Minister Wilson - Chancellor’s Autumn Statement to be welcomed but further Public Expenditure pain for Northern Ireland beyond 2015
Finance Minister, Sammy Wilson, today welcomed aspects of the Chancellorís Autumn Statement but warned that the latest projections from the Office of Budget Responsibility suggested a difficult public expenditure position beyond 2015.
~ Wednesday, 5 December 2012
There were a number of specific decisions taken by the Chancellor which will have a significant impact on Northern Ireland. Of significant importance is that HM Treasury have confirmed that they will support a derogation from the Carbon Price Floor for Northern Ireland.
Welcoming this development Sammy Wilson said: “Over recent weeks I have robustly made the case to the Chief Secretary that enforcement of the Carbon Price Floor upon Northern Ireland would have a massive detrimental impact on the local energy sector - for example local generators would have lost out to southern generators and electricity bills could have risen between 10 and 15%. I am therefore particularly pleased that HM Treasury have responded positively to our concerns.
“In the current economic hardship this will go some way in assisting those who are most vulnerable ensuring that electricity bills remain at a fair and affordable rate.”
Commenting on other aspects of the Chancellor’s Autumn Statement the Minister said: “I welcome the decision taken by the Chancellor to channel more funding into capital investment. For Northern Ireland this means additional capital investment resources of £131million over the next two years.
“The additional capital investment allocations were funded by cuts to Whitehall departments’ resource budgets of 1% next year and 2% in 2014-15. However, because health and education were exempt from these cuts and some additional allocations were made in respect of business support measures, the impact on Northern Ireland was much less severe.”
The Minister continued: “I am pleased that the decision to protect health and education from the Whitehall resource expenditure reductions means that any negative impact on Northern Ireland is much mitigated. In fact, our resource DEL will increase by £2.4 million next year, with a subsequent reduction of £34.3 million in 2014-15. This is manageable without the Executive having to re-open its Budget position.”
The Office for Budget Responsibility (OBR) also published its latest projections for the UK economy and public finances. These projections suggest that UK Total Managed Expenditure will fall by 0.7% per annum in real terms in the first years of the next spending review. However the UK economy is expected to record growth of 1.2% in 2013, rising to 2.8% in 2017.
Concluding the Minister said: “The OBR projections for the UK economy and public finances suggest that further public expenditure reductions will be necessary beyond 2014-15. There can be no doubt that the Executive will face some very difficult decisions as part of its next Budget setting process. It is therefore critically important that all Ministers deal responsibly with key policy areas to ensure that no unavoidable costs are imposed on us.”
Notes to editors:
1. The Chancellor’s Autumn Statement is one of two main announcements made each year on the UK public finances (the other is the UK Budget which is announced in the spring). It includes adjustments to both public expenditure and tax policy.
2. The Chancellor’s Autumn Statement can be viewed in full via the HM Treasury website
3. Any changes to UK public expenditure will impact on Northern Ireland through the Barnett Formula. The spending announcements made by the Chancellor resulted in Barnett allocations to Northern Ireland in the next two years as follows:
2012 Autumn Statement Barnett Allocations:
4. Media enquiries should be addressed to the Department of Finance and Personnel Communications Office on Tel: 028 9016 3389. Out of Office hours please contact the Duty Press Officer via pager number 07699 715 440 and your call will be returned.