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Belfast Live
Belfast Live
National
Brendan Hughes

Cost of living: What money NI will receive from UK funding and problems that remain

The UK government announced a £15billion package tackling cost-of-living pressures but questions remain over how Northern Ireland households will receive some of the funding.

The main issue surrounds a promised £400 discount on energy bills for every household in the UK.

Normally what would happen is an uplift in spending in England means an equivalent amount of money would be given to the Stormont Executive to determine how to distribute.

Read more: Financial support needed for older people as 40% of pensioners in NI living in poverty

If the funding was allocated through this usual Barnett consequential formula, the additional cash would likely need formal Executive approval before it could be spent.

But Northern Ireland currently has no power-sharing Executive in place as the DUP is blocking its formation in protest over Brexit's Protocol.

While most ministers from the previous administration before recent elections remain in post in a caretaker capacity, they can only make limited decisions.

This means the UK Treasury and Stormont's Department of Finance may have to see if they can find a workaround.

At this stage it is unclear what that workaround could be. Some believe it could require new legislation at Westminster.

With the discount due to be delivered in Great Britain in the autumn, it is unclear if it can also be distributed in Northern Ireland in the same timeframe.

The Treasury said it has not ruled out the usual Barnett consequential method but will "consider other options to ensure Northern Ireland gets equivalent support".

Stormont's Finance Minister Conor Murphy said there were "challenges involved" with no power-sharing administration in place but he was determined to work with the Treasury on a solution.

Mr Murphy said the funding announcements increase the pot of unallocated Stormont funding requiring Executive sign-off to £435million.

Are you struggling with the rising cost of living? Share your story in the comments section

Although problems remain with the £400 energy bill discount, it is expected that other support measures announced on Thursday can be easily distributed to people in Northern Ireland.

These are:

  • £650 one-off payment to people on the lowest incomes. The means-tested payment will be made directly into bank accounts in two installments - the first in July and the second in the autumn.
  • £300 payment for pensioner households already in receipt of the Winter Fuel Payment.
  • £150 for people receiving disability benefits.

It is expected these payments are more straightforward as benefit systems are already in place to allow the money to be paid directly to those in need.

The UK support package came a day after senior civil servant Sue Gray's damning report into lockdown parties in Downing Street, leading to scepticism over the timing of the government's major funding announcement.

The package is being part funded by a windfall tax on oil and gas firms, which have benefited from globally high prices driven by post-pandemic demand and the war in Ukraine.

Read more: Vacant properties owned by Stormont lying dormant at £1million cost in security fees

Read more: Northern Ireland will get UK cost of living cash, Treasury says

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