Select Committee on Northern Ireland Affairs Minutes of Evidence

Examination of Witnesses (Questions 60 - 79)



  60. Well in the past it could have got additional resources from the Northern Ireland Office grant if the whole expenditure was not taken up?
  (Mrs Brown) Yes, it could, although I think historically it would more likely have happened the other way round because Law and Order was the first of the Government expenditure priorities in Northern Ireland and therefore it had the first bite of the cake and the rest of the system fed off the crumbs.

  61. Now Subhead D includes a negative grant, for example a receipt of £474 million to support expenditure by the Northern Ireland departments in other expenditure outside Departmental Expenditure Limits. What does this cover?
  (Mr Cassidy) Subhead D represents the receipt covering net rates income, net interest on loans and various other receipts which have to be paid into the United Kingdom Consolidated Fund from Northern Ireland. So in effect the grant as a whole represents a topping up against locally generated income and this receipt here represents, if you like, the locally generated income in Northern Ireland.

  62. Is this income paid into the Consolidated Fund and then transferred back to the United Kingdom?
  (Mr Cassidy) Technically it transfers to the United Kingdom, but I think in practice what happens is that it remains in Northern Ireland and it is taken into account in determining the total share of the Consolidated Fund paid to Northern Ireland. So it is not as though the moneys are literally sent back.

  63. Can you offer the Committee a breakdown of the expected receipts from European Institutions between the various funds, the ERDF, the ESF, the EAGGF and the Financial Instrument for Fisheries Guidance?
  (Mr Cassidy) European regional funds £86,300,000, European Social Fund £63,800,000, European Agricultural—


  64. Give us the Social Fund again?
  (Mr Cassidy) European Social Fund £63,800,000, European Agricultural Guidance and Guarantee Fund £13,500,000, Financial Instrument for Fisheries Guidance £1,600,000 and there are a number of others totalling £100,000.

  65. And was the EAGGF £13 million or £30 million?
  (Mr Cassidy) £13 million.

Mr Burgon

  66. Through you, Chairman, what were the figures for the ERDF, please?
  (Mr Cassidy) £86,300,000.

Mr McCabe

  67. Can I just go back to the question that Mr Thompson was pursuing earlier; in fact, I think it was stimulated by your own question? If I understood it correctly, Mr Thompson was asking whether or not the departments would now be disadvantaged because they would receive the money through the Barnett Formula and there would not be the same capacity to buy as had existed previously. It occurs to me, it would be possible or it may be possible to actually have some indication about the truth of that because what we do not know sitting here is what kind of virement took place, whether it went from Law and Order to the departments or indeed if it went in the other direction which I think you speculated may have been the case. Would it be possible to have the figures for, say, the last ten years that would show what the virement was in either direction?
  (Mrs Brown) Firstly, if I add to a point I made. Historically I think the tendency was for Law and Order to get the biggest share of the cake. I think towards the latter stages of direct rule, after the cease fires, there would have been a movement in a different direction and the peace dividend would have come because the Law and Order amount in the Northern Ireland block were readily available for other programmes. I do not have figures for the way in which money has moved over the last ten years. There would be the departmental reports in existence which would show how the Northern Ireland block expenditure was broken down as between programmes and that would show the amount devoted to Law and Order, the amount devoted to Education and Health and so forth, but it would not necessarily show changes in spending plans in the year. It would not show where a programme expected to spend £80 million, but because of the need to fund pressures on other programmes actually only spent £70 million.

  68. So it is impossible to get those figures?
  (Mrs Brown) It would be possible to get, say, the figures of annual expenditure from the Northern Ireland departmental report.

  69. No, I understand that. I was only asking; I would not expect you to have the information now, but I thought it was an interesting point that was being raised and it did occur to me that if that transfer was occurring at regular intervals then it would be possible to see which direction it was taking at various times over the last ten years and I wondered if there was any way of actually having access to those figures so that we could see clearly what the transfer was or had been?
  (Mrs Brown) Those figures would exist. It would show actual expenditure and you could look at those over a ten year period and see what trends, peaks, troughs, whatever there were.

  70. Thank you very much. May I ask another relatively more straight forward question. What kind of information, in terms of the level of detail, does the Northern Ireland Office intend to make available to this House about the purposes for which these funds are required?
  (Mrs Brown) The amount of detail that is normally included in the Estimates.

  71. Do you want to tell me any more about that? I am none the wiser, I have to say.
  (Mrs Brown) The Secretary of State would present the Estimates for Vote 1 and Vote 2. This is the format of the Estimates, but in relation to the amount for Vote 2 for the devolved administration, the Estimates would simply show a total figure.
  (Mr Cassidy) When the Estimates of Parliament go to resource based Estimates, the level of detail that will appear in the Estimate will be exactly the same as in the Current Supply Estimate, Cash Estimate. Effectively that falls into five parts, one being the European institutions—money that we have just discussed—the other four parts represent grants and receipts in relation to the expenditure of Northern Ireland departments as a whole, but there is no break down in relation to particular expenditures within Northern Ireland.

  72. So, if you will excuse my ignorance, does that mean that if I wanted to know what you really needed the money for and what you wanted to do with it, there would be no way of telling?
  (Mr Cassidy) Not from the face of the Estimate. You would not be able to distinguish between that expenditure which goes on education, say, and that which goes on health, but of course, as in all of these things, it falls to Parliament to make its own enquiries once the Estimate has been submitted.

  Mr McCabe: Okay. Thank you very much.


  73. I am going to follow on from where Mr McCabe left off. I am going to ask a series of questions which I hope will follow a logical pattern. I am conscious that I am doing this from the Chair and therefore if, in fact, one of my colleagues wants to break in to ask a supplementary question arising out of your answers as we go through, then I am using this opportunity to make it perfectly clear to them that they should feel free so to do, though if they can signal in some way it would be helpful. Although the NIO accounts to this House for the proper use of this Vote, how in practice can it do so given the apparent lack of information it receives? This is following on from Mr McCabe.
  (Mrs Brown) Certainly the NIO's accounting for this Vote differs from its accounting for Vote 1. The control that it exercises over Vote 2 is exercised in two areas; firstly ensuring that the total of the instalments paid over in Grant in Aid is within the overall limit approved by Parliament and secondly ensuring that all necessary Parliamentary and Treasury procedures are followed in respect of obtaining the money and accounting for the money. But the legislation, the 1998 Northern Ireland Act, places no specific burden of control on the Secretary of State or the NIO Accounting Officer in respect of Vote 2 so our role is very limited and I believe it is the same as in Scotland and in Wales. The burden of ensuring that the money is used to best effect lies with the devolved administrations.

  74. You have made clear the absolute limits of the envelope or ceiling under which you are making money available, but is the pace at which you release that money determined by the Treasury for you or is that within your jurisdiction?
  (Mr Cassidy) The normal disbursement is in two weekly instalments, or twice a week instalments, of roughly about £50 million each and it has been decided between ourselves and the Department of Finance and Personnel as a rough average of what they are going to need. It does tend to rise occasionally, depending on what particular demand for money has arisen in Northern Ireland, but it works out somewhere around £100 million a week, in two instalments.

  75. So there is an absolutely regular amount and then there might be exceptional requests?
  (Mr Cassidy) The reason we have decided on that figure is simply for administrative convenience. It takes a little time to make the necessary approvals for release from the UK Consolidated Fund and to get it into the bank account of the Northern Ireland Consolidated Fund so that they can actually draw on it in time, but it is purely a mechanical thing.

  76. But the exceptional amount that might vary from the £50 million in two tranches is that an issue on which you effectively retain a discretion? Do they have to prove to you why they need it?
  (Mr Cassidy) No.

  77. If they ask for it, you give it to them?
  (Mr Cassidy) Yes.

  78. Provided they remain within the ceiling?
  (Mr Cassidy) Yes.

  79. All right. Why can the Northern Ireland Office not provide information on what the provision in the Estimate is intended to cover, given that at the time the Estimate was presented to the House, Northern Ireland Office Ministers headed the Department of Finance and Personnel?
  (Mrs Brown) The Estimates were presented to the House during the period of suspension and before that the Northern Ireland Assembly and Executive had begun, but had not completed, consideration of their spending plans for the coming year. The Minister of Finance and Personnel in Northern Ireland announced an approved Budget in December, 1999. The Government's aim when suspension came along was to bring about a return to devolution as soon as possible, so NIO Ministers did not wish to connect Northern Ireland departments to spending plans at any greater level of detail beyond what was announced in the proposed budget which had come from the local Minister of Finance himself. The NIO Estimate for the cash grant for devolved services would not have been affected in any way by such detailed plans.

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