Public services deficit leaves £4billion budget shortfall

The Stormont Minister for Finance Sean Farren has said there is a £4billion spending gap between what the Executive has to spend and what they need to spend in order to address chronic underfunding in the public sector.

Dr Farren has said because public services in Northern Ireland suffer from a legacy of underfunding the sums required to solve the problem are well in excess of the amounts the Northern Ireland Executive has to spend.

Finance Minister Sean Farren was addressing a themed seminar ‘Private Finance, Public Services and Partnership Arrangements’ in County Antrim on Tuesday February 18 organised by the Institute of Governance, Public Policy & Social Research in conjunction with Democratic Dialogue.

The Minister said that while the issue of private money funding public amenities harboured controversy, new thinking is required to address the £4 billion deficit facing the current administration.

“The Executive has to address a legacy of historical under-funding in the infrastructure of our public services which means that currently many areas – especially health, education and transport – require levels of capital investment far in excess of the resources available to us, if they are to be funded in the traditional manner,” he said.

The Minister said latest estimates put the deficit between what the current budget can sustain and what is actually needed, at a minimum of £4 billion over the next 10 years.

The Minister said the Executive was exploring new ways of financing and providing public services, including Public Private Partnerships. “Our focus in the quest for alternative sources of investment finance is on PPPs in the broadest sense and in determining when they are appropriate and how best they should be deployed,” he said.

“I do not believe simply that PPPs are the answer to all our infrastructure problems, or indeed that they are the only option.

“However, I firmly believe that there are potentially significant benefits to be gained, in respect of more modern and more effective public services, from developing socially acceptable, commercially sound, and accountable partnerships between the public and private sectors.”

(AMcE)