Select committee: Northern Ireland Affairs Committee
Conclusion 6
1st Report - Funding and delivery of public services: follow up
Published 7 Apr 2025
Addressed to Northern Ireland Executive; Northern Ireland Office
Northern Ireland Affairs Committee Funding and delivery of public services: follow up All items in this report Report on parliament.uk ↗ Inquiry on parliament.uk ↗
Conclusion (the committee's words)
In the longer-term, one way in which Northern Ireland could reduce its reliance on the vagaries of the Block Grant, Barnett formula and short-term funding would be to raise more revenue itself. That is, of course, easier said than done. The introduction of water charges (for example) may be politically difficult, but the public elect politicians who are expected to make difficult decisions and therefore the discussion should not be avoided. Such reform may take time to implement practically—delaying any increased revenue which could be collected and spent. Further fiscal devolution, with the Executive taking control of currently centralised tax and revenue-raising levers, may offer a different way forward if Northern Ireland takes control of, and responsibility for, increased fiscal powers which enable it to broaden its tax base and generate increased revenue. That the Government and the Executive are both willing to enter into these negotiations speaks to a welcome stability in Northern Ireland’s institutions, which can only benefit the funding and delivery of public services more generally in Northern Ireland. (Conclusion, Paragraph 73)
From: Northern Ireland Affairs Committee, 1st Report - Funding and delivery of public services: follow up (HC 477), 7 April 2025
Government response
The government responded to the whole report on 19 June 2025 (deadline 7 June 2025).
Summary written by Accountability Index from the government's response. It is not the government's own words.The government's response "notes" the Committee's recommendations on needs-based funding, multi-year budgeting and tax devolution, and sets out funding and Fiscal Framework developments, stating that "more time is needed" on the long-term framework.
- On needs-based funding, the government says the Executive will "continue to receive over 24% more per person" than equivalent UK Government spending in the rest of the UK, "above their independently assessed level of need". Its response does not address the request to backdate assessed need.
- On the Fiscal Framework, the UK Government and the Executive "have also agreed to immediately begin negotiations" on a full framework, covering Housing Executive borrowing and the Holtham Review. The government says "more time is needed" for any long-term agreement to be robust.
- On multi-year funding, the Chancellor "has confirmed multi-year funding for the Spending Review period until at least 2028–29". The government says it "would expect" the Executive to return to multi-year budgets.
- The government says £129m of the £235m Transformation Fund has been allocated to six projects, and it will "seek to identify more projects" and continue to monitor and evaluate allocated funding with the Public Sector Transformation Board.