Murphy describes Draft Budget as difficult

Date published: 18 January 2021

Launching the consultation which will run from 18 January until 25 February, Conor Murphy said “The Spending Review has not delivered the level of support required to kick start our economic recovery from COVID-19 and Brexit. It is difficult and effectively a standstill of our 2020-21 Budget position.

“With increased demands on public services and taking account of inflation, it will be a challenge merely to deliver existing services at their current levels. I recognise for most departments the draft Budget outcome represents flat cash settlement which will mean effective reductions once increased costs and demands on services are taken into account. Choices will have to be made, public services will have to be prioritised.”

Turning to the Draft Budget allocations, Minister Murphy continued: “Throughout this pandemic the Executive has been determined to do all it can to support the health service, businesses and vulnerable people. While the vaccine offers us hope, COVID-19 will continue to present challenges in the weeks and months ahead which is why over £380 million is being provided for the health service response. We have prioritised the small amount of additional funding available to continue welfare reform mitigations, fund Agenda for Change pay, help pupils with Special Educational Needs and to support low income families through holiday hunger payments.”

Outlining capital funding allocations, Minister Murphy said: “The Draft Budget sets out some £1.75 billion of capital spending which will also provide much needed investment in our infrastructure, supporting the construction sector and encouraging investment in areas such as the schools estate as well as delivering the New Decade, New Approach priority to increase investment in social housing.”

The Minister continued: “While the Executive has the option to increase revenue through the regional rates, we recognise the impact COVID-19 has had on households and businesses. This financial year we reduced business rates by 18% and froze domestic rates. Next year we intend to freeze the regional rates for both households and businesses. I would urge councils to play their part and do the same in respect of their district rates. I also intend to provide £150m of additional business rates support in 2021-22.”

Encouraging people to respond, the Minister concluded: “Unfortunately there is only a short consultation window. Nevertheless I would encourage everyone to get involved and have their say on how we can best maintain key public services in a very challenging financial context.”

The Draft Budget can be viewed here.