No cost of living payment for NI until Stormont budget agreed, says SoS

The secretary of state has warned that a cost of living payment cannot be made in Northern Ireland until an executive budget is agreed.

It comes after the Chancellor John Healey announced the payment for households in England, based on how much council tax they pay.

Delivering his first Budget, Healey said money would be made available to Stormont to fund an equivalent scheme.

However Sir Chris Bryant said Stormont would not be in a legal position to deliver the money without a budget.

Seven months into the financial year the Northern Ireland Executive has still not agreed a budget.

Stormont ministers say the UK's devolution funding formula no longer delivers enough for them to produce a balanced budget.

Sir Chris has offered them an additional £525m this year but they said it is still inadequate.

If a Stormont budget can be agreed ministers will have to come up with their own scheme for making the £100 payment to lower income households in Northern Ireland.

Northern Ireland does not have council tax so another mechanism will have to be used to identify who gets the payment.

Stormont officials have recent experience of designing similar payments, such as the home heating oil voucher scheme.

Overall, Northern Ireland will get an additional £270m for public services as a result of the budget, of which £130m can be used this year.

It is unclear how much of that will have to be ringfenced for the £100 payment.

All households in NI can also expect to get further help with their electricity bills.

Last month, households in NI got £63 off their bill as the local outworking of two schemes which apply in Great Britain, which has a separately regulated electricity market.

Part of that discount related to a temporary VAT cut on bills in GB, which is being extended.

The Treasury said it "providing funding for the Northern Ireland Executive to provide comparable support with household electricity bills."

The intention is to apply the VAT cut in NI from April 2027, bringing it in to line with the rest of the UK.

The government is also removing a 4% tariff, or import tax, on heating oil imported to NI from outside the EU.

EU produced heating oil is already zero tariff.

That moves potentially matters more in NI than other parts of the UK as oil is still the predominant heating fuel in NI.

However, in practice, it is likely to make little difference to consumer prices in the short term but could open up the market to wider sources of supply.

The government is also providing £1m for an investment summit in Northern Ireland to "highlight Northern Ireland's potential as the only place in the world with dual access to the UK internal market and EU market".

A similar event was held in Belfast in 2023.

There is also a £7.5m investment for Queen's University Centre for Secure Information Technologies (CSIT).

It is a centre of excellence in cyber security which has close links with GCHQ.

Colin Neill, chief executive of Hospitality Ulster, said measures introduced to support hospitality elsewhere in the UK should generate additional funding for NI through the Barnett formula.

"It is essential that this money reaches our sector," Neill said.

"The government cannot continue to raise wages without addressing the excessive taxation of the hospitality industry which is now over 40%.

Glyn Roberts, from Retail NI, said small businesses in Northern Ireland should be given the same support as their counterparts in England.

"Our High Streets have the highest vacancy rates in the UK, at 25%."

He added that the executive must use the additional funding to "prioritise small business rates relief, support independent retailers and help tackle the growing high street vacancy crisis".

Leo Slevin, from Belleek Men's Shed in County Fermanagh, said the village was a deprived area and in real terms the Budget did not offer much help to people.

"£100 will do nothing. The home heating oil today is about £1.28 or £1.25 a litre," he said.

"So £100 will not scratch the surface of putting any heat, unless it's coming every month to people. It'll make no difference on a yearly basis - absolutely none".

Sue Deacon is a volunteer at Belleek hub, a community centre in the village.

She thinks the pension income tax change will offer a small relief for pensioners.

"I'm pleased to see any help that they can get us a pensioner," she said.

"Because my fear is that with the pensions, the allowance staying the same, if pensions rise a lot more pensioners will be paying tax and they shouldn't have to pay tax on a state pension."

Hugh Ferguson is retired and said the challenges of living in a rural area with little money makes things difficult for pensioners in Belleek.

"Because we're a rural area, and we're a long way from a major centre, we spend a lot on fuel, driving back and forth, so that's difficult, with the prices going on," he said.

"Fuel cost, heating oil - very expensive,

"And that's more than doubled, but of course, our incomes haven't doubled, so it's very difficult for us."

Christina Taylor owns Shed Bistro in south Belfast and employs about 30 staff.

Speaking ahead of the Budget announcement, she said an additional rise in the minimum wage would mean higher prices for customers.

"The raise last year meant that every guest would need to spend £4.50 more to cover that," she said.

"That's so much money and people can't afford that.

"Raising the minimum wage isn't the answer to the cost of living because it goes in a circle and no-one is better off."

Taylor added that there "needs to be support for households or else eating out will be a thing of the past".

She echoed calls from business groups like Hospitality Ulster, which wanted to see a reduction in VAT.

"Comparing ourselves to the South (Republic of Ireland) at 9% and Europe at 10% and we're sitting at 20%, it's not sustainable," she said.

Derek Moore cares for his parents Margaret and Douglas in Greysteel, County Londonderry.

His mother is registered blind and his father had a stroke and a heart attack earlier this year.

He said he could not get his parents "out and about" as much as he would like to "because the cost of living has made it much harder".

Moore works full-time and his parents have carers who visit four times a day.

Ahead of the Budget, he wanted to see help for carers and with heating costs.

"You also don't turn the heating on as much as you would like, you have to go down the coal route and make sure it's cosy and warm for them," he added.

"You have to make sure that one room is really warm, and close doors."

On Tuesday, BBC News NI also gauged the views of the public at a family event in Slieve Gullion Forest Park, near Newry.

The Harrison family lives in Craigavon, County Armagh.

Leanne Harrison said the price of groceries was "crazy".

Tim Hanna said families were "feeling the pinch" and tax breaks on hospitality and fuel duty would be helpful.

"I know the hospitality sector is particularly hard hit, the price of a pint seems to keep going up and up, seems to deter people," he added.

Rozlyn Sheridan, of the Sheridan Stage School in Newry, was hoping for a boost to the arts sector.

"In my own business in the arts, we are paddling our own boats and trying to survive in an industry that sometimes isn't valued within our society, within our government" she said.

"The arts brings so much to a community and gives so much value to people's mental health."

Stormont gets a population-based share of additional spending allocated to public services in England.

Stormont's Department of Finance will make its own calculations of when that money can be spent and what it can be spent on.

Stormont is already due to receive a small amount of money for spending this year, as a result of measures announced shortly after Andy Burnham became prime minister.

For example, his decision to freeze bus fares in England is likely to be worth about £10m to £15m to Stormont this financial year.

However, most of what Healey allocated on Wednesday is likely to be for next year.