Warning 'golden opportunity' could be lost on NI budget as parties prepare for election

A "golden opportunity" could be lost if a budget for Stormont can not be agreed, the body set up to scrutinise the state of Northern Ireland's finances has warned.

It said reaching an agreement could be all the more difficult as the parties position themselves to go into the forthcoming Assembly election.

The Fiscal Council has been considering the finance minister's draft budget which is currently a proposal of how money should be spent over the next three years, and is out for consultation.

The Fiscal Council's assessment of the plan states that the fact only a draft budget has been drawn up so far "will make the task of agreeing a final budget before the new financial year more difficult, not least because the parties are positioning themselves for looming Assembly elections".

While Stormont departments could keep spending without an agreed budget before the Assembly is dissolved, the Fiscal Council points out that those involved in making key spending decisions have indicated that single year budgets up until now have stymied long-term planning, and the return to multi-year budgeting as proposed now would be a "golden opportunity". 

It indicates that opportunity could be lost without an agreement.

The Fiscal Council, led by Sir Robert Chote, also highlights the lack of a Programme for Government and an Investment Strategy for the Department of Finance to work towards.  

The draft budget for 2022 to 2025 makes funding for health a priority and other Stormont departments have been asked to take a 2% budget cut to allow more money to be given to health. 

However, the Fiscal Council says there is no long term strategy in the draft budget beyond focusing on health.

The Fiscal Council does say there have been improvements in the transparency of how Stormont's finances are set out, but there remains room for improvement. 

“The proposals set out in the draft budget deliver a ‘balanced budget’, in the sense that the spending plans match the amount of money available to the Executive,” Sir Robert told UTV.

“But the way in which the finance minister has suggested allocating resources between departments - what you don’t have is a clear strategic plan behind this, which would have a number of elements to it - one is a close link between the allocation of money and a programme for government agreed at the level of the Executive, and for that we’re probably going to have to wait until the other side other election."

He continued: “There is also at the moment not an investment plan for the Executive which there has been for the previous ten-year period.

“We’re led to believe there’s one of those in draft waiting to go out for consultation - obviously in an ideal world that would have been there in time to inform the decisions on how much money to allocate for capital investment to different departments. 

“So to that level you’ve got a budget that, on the face of it, balances but doesn’t necessarily have that sense of strategic priority set out as clearly as it could be. 

“In part that’s because this draft budget is not an agreed Executive position in terms of the allocation between different departments.

“So there’s a good deal of work to be done yet to get to a final budget that fills in those other elements, then building on that when you get a new Executive beyond the election.”