Former Civil Service head says financial situation unprecedented

Sir David Sterling retired as the head of the Northern Ireland Civil Service in 2020

The former head of the Northern Ireland Civil Service has said the financial situation facing departments here is unprecedented.

Sir David Sterling told The View the combination of no budget and mounting financial pressures on departments made the situation pretty bleak.

Earlier this week the finance minister warned that Stormont is facing a £660m overspend unless action is taken.

Conor Murphy blamed the impact of inflation and the lack of an executive.

Northern Ireland Secretary Chris Heaton-Harris said the overspend was "unacceptable".

"The government fully expects the Northern Ireland departments to take responsibility and ensure their spending remains within budgets," a statement said.

Sir David, who retired in 2020, said he did not think the Treasury would welcome any request for additional money to help the situation.

"This is pretty bleak at the moment," he added.

"I can't see the Treasury, at the moment, welcoming a request for additional monies.

"I think the Treasury's view will be that Northern Ireland already gets more per capita than any other part of the UK. Northern Ireland has as well got additional monies on a number of occasions over recent years.

"I think, if the Treasury was to be persuaded to provide some money, a bail out if you like, then I'm fairly sure they would want to attach some fairly tight strings to that.

"I would imagine that there would be no bail out until such times as an executive is formed."

• Stormont faces £660m overspend warns Conor Murphy

• Cost of living support 'delayed by no Executive'

• NI Finance Minister's warning over lack of budget

The executive has not been operating since February when the DUP withdrew from the first minister role in protest at the Northern Ireland Protocol.

In a written statement to assembly members, the finance minister said "a large proportion of the increased costs are due to energy costs and pay pressures resulting from the cost-of-living crisis".

The minister explained that because a budget had not been passed before the executive collapsed, departments had been working with indicative "spending envelopes".

Departments were not constrained to these totals and were advised that they should not make decisions to stop services where there was a "reasonable expectation" that they would receive further funding later in the financial year once a budget was in place.

Sir David told The View Stormont departments would be weighing up "the need to be fiscally prudent with the need to continue to provide much needed services".

But Justice Minister Naomi Long said that the restoration of the executive would not be a magic wand to make all the financial challenges facing Stormont disappear.

Naomi Long says people's lives are being impacted

"Our narrative has always been that while we accept that restoration of the executive isn't a magic wand that will make all of the challenges disappear, it is the difference between being able to do something to help and to do nothing," said the Alliance Party leader.

"I'm not saying that the holes in the budget will disappear if the DUP come back.

"But I am saying very clearly that the lack of oversight, the lack of governance, the lack of having an executive and having timely access to funds is impacting people's lives."

The largest overspends are being forecast for the departments of health and education. They face the additional costs of funding nationally-agreed pay deals.

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