Archibald: 'Urgent action' needed to tackle £767M budget over-spend
The Finance Minister has urged Executive colleagues to take "urgent action" to rein in spending after revealing that departments are currently overcommitted by £767 million.
Caoimhe Archibald said the administration was expecting around £500 million in extra funding from the UK Government following next month's budget through the Barnett funding model used to distribute money to the devolved regions.
But she highlighted that would still leave the Executive facing a funding gap of around £267 million.
Ms Archibald said such an overspend would have "grave consequences" as she warned that failure to balance the Stormont budget by the end of the financial year would see the UK Government withdraw a previous offer to write off £559 million worth of debt owed to the Treasury.
The Treasury offer to set aside the £559 million was conditional on the Executive delivering a balanced budget in 2024/25, the minister told MLAs.
Ms Archibald was responding to an Assembly debate on a motion tabled by the Alliance Party on the issue of Stormont's finances and associated calls for the UK Government to reform and enhance the funding arrangements for the region.
The minister said 90% of the £767 million worth of overcommitments were shared among three departments - health, education and justice.
She said 55% of the overall bill was related to the costs of implementing recommended public sector pay uplifts this year.
Ms Archibald said that while it remained unclear what extra money the Executive would be receiving by way of Barnett consequentials, she said she would nevertheless bring a proposal to fellow ministers that would see departmental budgets increased on the basis of the estimated Barnett share.
"It is expected that this will allow the allocation of around £500 million," she told the Assembly.
"While this will fall short of the overcommitment departments are currently reporting, it will go a significant way towards addressing the pressures.
"But all ministers will have to play their part by living within their budget once this funding is provided.
"Not doing so would have grave consequences for future funding.
"Any overspend would come off next year's budget, and even more concerningly, Treasury has been explicit that not living within budget would result in the Executive having to repay the £559 million that Treasury had agreed to write off, making an already difficult financial situation even worse.
"While I, along with my Executive colleagues, will continue to make the case for adequate funding of our public services, I remain hugely concerned that the ramifications of not living within budget this year would represent a potentially disastrous outcome for the Executive and our public services.
"At the Executive meeting last week, I outlined to my ministerial colleagues the need for urgent action to be taken.
"Collectively, we must ensure a balanced budget is delivered.
"I am currently meeting with individual ministers to discuss the budgetary challenges and collectively, as an Executive, we will need to chart a way forward.
"I will continue to make the case to the British Government that more funding is needed for public services to support our workers, families, and businesses; and will be raising this at a meeting with the Chancellor later this week.
"Difficult times require courageous leadership."
Ms Archibald will be joined by First Minister Michelle O'Neill and deputy First Minister Emma Little Pengelly for the meeting with Chancellor Rachel Reeves in London on Thursday.