Extra £920 million for Northern Ireland not enough, says Murphy

Chancellor Rishi Sunak annoucned on Wednesday that Northern Ireland would receive an additional £920m as part of the UK government’s latest spending review.

Of that total, the Treasury say £540m is in relation to extra government spending due to the costs of dealing with the pandemic, while the remaining £380m is for core departmental spending.

Outlining his spending plans, the Chancellor warned that the devastation caused by coronavirus will see the UK economy shrink by its largest amount for 300 years and Government borrowing reach levels previously unseen in peacetime.

Mr Sunak warned there would be lasting damage with the economy shrinking by 11.3% in 2020 and not recovering to pre-crisis levels until the end of 2022.

Unemployment is forecast to hit 2.6 million by the middle of 2021, official forecasts from the Office for Budget Responsibility (OBR) said.

The “long-term scarring” from the crisis means that in 2025 the economy will still be around 3% smaller than had been expected in March this year, Mr Sunak told MPs.

The Chancellor said: “Our health emergency is not yet over. And our economic emergency has only just begun.”

Northern Ireland Finance Minister, Conor Murphy, responded to the spending review by saying the extra cash “does not deliver the funding we need”.

The Sinn Fein MLA said the budget for what he described as “everyday spending” has changed little.

“Covid and Brexit create huge challenges for our economy and public services,” he said. “In that context today’s announcement is disappointing.”

Mr Murphy continued: “The Executive’s budget for everyday spending on public services stands still while Capital investment needed to kick-start an economic recovery only increases marginally.”

Mr Sunak also announced a freeze on pay increases for those in the public sector — with exemptions in place for NHS staff and those earning less than £24,000 per year.

Mr Murphy, responding, said: “The Chancellor’s announcement on freezing pay in the public sector is disappointing and will have implications for the funding of pay awards here.”

He added: “Today’s announcement does not deliver the funding we need to support the health service, public services, vulnerable people, businesses and workers.”

Mr Sunak, however, said: “The commitments we have made at this Spending Review will help people across Northern Ireland to bounce back from the economic impact of coronavirus.

“We will provide billions of pounds in the fight against coronavirus, deliver the peoples’ priorities and drive the UK’s recovery.”

The Chancellor added: “The Treasury is, has been, and will always be the Treasury for the whole of the United Kingdom. And this is a Spending Review for the whole of the United Kingdom.”