The future of Stormont’s stumbling power-sharing Executive has been left mired in uncertainty after a failed bid by David Cameron to resolve a series of major disputes.
The Prime Minister left Belfast yesterday without reaching the agreement he had hoped for when he arrived to join cross-party talks on Thursday.
During a long night of negotiations at Stormont House, Mr Cameron and Irish Taoiseach Enda Kenny tabled a range of proposed solutions on vexed wrangles on flags; parades; the legacy of the past; reform of the Assembly; and the Executive’s serious budget crisis.
The Prime Minister offered Northern Ireland what he described as £1 billion of increased spending power over six years, conditional on an agreement being struck on the swathe of logjams destabilising the administration.
But the Province’s politicians failed to sign up to the document and rejected the financial offer as not credible, raising the looming spectre of a possible collapse of the institutions and a return to direct rule.
While many of the issues on the agenda of the talks are peace process logjams that have rumbled on for years, the budgetary problems, in particular the impasse over the non-implementation of the UK Government’s welfare reforms due to Sinn Fein opposition, pose an immediate threat to the institutions.
Ministers in Belfast have already had to ask for an emergency £100 million loan from the Treasury to balance their books this financial year, and if a deal on welfare reform is not agreed they will face about £200 million of Government penalties for non-implementation.
As it is unlikely the five-party administration would be able to absorb such a financial burden, the future of the Executive effectively depends on a resolution to the welfare reform issue.
Many of the politicians have conceded that Christmas is an effective deadline for resolution, as positions will undoubtedly harden as the UK General Election looms in the New Year.
Mr Cameron insisted the financial package on offer would give new “financial firepower” to the Northern Ireland Executive. But he warned: “If there isn’t an agreement, then that financial firepower isn’t there.”
The Prime Minister said “intensive work” needed to be done to ensure the NI Executive’s budget was sustainable in the longer term.
“I think a deal is possible. It’s possible because I think the parties have done a lot of good work on the issues that need to be settled – the issue of how to manage parades, how to handle the past, the issues of flying flags.
“The real work that still needs to be done is to make sure that the budget of the Northern Ireland Executive is sustainable and works, so intensive work needs to be done between the parties on that issue.”
Regarding his offer of £1 billion of spending power, Mr Cameron said a “comprehensive agreement” was needed to release it, rather than “simply some words about these issues”.
Stormont’s First Minister Peter Robinson and Deputy First Minister Martin McGuinness both questioned the credibility of Mr Cameron’s offer, insisting hardly any new money was on the table.
It is understood the majority of the Government’s proposed financial package relates to extending greater flexibility to the Executive to draw down and borrow funds.
Democratic Unionist leader Mr Robinson said the offer had to be improved.
“In terms of the package from the Prime Minister I don’t think it was adequate,” he said.
“I think if he wants to bribe us, to bribe us with our own money comes a bit short of what’s required.”
Sinn Fein veteran Mr McGuinness said: “Whatever you have been told by the British prime minister David Cameron, there was no credible financial package offered to the Executive ministers to allow us to combat the austerity agenda that this British government has been inflicting on us over the course of the last four-and-a-half years.”
Mr McGuinness said he did not want to see the institutions collapse.
“We don’t want Stormont to crash, we want these institutions to continue,” he said.
The talks are expected to resume next week.