Pivotal

Author

Ann Watt

Ann Watt

Published

If the polls are correct, it looks like it will be all–change at Westminster. What will that mean for Northern Ireland? Let’s take a dive into eight decisions facing the next UK Government to see how they might impact here.

But first, a word about devolution. Some big issues are decided UK–wide, the most important being total public spending and most taxation (and also immigration, defence and foreign policy). But lots of the policies being debated in the UK election campaign are devolved – the health service, education, housing, environment, planning – and in these areas what happens in Northern Ireland won’t be directly affected by decisions made by the Government in Westminster. NI gets ‘Barnett consequentials’ of this funding, but there is no obligation to spend on the same things. 

So how will choices made by the next UK Government affect Northern Ireland? Let’s look at eight important issues. 

  1. The next Government’s approach to public spending will have a big impact on Northern Ireland’s finances

    The biggest determinant of Northern Ireland’s block grant is the amount of comparable funding allocated in England, since that’s what the Barnett formula calculations are based on. So if the next Government decides to take a more generous approach to spending, then that should mean some relief for NI’s public finances. However, both main GB parties are tightly bound by their manifesto commitments about borrowing, debt and not raising taxes – and this leaves little flexibility for more spending. That may not stay the case, given the very poor state of many public services across England – but in the short term it looks unlikely to produce the kind of amounts that would resolve NI’s current budget problems (e.g. Labour’s manifesto lists Barnett consequentials for NI of new spending at only £135 million annually by 2028–29)
  1. Achieving higher economic growth is centre–stage for both Conservatives and Labour

    Both main parties are banking on kick–starting economic growth to bring in more tax revenues and reduce the demand for public spending. This is a tall order given UK growth has been in the doldrums for nearly 20 years, but it’s been taken up as the key way to boost incomes and wellbeing, as well as bringing relief to stretched public finances. There is a commonality between the parties in the policies they are pursuing to boost growth, including reduced regulation, infrastructure investment, improved education and skills, and more flexibility in planning. Most of these policy areas are devolved, and Northern Ireland’s MLAs will need to consider whether they should make similar changes to avoid being left behind.
  1. A renewed focus on improving public services in England may underline poor performance in NI

    There is a big focus from both Conservatives and Labour on improving what people experience day–to–day from the health service, schools and the police. There are ambitious commitments to reduce GP and hospital waiting lists, recruit more teachers, provide more free childcare and crack down on anti–social behaviour (although it’s not always clear how these will be paid for given the tight control on spending). Northern Ireland already lags well behind on many indicators of public service performance, so big improvements in England would only serve to emphasise that gap. One interesting detail in the depths of the Conservative manifesto is a commitment to publishing comparable public service performance data for all parts of the UK. Sadly at present we can be sure NI would be at the bottom of the class on many fronts.
  1. Decisions about social security will have a big effect on the lowest income households here

    Although social security is devolved to Northern Ireland, long-established policy commits the UK government to providing the resources needed to fund the benefits system at parity with GB. That means if the Executive agrees to additional provisions or mitigations (as for the bedroom tax and benefits cap), these have to be funded from its own budget. Across the UK, campaigners have expressed disappointment that neither main party has set out clear measures to address growing poverty and destitution. Labour’s manifesto says they will review Universal Credit and makes a specific commitment to end mass dependence on emergency food parcels, but doesn’t say what this will mean in practice or how it will be funded. The Conservatives have reacted to the soaring numbers of people on disability benefits by saying they will save an eye–watering £12 billion from the total cost of welfare, but without details of how this will be achieved.   
  1. Northern Ireland’s new fiscal framework and current budget will be early subjects for negotiation

    The Finance Minister has just agreed an Interim Fiscal Framework with the Treasury, and taking this forward will be one of the first interactions for NI with the next UK Government. Discussions and decisions will be needed about the appropriate level of need for public spending here (currently set at 124% of spending per head in England), fulfilling the commitment to address the cliff–edge in funding that is coming up in 2026–27, fiscal sustainability and infrastructure plans, and possibly greater devolution of tax–raising powers. The next Government will also need to decide if it will offer some extra funding to relieve the Executive’s dire budgetary position this year, and how robustly it enforces current conditions around past overspends and raising more revenue locally. In both cases it seems likely that that there might be some flexibility in return for clear progress in areas like public service transformation and revenue raising. 
  1. The UK’s future trade relationship with the EU will impact on how goods move between GB and NI

    Neither of the main GB parties is suggesting any change to the Windsor Framework, which gives Northern Ireland’s goods exports guaranteed access to both the EU Single Market and the UK internal market. The UK Government should work with the NI Executive to make the most of Northern Ireland’s access to both markets. Labour have said that they will seek to improve some elements of the Trade and Cooperation Agreement (TCA), perhaps resulting in a closer alignment to some EU rules. If their reported intention to reach a veterinary agreement with the EU comes to pass, that would have a very significant impact on the operation of the post–Brexit arrangements for the movement of agri–food produce from GB to NI. The UK Government needs to be continually aware of the possible negative effects that UK–NI divergence could have on political stability in Northern Ireland.
  1. There is a difference between the two main parties on how they will deal with the legacy of Northern Ireland’s past and with rights issues

    The Conservative manifesto repeats support for the new Commission for Reconciliation and Information Recovery and its work to ensure victims and survivors have access to more information about what happened to their loved ones. Labour has said that they would repeal and replace the Legacy Act, returning to the principles of the Stormont House Agreement and seeking support from all communities, although there are still questions about what difference this would make in practical terms to victims and survivors. On rights issues, the recent legal challenges to the Illegal Migration Act revealed that the commitment in the UK’s Withdrawal Agreement with the EU to ensure no diminution of human rights in Northern Ireland has the effect of preventing the application of new UK law that would constrain the application of the European Convention on Human Rights (ECHR). The Conservative manifesto does not rule out attempts to appeal the judgements and pursue the controversial policies, while Labour remains clearly committed to the ECHR. 
  1. Both parties are firmly committed to supporting devolution in Northern Ireland – but what will this look like in practice?

    What Northern Ireland needs most is a sustained period of stable devolved government, to allow the Assembly and Executive to plan how to manage its budget and improve public services. As co–guarantors of the Belfast Good Friday Agreement alongside the Irish government, it is essential that the next UK Government gives lasting attention and practical help to support and maintain the Assembly and Executive, particularly through difficult political periods. Unfortunately during some of the time since Brexit, the importance of this ‘neutral broker’ role seemed to fall away, to the detriment of our fragile institutions. Moreover, the UK Government should find ways to offer appropriate support to the Executive, particularly with its biggest immediate challenges of managing its budget and improving public services. Impartial practical support and expertise from the UK Government and beyond would be welcome. 

To finish, while it’s likely to be all–change at Westminster, the spotlight will quickly return to devolved government at Stormont. Change in Westminster inevitably means there will be issues that need to be debated and discussed with the next UK Government, and NI’s finances will be at the top of our local politicians’ list. But ultimately responsibility for managing budgets and policy delivery here sits with the Assembly and Executive. That brings us back to the need for a Programme for Government which sets out the Executive’s shared goals, and an Investment Strategy that shows how infrastructure and public services will be restored and improved. We need the Executive to agree these plans – and then we need a relentless focus on delivering changes that makes a real difference. We’ve heard plenty on the UK airwaves about economic growth, health waiting lists, schools, childcare and housing – but once the general election fever has died down, it will be over to our local Assembly and Executive to step–up and make real improvements for people here.

Ann Watt is Director of Pivotal, the independent public policy think tank for Northern Ireland. Since its launch in 2019, Ann has developed Pivotal’s role as an independent policy voice. Before Pivotal, Ann was the Head of the Electoral Commission in Northern Ireland from 2014–2019. Ann started her career as a civil servant in London, working in the Treasury, Home Office and Cabinet Office for 15 years.

 

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