The head of the Northern Ireland Civil Service has told MPs that the budget set for the nation by the UK government is likely to require service cuts that will be beyond the authority of departmental officials to deliver amid the ongoing power vacuum at Stormont.
Jayne Brady said she could not overstate the difficulty departments faced because of the continued absence of a Northern Ireland Executive to provide political leadership.
Power-sharing in Northern Ireland most recently broke down last year and no executive was formed following the Northern Ireland Assembly elections one year ago today, when Sinn Féin emerged as the largest party for the first time.
Last week, Northern Ireland secretary Chris Heaton-Harris tabled a budget for 2023-24 that implies some departments will face funding cuts of around 10%. Civil service leaders’ union the FDA said the situation would have “profound consequences”.
A report from the independent Northern Ireland Fiscal Council calculated the overarching real-terms cut in resource spending for the year at 3.3% and said the NICS has estimated it will need to find £800m in cuts and additional resources.
While civil seevice leaders are empowered to take some decisions when an executive is not in place, Brady said there are clear rules about how far those powers can be exercised.
She told the Northern Ireland Affairs Committee this week that some necessary decisions will fall outside of the powers held by civil servants, and there is a risk that funding for important long-term goals such as economic development and skills may be diverted to support statutory services.
The session heard that the £2.6bn in funding allocated to education in the budget represents a cut in both cash and real terms. The Department of Health's budget of £7.3bn represents a 0.5% increase, according to the British Medical Association.
Brady told MPs that since Heaton-Harris delivered the budget last week, departmental permanent secretaries have been looking at where decisions about the future of services can be made and at the legal requirements for making them.
“Where there are gaps, we are looking at how they can be addressed,” she said.
Brady told MPs it is “quite likely” that civil servants will face budget-related decisions that are “beyond the bounds” of their powers – namely decisions that terminate or have a detrimental impact on services. Brady said guidance accompanying the Northern Ireland (Executive Formation) Act 2022 clearly states that decisions that will have “a major change of an existing policy, programme or scheme, should normally be left for ministers to decide or agree”.
She predicted that the need to keep legally-mandated services running will have consequences for other areas that are important for Northern Ireland’s future prosperity.
“Statutory services need to be protected, so the implications of some of the decisions are the things that are strategically long-term and important, which I would suggest include investing in our young people, investing in the economy, skill provision, FE and HE colleges, and so on,” Brady said.
“They are vital to our long-term sustainability, as indeed is investing in green growth, which is a big opportunity for us as well as a legal obligation. Some of those are very difficult options for decisions and have to be made as part of that, so it is a reflection of the budget position that we are in.”
Service transformation is effectively on hold because of the ongoing political vacuum, Brady said.
“Ability to deliver on transformation requires stable political planning,” she told MPs. “Particularly in health, education and justice, there is a level of unsustainability in those services unless we address the transformation aspects.
“We have numerous reports that have identified those areas, but the ability to deliver on those transformations requires stable fiscal planning, not cuts. It also requires sustainable institutions to be in place.”
Brady said the lack of an executive at Stormont for more than a year has also put the brakes on policy development.
“As we are officials, we can continue to deliver the policy direction that was set by previous ministers – in fact, that is in the guidance – but no new policies are being developed or delivered,” she said.
“Of course, the overall coming together to agree a budget and agree the prioritisation of those aspects has not been done – that has been set by the secretary of state.
“The impact is at the policy level, and at the level of the budget, fiscal position and, obviously, the operation of the budget.”
Brady said officials can engage in preparatory work to advise incoming ministers, and are working with political parties to support that. But she said a programme for government cannot be developed without a restored executive.