Northern Ireland Assembly
Tuesday 20 March 2001 (continued)
Does the Member agree that the average industrial wage in Northern Ireland is significantly lower than on the mainland where people have the advantages of cheaper clothing, food and fuel?
I thank the Member for that pertinent point. I think that the figure in Northern Ireland is £100 less per week. We must put the blame where the blame lies - fairly and squarely on the Executive. The Executive should say that council tax across the water has gone up by 8% and that that is where that figure came from. We must make no mistake about that; this has nothing to do with the needs of Northern Ireland. This is following directly what is happening in the rest of the UK. That is unfair; it is unjustified; it is iniquitous. We cannot stand here today and endorse that iniquity or turn a blind eye to it. If we really mean what we say, if we have concern for our people, we will share that concern and not support this Order.
The other question is: where are you - not you, Mr Speaker, but the Assembly - going to get the money? When the rates issue was first raised in the House I stated - and Hansard will show this - that the money was in the system. The money is still in the system. If Members take the time and effort to look through the various monitoring rounds they will find that since the issue was first raised, virtually enough money has been raised through the monitoring rounds to cover the total amount of money raised through the regional rates.
At today's meeting of the Finance and Personnel Committee further savings will be shown as a result of the February monitoring round. How much money are we talking about? It is another £25 million. Reducing the rate of increase of the domestic regional rates to the same level of increase as that of the non-domestic regional rates would cost £4 million. My plea is for the Executive to take that £4 million from the latest £25 million of savings and demonstrate once and for all that they have the care, concern and the interests of the people of Northern Ireland at heart.
Mr Close quoted Ecclesiastes, I think. I shall make a play upon some words from Ecclesiastes:
"All the rivers run into the sea; yet the sea is not full"
and there is no new thing under the sun. The rivers of taxation flow into the coffers of the Exchequer and it is not filled, but that is nothing new so far as Ministers of Finance are concerned.
I do not often find grounds for agreement with the First Minister, but in a speech he made on 3 November 2000 to the Society of Local Authority Chief Executives - interestingly called SOLACE - he said this about the cost of bureaucracy:
"In addition to the Assembly, its Committees and the 11 Departments, we have a Civic Forum, nearly 80 executive quangos, 50 advisory bodies, 26 district councils, and a range of partnership boards.
It is difficult to argue in favour of a system that is as elaborate, complex, fragmented, and expensive as ours. We need to be able to provide the public - our customers - with better quality services and value for money."
The Minister of Finance, in proposing the Order, said that £300 million would be raised through the rates, and that in the current year there would be an increase of 8% in the cost of expenditure, presumably on services such as education and health. There is some financial sleight of hand taking place in connection with this because there is no question that those services could still be delivered and significant savings made.
Mention has been made in an earlier speech about the vast sums of money - £57 million on one occasion, and an alleged £20 million on the present occasion - found during the monitoring rounds. In those circumstances it is extraordinary that out of those vast sums of money £4 million cannot be found to reduce the proposed increases in the domestic rate to the level of inflation. We are only talking about £4 million.
Perhaps Mr Close put his finger on the matter when he said that the figure for the 8% rise really came from the mainland, where social, economic and domestic considerations are entirely different from those in Northern Ireland.
Where can these savings be made? The Democratic Unionist Party has argued, with some force, that if £18 million is being spent on cross-border bodies - essentially not a domestic or social objective but a political one - some saving might be made there.
That is a fundamental political question, but huge savings could be made in relation to the administrative matters that the First Minister has alluded to. For example, for the current year the Minister previously indicated that it would cost approximately £670 million to administer this place. I understand that the budget for next year for administering the 11 Departments and running the Assembly will reach a new level of £750 million. Are people honestly going to believe that administrative costs of £750 million per annum could not be successfully pruned, even very slightly, to deliver the £4 million that is going to be raised by the increases in the domestic rate above the rate of inflation. I do not think any sensible citizen will believe that that is not possible. Of course it is possible.
People in the Assembly will say that Bob McCartney is on his usual hobby horse, criticising the amount of money that is spent on running the Assembly and its Executive.
Well, take the appointment of three Deputy Speakers, at £7,500 each, for an Assembly that sits in plenary session two days a week for a limited number of weeks of the year - and not always two days in every week.
Look at the current proposals before the Commission for the payment of short money - only it is not now going to be called that but given some fancy title such as "professional services". These will increase the current very generous payment of short money from something like £440,000 to almost £1 million - £1 million that is being milked out of the system. That amounts to a quarter of the entire money that will be raised by the increase in the domestic rate.
This payment is an entire fraud. The four major parties in Government will receive by far the lion's share of that £1 million of short money - something like £600,000. Short money is not even paid in the Westminster Parliament. It is only paid to parties notionally in opposition, on the basis that the parties of Government have access to the whole support system of the Civil Service, special advisers and others, who are all paid out of the public purse. How anyone could conceivably justify the payment of that sort of money in an administrative cost, in circumstances where it will represent almost 25% of the total of £4 million to be raised by this increase in the domestic rate, beggars belief.
An enormous amount of money, as the First Minister has pointed out, could be saved. However, money is being poured into all sorts of community groups and other specialist lobby groups. There are now groups for almost everything from nose-picking to bottom-scratching. We are inundated with literature - glossy magazines and annual reports that cost tens of thousands of pounds. The only sign that these groups exist is the presentation of their annual "glossy". That is just one example of Government expenditure being churned out at the expense of ordinary people - ratepayers who are working. I am not suggesting that all these groups do not have worthy objectives. However, in the administration costs of the Government in Northern Ireland, we are now supporting a whole range of bureaucrats and other people who are contributing absolutely nothing to the inherent wealth and welfare of our society - and yet we have increases in the domestic and regional rates.
I welcome the statement from the Minister that a comprehensive review of the whole rating system is in the pipeline. Changes in Government have undermined the whole basis of the rating system. Originally rates where raised from the people in the community to pay for the services being provided by the district or county council. Then, as central Government took an increasing role in providing services in those local or county districts, the rate system was changed. Now we have the Government actually taxing through the rate system, in an unfair and inequitable way, all the people in the taxation area - many of whom do not receive direct benefits from the rating system.
It was fairly pointed out by both Mr Peter Robinson and Mr Close that each and every district council has opposed the regional rate on the basis that, while the councils scrimp and save in order to minimise rate increases, they have no control over the sweeping imposition of a regional rate. Other Members have already pointed out the inequities of that system, and I will not dwell upon them.
However, let me raise one particular point in relation to the rating of agriculture businesses. It has been recently drawn to my attention that in the view of the central Government - and no doubt it will spill over into this devolved Government - the countryside and farming are no longer of major importance. Someone recently said "What is all this outcry about foot-and- mouth and the special relationship with farmers? They should be treated like the miners, since on the mainland they contribute something like 1·6% of GDP, while tourism, which is being battered to death as the result of foot-and-mouth, contributes 6%".
Many farmers are now looking for alternative means of earning a living. They are converting their farms for other interests: horse training, horse breeding, riding schools and the like. But once they do that, once they attempt to utilise their assets for another purpose - since farming is not profitable - in businesses that the Government encourage them to take up, they are hit with the business rate. I hope that that will be one of the aspects of rural life, along with post offices and rural shops, that the Minister will take into account when any rebate scheme is introduced in order to alleviate some of the acute difficulties that people in those communities experience.
However, I return to the central issue of the domestic rate. Four million pounds is a drop in the ocean. It is a drop compared to the vast sums that are available to the Minister. It is a fraction of the sums that, in the monitoring round, he has managed to extricate from all sorts of weird places in the Departments - almost £100 million. Yet he finds it necessary to impose these increases in the regional rate and the domestic rate.
I read recently in the 'Belfast Telegraph' a tremendous panegyric about the Minister and his capacity to deal with all the intricacies of our financial system. The article dealt to some extent with the necessity to exercise the ministerial powers to raise money by means of the rates. That apologia may have satisfied the readers of the 'Belfast Telegraph'. It certainly has not sufficed to satisfy the people within this Assembly who do not belong to the major parties that are going to railroad these increases through. It cannot be justified either in terms of the expenditure on bureaucracy in this Assembly or in terms of the money that it will produce, when that is related to the amount of money that is awash throughout the system.
It cannot be justified to those individual householders on the margin who have to pay for it. It is time the Minister really started governing in this Executive in the interest of the people, not in the interest of those who fill official offices and who are financially reaping the benefits of the emoluments of office in this Assembly.
This is a time-limited debate. If Members speak for substantial periods they will reduce the amount of time that is available to their Colleagues. Indeed, some of their Colleagues will not get the chance to speak at all. Even if you do not share power I encourage you to share time - at least for this morning in order to give all Members an opportunity to speak.
I will make some comments about three of the speeches that have been made so far by Mr McCartney, Mr Dodds and Mr Close. I had some sympathy with a few of Mr McCartney's comments about the cost of bureaucracies in the North, quangos and the system of Government that we had for far too long. However, one of his comments echoed what he said in the Assembly before Christmas when he demeaned Members who were previously unemployed. You were equally demeaning about the community sector in the North whom you characterised in a way that many find offensive and inappropriate. While you make some valid comments, you undermine your legitimacy by the abusive nature of the remarks that you make about those who are not even here to defend themselves.
Order. I encourage the Member to make his comments through the Chair.
I also noted what Mr Close said. He made some valid comments too, not least perhaps his remarks with regard to monitoring returns. However, it is inaccurate to characterise this debate and the Government by suggesting - as he did - that we are implementing the same policies as the Tories. Those were the words that he used. Go and ask the farmers if we are implementing the same policies as the Tories. Perhaps even ask those involved in the 11-plus consultation or those who will benefit from the section 75 equality duty and the workings of the equality unit in the Office of the First Minister and the Deputy First Minister if Tory policies are being implemented. Go and ask those people if this Government is administering Tory policies or implementing Tory practices. I think that their conclusion will be contrary to Mr Closes's assertion.
I suggest that Mr Attwood read the Minister of Finance's speech. He said that he was carrying forward the plans of the previous Administration with regard to the 8% increase.
Mr Close may have forgotten that there was an election four years ago which returned one Tony Blair to Downing Street and not one William Hague or John Major. It is Labour Party policy that we are listening to and heeding. As my Colleague Ms Lewsley said, in spite of that the Minister is clearly doing his best to remodel the rates in an effort to ensure that they are administered more favourably. She welcomed the Minister's commitment in the Programme for Government to explore new innovative ways of finding finance. One way is the rural rates relief scheme, which Ms Lewsley described in some detail. That is not Tory policy. This is not a Tory Government; this is a Government which is trying to rework rates policies in the North to benefit the people of the North, especially those in some need.
However, I found Mr Dodds's speech most instructive. At least our Colleagues Mr McCartney and Mr Close tried to outline ways of finding additional sources of funding. Mr Dodds did not even go that far, save in one regard, which exposed the core frailty of his argument. The only source of additional finance that he could come up with was the North/South bodies. The only strategy that Mr Dodds put forward for finding additional resources was to unpick and undermine the integrity of the Good Friday Agreement, the workings of bodies on this island that have economic and other benefits for all the people of this island and policies that can work well for the advantage of people on both sides of the border.
In that contribution Mr Dodds exposed the core motivation behind his proposals - to unpick the agreement rather than to create a proper Government. That was confirmed by the core inconsistency of his argument. On one hand Mr Dodds said that my Colleague Patricia Lewsley found the Rates Order to be wonderful and acceptable - those are his words - but, on the other hand, he said that SDLP members of the Belfast City Council considered the rates increase to be an outrage.
That revealed another core flaw and fault in what Mr Dodds said, because the SDLP does not deny or diminish the consequences that rates increases and the Rates Order will have on ratepayers. The SDLP does not deny or diminish that. In fact, the Minister has attempted to mitigate the effect of rates where that is consistent with the proper management of the country's finances.
We have not denied or diminished the fact that there are consequences, and the SDLP and Ministers in the Government will try - where feasible and possible - to mitigate the rates burden in the future. That is why the Government and the Finance Minister made their commitments in the Programme for Government.
It is ironic that in attacking the Finance Minister on the Rates Order, Nigel Dodds affirmed the policy of targeting social need. Mr Dodds spoke affirmatively and generously about the programme and policy of targeting social needs adopted by the Government and being implemented in the North. When the DUP Ministers come to implement the targeting of social needs, I trust that they will target the disadvantaged communities in the North - which are common between our peoples - and those communities that have been discriminated against over many years. That category applies particularly to one of the traditions in the North. It is to be hoped that the DUP Ministers will implement Nigel Dodds's warm phrases about targeting social needs. The Assembly will then judge them more fully than we do at the moment.
Over the past few months one of the consistent and prevailing themes of those who present themselves as the Opposition in the Assembly has been the rates increase. That theme has been raised many times. It seems as though the rates increase is their only point of attack against a Government that is working demonstrably on behalf of the North's citizens and communities. If that is the only criticism that they can level at an Executive who are working effectively for the citizens and communities in the North, it is a sad indictment of the argument that they are making.
Mr S Wilson:
Some Members who spoke in support of the Order have admitted that the Assembly is finally ratifying the bill for the Good Friday Agreement and the chopped-up Government that have led to the formation of ten Departments - which were set up to ensure the inclusion of two Sinn Féin Ministers in the Executive - and the cross-border political institutions. Despite what was said by the previous Member -who has done his usual stunt of making his speech and leaving before anybody can comment on it - those cross-border bodies are nothing to do with the economic or social betterment of the lives of people in Northern Ireland. They are to do with political chicanery and with setting up institutions to keep Republicans and Nationalists happy.
Ms Lewsley was quite clear about the rates increase. She said that the North/South bodies must be funded. Part of the price of that is an increase in the domestic rate over and above the level of inflation. There is no doubt that ratepayers are getting a bill for the political institutions and the political arrangements which are essential to keep Nationalists and Republicans happy and to finance what they want from the Good Friday Agreement.
You cannot fault the SDLP and, to a lesser extent, Sinn Féin for supporting the Rates Order. However, I find it very odd that Unionists are supporting it. To date, no Members from the Ulster Unionist Party have spoken on this important issue. However, they have made various declarations in the past and a couple by way of interventions this morning. The Member for North Antrim, Mr Leslie, who is at least sitting through the debate, said on a previous occasion that we should be rejoicing at the increase and that we should be looking forward to paying our bills and standing on our own two feet.
Today he has sought to defend his party's support and his party's vote by taunting Mr Close about his alternatives for raising money. I will not go through Mr McCartney's proposals, because you have encouraged us to be brief, Mr Speaker.
Mr McCartney and Mr Dodds outlined ways in which we could raise money without increasing the rates bill and without hurting the people of Northern Ireland by cutting services. But rather than applying itself to the rigour of doing that, and rather than offending those who demand the North/Southery which is all part of the agreement, the Ulster Unionist Party has decided to support the Rates Order. However, there have been reductions since the increase was first announced. Before he left the Chamber, Mr Attwood said that the only way in which the anti-agreement parties have been able to oppose the Executive - and that shows that he does not sit in the House long enough to listen to anybody - is by raising the rates issue. At least we have had some success on that.
I wonder how the Member would feel if we had a cut-price model of Government such as direct rule under which the rates increases would be forced through every year with no opportunity to argue for the reductions, which have been delivered this time round. Perhaps he would prefer something much cheaper, more autocratic and on the Cuban model administered by Ché Close and Fidel McCartney.
Mr S Wilson:
I do not understand the point that the Member was making. Anyone, by any stretch of the imagination, could say that Northern Ireland has got an austere system of Government. Mr McCartney pointed that out and his contention is supported by the comments of Mr Leslie's party leader, who has said that we are over-governed and that the bill for Government is way too high. I am not suggesting any kind of hair shirt type of Government for Northern Ireland. I am simply saying that there are plenty of ways in which the pain of this Rates Bill that we are discussing this morning could have been reduced with ease. But, of course, for political reasons, that will not be done.
I now move on to the reductions that we have seen and where there has been some success as a result of the pressure applied by my party, and by others, on this issue. When the Minister first announced this, he was emphatic that it was required. In the debate of 18 December he stated
"The Budget plans . are based on an assumed level of regional rate revenue of £334 million . the indicative allocations of 2002-03 and 2003-04 would imply further increases in the domestic regional rate of 8% and 5·5% in the non-domestic regional rate in 2002-03 and 2003-04."
But by February the Minister seemed to have got his sums wrong. In the short space of two months he recalculated his figures and in February he told the Assembly that because of strong continued growth in valuations of domestic property, there was some scope for adjusting the domestic regional rate increase. He then went on to make the announcement.
I suggest that, rather than the Minister's getting his sums wrong, the effect of opposition by the DUP and other parties in the House - and the opposition that was found outside - forced the Minister to look at his sums again. As Mr Dodds said, if the Minister could find that within two months, surely to goodness if he looked a bit harder - and along the lines indicated by Mr McCartney in the House this morning - he would find sufficient money to keep the regional rate increase at to the rate of inflation.
There is one other point that I want to make regarding the Minister's statement this morning. He announced three things. The first is a review of the policy and, as has been said, you only review something if you know it is inherently wrong. Secondly, we are to have rates relief for shops and post offices in rural areas. [Interruption].
May I suggest that the Member bring his remarks to a close?
Mr S Wilson:
I am going to finish now.
There are just as many owners of small shops on arterial routes in main towns - especially in the inner part of Belfast - hanging on by the skin of their teeth. Are they going to be included in that review?
The last announcement is not a reason for hope; it is a reason for dread, especially for householders: he has announced a revaluation of properties. In one east Belfast street there are new properties on one side, old properties on the other and a 75% difference in what is being paid between the two. Both sides of the street will be revalued under current rental rates, and what is being paid by those in the old properties will eventually rise to the same as what is being paid by those in the new ones. So the final announcement made this morning should not - as has been suggested by some members of his party - be a source of hope. It should be a source of dread for many people, especially for those on the margins who do not qualify for housing benefits and who will be forced to pay higher rates bills in the future.
Go raibh maith agat, a Cheann Comhairle. Ba mhaith liom labhairt i bhfabhar forbartha uile-Éireann i gcúrsaí eacnamaíocha, agus cuirim fáilte roimh an díospóireacht seo.
I welcome the debate on the rates issue and the repeated indication of a comprehensive review of the whole rating system - a root-and-branch review, which is to be instituted later this year.
Similarly, I want to identify with other Members in acknowledging the hard work of the many councils that wisely manage their resources at local government level. Armagh City and District Council seems to be one of the exceptions, and Castlereagh Borough Council should not claim to be so masterful in this respect either, given the fact that many of the services used by the citizens of Castlereagh are in Belfast and that the industrial base is concentrated there. Castlereagh Council members are, perhaps, blowing their own trumpet a bit too much.
Many councils deserve commendation to have arrived at a district rate which is sensitive to the views of local people. This year, Omagh District Council - which includes a number of Members of this Assembly as members - instituted an open forum approach whereby citizens of the district came to a publicly advertised meeting to be consulted, for discussion and for councillors to listen in line with best value principles. As part of the root-and-branch review, I hope to see that exercise being repeated as much as possible at the macro level in Six Counties terms.
There is much talk of rates relief, and that is worth exploration. Areas of disadvantage - namely, County Tyrone and County Fermanagh - do not have the requisite infrastructure or investment and, therefore, should be treated as being different until such time as the playing field becomes considerably more level.
Order. If Members wish to have ongoing conversations, they should, in fairness to the House, have them in the Lobbies.
Go raibh maith agat. In relation to one political untouchable for many, I believe that a comprehensive programme of British demilitarisation in the North would free up resources for necessary spending elsewhere, such as in areas of health, education and industrial development. This is an area where savings can be made and money redirected.
It is poor reasoning in this day and age for Nigel Dodds to be advancing the argument that what he calls "North/ Southery" is costing money, when the reverse is true. To examine the folly of having separate economic systems on the island of Ireland shows that the underdevelopment of North/Southery is costing money. There should be further development and further intensification of all-Ireland harmonisation, which will benefit everyone concerned. There is an economic rationale for this in terms of health provision. For example, why should seriously ill patients from Donegal have to bypass Derry and Omagh on their way to hospitals in Dublin?
It makes sense to have a single island's wholehearted embrace of tourism potential and agriculture - this has all been said before. Here are three key areas where all-Ireland development will make a tremendous benefit. It would be great if the Celtic tiger got its paws wet more often in the North. The DUP are swimming against the tide of economic rationale and history by opposing the economic coming together of both states on this island. Go raibh maith agat.
Before calling the next Member, I want to refer to remarks made by Mr Wilson earlier. He said that a Member had left the Chamber shortly after having spoken. I know that Members who are here are not the ones to be reproved. I have noticed from time to time a number of Members coming in almost immediately before they intend to speak and/or leaving immediately after they have spoken, frequently having put a number of questions to a Minister and not returning to hear the replies.
This is discourteous to the House as a whole and to individual Members. Mr Sammy Wilson made the point. I think that it is worthy of note and emphasis - not only in respect of the particulars to which Mr Wilson referred, but also in the generality. I ask those who have taken the trouble to be here - people in all parties - to convey this to their Colleagues. My experience is that all parties have from time to time transgressed. No one should point at anyone. [Laughter] It has often been remarked that when someone points a finger, there are at least three fingers pointing back.
I have listened to the debate, and there is no doubt that there are many double standards in this House. Many of us have been members of district councils in Northern Ireland - those of us who managed to get elected. If we are honest we will admit that we have all condemned direct rule Ministers over the years for continually hiking the regional rate. Some of us - right across Northern Ireland - felt so strongly about the matter that we frequently met with those Ministers. We made it clear that if local councils decided to strike a lower rate it would be unfair for a direct rule Minister to then take advantage of that by striking a very high regional rate. Indeed, in Mr Durkan's council there was deep concern at the rise in the regional rate. Our council felt so strongly about this that, rather than just voicing concern, it was proposed that a letter expressing our concerns should be sent to Mr Durkan.
The tragedy is that, when it comes to the rise in the regional rate, all of us - certainly the Members who have spoken this morning - seem to be saying one thing at local Government level and then doing something different in the House. That is what is happening here today. I have no doubt that when councils were striking the local rate, most of us - and most of the councils - expressed deep concern at the rise in the regional rate. Members need to be honest when they express concern at the regional rate hike.
For quite some time we had a situation in Northern Ireland where direct rule Ministers were responsible for a number of issues, including that of the regional rate. As public representatives from all political parties, we have all over the last 30 years continually and absolutely condemned direct rule Ministers on many issues relating to Northern Ireland. That was because we ourselves had no control over some of the matters. It was easy to blame the direct rule Minister, to opt out and to point the finger somewhere else. We can no longer do that. We must lay the blame fairly where it belongs - in the Executive and in this House. The Minister of Finance knows quite well that when he was on his local council he expressed deep concern at direct rule Ministers' taking advantage of the local rates struck by local councils.
We must be honest about this. Small businesses in Northern Ireland will continue to suffer in the way that they have done for many years. In my city of Londonderry the retail business sector is under severe financial pressure because of our proximity to the border and the exchange rate differential between the punt and the pound. Many small business owners' biggest expenditure is their rates bill, and, over the past five to eight years, many have found it extremely difficult to pay that bill. As Assembly Members, we are responsible to the entire community of Northern Ireland, but especially to the small retail businesses here. Some Members are defending the decision to increase the regional rate, but there are no grounds for this stance.
People are only interested in the size of the bill that drops through their letterboxes. We can debate the niceties, such as the contribution that the extra finance will make to the entire block budget. The tragedy is that it is the local council's name that will appear on that bill. Members who vote for the rates rise today in the hope that they will get away with it in the smoke must remember that it is the local councils which will be blamed when these huge bills arrive. Many still believe that the councils are responsible for rates increases in Northern Ireland. Public representatives have been trying to explain the situation. During direct rule they went out of their way to explain that the councils had been striking very low rates in their areas and that people should not blame the councils if the Minister decided to strike a very high regional rate.
It will be the Assembly's fault if we decide to increase the regional rate. The DUP has been very clear on this issue from the outset. There are no grounds for defending this decision to increase the rate.
This is a time-limited debate, and I regret that a number of Members who wish to speak will not have the opportunity to do so.
I thank everyone who contributed to the debate. The Assembly has before it the Regional Rates Order, and we are setting the rate poundages for next year. Although many councils disagree with the level at which the regional rate has been set, they recognise the importance of formally fixing the rate since they depend on this information for planning purposes. As I explained, there has been some delay in relation to the Order. It is important that we undertake that business today.
Quite a number of points were made. Mr Molloy, as Chairman of the Finance and Personnel Committee, took up the point about the review of rating policy. I have written to the Committee about that, and officials will discuss it further with its members. The review will take place in several stages. We will consult with the Committee at each stage and will come back to it on points raised. It will be, as Mr McElduff said, a root-and- branch review looking at the whole rating policy. This is not a new announcement, as Sammy Wilson seemed to think. I announced it some time ago, and it is contained in the Programme for Government. It was drafted and proposed in the Programme for Government before we tabled increases in rates as part of the draft Budget precisely because we recognise that anomalies and inequities exist in the rating system. Those apply in the non-domestic sector, as well as in the domestic sector and we are determined to overcome them. However, there is an underlying imperative that we raise money from our own resources, such as rates, in addition to that which the Treasury allocates us under the Barnett formula.
We have to be realistic in the representations that we make on the Barnett formula. However, we also have to be determined in our representations, and many people in the House have on previous occasions urged me, the Executive and the First and Deputy First Ministers to take a fairly aggressive line. We want to take a strong line in order to increase the resources that we get from the Treasury. We have to argue that we need the money for valid public expenditure purposes. We must say that our service programmes and our communities need it. Our infrastructure, which, as everybody tells me, has historically been underinvested in, needs it, as does our service infrastructure, which has also suffered from underinvestment. If we choose not to raise additional resources ourselves and concentrate our argument instead on what the Treasury will view as raising additional money from English taxpayers, the Treasury will argue that that is not a convincing demonstration of our belief in the necessity of additional public expenditure.
The argument has been put that that represents only a small amount of money. I deal with lots of bids for small amounts of money that are equal to or less than the amount discussed here. There are many additional outstanding bids, many of which were supported by the Committees during the Budget consultation. Many cases are being made for additional public expenditure. I hope that when people argue that it is only a small amount, they will also realise that all the so-called small amounts of money and bids add up, unlike the contradictory positions of some Members in today's debate, which do not always add up.
We have historical underfunding in a number of areas. All the Ministers have been emphasising that. Most of the Committees that have been looking at the Departments' programmes and historical spending profiles have emphasised that. Many different policy makers have emphasised that. In these circumstances, we need to put more money into those programmes. That is what the Budget does. We are increasing public expenditure by some 8% in the next year. The original domestic rates increase that we were talking about was 8% and the non-domestic rates increase - to contradict Mr Close - was 6.6%. That is what we announced in October. That was to fund public expenditure increases of some 8%. We are still proceeding with those.
Contrary to what Sammy Wilson suggested, not only in December but as far back as October I said that if the buoyancy figures showed that we could raise the same amount of money with a lower rates increase, we would do so. I said that at the draft Budget back in October. I obviously was not believed then; people believed their propaganda rather than my assurance on that point. I repeated that again at several Question Times, in the context of the monitoring round and again in the debate on 18 December on the Budget.
I again made the point that if the figures showed we could raise the same from less, we would. The figures indeed showed that; hence the reduction in the domestic regional rate. We also took advantage then of the figures which became available in the December monitoring round. A number of Members have said today that all sorts of money becomes available in monitoring round, so the best tactic is to assume that that money will be available and budget accordingly for a low rate increase. That would be very convenient thing for me as Minister of Finance and Personnel. It would suit me fine to do that. It would save me a lot of hassle and bother. However, it would not be entirely fair to the rest of the Executive. Nor would it be entirely fair to other ministerial colleagues, because we cannot always rely on the sort of out-turns from monitoring rounds that we have had this year. In fact the out-turns from monitoring rounds this year have been quite exceptional in comparison with those of previous years.
I could be bold and pretentious and claim that this is something to do with the fact that I am Minister of Finance and Personnel. I do not believe that it is.
I hope that the devolution factor is making a positive difference, in particular to recognition of the monitoring rounds - I do not think that many people knew very much about them before devolution. I also hope that a positive contribution is being made to the decisions taken in those monitoring rounds by the fact that the monies which become available are recycled to good use elsewhere to give sound public expenditure that is focused on public needs. This is the difference from direct rule.
I have listened again to this lecture about social conscience from Mr Close, as though I parked my social conscience when I took ministerial office. This applies to Mr Hay as well. Mr Hay knows that in Derry City Council debates on the regional rate, we always argued that direct rule Tory Ministers were cutting back on public services and areas of public expenditure while imposing regional rate increases at the same time. That is not happening with this Executive. There are public expenditure increases right across the board that are well above the rate of inflation.
In areas like health and education where we are under serious pressure, all parties recognise that the Barnett formula does not give us what we need. We have managed to achieve increases in health and education expenditure over and above our Barnett consequential for those areas. The Executive has not done the same as direct rule Ministers. A number of years ago direct rule Ministers were, for instance, cutting back on elective surgery and imposing cuts in health services while imposing high regional rate increases. There is therefore no comparison whatsoever.
Rev Dr William McCrea:
Will the Minister give way?