The Government's financial offer to Stormont is on the table - but Sinn Fein and DUP say it's not enough

There is no deadline on the financial package – but Northern Ireland only gets the money if and when the power-sharing government returns.

The offer contains funding for public sector pay rises, a ‘fiscal floor’ to guarantee Northern Ireland more funding based on its needs, more cash through a stabilising fund for the next four years, Stormont control over UK Government money due to be spent here and an extension to the period the Executive has to pay back its overspend.

It is believed to amount to around two and a half billion pounds.

The Hillsborough Castle talks are expected to continue throughout Tuesday and Wednesday and focus will be on the detail of the financial offer.

Sir Jeffrey Donaldson said the talks are not a deadline. The DUP leader said: "This is a process and I don't believe it is a process that is going to be corralled into a few days here."

He welcomed it as “a first step” by the Government, adding: “I think it puts on the table an offer that begins to address some of the issues that are at the heart of the shortfall in our budgetary arrangements.

"Does it go far enough? No. Is more work required? Yes it is."

Mr Donaldson said: "We're not there yet, we need to continue working on this to get the right outcome for Northern Ireland."

Public sector pay is one of the biggest funding issues facing Stormont. If Northern Ireland is to match the pay that public sector workers receive in the rest of the UK – it would create an overspend of around one billion pounds per year under the current funding model.

The offer on the table also includes revenue-raising measures. Ideas floated in the past that could boost Stormont coffers include water charges. An additional charge for water is opposed across the board at Stormont – with parties arguing that it is already covered in rates bills.

The TUV has warned the DUP about allowing the talks on a trade border to become entwined in discussions about Stormont finances.

And speaking before the talks, Doug Beattie said it was his understanding that Irish Sea border negotiations are making “very good progress” and are close to a conclusion.

But after the discussions began, the UUP leader said that he doesn’t see the institutions returning before Christmas – as had been speculated by some – and raised doubt over whether the amount of money on offer was enough.

Also critical of the money on offer from the Secretary of State, Sinn Fein’s Michelle O'Neill said it was nowhere near enough.

Ms O’Neill said: "What is on the table today does not even touch the surface of what is required to have good properly funded public services.

"We have a battle, but it is a battle the parties must fight together and take this fight to the British Government.

"If the Executive is going to be successful then we need to have properly funded public services."

Sinn Fein said the DUP had a decision to make on the ‘conditional offer’ by Wednesday. However the government’s view – and that of the DUP – is that there is no deadline for the financial deal to be accepted by the parties, and the institutions restored.

TUV leader Jim Allister – who wasn’t involved in the discussions – accused the government of trying to bribe unionists. He said: “If the government recognises considerable financial need in Northern Ireland and then makes the offer of meeting such need conditional on the DUP doing what it wants, then, that by any definition is a bribe.

“His Majesty’s Government needs to step up and govern, not play politics with deserving need.

“If money, even £3 billion in smoke and mirrors, to abandon principle and become Protocol implementers buys off some, it will not impact those whose unionism is rooted in principle, not pounds.”

The DUP has repeatedly said it will not make decisions based on timetables – but rather when its conditions have been met. Both the party and the UK government say that the discussions over Northern Ireland’s place in the UK Internal Market scheme are continuing. Yesterday, the Secretary of State said: "In parallel to these meetings, I continue to engage with the DUP and am pleased that those negotiations have made significant progress over recent months, but at this point are yet to conclude."

The DUP’s Gavin Robinson told the BBC on Friday that how Stormont is funded and the discussions over the Irish Sea border were “parallel” and “both of significant importance”. The TUV responded: “To create and talk about a parallel process is to invite trade off on the vital constitutional issues ‘if the price is right’.”

Alliance leader Naomi Long said that she had no idea whether negotiations between the government and the DUP were still going on. She told reporters outside Hillsborough Castle yesterday: “To be blunt, I don’t know what there could be left to talk about. These were tiny issues back even 18 months ago. And however important and crucial they were for the DUP – how they have not been resolved either way at this point frankly defies explanation”.

Speaking to the media before the meeting, Mr Heaton-Harris said progress was being made in negotiations with the DUP on the Windsor Framework but he would not be giving a "running commentary" and that the UK Government has worked to address the DUP's concerns on the framework.

"I continue to engage with the DUP and, as I've said before, these discussions are making progress, but I'm not going to provide a running commentary," he told reporters on Monday.

"Alongside those negotiations, I'm now convening the Northern Ireland party leaders here today at Hillsborough Castle to talk about ensuring financial stability and sustainability for Northern Ireland.

"I want to agree the basis upon which the Northern Ireland Executive can return on a stable financial footing. I also want to ensure that public services are able to meet the needs of the people of Northern Ireland.

"The UK Government is willing to help but all of these issues can be best addressed by the return of locally accountable institutions built on secure foundations. I hope our work together over the next few days will do exactly that."