Funding gap in Stormont budget is ‘small change’ for UK Government, says O’Dowd

The size of the funding gap preventing a deal on Stormont’s long-delayed budget is “small change” for the UK Government, Stormont’s Finance Minister has said.

John O’Dowd said the sum Northern Ireland ministers are asking the Treasury for would make a “huge difference” to public services in the region, but it is a “pittance” in the context of the overall size of the Government’s finances.

The Sinn Féin minister was commenting amid the ongoing impasse between Stormont and the Government on the devolved budget.

For months, local ministers in Belfast have argued they cannot strike a budget for 2026-27 without additional financial support from the Treasury.

The UK Government has offered about £1.5 billion in extra funding over the next three years, with £525 million delivered this year, in an effort to assist with balancing the books, but Stormont’s leaders have insisted that is not enough.

It is understood the extra funding would be dependent on Stormont committing to raise around £200 million annually of its own revenues.

Last month’s UK Budget allocated a further £131 million of extra funding to Northern Ireland in the current financial year and a total of £270 million across three years.

Of the £131 million this year, £87 million was generated as a result of Chancellor John Healey’s move to offer £100 energy support payments to low-income householders in England and there is an expectation that Stormont would seek to use that money to make similar one-off support payments in Northern Ireland.

In terms of the overall budget, Stormont ministers contend a gap remains between what the Government is offering and what they believe the Executive needs, but Northern Ireland Secretary Sir Chris Bryant has repeatedly insisted no more money will be offered.

If ministers do not pass a budget at Stormont, they will face the prospect of Sir Chris intervening to set the region’s spending plan at Westminster.

Mr O’Dowd said ministers are seeking “several hundred million pounds” more from the Treasury.

“I think there’s still room for progress in the engagements we’re having with the British Government,” he told BBC NI’s Sunday Politics programme.

“In reality, we’re talking around several hundred million pounds, which, in universal terms, for a sovereign government such as the British Government, is pittance. But it will make a huge difference to public services and the economy here, and for the people who use our public services.

“So the British Government needs to understand the challenges the Executive face, and many of those challenges have come about through the decades of underfunding by the British Government.

“I constantly refer to the comparisons to Wales and Scotland, where Wales has £1 billion more than their level of need, Scotland has £3 billion more than their level of need.

“If I was sitting here today with an extra £1 billion, we would have our budget set and our public services moving forward and our economy growing.”

Mr O’Dowd said he believes the Government is reluctant to allocate any more to Northern Ireland because the UK economy is in a such a “poor state”.

He added: “It is small change for the British Government, but I think it also reflects the scale of the impact of Brexit and other measures that have been taken over the last number of years on the British economy.”