UK government makes £3.3bn ‘final offer’ to Northern Ireland in bid to restore power-sharing

UK government makes £3.3bn ‘final offer’ to Northern Ireland in bid to restore power-sharing
  • PublishedDecember 20, 2023

Since May 2022, there has been no elected government in Northern Ireland.

The UK government has made a fresh offer of £3.3bn to Northern Ireland’s budget in a bid to get the devolved administration up and running again.

There has been no executive at Stormont for almost two years after the DUP collapsed power-sharing, saying this was in response to the post-Brexit trade deal put in place by Westminster which effectively put a trade border between Northern Ireland and Great Britain.

The unionist party’s refusal to take part in an executive – required under the Good Friday Agreement – also came after the republican Sinn Fein party became the largest in the nation for the first time.

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Since the election in May 2022, there has been no elected government in Northern Ireland – despite Rishi Sunak’s attempts to solve the post-Brexit issues with his Windsor framework agreed with the European Union.

The UK government has been trying to restore power-sharing through various negotiations – both with the DUP and with political parties in Belfast as a whole.

A resolution is not expected to be reached in either set of talks this year, Northern Ireland Secretary Chris Heaton-Harris has said.

Today’s offer to increase the nation’s budget by £3.3bn over five years is an increase from a previous proposal worth £2.5bn.

There is no deadline to accept the deal, but Mr Heaton-Harris said the financial package is a final offer.

“The message is clear,” he said. “It is now time to take some decisions.”

The secretary added: “This package is on the table and will remain there, available on day one of an incoming Northern Ireland Executive to take up. This is a generous package.

“The UK government has also held extensive talks with the DUP on the Windsor Framework over the last eight months.

“From our perspective, those talks, all the issues of substance have reached a conclusion.”

Sir Jeffrey Donaldson
Image:Sir Jeffrey Donaldson said his party is still trying to fight for the best deal

DUP leader Sir Jeffrey Donaldson said that progress had been made, but added his party is still trying to fight for the best deal.

He said: “We are very clear, there is not yet agreement finalised on the issues of substance and we will continue to engage with the government to get to the point where that agreement is reached.

“We are not for giving up, we want to get this right, it is important for the future of Northern Ireland within the United Kingdom that we secure the change that is required to restore our place within the United Kingdom and its internal market.”

Michelle O’Neill, Sinn Fein’s vice-president, warned that the DUP can “no longer hide behind Windsor Framework negotiations” and that they should accept the offer.

And while Alliance leader Naomi Long said the offer was not enough, she added that “I think we’re looking a gift horse in the mouth here by refusing to actually grasp that money and bank that money at this stage”.

The government’s offer includes:

• Up to £584m for public sector pay claims as a non-repayable reserve claim

• A new needs-based funding formula set at 124% in the Barnett formula from 2024-25, similar to that in Wales

• A £1.125bn stabilisation fund, concentrated into two years to cover backdating of the funding formula

• Deferring a Stormont budget overspend of £559m for two years, which will then be written off when a returning Executive publishes and implements a fiscal sustainability plan

• A dedicated fund of more than £600m for a transformation plan, with at least £150m ringfenced for transformation projects

• An extra £34m to tackle hospital waiting lists in Northern Ireland

• £15m to the PSNI to deal with impacts of a major data breach

• The creation of an enhanced investment zone worth £150m

• An increase of Northern Ireland’s annual capital borrowing limit over five years, worth an extra £135m by 2028/29


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