Public Finances

6. What steps his Department is taking to ensure the sustainability of Northern Ireland’s public finances.

The Northern Ireland Budget (No. 2) Bill 2023-24 is progressing through Parliament and is due to be debated in the other House next week. The Secretary of State has used his powers to request information and advice from the Northern Ireland civil service on measures that could generate revenue and improve the sustainability of public finances.

I thank my hon. Friend for his answer. I congratulate him and the Secretary of State on their anniversaries and pay tribute to them for all they have done in the past year.

Some have suggested that we could reform the Barnett formula to address the sustainability of public finances in Northern Ireland, but does my hon. Friend agree that that is not a silver bullet, and that trade-offs will need to be made to fund public services?

I am extremely grateful to my hon. Friend for his question. This is a very important point. Although we will remain open to discussing proposals put to us by the Northern Ireland parties, it would not be a silver bullet to reform the Barnett formula. An Executive will still need to make trade-offs when they decide to spend scarce resources. Negotiations between the Welsh Government and the Treasury on a fiscal framework, which included an adjustment to the Barnett formula, took place over seven years, so, with the best will in the world, it is not an issue that can be solved overnight. What we need is a functioning Executive and we stand ready to work with that Executive. In the meantime, we will continue to engage with the Northern Ireland civil service on a range of measures that could improve fiscal sustainability.

Let me welcome the shadow Minister.

Early years services are vital for children to reach their potential, but they are underfunded and at risk in Northern Ireland. Northern Ireland is the only part of the UK without a childcare strategy. According to the Department for Education, it was delayed again because early years faces potential significant budget reductions. When can hard-pressed families in Northern Ireland expect the childcare strategy? Will the Minister commit to early years services receiving the increased multi-year funding that is needed to invest in children?

I am glad to welcome the hon. Lady to her place. As she knows, education is devolved in Northern Ireland and it is a matter for the Education Department there to take these decisions, but her point is well made, and I am confident that, when she makes her first visit to Northern Ireland, like me she will be engaging with all parties on just such issues.