First in Line: Public Finance

Posted on May 29, 2008 · Posted in Public Finance
 

First in line, by Paul Gosling

Peter Robinson is happy to talk about his work as Northern Ireland finance minister. But Ian Paisley’s resignation means he’s going to have to face up to that succession question very soon, says Paul Gosling

Peter Robinson met with Public Finance in the midst of the most tumultuous and politically significant period in Northern Ireland’s recent times. Interviewed less than two weeks before Ian Paisley announced he will step down in May, it already seemed that Robinson was about to become first minister.

He is deputy leader of the Democratic Unionist Party, the province’s finance minister and Paisley’s almost certain successor. When interviewed by this magazine, Robinson looked confident that events were moving in his direction.

But he will inevitably bring, at the very least, a different style to the job than Paisley. While both have gained the reputation of working well with Sinn Féin ministers, Robinson does not share Paisley’s capacity to turn on the charm – or the fire and brimstone rhetoric. Robinson is quieter but he is also steely. He spoke bluntly about his criticisms and demands of other ministers in the Northern Ireland Executive and he is no political pushover.

While Paisley seemed to see his Free Presbyterianism and Democratic Unionism as almost the same thing, Robinson is a Protestant, but not, apparently, a member of Paisley’s Free Presbyterian church and plays down his personal religious beliefs. Decoupling politics from religion would be a radical departure in Northern Ireland.

Robinson is already heavily immersed in politics as an MP, an Assembly and Executive member and finance minister, and his wife, Iris, is equally committed as MP, MLA and chair of the Assembly’s health committee. Peter Robinson’s main hobby – breeding ornamental Japanese koi fish – has been neglected, but he laughs: ‘They don’t need my help to do this’ although, in an appropriate metaphor for party politics, he warns that without his supervision his fish are likely to eat each other.

Rumour has it that both Ian Paisleys – father and son – feel the same about the DUP, with colleagues’ pressure reportedly behind the resignation of the two as ministers.

As finance minister, at least for another few weeks, Robinson has the satisfaction of having just completed his first Budget. But he describes it as an ‘absurd’ and ‘convoluted’ process, with a draft budget announced in November and only finalised in January; drawing comments from ‘10,000 people’, with each of them calling for more spending. ‘But given what the processes and structures are, I’m very happy with what came through that process,’ he adds.

The experience, though, revealed serious tensions within the Executive between the minority partners – the one Social Democratic and Labour Party minister and the two Ulster Unionist ones. The minority parties argued that they had too little money and after difficult and semi-public negotiations got more funds.

Robinson – a strong advocate of more effective guarantees of collective responsibility within the Executive – would like a new attitude from ministers. ‘The parties take ownership of departments,’ he complains. ‘They fight for more money for their departments, not worrying what the overall position is.’

His strongest complaint is with the SDLP, whose minister – Margaret Ritchie, in charge of social development – signed off the revised Budget, but whose other representatives then voted against it in the Assembly.

‘I am not sure what the SDLP argument was at all,’ he says. ‘The minister declared herself happy with the expenditure. We both agreed she needed more money for housing and I delivered for her. As far as the Ulster Unionist ministers were concerned, both got an increase in their budget.’

Its health minister Michael McGimpsey – a vocal critic of his initial departmental allocation – got ‘the largest health budget any minister in Northern Ireland ever had’, argues Robinson.

And there is a barely veiled warning to colleagues that they had better spend the extra money they demanded. ‘I have gone through a period of ministers telling me they don’t have enough money – that their departments deserve so much more.

‘And it irks me somewhat when I see the same ministers saying they can’t spend the money they have and handing it back to me. There will be a number of “I told you so’s” over the coming months if they don’t spend the money that has been allocated to them.’

Robinson repeatedly stresses the need for collective responsibility. Two incidents particularly upset him in recent months. One was when the SDLP’s Ritchie cut off funding to the Conflict Transformation Initiative without – claims Robinson – properly getting the decision cleared by the Executive.

The decision was taken over alleged links with one of the loyalist paramilitary groups, though these links were denied by the CTI.

The other area of profound disagreement within the Executive is over the future of grammar schooling. Sinn Féin’s current deputy first minister, Martin McGuinness, decided to abolish the 11-plus in a previous period as education minister, but the decision was never approved by the Assembly.

Sinn Féin’s current education minister, Caitríona Ruane, has confirmed McGuinness’s approach but again without Assembly endorsement. With the two unionist parties supporting the retention of grammar schools and academic selection, it is unclear how the intra-Executive dispute will be resolved. But Robinson revealed exclusively to Public Finance that the Executive has agreed, for the first time, a process to deal with the matter collectively.

As Northern Ireland’s politics mature, ministers will simply have to accept the need to achieve agreement and consensus, he says. ‘That is the test for politicians,’ he argues. But one of the great tests for Robinson as a politician – whether as finance minister or first minister – will be getting the public sector to operate more effectively. Underpinning the province’s financial challenges is the fact that the public sector spends more than half as much again of Northern Ireland’s GDP as the UK average. To challenge this, Robinson is in the process of establishing the Performance and Efficiency Delivery Unit, which will consider how to reduce costs and improve effectiveness in central government.

The PEDU will be a core team of six to ten officials reporting directly to the finance minister and overseen by a small group of experts drawn from the private and public sectors. Robinson knows which officials he wants in post and is negotiating with them, with the objective of the unit being operational ‘within weeks’.

Robinson has talked to Sir Michael Barber about his experience leading the Prime Minister’s Delivery Unit, which he wants the PEDU to learn from. ‘It’s the kind of role I would love if I were an official in the department,’ explains Robinson, who was actually an estate agent before becoming a professional politician. Targets have been set for overall departmental efficiencies of 3% and administration savings of 5%.

A Robinson priority for the PEDU is tackling the high level of sickness absenteeism in Northern Ireland’s public sector. The civil service contains, he suggests, ‘a small group who seem to think that sick days are part of their holidays’. One of the great inefficiencies, however, is the duplication of services because of the religious divide. ‘There are conflict-related difficulties that hopefully over time we will be able to overcome.’

Education is the biggest of these areas of public sector oversupply, with four school systems (state, Catholic, integrated and Irish language) and 55,000 surplus places in Northern Ireland schools. Robinson says he wants to improve service integration, but this will not change ‘in this CSR period’.

Interestingly, he hints that the PEDU and the Executive ministers have more scope than any previous group of ministers to change radically the way the public sector operates and allocates resources. The significance of this view is much greater because of the apparently harmonious working relationship of the two main parties, the DUP and Sinn Féin. ‘We are a new administration,’ says Robinson. ‘We don’t have to stand over things that went before.’

Despite this, it does not sound as if Robinson is keen to walk away from plans inherited from direct rule ministers to use the Private Finance Initiative. ‘This is an area where we have some very specific difficulty.’ He adds that at least two of the parties in the Executive ‘are doctrinally opposed’ to PFI.

Yet the Workplace 2010 PFI project for sale and leaseback of civil service office accommodation won cross-Executive support, he points out. This shows that the parties will take a value-for-money approach to particular PFI proposals, he says. And, he stresses, Northern Ireland’s public sector needs more private sector involvement.

Where Robinson has been frustrated was in the review of corporation tax rates conducted for Gordon Brown by former Revenue & Customs’ executive chair Sir David Varney. Robinson and the rest of the Executive wanted Northern Ireland’s rate cut to that of the Irish Republic but Varney rejected this. Mostly, says Robinson, this was in fear of what the Scottish and Welsh devolved governments, and even the northern English regions, would say if Northern Ireland’s corporation tax rate was cut.

There is now to be a second Varney review, advising on what Northern Ireland might do to improve its economy. This is due to be published in May, to coincide with a major investment conference that is to be Ian Paisley’s last major event as first minister. Robinson believes that ‘Varney Two’ is likely to be more positive, not least because its work is supported by officials from the Northern Ireland Civil Service.

At the time of the interview, Robinson was reluctant to comment on speculation about the retirement of Ian Paisley as first minister. Asked for his reaction to predictions by deputy first minister Martin McGuinness that Paisley would be replaced by Robinson, the finance minister said: ‘I just wish people would leave the first minister to get on with it. ‘I don’t think I have ever enjoyed a job as much as this one. I am not rushing to the post [of first minister]. I am happy where I am.’

Robinson’s demeanour during PF’s interview made it clear he is genuinely happy as finance minister. But it is also likely that he will also be very content to be first minister.

14-03-2008