Stormont Could Raise £3bn Annually Through Financial Measures
Stormont ministers could have an additional £3bn each year to allocate to public services if they increased rates, introduced water charges, and reduced the workforce by thousands, according to a Treasury review.
The open book review of Northern Ireland's finances was conducted following an overspend of £400m by the Executive last year.
The review finds that the Northern Ireland public sector employs significantly more people compared to England. This conclusion is based on analysis by the independent Fiscal Council watchdog.
It suggests that reducing the civil service to the equivalent size of England's could save nearly £400m annually. However, the review notes that this example is "illustrative" and does not consider all caveats.
Additionally, the review proposes that ending the current policy of "pay parity" could save up to £2.5bn a year. The details of the review were initially published by the Press Association.
Increases to Match Those in England
Pay parity is the principle that public sector workers in Northern Ireland, including teachers and nurses, should receive pay broadly equivalent to their counterparts elsewhere in the UK.
Breaking parity for certain jobs in recent years has led to strikes and other industrial actions.
The Treasury review also evaluates revenue-raising options. It suggests that raising domestic rates, a property tax on houses, to match council tax levels in England would generate more than £400m annually. This would increase the typical rates bill from approximately £1,200 to nearly £1,800.
Furthermore, introducing water charges of about £465 per household could bring in an additional £357m.
The review was initially intended as a joint effort between the Treasury and the Northern Ireland Department of Finance. Ultimately, it became a Treasury-only report.
A senior official recently informed MLAs that the Department of Finance effectively withdrew because it was not given sufficient time to verify the Treasury's assumptions and calculations.
