Finance Minister warns of strain on Northern Ireland finances into next year

Finance Minister Conor Murphy has warned of a near £1billion overspend in Northern Ireland's finances leaving them in a "critical" position.

That could bring implications for next year's budget, which the finance minister says is already under "significant pressure".

There remains a pot of £300million available to the various Stormont departments, however, the power-sharing impasse has meant this can't be distributed. Should that be released the projected net overspend could be £660m. Which could come out of next year's budget.

Asked if the public should prepare for cuts to public services, he said that was for the various ministers to decide upon.

In terms of pay rises for the public sector, he said with an Executive in place they could act.

He said he would have hoped to be able to fund an increase over an agreed 2.5% rise - but couldn't act in the absence of a fully working administration.

He confirmed he could not make any pay award to staff given the current political stalemate.

"We are in a dire financial situation," he said.

Mr Murphy said the administration had to live within the block grant - that is the money supplied from Westminster for public finances in Northern Ireland.

Chancellor Kwasi Kwarteng’s mini-budget did not provide additional funding for Northern Ireland, which Conor Murphy said puts “our finances in a critical position”.

The finance minister had written to the Stormont ministers urging them to act with restraint on their budgets.

“While I appreciate it is hugely challenging for departments to operate in the absence of a budget as ministers we have a collective responsibility to ensure that we live within the Block Grant," he said.

"I have written to ministers reminding them of the importance of ensuring spending remains within the overall budget provided to us. This is crucial, as any overspend may be taken from next year’s Budget – making an already difficult financial position much worse.”

Mr Murphy outlined the importance of a return to devolution for future budgets.

“Our citizens, businesses and public services need certainty," he said.

"Restoration of the Executive will enable us to work together to agree a multi-year Budget. It would also allow us to decide on the prioritisation and allocation of funding including support for households and businesses as well as a pay award for public sector staff.”

North Belfast DUP MLA Phillip Brett said: “The finance minister’s comments underscore what we have been saying for many months now.

"That rather than sitting on some mythical pot of money, Stormont doesn’t even have the resources to meet the challenges facing the public sector, let alone offer help to working families.

"The finance minister himself recognised alongside his other UK counterparts that only London holds the levers that can make a difference.

"The DUP will continue to be at Westminster fighting for Northern Ireland and ensuring we get the real help that is necessary."

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