4 September 2014 Last updated at 19:48

George Hamilton warning over PSNI budget cuts

By Vincent Kearney BBC News NI Home Affairs Correspondent

George Hamilton said proposed cuts represent "a huge sum of money"

The chief constable has warned that the ability of the PSNI to do its job will suffer because of budget cuts of up to £80m this year.

George Hamilton told the Policing Board that could mean reducing the amount of resources used to investigate the past to concentrate on policing the present.

The sums involved are vast, but have been substantially reduced due to a variety of cuts.

The overall PSNI budget this year was more than £1bn.

But more than a quarter of that is for ongoing pension costs.

A cut of more than £47m was imposed as part of a four-year budget settlement, leaving an operating budget of £738m.

Further cuts by the Department of Justice and running costs for the Historical Enquiries Team reduced that figure to just under £717m.

The PSNI is now being asked to make further cuts in the region of 3-5% this financial year. A cut of 4% would mean a reduction in budget of a further £18m.

The chief constable told the Policing Board on Thursday that further cuts would have an impact on the ability of the PSNI to deliver frontline policing services.

"The total reduction in the police budget in this year compared with last year is going to be at best £73m, and it could rise on the projections we have been asked to give up towards £88m. That is a huge sum of money," he said.

"You cannot have cuts of that size without it having an impact on the service we can provide. We are trying to minimise that impact as much as possible."

Policing Budget 2014 - 2015
Source: PSNI
Total budget	£1.1bn
Pension costs	£275m approx
Previously agreed savings as part of four year plan	£47m
Operating Budget after deductions	£740m
Department of Justice holdings	£11m
Wider pay reforms	£4m
Historical Enquiries contribution (previously funded by Department of Justice)	£6m
Final Operating Budget	£717m approx.

The problem for the chief constable is that around 80% of his operational costs are spent on salaries and other fixed costs. That reduces the flexibility of his decision-making, as it it means any cuts will have to come from the remaining 20% of the budget.

So where are cuts likely to be made?

Policing the past

The PSNI said its primary responsibility is to keep people safe today and that its focus is on policing the present, not the past.

Senior officers have said repeatedly that the cost of dealing with the past is a huge drain on resources, both in terms of financial cost and personnel.

The current annual cost of what the PSNI calls "legacy issues" is about £25m.

The chief constable said on Thursday the cuts could mean "shrinkage" in the amount of time and resources deployed to deal with the past.

"We acknowledge that we have a legal responsibility around the past, but the priority has to be keeping people safe in the present," he said.

"If I have to reduce the head-count of police officers or police staff, I will do it on historical issues before I do it on keeping people safe today."

So what kind of investigations could be affected?

The future of the Historical Enquiries Team HET) is already in doubt after a highly critical inspection report which led to its director, Dave Cox, having to stand down.

There are also financial pressures as the PSNI is currently paying £5.9m a year to run it, costs that were previously picked up by the Department of Justice.

A reduction in resources to deal with the past could lead to the HET being substantially scaled down, or abolished and its work taken over by a new, smaller specialist PSNI team.

Other major police investigations into legacy issues could also be affected.

The HET could be substantially scaled down or abolished

These include a review of letters issued to about 200 republicans as part of the On the Runs scheme, assuring them they were not wanted for arrest or questioning by the police.

The existence came to light earlier this year after the collapse of a court case against Donegal man John Downey, who had been accused of the murders of four soldiers in the IRA's Hyde Park bombing in 1982.

He had been wrongly told he was not wanted for questioning, but the judge said the assurance he had been given had to be honoured because the PSNI was aware a mistake had been made but did not inform him.

A team of 30 detectives is currently reviewing all of the letters to check if any others contained mistakes.

Bloody Sunday

Other major legacy investigations that could potentially be scaled back include the killing of 13 innocent civilians by soldiers on Bloody Sunday.

The PSNI also deploys a large number of resources to provide files and information for coroners' inquests and that process could also be scaled down.

If the past suffers, could resources to deal with the present also be cut?

There has been speculation that the PSNI may have to stop or substantially reduce its current recruitment process.

Mr Hamilton made it clear that this would be "the absolute last option".

The PSNI said in order to maintain what they call "operational resilience" - it needs enough officers to do the job.

It recruited 100 new officers last year, and plans to recruit a further 378 this financial year and the same number the following year.

The PSNI plans to recruit a further 378 officers this financial year

There are currently around 6,600 police officers here, but around 200 leave each year through retirement and other reasons.

The PSNI compiled a Review of Resilience and Capability before embarking on the recruitment drive.

The numbers were very precise, with the review stating that the PSNI believes it needs 6,953 officers, supported by 2,601 civilian staff, to maintain resilience. Those conclusions were accepted by the Policing Board and the Department of Justice.

"That is the bottom line figure," a source said.

"If numbers drop below that, it will impact on our ability to provide a service and keep people safe, so the last thing we want to do is turn off the recruitment tap, because doing so would have long term detrimental impact."

But while the chief constable said reducing the number of police officers was a last option, he did not rule it out entirely.

"I can't recruit people if I don't have the money to pay them," he said.

Another area where the chief constable has little room for manoeuvre is what the PSNI calls "the Northern Ireland factor", which accounts for about 25% of its operating budget.

This includes combating the ongoing threat from dissident republicans, what the government and security services refer to as "national security" and the policing of parades and protests.

The chief constable said he cannot see any change in the Northern Ireland policing environment in the immediate future, which means those security costs will continue.