---

Comprehensive Spending Review

When the comprehensive spending review was debated recently in the Northern Ireland Assembly, there was a general feeling that, against the budgetary framework outlined at the time when devolution was restored, we had been short-changed. Notwithstanding the protestations of the Secretary of State for Northern Ireland, we have been disappointed, to say the least. I note, however, the undertakings given today by the Chief Secretary to the Treasury that the Government will keep their commitments on track. The Members of Parliament for Northern Ireland will undoubtedly hold them to that. During that debate in the Assembly, there was an air of financial realism. Perhaps for the first time in our recent history, it has become clear to everyone in Northern Ireland that we really are responsible for ourselves and for making the best use of the available resources. I hope that it might still be possible, however, to secure improvements around the edges of the published settlement, including guarantees on policing and security; access to end-year flexibility; latitude in how welfare reform is implemented in Northern Ireland, given its unique legacy; and more freedom to borrow. For this reason, I fully support the plans of the joint First Ministers in Northern Ireland to engage directly with the Prime Minister and the Chancellor. The impact of the CSR settlement on Northern Ireland can be assessed in three parts. First, on current expenditure, we are facing a cut in real terms of 7% by the final year of the CSR. That is challenging, but it is not insurmountable. Secondly, in regard to capital expenditure—regardless of the smoke and mirrors put in place by the Chancellor, the Prime Minister and the Secretary of State for Northern Ireland—we have been left well short of our expectations. Thirdly, on capital investment, we faced a further downturn the other day with the suspension of the Northern Ireland aggregates levy credit scheme. I want to ask the Chancellor and his Treasury team to continue the negotiations with the European Commission to ensure that that is reinstated.