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Lord Molyneaux of Killead: My Lords, the House is being invited to endorse additional expenditure of £146 million for the current year. Secondly, and more importantly, we are invited to give approval to the much larger sum of £3,120 million to enable Northern Ireland services to be financed pending the new Northern Ireland Assembly's approval, and to approve the main estimates for the coming year.

There is an urgent need for early decisions on the mechanism for dealing with approval in the near and intermediate future. Approval is needed for authorisation and scrutiny of expenditure by all the departments that will be devolved to the Northern Ireland Assembly. The separate funding for those areas of government reserved to the United Kingdom Parliament, as the Minister has rightly said, is not within our remit this evening.

However, there is a dichotomy. Looking at all the various documents being produced by and on behalf of the Assembly, I cannot help thinking that there is a degree of overlap in the functions of the United Kingdom Parliament and Government and of the Assembly. That overlap was not so apparent during the lifetime of the previous Stormont parliament and government. I had the impression that there was a general belief that a perceived "restored" Stormont, as is often referred to, would automatically reinstate the financial arrangements that existed during the lifetime of the Stormont parliament.

Those who take that rather simplistic view forget that, until 1972, there was no Northern Ireland Office. Presumably, the Vote on those matters for which the United Kingdom Government remain responsible would have been fairly small compared with that over the past 10 years. The Northern Ireland Office now has its own budget and, depending on various factors beyond the control of any of us, it can expand very rapidly. That structure, which existed until 1972, and that very clear division no longer exist. There will be a certain parallel with legislation in the Welsh Assembly and in some respects the Scottish Parliament.

There are problems and overlaps which, as yet, have not come over the horizon in regard to all three areas of the United Kingdom. That being the case, why is it proving so difficult to complete the design of what one might loosely call accountability and control of expenditure, given that all three regions of the United Kingdom have featured so prominently in the

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deliberations of your Lordships' House and the other place for a good deal of time? I notice that the Whip is taking account of this particular point.

For the first two years of this Parliament, Northern Ireland has featured in terms of the usage of the time and facilities of the draftsmen in a way that probably did not happen over the previous 20 years. The Minister of State in another place, Mr. Murphy, has explained that the President of the Council and Leader of the other place is looking at the issues in so far--these are the Minister's words--"as they affect Northern Ireland, Scotland and Wales." There is a certain commonality, and there ought to be a commonality, in our approach to all three areas so that at least there is a degree of uniformity and one area is not out of step with another.

Will the Minister share my view that progress could be hastened if senior Ministers in Her Majesty's Government could begin with a basic design for all three regions of the United Kingdom? They could then consider slight variations that might be desirable in the light of local differences.

I raise a brief question under Department of the Environment Vote 1. The Chancellor of the Exchequer announced his generous package for road improvements and much else besides. The fact that the Chancellor made the announcement gave the impression that it was a Treasury initiative, a Treasury bonus, perhaps over and above any future appropriation order. However, confusion arose when the local Stormont Department of Finance made it clear that the Treasury bonus would become available only if the Port of Belfast were privatised and the proceeds and receipts used to fund the Chancellor's generous hand-out. That sounds to me like selling the family silver. Perhaps the Minister can provide some much needed clarification.

I have a final point under Department of the Environment Vote 4 relating to planning. In regard to recent proposals for the expansion of facilities and ancillary undertakings at Aldergrove international airport, can I assume that the Minister in his department and the Department of the Environment welcomed those statements, first, on the grounds that such a hub of commerce and industry around the airport would provide lasting benefits for the entire Province and, secondly, because the provision of employment centred roughly on the airport and the town and borough of Antrim would provide employment in an area extending well to the west of the Province where there has been much depression caused by the closure of what appeared to be secure undertakings?

There is a general appreciation of the diligence and determination of the Minister in directing and encouraging all who serve in his wide ranging department and the results that he has achieved. In addition to the burden that he carries in representing and answering for all Stormont departments in your Lordships' House--sometimes we are inclined to forget this--I am certain that we can rely on the Minister to use his experience and initiative in co-ordinating all the various agencies and furthering this much-needed set of projects for the enhancement of the airport, not just the passenger side, but what flows from that by way of

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auxiliary undertakings in the area of the airport. We had high hopes at one time that there would be expansion there because it was going to be a kind of tax-free area, but that did not happen. This seems to me a good opportunity to carry that forward. The attraction for one of the Minister's departments--namely, the Department of the Environment--would be that this could all be done at no financial cost to the department. That ought to bring him good cheer.

It was encouraging to hear from the Minister the good news about the improvement in the economy and a further reduction in unemployment. All of that we welcome and applaud. But, like the Minister, we regret the continuing problems of farmers. He will know that, despite the financial support of his department of Agriculture, the pig sector is rapidly collapsing. That is a fact which we have to face. I trust that the Minister will receive full support across the Province for any measures he can take in the form of what would now amount to a rescue mission.

9.15 p.m.

Lord Redesdale: My Lords, I believe that the delay in the implementation of parts of the Good Friday Agreement has left this House with a continued responsibility to discuss the appropriation order for Northern Ireland. I am sure we all agree that the sooner the agreement can be implemented in its entirety the better. To that end, we all wish the Government well in their efforts to accelerate the establishment of an executive on terms that are acceptable to all who invested goodwill in the agreement last April.

I am sure that the Minister of Finance of the new Assembly, being held to account by that Assembly, will be able to do the issues involved more justice than we can tonight. No doubt when the new Minister of Finance announces next year's budget to the eager members of the Northern Ireland Assembly the attendance will be far greater than it is here tonight!

However, we are presented with an opportunity, since, if this is the last appropriation order to be dealt with by this House, as we all hope, we can be sure that it will be against this appropriation order that future budgets in Northern Ireland will be compared. Whatever the new Minister of Finance announces next year, those changes will inevitably be compared with the figures we pass tonight. This order will therefore probably be judged more critically than most of its predecessors, even if that criticism is blunted because it is indirect and because it is delayed by 12 months.

With that in mind, it would be nice to think that we could bequeath Northern Ireland a golden inheritance. Unfortunately, this order seems to have been bound by the Treasury orthodoxy that money is always tight. In some areas it bequeaths a silver inheritance; in a few others, more base metals spring to mind.

Let me start with the areas on which the Government have done well. Agriculture, which has already been discussed by the noble Lord, Lord Molyneaux, accounts for almost 5 per cent. of gross domestic product in Northern Ireland and employs 6 per cent. of the

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workforce, compared with 2 per cent. and 2 per cent. respectively for the rest of the United Kingdom. In addition to its other woes, the Province has been one of the areas hardest hit by the recent problems in agriculture, in particular in securing export markets for some agricultural products. I am particularly pleased, therefore, to see that in this order the Government are allocating an extra £36.5 million to the Department of Agriculture. That is considerably above the annual rate of inflation and will go a great distance towards shoring up an industry which has been hard hit.

However, there is more that the Government can do for this vital industry. I understand that last year some £4 million in quota support from the Common Agricultural Policy which should have gone to Northern Ireland farmers to supplement the suckler cow premium remained unclaimed. Although the Government are not directly responsible for this shortfall, they should try to ensure that in future all these European funds are taken up. Further down the line, if the Objective 1 status for Northern Ireland is lost, the Government may have to step in to help Northern Irish farmers further. Although agriculture is to be devolved under the new arrangements, the Minister will be aware that dealings with Europe on all matters including agricultural grants are not, so the Government will need to keep an eye on this. They have done reasonably well so far, but there is no room for complacency.

With regard to education, I fear that the Government have fared considerably worse than they have with regard to agriculture. Putting teachers' superannuation to one side, it seems that funding for education is to be increased by only 1 per cent. in the coming financial year. That follows this year's increase of only 2 per cent., which was also below the rate of inflation. And we must remember that these meagre increases--cuts in real terms--are to an education service already struggling from serious under-funding.

I also understand that some of the reduced overall total of funding is to be sidelined into other areas: energy efficiency in schools, the Council for the Curriculum and costs associated with the Omagh bombing. We have nothing against these special areas of funding--indeed, they seem to be very worthy causes--but they leave even less money in a pot that was never full in the first place. This will stretch teaching resources in Northern Ireland even further. To suggest that money can be saved by cutting back on education is a false economy. I fear that the Government have forsaken their last opportunity to give the schools and colleges of Northern Ireland the boost that they need for long-term stability before control on this issue is devolved to the new structures.

As with all large expenditure totals, there is also the question in the area of education funding of how the global figure is distributed between competing demands. I have come across several well-researched reports and indications, backed up by the most heart-rending testimonies, that integrated education continues to do poorly in several senses of the word. We very much applaud the steps that the Government have taken to remedy this. I believe that they share with us the hope that integrated education has real potential to prevent

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future generations being blighted by the tribalism instilled at an early age that has been so destructive in Northern Ireland. The Government's recent decision to support all but one of the integrated schools established by parents--originally without government support--is one that we admire, and we hope it yields long term benefits in the Province.

Unfortunately, the basic facts remain that the demand by both parents and pupils for integrated education is very much greater than the supply and that, where it is in supply, it is not well funded at all. I hope that in this "limbo time" before the executive is established the Government will at least make one further gesture in support of integrated education by agreeing to fund Ulidia integrated primary school, which, sadly, remains dependent on the goodwill of parents and philanthropists.

I should like to conclude by dealing with one quandary brought to my attention recently. I refer to the difference between two figures. One is the suggested figure for the running costs for the new Assembly; the other is the estimated expenditure voted on by the Assembly itself. There is a difference between the £14.5 million on which the Government expect the Assembly to be able to run and the figure of £36.8 million that the Assembly is considering. I realise that these figures must be looked at much more closely to see which bears a closer resemblance to the truth. However, the large divergence between the two figures is a cause of concern.

9.22 p.m.

Earl Attlee: My Lords, I am grateful to the Minister for his explanation of the order. Noble Lords will not be surprised to hear that I sneaked a look at the previous debate on a similar order. My noble friend Lord Cope of Berkeley at the time observed that that might be almost the last time that the House debated such an order. We are still debating it this year. I agree with the noble Lord, Lord Redesdale, that it is even more likely that this will be the last occasion. Presumably, next year the matter will be covered by a block vote from the Treasury to the Assembly and the Northern Ireland Office. I found the figures confusing, and I am grateful for the contribution of the noble Lord, Lord Molyneaux. I share the concerns of the noble Lord, Lord Redesdale, about the education budget. The noble Lord, Lord Molyneaux, made interesting observations about devolution matters in general.

The Minister made light of the difficulties of agriculture, but these problems are not peculiar to the Province; they apply everywhere. The support that he has given to agriculture is welcome. I join the Minister in welcoming the improvement in the employment situation in the Province. I was pleased to cover this matter in our debate last week. I believe that this improvement is the fruit of the relative peace and stability in the Province.

Perhaps I should have studied the figures more closely. Clearly, the fire service is a vital emergency service for the Province, but I was a little surprised when the Minister mentioned the training centre. Is it

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economic or effective and does the number of courses it runs make it worthwhile? I do not expect the Minister to respond or worry too much about my question tonight. I was a little surprised by his comment, but as I have not studied the matter previously I have no particular view on it.

I am concerned about the macro-economic effects of any welcome reduction in expenditure on security as and when it is prudent and safe to do so. I mentioned the subject last week, but it bears repeating. Expenditure on the RUC is more than £400 per man, woman and child in the Province. There would be a major effect on the economy if it were to be significantly and rapidly reduced. As it is a reserved matter, any savings will go to the Treasury in London via the NIO and not to the block Vote for Northern Ireland to be reallocated by the Assembly. Thus, there is little incentive to reduce the need for high expenditure on the RUC, either on the part of the unionists or the nationalists. I am not advocating continued high expenditure on the RUC just for the sake of the economy in the short term; I am just interested in the consideration that the Minister has given to the problem.

There is a further problem relating to the RUC and any redundancy or compensation payments. I accept that it is not strictly relevant to this order, but the costs will be considerable although necessary. Indeed, the Prime Minister has said that the payments will be generous. The payments will have to be funded by the Treasury. Are they being built into Treasury forecasts? If not, there is a future danger that unnecessary expenditure on continued and unnecessary manning of the RUC could be incurred because of a lack of funds to pay lump sum compensation payments. It may be that the Minister cannot help me tonight, but will he draw the problem to the attention of his right honourable friend the Chancellor of the Exchequer?

If I misheard what the Minister said about agriculture, I apologise. My observations apart, I am content with the order.


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