Select Committee on Northern Ireland Affairs Minutes of Evidence

Examination of Witnesses (Questions 80 - 99)



  80. So it was as if—to make sure I have understood—suspension had not occurred?
  (Mrs Brown) Yes.

  81. Was a public statement made to that effect or was that a decision which Northern Ireland Office Ministers took, in a sense within their own closet?
  (Mrs Brown) I am not conscious of a public statement having been made specifically in relation to financial matters. Certainly at the time of suspension, the Secretary of State did say that his aim was to return to devolution as soon as possible. I am not conscious of anything other than that, that broad political statement.

  82. To what extent is the Secretary of State involved in determining public expenditure bids by the Northern Ireland administration?
  (Mrs Brown) At the moment he is not. Certainly prior to devolution he was. Under devolution firstly the amount of funding coming to the Northern Ireland administration is, by and large, as we covered earlier, determined by the Barnett Formula but any negotiations that there need to be, whether inspired by Treasury or inspired by the local administration, are done on that basis in the relationship between the local administration and Treasury.

  83. In that respect, he is no sense a conduit?
  (Mrs Brown) He can be involved in the process if the Northern Ireland administration wish him to press a case to Treasury and wish to involve the Secretary of State, hopefully in backing their case. There is a mechanism for resolution of disputes, if you like, between the Northern Ireland administration and Treasury and the Secretary of State would be involved in that, but in the main process he is not involved. If the Northern Ireland administration bid for a certain amount, Treasury apply a formula and do whatever tinkering they want to do and make an allocation. If the Northern Ireland administration is content with that allocation there is not a role for the Secretary of State.

  84. I do not wish the question to sound in any way sinister, but would the request by the devolved administration to the Treasury be copied to the Secretary of State or could it be occurring without the Secretary of State being in any way aware of it?
  (Mrs Brown) We are so early on in the process I am not clear that we have a marked out procedure for that.

  85. I will allow myself the ironic comment that in the light of everything else the Treasury has prescribed, it is slightly surprising that the Treasury has not prescribed anything in this regard?
  (Mrs Madden) Well they have.

  86. So they have? Right.
  (Mrs Madden) In this same document there is a process for resolution of disputes. The practical outworking of that resolution we have not—you know, we have had such a very short time of devolution we have not had in any sense practical examples, but how any disputes are resolved is by the local ministers going directly to the Chief Secretary initially and they would pray the Secretary of State in aid of their position. That is not to say the Secretary of State would accept their case as signed and he may actually, if he took a different view, could perhaps align himself with the Chief Secretary in those disputes. But if that does not resolve it and that is in a sense a bilateral, then the next step is for either party to call a joint ministerial committee, which would have Ministers of the devolved administration, plus Ministers from the Cabinet and they would resolve any disputes there. Ultimately it would be the Secretary of State who would represent the devolved administration at Cabinet level should the matter go to that level. The practical outworkings of that mean that for the normal business the local administration and local ministers would be in direct dialogue with Treasury and it is only if a dispute was arising that they would inform the Secretary of State through correspondence and allow him therefore to be aware that a dispute has arisen and inviting him, as would the Chief Secretary invite him, to a meeting where a matter of dispute was going to be discussed.

  87. Right. So to make sure I have understood. If the devolved administration wishes to communicate with the Chief Secretary and there is no problem with their request, then there is no reason why the Secretary of State would need to know about it or indeed would know about it?
  (Mrs Madden) He would most likely be informed as a matter of courtesy if there was a ministerial meeting between local ministers and the Chief Secretary. He would not be informed of bilateral discussions at official level; as a matter of courtesy he would be informed of ministerial contact.

  88. Right. Now I think you allowed for the possibility that the Secretary of State might disagree with the devolved administration about the desirability of the expenditure? Did I understand that rightly?
  (Mrs Madden) He is entitled to take his own view on the case that the administration would be advancing to Treasury for funding in the particular area, both in relation to the Barnett Formula but specifically in relation to special cases.

  89. No, I am assuming any of this is outside the Barnett Formula because of the nature of the request?
  (Mrs Madden) Yes.
  (Mrs Brown) In the case of special pleading the Secretary of State is entitled to take a different view to the devolved administration.

  90. So if, in fact, we reached the point where it came to Cabinet could we be in the situation where he was representing on behalf of the devolved administration a view with which he did not agree?
  (Mrs Brown) He would be presenting his own view in Cabinet and he would explain the view of the local administration and the case which they wished to pursue for additional funding, but he would then add his own comments.

  91. He would be affording the Cabinet to have the opportunity of hearing the issue on its merits and he would separately be declaring what his view was?
  (Mrs Brown) Yes, that is correct.

  92. Right. One last question before I turn to Mr Clarke, I am going back to what we have been over a moment ago. My source is Paragraph 12 of the memorandum where you describe the current position. I think I am right in saying that the 2000-01 Estimate was proposed during the period of direct rule and Ministers were presumably therefore involved in its synthesis. Is that accurate?
  (Mrs Brown) Yes, as was the devolved administration in that the devolved administration accepted the existing public expenditure plans for the coming year, but that was a conscious decision of the devolved administration during the period of devolution prior to the spell of suspension.

  93. But unless I am mistaken, it makes the Secretary of State more answerable for those particular figures because devolved administration was effectively accepting figures which had been put forward by the Secretary of State or am I misunderstanding?
  (Mrs Brown) No, you are right. The Secretary of State has put forward his figures. The devolved administration signed up to those figures, but in the process of doing that they became the figures of the devolved administration and had suspension not come about and had devolution bedded in first time around, they would have been responsible for those figures.

  Chairman: I see, yes. Thank you. Mr Clarke?

Mr Clarke

  94. Thank you, Chairman. You will forgive me if I lost my way slightly in the explanation of the various mechanisms in which the Secretary of State could involve himself in determining the Estimate. It seemed as if there were lots of if, maybe's, and could be's, and I think at one stage you said that practically it probably was not always the case. It is the practicalities of how detailed and how deep the Secretary of State could be involved. Would that be fair to say?
  (Mrs Brown) By and large the Secretary of State would not be deeply involved.

  95. I thought so.
  (Mrs Brown) It would only be in exceptional, unusual circumstances—well, we expect they would be unusual circumstances; we do not have a lot of history of devolution to guide us yet—but it would only be in the special circumstances where the Northern Ireland administration was making special pleading for special funding and the Secretary of State needed to be involved in helping to try and resolve the outcome.

  96. Taking that there is probably an absence of those exceptional circumstances, I wondered if you could give a professional view as to whether or not you consider it somewhat unsatisfactory for a Minister to present to the House an Estimate that he played no part in determining?
  (Mrs Brown) That I suppose would be the case if lying behind that there were not processes and safeguards in place to ensure proper bidding for money, proper use of money and so forth is, on the face of it, it looks rather strange, but that is the nature of devolution and that is the nature of devolution, not just in Northern Ireland but in Scotland and Wales. The principle to bear in mind clearly is that the responsibility for those moneys lies not with the Secretary of State but with the devolved administration.

  97. So the Secretary of State is going very much on trust?
  (Mrs Brown) Trusting that the elected devolved administrations make the right decisions and there are safeguards also in scrutiny by the Northern Ireland Audit Office, for example, who will continue to be completely independent from the Northern Ireland Assembly and administration to ensure proper accountability.

  98. Just to delve into these mechanisms a little bit further, how would the Secretary of State, through the Northern Ireland Office or others seek to determine that the Estimate that he was presenting was reasonable?
  (Mrs Brown) I think in that situation we would be looking to Barnett again and if the amount in the Estimate was varying substantially from figures of expenditure from the previous year and that could not be explained by something in Barnett, then the Secretary of State, as indeed would the Treasury, would be asking those questions.

  Mr Clarke: Thank you, Chairman.

  Chairman: I am going to ask Mr Burgon to ask what is the final question in this particular series. The final question in this series; you may well have a further question?

Mr Burgon

  99. What responsibility, if any, rests with the Secretary of State or the Accounting Officer for determining the regularity of the use of funds transferred to DFP?
  (Mrs Brown) The Secretary of State makes the payments into the Northern Ireland Consolidated Fund, but there is no specific burden of control on him or on the NIO Accounting Officer. So it really goes back to nothing more than I said previously about the two responsibilities of the Secretary of State—to ensure that the total transferred by way of Grant in Aid does not exceed what Parliament wished and to ensure that the agreed mechanisms and procedures for involving Parliament and Treasury are adhered to; nothing more than that.

  Mr Burgon: May I ask a supplementary?

  Chairman: Yes, do.

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