Government: We will not finance extra welfare in NI

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Secretary of State Thereas Villier has put down a very firm marker that the government will not be budging on what is arguably the key stumbling block of the Stormont talks – welfare reform.

While the DUP and Sinn Fein last week put up a somewhat united front to the Prime Minister, calling for more finance for Northern Ireland, it is clear that Mr Cameron did not go further in his offer due to the fact that the two parties have still not agreed on how to deal with their differences over welfare reform. Sinn Fein have firmly blocked implementing Westminster reforms while the DUP wish to press ahead with them.

Yesterday Theresa Villiers explained that Mr Cameron left earlier than planned on Friday when it was clear that “the partes were too far apart” to be able to accept the Government’s proposals and finanical offer of £1bn in loans.

There was “no question of additional funding without agreement” – and without serious attention to budgetary issues and efficiency reforms, she told the Sunday Politics Programme.

“The Government is not going to pay for extra welfare spending. If Northern Ireland wants a more expensive welfare system then it needs to pay for it through the block grant.”

She added: “On other issues it is clear the government will continue to negotiate, to discuss, but we are operating in an environment where there is very little money to spare.”

She went on: “The era of Prime Ministers flying in to Northern Ireland with a big blank cheque is over.

“The most progress has been made around structures on the past” she said, adding that the parties were agreed that the status quo could not continue in this area.

There has been “some common understanding on a new system for adjudicating parades”.

And there is starting to be recognition that efficiency measures must be taken in Northern Ireland governance, she said. However there are still “significant differences between” parties on all three of these issues.

If a deal is not done by the parties this week on finances, then it becomes “increasingly difficult” although not “completely impossible” to devolve corporation tax before the general election in May.

Ms Villiers said she had been involved in 80 hours of talks over the past eight weeks and will be chairing them again this week.