Draft Budget 2022-25
The Executive’s Draft Budget 2022-25 consultation was announced by the Finance Minister on 13 December 2021. The Draft Budget provides the proposed Resource and Capital investment funding allocations to departments for the 2022-25 financial years.
The announcement of the consultation of the draft Budget triggered the commencement of a Department of Finance (DoF) led public consultation on the Draft Budget, which will close on 7 March 2022. A copy of the Executive’s Draft Budget 2022-25 can be accessed on the website: https://www.finance-ni.gov.uk/publications/2022-25-draft-budget.
The purpose of this paper is to set out the Department’s initial assessment of the equality impacts of the draft budget on spending proposals for the 2022-25 budget period. The public consultation will run concurrently with the DoF Draft Budget consultation.
No decisions have been made by the Minister in terms of the distribution of the Department’s budget, this will occur following agreement of the Final Budget by the Executive.
The Department is facing significant inescapable pressures in future years, and in addition to the 2% reduction to department’s baselines, to prioritise health funding, this would require the Department to deliver efficiencies/ service reductions, should this budget position remain unchanged, to achieve savings of £125.4m in year 1, £100.9m in year 2 and £111.6m in year 3, in order to meet the inescapable pressures and the reduction to baseline.
The Draft Budget 2022-25 is proposing resource budget allocations to the Department of £31.5m in year 1, £35.9m in year 2 and £38.1m in year 3.
It is clear that the Draft Budget 2022-25 proposed outcome, were it to remain unchanged following consultation, would mean that the Department would not be able to continue to provide the same level of service as provided in the 2021-22 year. This would be compounded by the impact of increasing energy costs and inflation; which, if not funded, would further restrict what can be done with the resource funding available.
The Department identified indicative capital requirements for the Budget 2022-25 period of £787.3m in year 1, £1,017.7m in year 2 and £1,403.6m in year 3. This excludes City Deals capital requirements.
The draft Budget 2022-25 is proposing capital budget allocations for the Department of £767m for year 1, £821.7m for year 2 and £822.7m for year 3.
Year 3 of the draft budget allocations, in particular, presents a significant funding gap based on the Department’s indicative capital requirements submitted, should the budget positon remain unchanged, where there would be insufficient funding to address Flagship, inescapable and pre-committed schemes in total. This would require prioritisation of schemes over the budget period, resulting in the delay of some schemes into later years.
The Department is seeking comments on any potential equality implications arising from the proposed draft Budget for 2022-25 and will consider the need for any further mitigating actions in light of responses received during the consultation. Promotion of equality of opportunity and the protection of services to vulnerable groups will be a key consideration in the Department’s final Budget decisions.
The Department is therefore seeking views on potential impacts that could result from reductions to services given the very serious financial position it faces, and the requirement to manage within budgets allocated.
Comments on the DfI budget and equality impacts should be submitted via email due to current working arrangements during the pandemic.