due course.”
“I have said over recent days that the Budget is not perfect — it is certainly not the Budget that I would have brought forward had it been up to me — but at least we know that, if it had been just up to the Alliance Party, it would have been a Budget built on water charges, higher rates and the end of such schemes as concessionary fares.”
“I do not think there was a question there, Deputy Speaker. As I said to the Member's colleague, I am very content for the Alliance Party, if it wishes, to continue to characterise itself as a high-tax party, because that is what it is. That is what it is coming forward with, and that is what it is suggesting. It wants water charges, at a cost of probably £400 or £500, to hit every household in Northern Ireland. It wants to see rate bills increase significantly. It wants to see things such as the concessionary fares scheme disappear. To be fair, I have been critical of other parties for not coming forward with alternatives. Of the three Executive parties who voted against, at least the Alliance Party came forward with an alternative.”
“The Executive remain committed to locating a Community Safety College in that area, but obviously work has to be done across Departments — Health and Justice primary amongst them — to make sure that that continues, in whatever guise or shape. It does still require flexibility to be given by the Treasury as regards accessing the funding that has been sitting there on a flexible basis for the last number of years, so that it can be spent on that project if indeed it goes forward in the next financial year.”