Northern Ireland

ANALYSIS: Secretary of state's expected move to calm Stormont uncertainty could have a sting in the tail

Secretary of State Chris Heaton-Harris. Picture by Brian Lawless/PA Wire
Secretary of State Chris Heaton-Harris. Picture by Brian Lawless/PA Wire Secretary of State Chris Heaton-Harris. Picture by Brian Lawless/PA Wire

STORMONT departments are facing serious financial pressures and the political vacuum is only to exacerbating the problem.

The failure to agree a budget before Paul Givan's resignation in February has also complicated matters, with departments now operating not only without ministers but also without a clear spending plan.

In October, the then finance minister Conor Murphy warned there was a £660m deficit in Stormont's coffers, partly but not entirely due to increased energy costs. How this hole in the finances is plugged is, so to speak, the $64,000 question.

It's important to be reminded at this juncture that we are in this current crisis because of the DUP and its continued boycott of the institutions. Every other party is willing to form an executive but the current rules don't allow it.

While Westminster agreed legislation earlier this year that sought to avoid a scenario similar to the drift or 'indirect rule' which occurred between 2017-2020, the six month period of keeping caretaker ministers in place expired on October 28.

The period since has been one of limbo, with civil servants keeping the lights on, but hamstrung when it comes to doing anything more.

Successful legal challenges during the institutions' last period of prolonged dormancy means department permanent secretaries, the highest ranking decision makers in the absence of ministers, are reluctant to stretch the remit of their powers.

When Chris Heaton-Harris announced last week that he was delaying an assembly election, he too highlighted what he termed the "£660 million in-year budget black hole". Noting that civil servants were limited in their scope for tackling the deficit and making other major decisions, the secretary of state said he planned to "take limited but necessary steps to protect Northern Ireland’s public finances and the delivery of public services".

The anticipated legislation, which we can expect to hear more about in the coming days, is arguably the easy bit.

The greater challenge is finding ways to reduce Stormont's deficit. Westminster has topped up the regional coffers previously in a manner that went above and beyond the Barnett Formula but the British government appears highly unlikely to reward DUP intransigence, especially at a time when the talk is of a fresh round of austerity.

In his forthcoming statement Mr Heaton-Harris can be expected to deliver some of certainty around a regional budget while also shoring up civil servants' powers. But don't be surprised if there's a sting in the tail that threatens to take money out of people's pockets – and not just those of our MLAs.