Official Report: Minutes of Evidence

The Chairperson (Dr Archibald): I welcome the Minister, Diane Dodds, and the permanent secretary, Mike Brennan.

Mrs Dodds (The Minister for the Economy): Thank you for the opportunity to come to the Committee to talk you through the issues, challenges and exciting things in the Department that we will, I hope, work together to deliver in the couple of years that we have left of this mandate. Politics, politicians and Stormont have been given a second chance, so I am really looking forward to working with you so that we can deliver the best for our people in Northern Ireland.

I want us to see Northern Ireland's economy as being competitive, promoting innovation, attracting foreign investment and creating jobs. When we do that, we have prosperity for families and the people whom we represent. That is my overarching objective as the Economy Minister, but we have challenges. One of those — I outlined it during Question Time on Monday — is the process that we will now go through in our exit from the European Union.

Brexit has caused many of us to have many different opinions, and it has caused divides, but it is now time for us to come together. Brexit is a fact. It has happened, and we now need to work out where we can best place Northern Ireland in the midst of those challenges and, indeed, opportunities.

The next number of months will be taken up with looking at the challenges of Brexit. In the New Decade, New Approach (NDNA) agreement, the UK Government gave us certain pledges. We collectively need to hold the Government to account on those pledges. We are working to understand what the Government mean by the guarantee of unfettered access to the GB market. If we do nothing else, the most important thing that we can do in the short and medium term for our economy is to protect our place in the GB market. We also need to protect cross-border trade, but the relationship with the rest of the United Kingdom is absolutely critical.

In 2017, Northern Ireland sales to Great Britain were valued at £11·3 billion, and purchases from Great Britain were valued at £13·3 billion. Around 23,000 businesses in Northern Ireland traded with Great Britain in 2017. That is the scale of the issue before us, so access to the GB market — NI to GB and GB to NI — is absolutely critical, not only for firms that supply the manufacturing process and other things but for the high street, where many local shops are served daily by larger stores in England and, particularly, Scotland. That is a huge challenge for us. There is no doubt that we will want to talk about that in detail later.

We also want to build and maintain international relationships and collaborations post Brexit to help Northern Ireland to compete. It is very important to have that close economic relationship and cooperation with our nearest neighbours. We want to develop an overarching economic strategy for the post-Brexit world, one that will focus on skills, energy and exports, deliver the priorities in the Programme for Government and build on strengths in artificial intelligence and, of course, in line with the new deal, New Decade, New Approach, create and further strengthen expertise in cybersecurity.

I am quite excited, given my background, about having to deal with the skills and further education element of the portfolio. In the past year, our assured skills academies, in financial services, IT, welding and tourism, upskilled 227 people, with 190 of those people securing jobs at the end of the process. It will be exciting to look at how we can develop that process even further. Up to September 2019, 15,540 jobs were created, with the services sector accounting for 78% of that growth in jobs.

Employment does not just create wealth but boosts individuals and communities with increasing levels of health, self-confidence, self-respect and social inclusion. I am really keen to look at that in the light of the priority that the Executive have given to mental health and resilience. We can all play our part in that issue. We are doing good work, but we need to do more. We need to ensure that we not only provide pathways for young people — I am very excited about that and it is a good example of cross-departmental collaboration — but produce a 14- to 19-year-olds strategy for young people with the Department of Education.

It is also important to ensure that we have lifelong learning and that we create and maintain opportunities for people to learn in whatever situation they find themselves in. I am really keen to review some of our strategies to ensure that we have the maximum flexibility for people in their situations to learn, to progress and eventually to be part of the jobs ladder.

Ulster University's Belfast development project is one of the largest capital builds of its kind in Europe. There have been challenges — I am sure that we will talk about them — but I will continue to monitor the project, and, at the end of the process, it will be exciting to know that we will have a world-class campus for progressive education for our young people that matches the needs and skills of our economy. The expansion of Ulster University's Magee campus and the creation of a graduate-entry medical school have also been included as priority actions in the New Decade, New Approach agreement. There is much work for us to do to deliver on those projects.

Tourism is hugely important to Northern Ireland because it drives economic growth and supports jobs. In the last 10 years, overall visitor numbers have grown by 85% to five million, which is a phenomenal figure. Overall visitor revenue has doubled, with spend in 2018 reaching £968 million. The tourism sector in Northern Ireland supports 65,000 jobs, so it has a huge impact on Northern Ireland's economy. I am and will be working with you on a tourism strategy, which will contain targets, I hope, to double the value of tourism to the Northern Ireland economy and create another 25,000 jobs in the sector.

Climate change is high on everyone's agenda, as it should be. I recognise our responsibilities to contribute to the reductions required by the Paris agreement. The Department is committed to playing its part in reaching the UK Government's target of net zero carbon by 2050. There is, however, some good news on the issue. In the 12 months to September 2019, almost 45% of Northern Ireland's electricity was generated from renewable sources. We lead the way in that aspect of renewable energy. We are already exceeding our target, which was set in 2010, to achieve 40% renewable generation by 2020. Northern Ireland is exceeding what was quite a significant target then, given where we were coming from.

We want to develop a new energy strategy, which is very important. A call for evidence was launched in December 2019, and the responses are due back on 20 March 2020, when the call closes. There will be further public engagement and, I know, lots of conversations with the Committee as to how we develop that energy strategy.

Like everyone else, the Committee will have heard the announcement yesterday that the report on the renewable heat incentive (RHI) scheme is due on 13 March 2020. I will ask Mike to comment in more detail, and I am sure that we will get to that specific issue fairly quickly. I outline to the Committee that I have played no part in the inquiry. I have had no conversations or any communication with the inquiry whatsoever, and I have asked my officials to keep it that way. I intend to act in good faith on the results of the inquiry and to act in a way that is fair to those who participated in the scheme in good faith and to the taxpayers who fund the scheme. Work has been carried out in my Department as a result of the inquiry proceedings, and an inquiry subcommittee is being set up by the Executive, which will be the responsibility of the Minister of Finance, who will take forward inquiry issues. I suspect that those issues will cross-cut many Departments.

Finally, Project Stratum for the delivery of broadband is exciting, deliverable and hugely important for Northern Ireland's economy as it will increase productivity, which is an issue for us. Better connectivity and broadband can only increase productivity. About 90% of the delivery area for Project Stratum is in rural areas or in small housing areas. The project will help the economy right across Northern Ireland, and it can be delivered within this Assembly's mandate. It will deliver good results for the economy.

Colleagues, I am sure that we will talk about many other issues that we want to address this morning. I am here to address your concerns. If I need specific information, we will get that to the Committee. I want to work in a spirit of cooperation and openness with the Committee. We have a lot of work to do, a short time in which to do it, and I know that we will deliver for the people of Northern Ireland.

I am new to the Committee. I have just come back from almost 11 years in the European Parliament. We need to look collectively at many issues and find a good way forward. After a discussion with Mike and other officials, we are happy to offer the Committee closed sessions to work with officials on the detail of areas such as skills, energy or whatever area the Committee decides on. If you come back to us in the Department, we are very happy to work with you to provide closed briefings to allow us to work in confidence together on any of the issues. I look forward to your questions.

The Chairperson (Dr Archibald): Thank you, Minister. In response, we are looking forward to working with you in a collaborative way and in working to support the work of the Department. We all recognise the short time that we have over the next two years, and we are keen to do as much as possible. Thank you for the briefing.

I will start by picking up on a few issues. Last week in Committee, there were comments about Ulster University and the Magee business case. The expansion of Magee, in line with previous commitments, is one of the priorities for the restored Executive in New Decade, New Approach, including expanding the maximum student number (MaSN). Will you clarify whether that process has started or been developed?

Mrs Dodds: I will give a brief overview, and Mike will fill in some of the areas. We will take the two issues separately, if that is OK. First, we will address the Ulster University issue as it is quite important.

Ulster University has experienced significant difficulties with the new-build campus at York Street. It is a huge project that, when finished, will see the move from Jordanstown down into Belfast in a new state-of-the-art building, which can only improve the life chances of the young people who go to it. However, there are significant difficulties around the projected capital cost of £254 million, which we now know has risen to around £370 million. There is a significant gap in the funding to finish the capital project. Part of that is a rise in costs, part is the delivery and part is the fact that the European Investment Bank (EIB) withdrew its funding for the project. We are left with a situation whereby we want to support Ulster University. We want to make sure that it is a thriving educational campus for young people and that it meets its financial targets, both capital and resource. We have an issue around the £126 million.

I think that, in December last year, the Department approved a fairly conditional £126 million of loan support. That proposal sits, if I am right, with the Department of Finance. I have a meeting today with the Finance Minister, and I hope to discuss the issue with him so that we can plot a way forward that ensures that the university can progress and that we have a financially viable project to deal with.

Mr Mike Brennan (Department for the Economy): I will add a few additional comments. Last week, there was a lot of discussion around the greater Belfast development and how it was progressing. Obviously, the Committee will be aware of the Audit Office report into major project delivery and some of the concerns around what has happened with the cost escalation of the greater Belfast development. A lot of work has taken place in the Department to see what transpired over recent years in the roll-out of that project. We have had quite detailed discussions with the university and with colleagues in the Department of Finance about how we move forward. Costs have increased considerably, as the Minister said, so the key imperative now is how we finish out the project. An additional financial transactions capital (FTC) loan of about £126 million is needed over the next two years to finish it out. Some of the conditions that the Minister referred to are around getting assurance that proper project management processes are in place to finish out the project. It is also about looking at the capacity and capability of the university in being able to manage that out and ensure that the finances of the university, as an institution, are robustly managed.

The Chairperson (Dr Archibald): Where does the Magee expansion sit in terms of the commitments in New Decade, New Approach?

Mr Brennan: There are two commitments, effectively, in NDNA. There is the specific commitment to the graduate-entry medical school, and, as you know, £60 million has been ring-fenced for its delivery. The first imperative is for the university and the Department of Health to come to an agreed way forward on how that has to be rolled out. We are exploring the wider Magee campus expansion with the university. The difficulty is that we have not seen a business case from the university since the one that was circulated in 2016. I suspect that that needs considerable updating. The costs in that now dated business case were in the order of £300 million for construction, and then there were year-on-year resource DEL costs of about £103 million to run the expanded facility. We have asked the university for an update on that business case and what its projections are. When we have that, we can see how best to proceed.

The Chairperson (Dr Archibald): The commitment in New Decade, New Approach is for the Executive to bring forward proposals on that. Will the Department be working with the university to develop the plan to reach those numbers?

Mr Brennan: Yes, we will. Definitely.

Mrs Dodds: My first engagement outside the Department — they do let you out sometimes — was at Magee. It was fascinating to see the work on robotics and artificial intelligence, and the delivery of training for nurses at the Magee campus. As a Minister charged with the economy of the whole of Northern Ireland, it is important that we develop skills throughout. We have considerable work to do to make the progression. We will, obviously, also be talking to the Department of Health on how far its plans have progressed. There are no easy quick fixes; we need a work plan to make the delivery possible.

The Chairperson (Dr Archibald): That is welcome, because it is a transformative project for the wider north-west. The Irish Government have said that they are also open to contributing to the expansion of Magee. Will you clarify where responsibility for the sign-off on the decision for the graduate-entry medical school sits? There is a little bit of confusion on whether it is DFE or DOH.

Mr Brennan: It is the Department of Health.

The Chairperson (Dr Archibald): It is definitely the Department of Health. OK, thank you.

You mentioned Project Stratum and said that 90% of the funding for that project will go to rural areas or small housing areas. Will properties with no access be prioritised in the roll-out?

Mrs Dodds: My understanding on that — bear in mind that the procurement process started before I became a Minister — is that we will know the details when the procurement process has finished. Obviously, since there is a legal procurement process under way, I am not going, in any shape or form, to get involved in that. About 90% of what Project Stratum will cover will be in rural areas where broadband is either non-existent or its delivery is very poor. It will also cover those areas to try to bring them up to around 30 megabits of delivery. That procurement process is due to finish mid-year.

Mr Brennan: We would hope by May or June.

Mrs Dodds: Yes, May or June. The process will then become much clearer. Is there anything further that you want to add on that?

Mr Brennan: In recent days, Ofcom and the Department for Digital, Culture, Media and Sport (DCMS) have provided us with additional information from the bidding companies on likely coverage. Up until this week, we thought that some 97,000 additional properties would be brought in under the embrace of Project Stratum. However, the number of properties exposed to coverage of less than 30 megabits per second is now down to 79,000. That means that the money that was made available — the £150 million plus £15 million from DAERA plus the private-sector contribution — will go further. Officials tell us that they expected virtually all properties to get coverage. Obviously, there will be one or two on the extremes that would cost exorbitant amounts of money, but the coverage will be significantly greater than we thought it would be even a week ago.

The Chairperson (Dr Archibald): All of us, especially those who represent more rural constituencies, know the deep frustration there is because a lot of people do not have access to broadband. I urge, as much as possible, that that be taken on board in what is delivered.

Minister, I was listening during Question Time the other day when you commented on traineeships, and I know that the Committee has had correspondence about that, as you and many Members probably have also had. We all know about the good work that some training providers do. The concern is about the potential to lose those qualifications. What is your position on that, or have you come to a view?

Mrs Dodds: That is an issue of concern. I want to make sure that young people have valid and good career progression. That is not just evident in what we would look at in normal or higher-level apprenticeships, which I think are fascinating and something that we want to build on, but the skills academies etc, as well. The specific issue that you mention has been drawn to my attention.

I come from a background of working with kids and communities in inner-city Belfast for a very long period. I know the work that training providers do for those children and how they help them progress to a better pathway and future. If we are to have a stable Northern Ireland, we have to reach out to all children and young people in all communities, no matter where those communities are.

I am keen to see that we are not driving everything in one direction, but that the training and schemes that we provide will have flexibility so that, if a young person is progressing well with a training provider, they can progress further, until they are ready to go to the next level. I am really keen to see that. I have had a couple of fairly long meetings with officials around that. I have asked for a review of those particular issues and have asked the officials to come back to me and see how we can introduce flexibility into the scheme so that we are not disadvantaging the young people that we want to do well. That is really important.

The Chairperson (Dr Archibald): That will be welcome. We all recognise that there are some young people in particular who are harder to reach —

Mrs Dodds: Yes. Absolutely.

The Chairperson (Dr Archibald): — and that one size does not fit all in the training provided.

Mrs Dodds: I have had an invitation to Impact Training (NI) Limited on the Shankill — obviously, I have visited it on many occasions — and one to go to Workforce Training Services on the Springfield Road. I hope to do that within the next number of weeks. It is very important that we seek the views but that we also have really valid pathways for young people.

The Chairperson (Dr Archibald): Finally from me, the economic strategy, obviously, is listed in the 'New Decade, New Approach' document. A number of other items are listed in that document, such as the green new deal and commitments on cybersecurity and all the skills. I want to get some understanding of the process that is now going to be undertaken to review the previous industrial strategy, bring forward new proposals and build in all those various other strands.

Mrs Dodds: This is one area of work that is really exciting and something that we can take forward. We want to bring forward a new economic strategy. We have a draft industrial strategy that has been sitting on the shelf for some time. We want to bring forward a new economic strategy, and we want to work with the Committee to develop it. We want to make sure that it tackles a number of things.

In Northern Ireland, at the moment, there are almost record employment rates, but we have issues around economic inactivity and productivity. We want to develop our economy to take all those things into account, as well as some of the new technologies and how our economy can progress in what is going to be an ever-evolving and fast-evolving situation. So, yes, there will be a new economic strategy to take into account all those issues.

Recently, we launched an academy with Microsoft to train young people. We want to do more of that kind of thing, so that we are not just looking at building productivity but are looking for better, more-financially rewarding jobs with career progression. We want to put better and more jobs into that mix.

This afternoon, I am meeting a delegation from Qatar to discuss opportunities to develop our economic activity with that particular region. I hope to be going out to America reasonably soon to do some of that as well. So, yes, this is all work that will be undertaken in the next number of weeks and months. We look forward to a really busy time ahead to get that done.

Mr Brennan: Just to add to what the Minister said, it is important that we think of the economic strategy not as a stand-alone document that sits in the corner. It is really an umbrella document that brings together a lot of strands of work that reside not just in this Department but elsewhere. For example, it is a tourism strategy; a skills strategy; an export strategy; an energy strategy; a food strategy, working with colleagues in DAERA; and an infrastructure strategy, working with colleagues in Infrastructure. So, an economic strategy as a concept is something that really brings together all those other key elements that need to be progressed by the Executive.

Mrs Dodds: I think that when you hear that kind of thing, you realise the breadth of this Department and the work that we will do together in this Department. The breadth of it is quite phenomenal. It scales a lot of issues.

The Chairperson (Dr Archibald): It is very welcome to hear where we are going to collaborate on the development of that new strategy, and I am sure that we are all keen to do that. In particular, in the draft business plan that the Department currently has, there is no mention of climate, for example. There are a couple of mentions of sustainability, and, the other evening, we agreed the climate emergency motion and agreed to take forward those commitments. There is great potential from the green new deal for skills development and infrastructure development and for exploiting our natural resources for renewable energy. Those are all things that we will be very keen to see built into a new economic strategy.

Mr Brennan: An energy strategy that did not embrace, for example, net zero carbon or renewable energy just would not be a robust energy strategy.

Mr Stalford: Minister, thank you, and welcome home and welcome to your post. One of the issues that you mentioned in the House this week relates to leave for those who have been affected by the loss of a child. Can you speak to that for a few minutes to explain how that will work in practice and how that will be brought in?

Mrs Dodds: A couple of weeks ago, we in the Department heard that our Government were going to do this. To be honest, in this day and age, I did not believe that we did not have provision for parents who had suffered a child bereavement. It seems that, in a progressive, modern democracy, it is the sensible and compassionate thing to do. The Government in London have announced that parental bereavement leave will come into force in April. It will allow for bereaved parents who are employees to be entitled to at least two weeks' leave, which is not a lot, following the loss of a child or following a stillbirth after 24 weeks of pregnancy. Employees with 26 weeks' continuous service will be entitled to receive statutory pay, and it is about £151 a week. Currently, we do have some provisions, and some employers in Northern Ireland, quite rightly, offer compassionate conditions for employees in this area, but I think that it would be best if we could legislate for this as a statutory minimum. I have asked officials to look at this and to bring forward to me the best path that we can get to make this the law as soon as possible in Northern Ireland. I cannot see that anyone would demur from that.

Mr Stalford: Do you have a time frame in mind?

Mrs Dodds: We have just asked the officials about that, and unless Mike has a very urgent update on the issue.

Mr Brennan: No, I do not.

Mrs Dodds: It is my intention to do it, and it is my intention to do it as soon as possible. Our consultation might lead us to some slightly different conclusions, but I hope that we can at least match what England and Wales are doing on this issue. I think that it is just the right thing to do.

Mr Stalford: In relation to the UU, how can we be reassured that, at the end of this process, the expansion will be delivered in Belfast? How will we examine how we got to this point?

Mrs Dodds: That is well worthy of our consideration. The expansion project is very well under way. Anybody who drives through that junction will see it rising up in an area of very high deprivation. It will bring significant economic benefit to an area that has suffered very significantly during the past number of years and in which there was much dereliction. It will bring economic opportunity. I continuously talk to the university about not just economic opportunity but educational opportunity for the communities that live around the university. I do not believe that universities as institutions live unto themselves but that they have a responsibility for the communities that they are placed in. I am hopeful and I will work with the university to ensure that we can deliver what I think will be a fantastic facility for young people in Northern Ireland.

We will institute a review of how we got to this particular point to ensure that, going forward, we cannot repeat that scenario and that the university has both the capacity and the capability to make sure that it is sustainable into the future. There are lessons to be learnt and things to be done, but, underneath it all, we need to ensure that we have that delivery. I look forward to talking to the Finance Minister. I am sure that this is not an issue of huge difference between us. It is just a matter of getting it delivered and sorted out in the best way possible, with the assurance to taxpayers and the assurance that we will have full and proper delivery.

Mr Chambers: Minister, I take this opportunity, as it is the first that I have had, to congratulate you on your appointment and wish you well going forward. I have three or four issues. I will just go through them all, and you can answer at the end. The Finance Minister recently made comments that appear to have knocked back the concept of a reduction in corporation tax, and I know that it was designed to make inward investment more attractive. Is it off the agenda or are the Executive still considering it? Is it a weapon that you will need to take to America when you are seeking inward investment?

The other thing relates to strategies. We have heard all the strategies this morning, but the one that I am still not hearing about is a manufacturing strategy. That idea was brought forward in the last mandate to the Assembly by the Opposition, but it was voted down, and the Minister did not feel the need for a manufacturing strategy. Given the huge challenges that that sector has faced over the last couple of years and the huge number of job losses, will the Minister consider developing a manufacturing strategy?

We have heard you tell us this morning how important the hospitality sector is to the Northern Ireland economy, and it really is. It has been a huge success story for Northern Ireland over the last 10 years, but one of the things that the hospitality sector has been lobbying this Committee for is a reduction in the VAT rate to give it a level playing field with the hospitality sector in the Republic of Ireland. Will your Department look at that and support any call for a VAT reduction?

The other challenge that the sector has faced over the last year or so, since Brexit started being talked about, is that it has been losing a lot of very skilled workers — welcome workers — who came from the EU to help us develop our hospitality sector and enhance the skills that are delivered. There is a danger that, because of the uncertainty, those people will vote with their feet and go home, and we will lose them. I am very pleased to hear about the upskilling that you are doing with the hospitality sector; that is very welcome, but it would be a disaster if we lost the skills that those EU workers have brought to Northern Ireland.

My last point, Minister, is on the North/South interconnector. Reading the document that we have, I can see that the Department for Infrastructure is saying that, within three months, it "may" approve a revised planning application for the North/South interconnector. The word "may" is important. We know that the interconnector is vital to guaranteeing our energy going forward. Do we have a plan B to continue to guarantee the supply of energy from 2023 should the Department not feel able to approve the planning application for the interconnector?

Mrs Dodds: Thank you. That was a very comprehensive list of questions.

Mr Chambers: I was up all night, Minister. [Laughter.]

Mrs Dodds: Where you? [Laughter.]

I will rattle through what I have, and Mike will pick up whatever I miss.

I do not want us to get into a situation in which we have perceived differences on corporation tax. The lowering of corporation tax remains a tool in the toolbox that we can use to attract investment, so it is very important. You can see how different levels of corporation tax have worked to attract inward investment, here, on this island.

Since the idea was first mooted, the level of UK corporation tax has come down very considerably, so there is less of a difference between us and, for example, Dublin, which, by the way, is working very hard to hang on to its very low rate of corporation tax at a European level. If something called the common consolidated tax base comes in at a European level, it might make a very big difference to how corporation tax is treated in the Republic of Ireland. Many European countries look at its rate with much envy and disquiet, but that is just an aside.

Lowering the rate of corporation tax remains on the books, part of our toolkit and something that we aspire to. However, as I have said in many interviews over the last number of days, the short- to medium-term issue that the economy faces is in making sure that, in any post-Brexit scenario, we are well set up to ensure that we have completely open access to GB, North/South and other markets in Europe and the rest of the world and that we can access the trade deals that will help us in the future.

On your point about the manufacturing strategy, we will seek to produce an all-encompassing strategy in which manufacturing will play a very significant part. Manufacturing is core and vital to Northern Ireland, and we want to make sure that it grows, succeeds and has the skills and the base from which it can move forward. It will be core to what we do.

You are quite right that many people who work in the hospitality sector have come here, settled and live amongst us. They have contributed very significantly to our communities and enriched our lives in Northern Ireland. We want to retain those people, but there will always be a need for flexibility in the workplace. We have been working with the Government in London on the very important new immigration proposals. They began with a salary threshold that we thought was unrealistic for people in Northern Ireland, and that has now been reduced to £25,600. That is still quite a high salary threshold for Northern Ireland, and we will go back and make the point that Northern Ireland must have flexibility is its workplace. We will see how the immigration Bill develops at a national level, but we will continue to work on that issue because it is one of the core issues.

The hospitality and tourism sector has been growing exponentially in Northern Ireland. There was an event this morning — I did not go to it because I am here meeting you — which celebrated the success of Titanic Belfast and everything that has been achieved there.

As a personal aside, my first job when I was elected to Belfast City Council was chair of the tourism committee. That was in 2005 — not that long ago. The first document that we produced was a plan to build a Titanic exhibition centre. Look at how far we have progressed in that time. The centre offers product and reflects our history, our maritime history, our manufacturing history and all that is good about Northern Ireland in that area. I had visitors from Europe who had not been in Belfast before. They were hugely impressed by that area. Look at how far we have come with development in Londonderry. I was up in the city, not long ago, on a personal visit. We parked in the barracks and walked over the bridge. Things are progressing. Our tourism sector is key. We want to grow that; we want to double what we get from tourism and make it as viable and vibrant as we can.

Mr Chambers: Will you consider supporting the hospitality sector through the VAT rate, Minister?

Mrs Dodds: VAT is a reserved issue.

Mr Brennan: The application of VAT might also become more complex in an EU-exit world. We have to see where that lands, but, at the minute, it is reserved to national authorities to determine.

I will pick up on a couple of additional points. Mr Chambers asked about a manufacturing strategy. My concern is that people still try to look at manufacturing as existing in a silo in its own right. I do not think that applies any more. One thing the Department has learned from the work that it has done on Brexit matters over the past few years relates to the interconnectedness between manufacturing and the wider economy and tradable services. The Minister made reference to the cyber and artificial intelligence industries and the work going on in Magee, in the cognitive analytics research centre. It is impossible to classify that as manufacturing or services, because the entire manufacturing process relies so significantly on services that I do not think you can create a bespoke manufacturing strategy and say, "Let that exist in splendid isolation". It does not work like that any more. We need to be careful of that as we construct the overarching economic strategy that I referred to earlier.

In relation to the Migration Advisory Committee recommendations and the lowering of the salary threshold to just under £26,000, when you have 65,000 people employed locally in the tourism sector — a sector that relies so significantly on migrant labour — and set such a threshold, which is above the average private-sector salary in Northern Ireland, it will pose fundamental problems for that sector.

Mr Chambers: Absolutely.

Mr Brennan: I have a couple of points to make on the interconnector. Obviously, it is for the Department for Infrastructure to try to progress the interconnector and take decisions. I understand that there are some legal issues around that which may constrain decision-making for now, but the key point is that the greater the interconnection there is in energy markets, the more the consumer benefits. For example, the benefit to consumers in Northern Ireland of the construct of the single electricity market is €50 million per annum. The more that we can exploit interconnectors and use them in energy, the better and the quicker.

Ms McLaughlin: Thank you for the briefing this morning, Minister. I want to say a personal hello to the permanent secretary because I am sure we will be breaking down his door for the next few years.

Mr Brennan: I look forward to that. [Laughter.]

Ms McLaughlin: I welcome your ambition, Minister, in looking at a collaborative approach to working across sectors and Departments, because it is fundamental; we cannot work in silos. Working in silos does not work. Therefore that joined-up approach for government is fundamental.

I want to talk about two things: Brexit is probably first, but I have to turn to the university. In order for us to deliver a vibrant economy, we need to do things differently this time. We have been given a second chance, and we must take that chance. There has been a failure on the part of previous Ministers with good intentions and good people who did not make the hard decisions and move the place forward. We need to take control now, and good people need to do the right things.

The Department has key strategic objectives: accelerate and innovate research; enhance education skills and employability; deliver inclusive, sustainable growth that is regionally balanced; succeed in global markets; build the best economic structure; deliver a regulatory environment that optimises economic opportunities; and ensure Departments have effective governance. Overriding all that is that you have to be able to participate in the economy. It is a skills-driven economy, and skills are the engine of that economy. In the north-west, we do not have any oil for the engine, and we have not had it for many years.

At this Committee last week, we were told of the concerns and challenges around the Ulster University Belfast campus. I appreciate how difficult those are, but to say that there is going to be a knock-on effect that will slow up the delivery of the Magee campus and its expansion to 10,000 students is just not acceptable. We will not be doing the right thing in this mandate if we do not take up that challenge. We have to deliver expansion of the university.

I know, Minister, you said that there is a lot of work to be done, but there has been a business case. This is a political decision. I know that business cases need to be updated regularly and they are not set in stone. I completely accept that, and it has been four years since that business case was delivered, but it was the Government who failed the business case, because there was no one here to address those issues.

I do not want the unintended consequences of Ulster University's capability and capacity to have a knock-on effect or the unintended consequence that the expansion of Magee does not take place within a time frame that is going to help us to become involved in and contribute to the overall economy. We cannot accelerate research or enhance education skills if we do not have the skills, and the skills belong to our higher-educated people in our economy.

We have a small higher education provision. We must deal with it and the challenges around it. That is not a question, just a statement of fact. [Laughter.]

Mr Stalford: I wondered when the question was coming. [Laughter.]

Ms McLaughlin: It is a statement of fact and one that I am passionate about. I really want the whole of Northern Ireland to have access to the economy, so that it is an economy for all. I welcome the opportunity of the intention, and your good intention, and perhaps good people will do good things.

The other point is Brexit. Brexit is a process, not an event, so the event did not happen last Friday night. There is a lot to do and a lot of conflicting commentary, even within the UK. I am concerned for our businesses. I do not want any kind of barriers between Northern Ireland and Great Britain. It is a vital market for all our businesses, and we must do everything we can to protect our businesses.

You had your first Executive subcommittee meeting yesterday on Brexit. I would like to hear a bit about that, but I would like your comments on the provision of higher education and how we can ensure that the whole of Northern Ireland is able to become engaged in your ambition for the economy.

Mrs Dodds: Sinead, I absolutely share your passion and ambition for a skilled workforce throughout Northern Ireland. That is hugely important, and I want those skills to be open and available to the whole workforce in Northern Ireland. I want to see all communities benefit from the opportunity to avail themselves of better skills provision and training.

One of the most important things that we can do to have a stable Northern Ireland is to provide young people — and, indeed, those at other stages of their lives — with the opportunity for education, advancement etc. So, I absolutely share your passion in relation to that.

I have spoken to you privately about the Magee expansion, and, no doubt, we will take up the issue in private again. There is a significant amount of work to be done; I cannot avoid that statement. The fact remains that we have not had devolution for some time, and, therefore, we need to work very hard to catch up and make sure that the work is done. For the expansion to go forward and succeed, we need to lay firm building blocks. I will commit to working with you on the issues that have to be faced, not least the finance, the updating of the business case and the different issues that we have to get ahead on. That means that we have to work harder just to get it done. That is where we are.

I was hugely impressed by some of the work that is going on at Magee. It is absolutely fantastic, and, in a couple of weeks, I will be visiting Coleraine, because I want to see the level of work and so on that is going on there. Of course, I also have an outstanding invitation to visit Queen's University, so there is plenty of work to be done and plenty for us to understand and to take forward.

You described Brexit as a process rather than an event, and, in a way, that is absolutely true. I am not denying that, but I think that, after last Friday, the dynamic changed ever so slightly. It was not a country leaving the European Union; we are now in a situation where the country has left. No matter what you think about Brexit, we need to get to a stage in Northern Ireland where we are working together to ensure that we get the best outcomes from it, whether that is protecting our access to the GB economy, holding the Government to their promise of unfettered access to that economy, looking at the difficulties for business as we go forward or how we minimise barriers to trade within the British Isles as a whole. Those are all hugely important issues, and, no doubt, we will have many conversations about them.

I also want to make sure that the Government are held to account for their statements in the document around funding to ensure that businesses are not unduly penalised because of additional bureaucracy or difficulties that they may face as a consequence of trading in the GB market. We cannot get away from the fact that it is our most important market. About 70% of everything that we make, grow or produce is sold within the United Kingdom — England, Scotland, Wales and Northern Ireland — and about two thirds of everything that we bring in, either for manufacturing or for the high street, comes from GB. That is our most significant market, so we want to hold the Government to account on that issue.

We also want to hold the Government to account on the issue of access to UK trade deals. It is something that we should not ignore or get away from. It is hugely important for us to be able to compete for business and for our firms to be enabled to take advantage of any of the opportunities that come our way. As I said in the House earlier this week, I took part in the first UK trade forum with the Minister, Conor Burns, and the Ministers from Wales and Scotland. There is a genuine concern across all the devolved regions that these are issues on which they are able to engage properly with the Government and that they are able to defend the interests of their part of the United Kingdom. Again, that is a huge issue.

We are now in a slightly different scenario with Brexit, but it is still important. I spent some time on Friday morning, before I left the European Parliament, talking to UK officials in Brussels who will be responsible for the trade negotiation, some of whom, obviously, I have got to know over the years that I have been there, and they see that as being absolutely hugely busy, with about 10 different parts of that negotiation all running in parallel. It will be a huge challenge for us, as a devolved region, to keep up with that, but they also said that, whereas the withdrawal negotiations took place in Brussels, those negotiations will take place in London and in Brussels. We want to ensure that we also have that seat at the table when things that are pertaining to us are being discussed and, particularly, the protocol on that issue.

The Brexit subcommittee met on Tuesday. You talk about collaboration, and that is an attempt to draw together all the different strands. Obviously, Mike and I obsess about issues around the economy, but the Department of Justice has considerable issues that it will want to address and which impact on everyday life. The Department for Infrastructure, for example, around ports, airports and so on, has considerable issues. So, it is an attempt to draw that process together. We are not pretending that that is an easy process, but we have embarked by setting up a structure to try to do that, and I am hopeful that we will be able to take forward the issues of Brexit in a more cohesive way because of that.

Ms McLaughlin: May I just ask one very quick supplementary question?

The Chairperson (Dr Archibald): You can ask a very quick question. We have another four members still waiting to ask the Minister questions.

Ms McLaughlin: Do you have the required expertise in the Department to support you in this very short transition period?

Mrs Dodds: The transition period is extremely short, and the dangers are absolutely apparent in a short transition period, but we are where we are, and I do not think that there will be additional time within the transition period, so we will have to try to make that work. I will leave it to Mike to talk about the expertise that he has or does not have.

Mr Brennan: Obviously, over the last couple of years, we have built up our expertise. We have also established good links with external experts and worked very closely with them on a number of our publications in recent years. Indeed, you will hear from some of the guys shortly.

There are areas that worry me, not just from a DFE perspective but from an NICS perspective, over the coming months. Obviously, in the EU exit world, a lot of legislation will be required, and I worry about the resources that we have to draft legislation, for example, in the energy sector. It will require a great deal of coordination between our Department and DAERA, in particular, but also some of the other Departments, as the Minister said, in bringing legislation to this Committee and the other Committees and through the Assembly in a very, very tight time frame. The legislative drafting side of things is probably my greatest worry about resourcing.

Mr Middleton: Thanks, Minister and permanent secretary, for your very useful first briefing. No surprise, there is one loose end that I want to tie up in respect of Ulster University. It has been well covered, but I suppose that it is a topical question because, last night, our council in the north-west — Derry and Strabane council — voted unanimously to write to the Executive to urge them not to approve a loan for the York Street situation. I know that it is not particularly helpful. Will you give us an update on whether such a loan would have any impact whatsoever on the potential of Magee university?

Mr Brennan: The additional loan of £126 million is what is called financial transactions capital, and that is specifically to finish out the greater Belfast development. That funding is now needed in the absence of previous assumptions that EIB funding would be in place. It is not as if you could take the money from the greater Belfast development and say, "Right, we will use it elsewhere"; it is specifically for that. It poses the question: if you do not give the FTC to finish out the greater Belfast development, what happens to that development? Then, it poses some quite fundamental challenges for the university, and, as the Minister said in her opening comments, one of the things that we would like to do in a closed session is to talk you through some of the implications of that. They would be quite profound for the university.

Mr Middleton: That is a very useful contribution. It is not a case of them and us. We need to get away from that mindset. When Belfast does well, Londonderry does well. I think that it is the aim of everybody in the Committee for all of Northern Ireland to do well, and that should be the aim of everybody in the Assembly.

Mr Brennan: That ties in to some of the earlier conversation around the status of New Decade, New Approach, such as the ring-fencing of the £60 million for the graduate-entry medical school. There is also the wider Magee expansion. I mentioned that the 2016 business case stated that the construction costs were £300 million. I do not know what the figure is now, but let us think about the fact that the Department's capital baseline is somewhere in the order of £50 million. If the Executive have a willingness to do something and there is additional funding ring-fenced, that is fine. Look at it separately from FTC to finish out the greater Belfast development, which is a specific loan.

Mr Middleton: That is welcome clarification. We need to ensure that we do not have a replication of what happened in other areas. That is vital, notwithstanding the fact that, like colleagues around the table, I am 100% committed to ensuring that we have a first-class university campus in the north-west.

We have not touched on city deals, but that is an important issue. Could we have a brief update on the current position of city deals? I will have one very small supplementary, once I get that update on the current position.

Mrs Dodds: City deals are an exciting new development. They are an opportunity to focus economic development on the areas that are important. I will give a fairly factual overview of where we are. The Department's responsibility for city deals is in the areas of innovation, digital, skills and tourism. Not everything in a city deal comes to the Department, but those are the areas for which we will have responsibility.

It looks like there will be £850 million for the Belfast region city deal, with £350 million from the UK Treasury. That is very significant. We have not received any outline business cases yet, but we expect to receive one for the Belfast region city deal from mid-February/end of February onwards. No doubt, we will come back to a conversation around that.

City deals are a really important opportunity to leverage in other money for very important projects in the regions. The Derry City and Strabane city deal is a £200 million ambition, with £55 million from the UK and an additional £50 million from the inclusive future fund. We need to look at how that is augmented from local funds here and the council in the region. Some progress has been made on that.

For the mid, south and west region, which involves Omagh, Fermanagh, Mid Ulster and ABC councils, there is no figure yet in relation to the overall target, but there is £135 million for that huge area from the UK Treasury. There is no overall figure yet for Causeway Coast, but £35 million has been promised from the UK Government.

It really is a great opportunity to develop the economy in innovative ways, with significant money from Treasury being augmented at a local base. I think that Mike might want to say something about the staffing in the Department and the ability to work through all those issues.

Mr Brennan: Thanks, Minister. I have a couple of points to flag up to the Committee. DFE, as a Department, will lead on four areas of the various city deal initiatives: innovation, digital, skills and tourism. We will have quite a heavy role to play in the delivery of the four city deal growth-fund packages. At the minute, our estimate is that somewhere in the order of £800 million of city deal funding will flow through the Department. That poses two questions. First, how is the Department going to deliver, monitor and approve that degree of expenditure and the business cases? If the RHI issue has taught us anything, it is that you need to staff up to genuinely deliver and give assurance that money is being spent right. That is the first concern. At the minute, we do not have any money for city deals in our budget; we do not have any staff, really; we have no teams set up. Where do we get the resources to deliver that against the expectations in the various councils?

The second issue that concerns me is that we need complete transparency on the accountability of spending on this. There are various models out there for city deal proposals. For example, the idea that the money flows through the Department and just goes out to the councils and they can spend it, without the Department having an oversight or approval role, is a bit of a concern. We need to work with colleagues in the Department of Finance to make sure that we have a very transparent system of approvals and accountability to the Assembly on where the money goes.

Mr Middleton: Thank you. I have a small supplementary question, but I appreciate that this is a huge area and we may need a specific briefing. We have that planned already. So, there we go: be prepared.

You touched on the point about expectations, Mike. It is maybe an unintended consequence, but there are huge expectations, particularly in my council area, that the city deal will deliver a lot. The Minister touched on the Ebrington Barracks site project. Another example is the maritime museum, which is an £11·5 project. The Heritage Lottery Fund and the local council have already committed £5 million to that. Tourism NI is now saying that its funding should come from the city deal element. Our concern is that projects, such as the maritime museum, which were in play before the city deal proposal came forward, could be in jeopardy, because we could lose the other £5 million whilst waiting for the city deal to come through. I appreciate that you may want to come back on that.

Mrs Dodds: No, I think that that is valid. Mike has some detail on it, but we will come back to you, individually.

Mr Brennan: We are aware of that issue, and we can come back to you in greater detail about how we think it should be addressed. Duplication is a similar issue, where you have projects in one city deal initiative that are replicated elsewhere. We could end up with centres of excellence and a whole raft of things, all over the place, which do the same thing and just displace each other.

Mr O'Dowd: Thank you, Minister, for your presentation. I also thank your permanent secretary. I want to return to Project Stratum and the proposed investment from the private sector. What percentage or share are the tender documents asking from the private sector?

Mr Brennan: To be honest, we do not know. A tender process is under way, and the open market review is under way. We know what the public-sector contribution is. There are a number of bidders. It is a competitive process. Only when the bidding process has ended and we see who the successful bidder is and open their bidding package, we will see what their proposed contribution is.

Mr O'Dowd: Surely, in the published tender documents, which were put out for expressions of interest, a parameter was set that said, "We would like the private sector to come forward with —"?

Mr Brennan: Yes, there were a number of considerations. Obviously, there was the point that was discussed earlier about maximising the coverage and, also, the speed parameters being over 30 megabits per second. We expect the submissions to cover a range of issues.

Mr O'Dowd: So, if I get this right, you are saying to the private sector, "Come back to us with your best offer", in the sense that, "We are putting £165 million of public money on the table. How much are you prepared to put up?".

Mr Brennan: Yes. You would like to think that the bidder who puts up the most contribution to the package will be the successful bidder.

Mr O'Dowd: It is always good to get investment into broadband, as it is an area that public representatives are continually lobbied on. However, my concern is that the private sector sits back, public representatives are lobbied, public money is put into the system, the private sector profits from public money being put into broadband, and the taxpayer, who has already paid for the investment, pays for it again in their monthly bills. How do we ensure that the taxpayer — the person who pays their monthly broadband bill — gets value for money for an investment they have already given?

Mr Brennan: I have to tread carefully —

Mr O'Dowd: Yes, I understand.

Mr Brennan: — because the procurement exercise is under way. Maximising value for money in the procurement process is a central theme — I was going to say a key theme. It might be better if we take this aside, as one of the private sessions, and we can walk you through the specifications of the procurement, just to give you some assurance that there is comfort there.

Mr O'Dowd: OK.

Mr Brennan: The open market review is under way, which is why I am reluctant to say too much about it.

Mr O'Dowd: OK. I appreciate that.

I have one more question. Well, two questions. [Laughter.]

The Minister will appreciate the second one. Why did the European Investment Bank withdraw support from the greater Belfast development by Ulster University?

Mrs Dodds: I need Mike for that one. It is before my time.

Mr Brennan: It was because of the availability of financial transactions capital at a lower rate of interest.

Mr O'Dowd: OK. Which has now become available?

Mr Brennan: Yes. They have had —.

Mr O'Dowd: Sorry, so the investment bank was of the view that the financial transactions capital was the best way forward for it?

Mr Brennan: No. My understanding is that the university, when it realised that it could access the Executive's tranche of financial transactions capital and it was at a lower interest rate, thought that it was the more commercial option to follow.

Mr O'Dowd: OK. So, it was the university, rather than the bank, that withdrew?

Mr Brennan: That is my understanding, but —.

Mr O'Dowd: Finally, Minister, you recently answered a question for me, and I welcome the answer you gave.

Mrs Dodds: I have answered a lot of questions. [Laughter.]

Mr O'Dowd: I know, but I want to highlight it. There is a proposal in New Decade, New Approach in relation to a feasibility study on a high-speed rail link between Belfast, Dublin and Cork. I raised the issue with you with regard to ensuring that that investment also benefits towns and communities along the route: for instance — you will know these towns quite well —

Mrs Dodds: I do.

Mr O'Dowd: — Lurgan, Portadown and central Craigavon. It will be a huge mistake if there is significant investment in that high-speed rail link and it does not economically benefit those towns along the route. I am just looking for further reassurance that that will be one of the issues that your Department looks at when considering the feasibility of the project.

Mrs Dodds: It will. The high-speed rail link between Belfast and Dublin was not just part of the recent document; it was part of the DUP manifesto as well.

Mr O'Dowd: Ah, there we go. [Laughter.]

Mr Stalford: You haven't read it? [Laughter.]

Mr O'Dowd: Not the latest edition, no.

Mrs Dodds: For a growing economy, connectivity is absolutely key. In order to grow the economy, you have to connect the places where people live, work and do their jobs. Broadband, a growing economy and high-speed rail links are absolutely key. Yes, I absolutely give that commitment. You know that I live in the area; it is where I am from. I would like to see areas that that passes through benefit from such connectivity; but, again, we are at the very early stages. We have an enormous amount of work to do, but it is an exciting concept.

Mr O'Dowd: OK. Thank you.

Ms Sugden: Welcome, Minister, and congratulations on your post.

Mrs Dodds: Thank you.

Ms Sugden: If I may, I want to pursue the Magee issue a bit more. Is the £60 million that is ring-fenced for capital funding of the Magee medical school?

Mr Brennan: I think that the bulk of it is capital. Off the top of my head, I think, the breakdown is £45 million and £15 million, but I am not sure. We can write back with the detail.

Ms Sugden: So, is the business case that the Department of Health is considering in relation to the resource funding that will be required to maintain the medical school, year after year?

Mr Brennan: I think so, yes.

Ms Sugden: Where will that funding come from? Will it come from the Department of Health or the Department of Finance's budget?

Mr Brennan: That is to be agreed.

Ms Sugden: Sorry, I meant the Department for the Economy's budget. I beg your pardon.

Mr Brennan: The capital —?

Ms Sugden: No, the resource, if we were to have an expansion of the medical school.

Mr Brennan: Presumably, it would be through this Department, but I have not seen enough detail on it.

Ms Sugden: Do you anticipate that that would have an impact on other campuses in Northern Ireland? Obviously, budgets are finite.

Mr Brennan: As I said, it goes to the point that was made earlier that, if the money is genuinely additional and ring-fenced, it should not have. You then get into issues about displacement and how it interacts with, for example, the provision of medical services at Queen's. Again, we need guidance from the Department of Health on that and from the wider Executive.

Ms Sugden: What guidance are you expecting from the Department of Health? Is that around the need for extra nurses?

Mr Brennan: Yes, not just in the context of where the Department of Health is with the considerations of its business case but of what the wider ramifications will be across Northern Ireland.

Ms Sugden: I suppose that you will be looking at that in the context of the medical provision that we already provide in other universities.

Mr Brennan: With the Department of Health.

Mrs Dodds: One of the things that we will have to do is to look at the provision in a holistic way across Northern Ireland. I think that that is very important, not forgetting that this is identified as an Executive priority. We will have to look holistically at how we go forward.

Ms Sugden: I think that it is important to say that I certainly do support that provision in the north-west. We need to be mindful of having everything in Belfast, if you like. I am also concerned about the impact it will have on other universities, and I am keen to ensure that it is looked at in a holistic way, as you described. I do welcome that.

The New Decade, New Approach deal contains a commitment from the two Governments that they anticipate closing down the RHI scheme. Do you support that, Minister? I am mindful of the hardship that it may bring to some farmers who, as you said at the outset of your contribution, applied to the scheme in good faith. From listening to the media, I think that we sometimes forget that the scheme was always intended to raise revenue for farmers to help to supplement their agricultural businesses. Given that agriculture is probably one of the biggest industries in Northern Ireland, I am concerned about the impact that a sudden closure of RHI would have. I appreciate that it may not be appropriate to have new claimants, but do you support closing the scheme for those who, as you said, signed up in good faith?

Mrs Dodds: You touch on something very close to my heart. As a member of the European Parliament Committee on Agriculture and Rural Development, I spent a lot of time over the past number of years supporting and talking to local farmers. The food business in Northern Ireland is one of our great success stories and something that we as a Department will seek to support in the future, and I hope that the Committee will also. It is core to our economy, not just to farm families but on the processing side. I am excited to get involved in that issue.

New Decade, New Approach said that we should look at closing RHI. I intend to bring forward all the options to the Executive so that the Executive have them. I do not want us to look at this in five years' time and say that we should have done this, that or the other. We are going to take a little a bit of time and bring forward all the options in relation to the scheme and look at them.

The scheme is complex, to say the least, and there are issues that are ongoing in relation to the current scheme. However, the current scheme is closed, so there are no new applicants to it. There are issues that we must be mindful of as we take any of the options forward. There is the hardship review and the tariff review after the Northern Ireland Affairs Committee report. Those issues are due with us fairly soon for us to report on. There is the issue of the voluntary buy-out scheme, which closed in the autumn of last year. How do we manage to make the thing fair, both to the farmers and to taxpayers? People who acted in good faith should not be punished, but taxpayers must be sure that their money is well spent and transparently spent. I intend to play an absolutely straight bat on this. We will look at all the options and decide the best way forward.

Ms Sugden: I think that there was a suggestion in the House of Lords that the RHI scheme could be taken back to Westminster. Could that be an option for the Executive?

Mrs Dodds: .It is not something that I am considering at all, but we will certainly look at all the options. Bear in mind that, while we are doing quite well in generating electricity from renewables, we are not doing very well in decarbonising our heat. We will need to deal with what we have in front of us and with how we proceed in future. Above all, I want to make sure that that is done transparently, is value for money, and that the aim of any new scheme is in making sure that we reduce our carbon footprint.

Ms Sugden: I have one last question, Chair. I am very pleased to hear your comments about leave for the loss of a child; I think that is incredible and look forward to seeing how it plays out. When you take that work forward, would you also look at birth trauma? In some circumstances, women are trying to deal with the difficulties of birth trauma and are losing part of their maternity leave to bond with their child. That is maybe something you will want to consider as part of that work.

Mrs Dodds: I will certainly consider it, but I do not want to delay anything.

Ms Sugden: Yes, I know. I understand.

Mrs Dodds: I accept that it is an issue, but if we have to do research or work on that issue, I would not want to delay the other work. I will not give any commitment to link the two. I would like to see the bereavement issue dealt with. As I said before, I could not believe that, in a progressive modern democracy, we did not have anything in law to protect people in that way. I want to make sure that that comes in as quickly as we can do it, but I will certainly look at the other issues. You can write to me about those issues. It is important that employment law is fair to employers and employees but also has compassion and flexibility.

Ms Sugden: Separately, but, perhaps, in a similar vein, I would also add the issue of childcare. It is one of the biggest difficulties —

Mrs Dodds: Absolutely.

Ms Sugden: — particularly for working mothers, but for fathers as well. If you have time in this short mandate, I would like you to look at childcare options so that we can have more options for women, in particular, to be able to go out to work.

Mrs Dodds: We want to get as many people into the workforce as we can. Therefore, having options for childcare is hugely important. It is something that we will consider, along with the many other priorities. It is a priority. It is a real issue for working families, who find that childcare prices them out of work. It is on my radar, and we will consider it. Thank you for raising it. It impacts on families across Northern Ireland and is very important.

The Chairperson (Dr Archibald): I want to pick up on the comments about RHI. I think that we all understand the complexities, but the 'New Decade, New Approach' document refers to bringing forward a new scheme that will effectively cut carbon and there are question marks about the effectiveness of RHI, as it stands, in cutting carbon and the carbon neutrality of wood pellets. We need to consider that very carefully in the new energy strategy.

Mr Dunne: Thanks, Chair, and welcome, Minister, to your new post. It has been a long session; we will not keep you much longer. Mike, we also welcome you and look forward to working with you.

We have covered universities quite a bit. We all want to see the Ulster University succeed in Belfast, as there was huge investment there. However, there is great concern about how the procurement processes were managed in the university. It is now looking for a £126 million loan to address the issues. Is that correct?

Mr Brennan: Yes.

Mr Dunne: Following our discussion last week, it was highlighted that the university does not follow the DFI procurement processes that many other government agencies do and are encouraged to do. I understand that there are various reasons for that and that the university is stand-alone in many areas. We need an assurance that there will be no recurrence of this in the future. We are all very aware that this has been a weakness in Departments and organisations throughout the UK and that procurement processes have been weak and found to be wanting. What assurance can you give us that there will be a major review of that and that that type of thing will not reoccur in procurement projects for universities?

Mrs Dodds: Thanks, Gordon. Mike will speak on the general procurement issue, which is valid and very important. We intend to review what actually happened at Ulster University to lead us to this particular situation so that we can ensure and have confidence that it does not happen again. There will be a specific [Inaudible.]

Mr Dunne: OK.

Mr Brennan: I will just add that, when she engaged with you last week, Heather Cousins highlighted some of the procurement problems that occurred when the university self-managed the procurement process. Indeed, those issues have already been highlighted by the Audit Office in its major projects paper. Yes, there are concerns about the university's procurement of the project and financial management of the project thereafter. As the Minister said, one of the conditions will be the taking forward of a fundamental review into both the financing and the capability of the project to date in order to ensure that it does not happen as the project is finished. I suspect that the Public Accounts Committee will also want to look at the issue.

Mr Dunne: Will there be a fundamental change to its processes so that it cannot happen in further projects?

Mr Brennan: I would have thought that it was a key concern for the university's governing body, the governing council, to ensure that it does not happen again.

Mr Dunne: I see that a draft tourism strategy is in progress. Can we have a commitment to event tourism? We talked about this last week. When you talk to Tourism NI about events, smaller events, it tends to move away from that. I still feel that we need to promote event tourism strongly. Look at the success of the Open, for example. Obviously, there was significant investment. We all recognise that. We have been looking at other events. Some time ago, we talked about the Rugby World Cup, which did not develop. I am aware that there is a bid to bring the World Rally Championship back to Northern Ireland. So, we would like a commitment in the strategy to support events like that in the future.

Mrs Dodds: One of the commitments in the recent deal is to promote Northern Ireland through the staging of major events here; that is part of what we will be looking to deliver upon. The Open was the first time that we had staged such a massive international event of that kind for many years in Northern Ireland. Its attendance was 237,750 people; absolutely phenomenal. I know, because I did it — I parked the car and got the bus in — that the ferrying of people to and from the event was phenomenal. We must congratulate those who delivered an event that ran as smoothly as it did and involved those numbers.

About 57,000 of those spectators were from outside Northern Ireland; that is a massive contribution to the local hospitality and hotel sectors. It generated a combined economic benefit of £100 million for the local economy. That is the success that was delivered by the Open. Huge congratulations to those who spent, I am sure, many wakeful hours worrying about and setting up the arrangements for it.

There is a commitment in the deal to stage further big international events to promote Northern Ireland. It is hugely important, not just in promoting Northern Ireland, but through its economic benefit. Events like the Open do not just have a one-off economic benefit: they have a recurring economic benefit. The course is now a "to-do" course for golfers. I am not one of them, by the way. Its benefit is huge. Of course, remember that staging international events and ensuring that they happen and are attracted to Northern Ireland costs significant amounts of money. One of the things that we will be looking at over the coming months will be how we finance some of the commitments in the deal. So, yes, an absolute commitment, huge success and a great boost for Northern Ireland economically and in every other way.

Mr Dunne: One other issue that we talked about last week was R&D and how a future challenge will be how that is funded. R&D is critical to the success of business and is key to manufacturing. We are very aware of the significant funding that was drawn down through Horizon 2020 and so on. How will that be addressed? What will be done to further promote R&D and innovation?

Mrs Dodds: That is a hugely important topic that we are getting to in the last breath of the session. Maybe we can come back and talk to the Committee about it.

A huge amount of money comes into Northern Ireland through European funds. For example, through the European social fund for skills and training, and through the European regional development fund for research development. The Government have proposed a UK prosperity fund, and we need to see fairly soon how that will pan out for the regions, what the volumes of money are in it, what its ambition is, and whether there will be an overall umbrella structure and then regional divergence and input to suit regional economies. Those issues are yet to be worked out, but that is a very high priority as we progress.

Horizon 2020 and its predecessor in Europe provided significant funds for research and innovation. Sometimes, I think that we assume that because we have left the European Union we cannot take part in those programmes. Of course, we can take part as a fully aligned country or as a third party. I was recently in Israel, which was one of the most successful countries in drawing down research and innovation funding through FP7 — the forerunner to Horizon 2020 — and working with the European Union to advance research and innovation. I would really like to see us being able to be part of whatever comes after Horizon 2020.

I would also like to see us invest in and grow our own research and innovations programmes, both within the United Kingdom and in collaboration with other countries. That is the way to go. No one has the monopoly on knowledge, and collaboration across sectors and countries is very important.

Another European fund that is close to my heart is Erasmus. Again, I would like to see us being able to be part of the Erasmus programme. I have long had a bit of a bee in my bonnet about Erasmus, as sometimes it is seen as the prerogative of university students to take a year out and travel around Europe. That is lovely, and it is great. However, in the European Parliament, I championed making Erasmus open and available to all. One of things that I loved doing was making sure that some of our young people who were doing apprenticeships in the building industry were able to link up with apprentices in, for example, northern Germany.

There is no reason why we cannot continue that. I noticed a tweet from Kilcooley Women's Centre earlier in the week, which you know very well, Gordon. They are off on another Erasmus journey and are linking up with groups from countries like Turkey, which are outside the European Union but which participate in the programme. Those are all issues for the future that we can discuss how best to take forward, but there are opportunities that we should not miss.

Mr Dunne: Thanks.

Mr Stalford: I just want to come back to the UU issue. This section of our proceedings is being recorded by Hansard, so, to be absolutely clear: the £126 million FTC going to UU in Belfast is unrelated to, and has no impact on, UU at Magee.

Mr Brennan: The ask for £126 million of financial transactions capital is from Ulster University to finish out the greater Belfast development.

Mr Stalford: Yes, and if the local council got its way and its actions resulted in it not being granted approval, what would happen?

Mr Brennan: If the financial transactions capital does not go to Ulster University, it will not have the financial resources to finish out the project —

Mr Stalford: So you would be sitting with a half-finished campus.

Mr Brennan: — or it will have to try and find it elsewhere.

Mr Stalford: So you would be sitting with a half-finished campus in Belfast.

Mr Brennan: That would be a conclusion that you would draw.

Mrs Dodds: Be absolutely clear: that is not our intention. To be absolutely clear, our intention is that we have a world-class site in Belfast that benefits our young people and our students and grows them in whatever way we can but also grows the economy of Northern Ireland and benefits us all educationally, culturally and in every way.

Mr Stalford: Thank you.

The Chairperson (Dr Archibald): Thank you very much for your prolonged briefing. There are a number of issues that we will probably want to talk to you more about, and we will take up the offer of the briefing sessions as well. Thank you both very much.

Mrs Dodds: Thank you. I look forward to our continued cooperation. I am perfectly prepared for scrutiny and robust conversation. This is very helpful for us all to take forward.