Every day, it seems, new and harsh cuts to our public services are announced by those civil servants forced to run Northern Ireland’s departments because there is no functioning government.
Cuts, so far, have included schemes that support toddlers from deprived families, schooling for children with special needs and student places on nursing and allied health courses. Swingeing are cuts expected to voluntary groups providing many of our vital services.
It seems that where there is not a clear and legally binding obligation to provide a service, it is in line for cuts or closure. Even the PSNI is in a £100m financial crisis.
Why are we here? As Mr Micawber pointed out, spending more than you earn gets you into trouble.
While our domestic rates bills are typically around £1,000 a year, those in England are on average £2,000 (though half that in some places) – plus another £450 in water charges.
Not levying water charges here costs around £345m a year. And not imposing the harshest cuts to welfare benefits that were imposed in the rest of the UK costs us £43m a year. Holding down university tuition fees to a level of about half those in England generates a bill of around £90m. Other distinctive NI spend includes £43m for business rates relief; £33m on non-statutory domiciliary care; £30m for 60+ concessionary travel; and £20m for not charging for prescriptions. These add-ons cost £616m a year.
The profile of government expenditure in NI varies from that in the rest of the UK in other ways. We spend more on public safety as a legacy of the Troubles, on welfare benefits because of cuts mitigations and greater levels of poverty and on identity-related items, such as culture and sport.
We spend less on transport and environmental protection. We spend much less on education than Scotland, but similar amounts per pupil compared to England and Wales. Spending on health is in line with that in England and Wales, yet our service is far, far worse.
Our waiting lists are longer than those in England, despite our population being only a fraction of the size. Yet, our capital spending across our public services is less.
In total, public spending per person is higher in Northern Ireland than in other UK nations. In 2020/21, it was £13,166 in England; £14,222 in Wales; £14,842 in Scotland; and £15,357 in Northern Ireland.
In part, this can be explained and justified by three factors: our geographical spread and divided society increases the costs of public service delivery; we have a higher percentage of children; and our population is more deprived, with a much lower employment rate.
There are limited options for raising additional revenue on the scale required. Doubling the regional rate element of our domestic rates would raise only around £400m. The immediate pressures were assessed earlier this year at £1.5bn and are probably now closer to £2bn.
So the alternative needs to be to re-profile expenditure in ways that reduces administrative costs, while increasing well paid employment and economic productivity. Many of the cuts announced so far are clearly counter-productive.
We are short of nursing staff, so reducing the intake of new nurses will lead to even higher spending on agency nurses. Cutting the support for children in deprived families has not only a devastating social cost, it will also negatively affect NI’s future economic performance. As will cuts to spending on schools, tourism, business support, FE colleges and universities. It is not that the civil servants making these decisions are stupid, they just have no rational or intelligent options.
What is needed is UK government funding for investment-led reform – and the political courage to implement it.
We need to make much faster progress in modernising the health service, focus more on vocational skills training, rationalise the schools estate so that more children from different backgrounds are educated together, reform our careers structure in ways that reduce the number of teenagers who switch off and drop out of education and increase the number of students in university here – even if it means raising tuition fees.
I am against all university tuition fees, but the system we have at present is in effect a subsidy to the middle classes. Who is most likely to go to university in NI? Those children who went to our grammar schools. Who is most likely to get into a grammar? Children from affluent families. Financial support would be better targeted at students from poorer backgrounds to enable them to study at university or college, rather than a blanket subsidy for those who don’t need it.
That is a list of radical reforms. What are the chances of ministers from NI’s political parties endorsing and implementing them when and if they return to office? About zero, I would say.