Yahoo Finance Alliance calls for Northern Ireland to get similar 'funding floor' as Wales has to make sure budget keeps pace with need
Since 2015, Wales has had what’s often called a “fiscal floor” or “funding floor”, which means that for every £100 spent in England per capita each year, about £115 would be spent in Wales (though that figure sometimes varies).
The floor is basically like a kind of guarantee that funding will keep up with the level of need.
Just a couple of weeks ago, Alliance’s Stephen Farry told MPs Stephen Farry “it probably is, structurally, the biggest challenge facing Northern Ireland’s funding over the decades to come, so I think that it is something that needs to be top of the pile for discussions”.
He added that “Northern Ireland is potentially losing out on between £300 million and £400 million per year due to the assessment of need”.
Carla Lockhart of the DUP told MPs in the same session that “I think in Northern Ireland we get £1.21 for every £1 spent in England, despite our assessed need of £1.29”.
Following Thursday’s news of the spending gap, Alliance finance spokesperson Eoin Tennyson said: “The Secretary of State has previously inferred that overspends have arisen as a result of Executive mismanagement.”
But the latest overspend “on his watch… is clear evidence that such an argument has no basis in reality”.
Mr Tennyson added: “NI’s public finances are on a dangerous trajectory. What is urgently required is a fiscal floor, building upon the experience of the Welsh Government, to ensure our block grant cannot dip below our level of relative need.”
