The north’s £3.3 billion financial package following Stormont’s restoration is a “substantial” boost that is more than it appears on the surface, a leading economist has said.
The package had been pledged by the UK Treasury ahead of the British government’s deal with the DUP to return to power-sharing, with the money to be used, among other things, to plug the gap in public sector pay.
The sum will soon be bolstered by funding from the Republic through the Shared Island Initiative, Taoiseach Leo Varadkar said on Monday during his visit to Stormont to meet the new Executive ministers.
UK Prime Minister Rishi Sunak has described the £3.3bn as “generous and fair”, but the new Executive ministers have written to his government to warn it is not enough to deliver “sustainable public services and public finances”.
However, the director of the Institute for Fiscal Studies, an influential think tank that describes itself as the “UK’s leading independent economics research institute”, has said the sum is more than fair.
Paul Johnson made his comments in an X post responding to an Irish News link to an article on Mr Sunak’s assesment of the financial package.
A note on scale.— Paul Johnson (@PJTheEconomist) February 5, 2024
Northern Ireland is roughly one 40th size of UK. So can think of £3.3bn for NI as around £130bn in UK terms.
I know some of it is backdated, some for subsequent years, and some looks like reallocation. But this is a substantial settlement. https://t.co/d6qce3dvXg
He wrote: “A note on scale. Northern Ireland is roughly one 40th size of UK. So can think of £3.3bn for NI as around £130bn in UK terms.”
The economist added: “I know some of it is backdated, some for subsequent years, and some looks like reallocation. But this is a substantial settlement.”