Official Report: Minutes of Evidence

The Chairperson (Mrs Erskine): We now move on to the session on the June monitoring round. The officials have a presentation. I will hand over to the officials to talk to that.

Ms Susan Anderson (Department for Infrastructure): Thank you, Chair. I will start the presentation. We probably covered the first slide in the previous session. We have closed off last year, which was 2024-2025, and we have just reported provisional out-turn. We already outlined the ring-fenced underspend to do with depreciation and impairment. We also had a capital underspend. The majority of that related to the A5, due to the legal challenge. As you would expect, some of that spend has shifted as well.

I turn to the resource budget. I will set out where we are now with our final opening budget. Our final opening budget position is £637 million. We got an increase of about £3·8 million from the draft budget outcome. In the main, that related to £2·7 million towards the Northern Ireland Civil Service (NICS) pay award and £1·2 million for the transforming planning ring-fenced funding as well.

As part of agreeing the final Budget, the Executive also agreed some June monitoring commitments. We have a commitment of £4·3 million. That is towards our increased employers' National Insurance costs. As a reminder, our total estimated cost for the increase in employers' National Insurance contributions were around £12 million. We have a commitment of £4 million towards that.

As I mentioned earlier, the final capital opening budget is £917 million. That is a reduction from the draft budget, but that is due to easements on the A5, as we mentioned, and some of our city and growth deals. We got an allocation of £8 million, so we net those off, and we have a small reduction of £15·7 million. Similarly, commitments have been given as part of June monitoring. There was a £1 million general commitment and £0·4 million for our transformation fund on the urban drainage transformation project.

We looked at that as a starting point when considering what we needed to bid for in the June monitoring round. On resource, we submitted bids of £50 million, all of which are inescapable at this stage. We submitted the road drainage charge as our top-priority bid. That is the charge that the Department pays to Northern Ireland Water (NIW) for the water that runs off the roads. That is in line with the PC figure. That represents an increase from last year. It has increased in line with fees that increased from last year's figure. That is how we get the figure of £1·8 million. We have a bid of £1·3 million in respect of the element of the Driver and Vehicle Agency (DVA) that the Department funds. That is the resource subsidy to the DVA in relation to enforcement and licensing activities that it carries out. That is an update on the figure that we had in previously.

I mentioned that we have a June monitoring commitment of £4 million for the increase in employers' NIC. Our total estimate was around £12 million, so we have bid for the balance of £7·6 million. The NI Water bid of £20 million reflects what NI Water has set out in its operating plan and budget. That reflects the volatilities that NI Water is subject to around power costs and, in particular, the impact that the weather has on those costs. We have bid for £20 million for that. We have bid for £19 million for Translink, which reflects its current projected cash shortfall. Again, that will be subject to change as the year progresses.

The total for our resource bids is £50 million.

We have submitted capital bids of just under £110 million. We had a ring-fenced easement on the A5, which is due to the legal challenge to the project. Our top bid of £50 million is for increasing the waste water capacity. As Declan mentioned in the previous session, the allocation to NI Water at the moment is £350 million. However, NI Water has indicated that it could spend £405 million this year, so the bid would, effectively, bridge the gap between those figures. That would ease the capacity constraints, and it has the potential to unlock around 7,000 properties if it is met in full.

Our next priority, as Colin mentioned in the previous session, is for structural maintenance. We have £68 million in the equality scenario, and the bid for £29 million will bring us up to last year's levels and mean we can deliver the same level of structural maintenance that we delivered last year.

The next priority bid is for health and safety. That covers street lighting columns. We estimate that we need around £16 million for that per annum, which is a shortfall compared with the equality scenario. That programme for replacing street lighting is ongoing. The next bid is for a local transport safety measure: the 20 mph part-time speed limits at schools. That bid is for £1·5 million and is in addition to the figure that the Minister has announced for that measure.

The fifth priority bid is for NI Water for drinking water and is around £10 million. Our final two bids are for £4·3 million for the A1 junctions phase 2 scheme and for a general allocation of £3·5 million to Translink. Capital bids totalling £110 million have been submitted in the monitoring round.

We are preparing the report for the Minister to consider on the outcome of the equality impact consultation, and we hope to have that with her in the coming weeks. As I mentioned in the previous session, we have received 27 responses, and I have already outlined the range of themes that are coming through. That is how we will move the process forward. We will then invite the Minister to take the final opening budget decisions. It is likely that we will have the outcome of June monitoring at that stage, which will help us to mitigate any issues that have arisen as part of the equality consultation.

I am happy to take questions.

The Chairperson (Mrs Erskine): The bids in June monitoring ring alarm bells for me because all the priorities are inescapable pressures. We are not even bidding for desirable outcomes: the bids are all for inescapable pressures and are big sums of money. Monitoring rounds are always very competitive when it comes to getting funding to the Departments. How bad is the current scenario for the Department?

Ms Anderson: It is challenging for the Department, and it has been challenging. We got an increase in the resource budget, but that does not mean that the Department can deliver everything, which is why we have submitted the bids. Obviously, the increase in employers' NIC is a new cost, so we will have to try to absorb it in our pay costs if our bid is not met. NI Water and Translink are working through their operating plans and budgets to see if there is anything that they can do to come closer to the figure that was set out in the equality consultation.

The Chairperson (Mrs Erskine): We have no guarantee that the Department will be allocated the £50·1 million of capital funding and the £109·9 million of resource funding that it has bid for. The pressures that have been identified are inescapable, but what do you anticipate happening? What are you looking at in each business area that could be cut? Going back to Keith's point in the previous session, the outworkings will all be seen outside people's homes. People will not be looking at the pie charts or the amount of money that is available, but the picture is pretty worrying. What pressures have been identified in each business area? What is the contingency plan because all the pressures are inescapable?

Ms Judith Andrews (Department for Infrastructure): I will come in first to talk about the Translink piece, which is my main business area. The forecast for Translink for this year is very difficult. I suppose that last year's was also difficult in that Translink ended up with an operating loss. We have been working closely with Translink on all of that. The pressures are from cost increases. Susan has mentioned National Insurance costs, but you also have things like pay in there, increases in the price of fuel and ongoing sundry cost increases. We have been having discussions with Translink on all of that, and it is trying to tighten its belt as best it can. It is putting a freeze on recruitment. To date, it will not affect the public service obligation (PSO) for level of service but it had plans, for example, to increase the frequency of some bus services and provide night-time and weekend services. Those are all on hold. The use of fuel is also a factor. Hydrogen is one of the new fuels that Translink has been using and it is expensive, so it has been reducing its use of that, which means having to rely on batteries or diesel. It is making decisions where it can, including on the delivery of services such as cleaning etc in bus and train stations. Translink is aware of the bleak financial outlook. We are working with it as much as we can on all of that.

The Chairperson (Mrs Erskine): What about Roads or NI Water?

Mr Colin Woods (Department for Infrastructure): From a Roads perspective, only one of the bids is not in an area of work that is entirely within our control. With structural maintenance, street lighting and local transport safety measures, if we cannot afford to do all the things that we want to, we will simply not do them. That is the inevitable consequence. The capital bid ranked sixth in the table, which concerns the A1 scheme, is slightly different. When we make vesting orders for a scheme, landowners are entitled to claim a portion of their compensation. However, most do not do so immediately and wait until later in the process. Therefore, there is a managed risk regarding the actual cash need in-year. We are bidding for the balance of that: the difference between the opening allocation and what the final figure might be. If that money was needed for the A1 scheme, we would manage in-year by simply not doing £4 million worth of other work.

The Chairperson (Mrs Erskine): Declan, before I move on from Roads, I will ask about street lighting, which relates to the Programme for Government commitments on safety, ending violence against women and girls, active travel and all of that. What is the likelihood of being able to fund some of that, given what that would mean for public safety, particularly in rural areas where street lighting has not been upgraded? I know that there are urban areas that are in the same situation. What will the backlog mean for service delivery?

Mr Woods: It is worth clarifying that none of this is about the switchover from sodium bulbs to LED bulbs. It is about sustaining the network that we have rather than upgrading it. Street lights are very beneficial for people in the community. They are also live electrical installations in publicly accessible areas, so we have a responsibility, first and foremost, to make sure that they are safe. When a column is either electrically or structurally unsafe, we must find it in short order and decommission it. The money that we have bid for would allow us to put a new one in in such circumstances, as opposed to simply making the existing one safe and going away, which would result in a decrease in the level of street lighting. Obviously, a decrease in street lighting is not a great thing for communities, and it is not something that we can control, because the failures come where they come. We do not choose to decommission street lighting columns, but unfortunately we have to ask whether we have the money to replace those that fail with new ones. This bid is important to ensuring that the answer to that is yes. Much of the money can be usefully spent. There is a significant number of aged street columns. Some are 40 years old and not in great condition, as you would expect. We are finding that the number that we are having to consider replacing is increasing.

With some groups of street lights, we are also finding that the underlying power supply needs to be replaced, which is even more expensive. Again, if we do not have sufficient funds in our budget for street lighting, we move to decommission and make safe rather than replace. That would be the impact of the bid not being met.

The Chairperson (Mrs Erskine): Yes, OK. We are not able to take the invest-to-save route when it comes to some of those things. That means that when things get to a critical stage, we are in the inescapable pressure scenario. You are bidding for funding for street lights as an inescapable pressure because they are a health and safety concern.

Mr Woods: Yes. Investing to save only makes sense if you have the money to invest. We are not in that place when it comes to street lighting. We could convert more street lights to LED bulbs to reduce energy bills. That would be a good and sensible thing to do if you had the money available to invest. We are in a situation in which we are trying to figure out how to sustain the existing street-lighting footprint and ensure that we do not have to simply take street lights away when they fail or are deemed unsafe.

The Chairperson (Mrs Erskine): Declan, what about Northern Ireland Water?

Mr Declan McGeown (Department for Infrastructure): We have had a number of conversations with the board of Northern Ireland Water in recent weeks. Unsurprisingly, the pressures that it will face should it not be fully funded are there for all to see, and they will present challenges, particularly for its resource budget given the gap that exists. If there is any comfort that can be taken it is that in recent years there was a variation between the amount that Northern Ireland Water predicted it would need at the start of a year and the amount that it actually needed at the far side of that year. That is because power costs fluctuate, sometimes to a large degree. In recent years, that has meant double-digit fluctuations. Perhaps the power costs will not be as severe as Northern Ireland Water is estimating. If so, that will help.

Of course, Northern Ireland Water will also look at a range of other budget heads that it has under its resource budget in order to control spend. We would expect it to do that, as we would expect ourselves to. There will be a pressure on Northern Ireland Water's resource budget: the gap is in and around £20 million. We will bid for that, but if Northern Ireland Water does not get it, it will be a pressure. The power costs, which are the highest costs, are tied to the prospect of the weather conditions over the next year and the related electricity costs that come with that. If the weather is not as severe as is being prepared for, obviously the costs will be less and the figure will go downwards, as it has done, thankfully, in recent years.

The Chairperson (Mrs Erskine): There was something running through my head when you were chatting about power. Is there anything being bid for as a result of storm Éowyn in order to prepare for such events happening in the future? For example, we saw that NI Water needed to get generators into power stations and that type of thing. Has there been any planning that has resulted in some of the current bids?

Mr McGeown: There will always be preparatory work done for that. Thankfully, storms such as Éowyn last year are a rarity. Hopefully, they will continue to be so and we will not have storms like that in future years. Northern Ireland Water is more attuned to looking at extreme wet or dry weather rather than storms. When there are storms, we typically bid for funding from a pot that becomes available through DOF to cover the emergency costs. The predicted power costs are linked to the prospect that the weather might take a turn for the worse in an extreme way, either very wet or very dry, which is why they are so high. If we were to get a normal year of weather in Northern Ireland, if there is such a thing, we would expect lower power costs. As I said, in recent years, there has been fluctuation in the power costs and the required figure has been much lower.

Mr Stewart: Thanks folks. When was the last time that a Department's monitoring round bids were granted in full? Has it ever happened?

Mr McGeown: I cannot remember. [Laughter.]

Mr Stewart: The good old days. [Laughter.]

Mr Woods: Individual bids are sometimes granted in full.

Mr Stewart: Yes ,but if you come forward with bids for £109 million of capital and £50-odd million of resource, it is highly unlikely, given the competing priorities across the Executive, that you are ever going to get anywhere near 100%. That would be fair to say. I imagine that every other Department has a plethora of inescapable pressures. You know this better than I do, but when funding for drinking water infrastructure is an inescapable pressure in a monitoring round, the lamentable situation that we are in has to hit home with people. How do you triage inescapable pressures if we are not going to get 100% of funding in this monitoring round? It is a massive burden on your shoulders. That is the first question, and the Chair touched on it. When you have pressures related to health and safety through street lighting, the structural maintenance of roads and drinking water infrastructure, how do you go about triaging them if we do not get the required level of funding? Do we worry about that as and when we have to?

Mr McGeown: Perhaps I will go first, John, on water. We live in hope. Let us see how the monitoring round goes. As I mentioned in the previous session, under PC21 there are groups of areas that Northern Ireland Water has to look at and is contractually committed to provide essential maintenance for and so on. If we did not get that extra money, I imagine that Northern Ireland Water would have to re-prioritise because, as you said, drinking water would have to be the priority. You would hope that that would be the case, and I know that Northern Ireland Water would target the money towards those areas if it needed to.

Mr Stewart: OK, that is fair. The priorities in the table are the inescapable pressures. I am sure that you could have given us a list of 80 or 90 other significant pressures that are not inescapable: you did not even go near those because you know how tight the finances are. If we got 80% of the £160 million combined bid for resource and capital, how you would go about prioritising the inescapable pressures?

Mr Woods: We would bring advice to the Minister on the options. That is the process answer. It is part of our job to have that wider understanding of public finances, know what constitutes a realistic expectation and use that judgement to be ready to respond to a range of scenarios. From a Roads perspective, we know the areas in which the tap can be turned on or off more easily. If you get a bad monitoring round in October, for sake of argument, and you only have five months left to cope, there are only so many sensible ways to dial down your spend to match the budget that is available or, indeed, respond to bids. That is why you will typically see bigger bids in June monitoring than you will in January monitoring: you can only spend so much between January and March. It is about trying to keep all of that in your mind and using your judgement in bringing advice to the Minister so that she has choices.

Mr Stewart: I do not envy you in that task, but it is a stark reminder of how bad the situation is. The Chair touched on the issue with street lighting. Will you give us an indication, Colin, of how significant the backlog is for the refurbishment of the dated schemes? I know that there is a £12 million bid in for street lighting, but is that to fully tackle the issue or is it just what you would like for this round?

Mr Woods: It is the amount that we would like and could spend sensibly in-year. The backlog is larger. I am afraid that I do not have the exact number in front of me. As I said, we could spend almost as much money as we could find on street lighting columns and still think that that was a good thing. It is the relative prioritisation of that against all the other things that we are trying to do that becomes the constraining factor.

Mr Stewart: There are a number of areas that did not come anywhere near being inescapable pressures but might have been funded in the past through monitoring rounds, such as the continued maintenance of grass verges at junctions in the interests of road safety. Are you confident that there is still enough in the budget to continue that maintenance to a satisfactory degree?

Mr Woods: As I said, we are increasing the resource budget for essential maintenance, which is where the funding for that activity would be from. So, yes, the budget this year is very comfortable compared with that of last year. It is then about how good we can get things within the slightly expanded budget that is available.

Mr Stewart: My final question is not related to the June monitoring round but it is related to finance, so please indulge me. Northern Ireland Water is the biggest consumer of electricity in Northern Ireland, consuming a massive amount, and Translink is the biggest consumer of fuel. Combined, the Department for Infrastructure and those entities are massive consumers of fuel and electricity. Have attempts been made to get the benefits of economies of scale by combining the purchasing power for electricity and fuel? Translink has significant purchasing power, but does it team up with the Department and NI Water in its purchasing to try to get better value for money?

Ms Andrews: Translink hedges its purchase of fuel, and I think that that is the best arrangement that it can come to in order to maximise savings and discounts on fuel.

Mr Stewart: OK.

Mr McGeown: Northern Ireland Water has also moved to hedging.

Mr Stewart: Has it? OK.

Mr Woods: We also do that for electricity. There is collaborative procurement across the NICS for electricity supply, so we look at ways to bring the bill down. Initiatives such as the LED switchover programme, where you are trying to need less electricity in the first place, are also part of that.

Mr Boylan: I suppose that, if you take money out of the system for 15 years, you are left with what you are left with. Hopefully, the Committee will support you in the bids. What period is it from on the National Insurance costs? Does that date back —?

Ms Anderson: The start of this year, so from 1 April.

Mr Boylan: The start of this year? Right, OK. And that is the cost.

I will probably have to go back to the NIW stuff. Can you give us a wee overview of where we are at with the bids? Have you confidence in it, Declan?

Mr McGeown: I am not a politician, so I do not know what decisions the Executive will make. We have put the bids in, and we hope that we get them. If we do not, it will present challenges for Northern Ireland Water, particularly on the resource budget but also on the capital budget. As with colleagues at the table, we will have to cut our cloth. Let us see what comes out of it.

Mr Boylan: I am only going by what —. Obviously, there has been a lot of support in the Committee. There have been a lot of conversations in Committee. There is no doubt that we will support you in the monitoring round. Do you know what I mean?

Mr McGeown: On Northern Ireland Water specifically, and given the Minister's plans and intentions for how £50 million could unlock up to 7,000-plus houses, potentially, if we got that bid, it would be a great one. Not that I am making a bid; I am just putting it out there.

Mr Boylan: No, no, I am only throwing it out there.

Mr McMurray: My question sort of touches on that, if that is OK, Chair. Like Mr Stewart, I am going to go back. You were worried about coming in on the June monitoring round last time, and now I am going to go back again. Forgive me in that regard. On the £50 million bid and the potential for 7,000 houses, are those 7,000 houses split into 4,000 and 3,000, or is it a different split? Are those 7,000 houses dependent on the £90 million, with £40 million coming in the next funding round?

Mr McGeown: Andrew, if you will indulge me for 30 seconds, I will take it back. From Christmas, really, the previous Minister and the current Minister have both been very keen to show that Northern Ireland is open for business. In the light of the Programme for Government and the housing supply strategy coming out at around the same time and pushing for more housing, we wanted to play our part as a Department. I have been encouraged to work with colleagues in the Department for Communities, the Department of Agriculture, the Northern Ireland Environment Agency, Northern Ireland Water and the Northern Ireland Housing Executive to see whether we could plot a way through; look at where there is a Venn diagram, as I describe it, where all our needs meet in the middle; and see where we could identify potential. In doing that work over the past two to three months, we have identified potentially 7,200 properties, to be precise, that could be unlocked over the next two years. That is not necessarily just housing: it could mean commercial properties, as you can imagine. They could be unlocked if there were an injection of around £50 million. I have to say that all parties to that conversation, including Northern Ireland Water, the Northern Ireland Housing Executive and the Northern Ireland Environment Agency, have really come along with a can-do approach. If we can get that, we are talking about unlocking around 10,000 properties in total, potentially, if, as I say, you take the £19·5 million that was made available for over 2,000 houses before Christmas. That is a tenth of the housing supply strategy. It is a good news story for Northern Ireland. This is me almost making my bid, but there are great opportunities there. Areas across the region could be targeted for housing. That £90 million — potentially £50 million this year and an additional £40 million next year — could unlock up to 10,000 properties across Northern Ireland. That is a good news story for us if we get it.

Mr McMurray: Sticking with the NI Water theme, the overspend related to its resource budget. What do officials expect the impact to be on NI Water if that resource is not met?

Mr McGeown: Northern Ireland Water is a non-departmental public body. Therefore, like all non-departmental public bodies, it has to live within its budget. We hope that we are not faced with that position again. That is the purpose of the forensic accounting report: to look at ways in which we can work together to ensure that it does not happen. While it happened this year, and it was £1·4 million in the end, we hope that it does not happen next year. We will work very closely. As I say, we have had regular discussions with Northern Ireland Water and the board in recent weeks. That will continue throughout the year. That has been the kind of discussion that we have had — "Let us talk more over the next year" — and that is what we are going to do.

Mr McMurray: To go backwards, if you will indulge me, Chair, just last week, the Downpatrick flood feasibility study was released, if that makes sense. Is that funding in line with that from the last round, or where is the funding for that coming from?

Mr McGeown: Our Rivers team sits under me, and it needs in and around £30 million per year. This year, it needs less, but that is because it has worked out its programme of works, and that will include works such as Downpatrick etc. We are not bidding for funding for Rivers; we feel that we have enough to do what we need to do this year.

Mr McMurray: Thank you.

The Chairperson (Mrs Erskine): Can I just check something? With regard to your legal contractual obligations, which is why you are bidding for inescapable, I do not —. Naturally, I want to see more money and delivery on the ground for these things, but when you are talking about the 7,000 properties, for example, which will unlock some of the homes that will be under the housing supply strategy, what are the legal risks to the Department of the bids not being met? Are you fully confident that, in terms of inescapable, it is all legal contractual that is bid for? There is an issue here where you could be facing court if those bids are not met, and yet we have also discussed the fact that rarely or never have we seen June monitoring round bids being met. That is huge.

Mr Woods: I will answer from a Roads perspective, and I expect it will be very similar for Northern Ireland Water, Translink and Rivers. When we enter into a contract for the delivery of resurfacing schemes, for example, that contract has a value. However, that, in itself, is not a commitment to pay that amount of money to that contractor, because the process that the contract itself sets out says how we commission specific projects. Then, when we issue a works order, that becomes the binding agreement between us. We are comfortable that we can manage that risk at this point in the year, and that is precisely why you cannot necessarily spend out more money later in the year, if it comes along, because you have not actually lined up the delivery of a specific scheme with a specific contractor and a specific workforce, who all have to turn up in real life to do the work. We need the ability to know far enough in advance when to put those works orders out. At that point, we are entering into a binding contractual commitment that, when the work is done, we have to pay for it. However, at this point in the year, we simply would not issue those works orders, and that is how we manage that risk if those bids are not met.

The Chairperson (Mrs Erskine): Sorry if I am not clear on that. Does that not mean then that it is a high-priority bid rather than an inescapable, if you have not actually signed off contracts for the individual capital?

Mr Woods: The contracts are in place and the work programme has been agreed, and it is what we want to deliver, so that makes it an inescapable bid from a public finance perspective. Do not get me wrong: contractors would, rightly, be unhappy if we came quite late in the day and cancelled a planned work programme, because they are building their capacity. There is activity happening to prepare for that. The legal risk is slightly different, because it is down to what exactly the contract says, and we have break clauses and other ways to unwind things that we plan to do if in fact we cannot afford to do them, because we do not want to enter into a commitment that we cannot stand over.

Mr McGeown: As Colin has rightly said, it will be the same across the board. If you take, for example, Northern Ireland Water's perspective, you can see contracts and will have heard, under Living with Water in the Belfast area, that it has developed a business case but cannot get to the next stage. In the interim, and until it gets all the funding, Northern Ireland Water is sensibly looking at the maintenance of those waste water treatment works to ensure that it can do all that it can do to manage the situation. That is what it is having to do. I am just picking a figure here, but in and around 90% of what we do in the Department has a statutory requirement in some shape or form, so you can see that the fact that we are not fully funded will present problems, and it is about prioritising.

Ms Anderson: Translink is the same around the capital piece, but the resource piece is more challenging because it is about the financial viability of Translink as a public corporation. That is the worst-case scenario for all of that, but that is why we are working closely with it to try to manage the resource position, and it is all measured against its cash reserves as such. We have been frontloading cash to help with that. Hopefully, its commercial revenue that I talked about earlier in terms of increased passenger journeys will come to offset that as we move forward, so we need to manage that closely.

Mr Durkan: Thanks again to the team for the preparation and presentation to us of that bid. It is scary that, when the ink is barely dry on the Budget, we are coming in with a bid of this scale. It obviously reflects an inescapable need across the Department. Does that reflect how far the Budget fell short of the requirements of the Department? I know that you do not have a crystal ball, but it seems to me like a kind of setting down of a marker for the year. Can you see how those bids might go, or how they might grow, should they be unmet at this stage?

Ms Anderson: Certainly, while the final Budget was more than the draft Budget, it still would not let us deliver everything that we had wanted to, so June monitoring does reflect some of that as we try to increase our capacity to spend. We can certainly do more at June than we can later on in the year. As Colin mentioned earlier, if we get it now, we can spend more, but if we do not get it, we are unlikely to be able to spend as much as we work our way through the year, and the remainder of the year as well. As we look towards the spending review, we are going to go back out and ask for requirements over the subsequent years as well to see how that factors in and how it would look, and to compare it to this year too.

Mr Durkan: In terms of the spending review, anything that comes here as a Barnett consequential is unhypothecated. Are you aware of any infrastructure-related or -associated investments that might be announced that we as a Committee could and should be pointing to in order to make the argument for ring-fencing that for similar spend here?

Ms Anderson: No, we will not be aware of anything until the statement is announced.

The Chairperson (Mrs Erskine): OK. Oh, sorry; Keith.

Mr K Buchanan: I apologise. I want to come in, Declan. You mentioned — I want to get it clear in my head — that the budgetary figure for increasing waste water capacity is £50 million, right? That is talking about unlocking new housing?

Mr McGeown: Unlocking properties, yes.

Mr K Buchanan: Right. So you are aware of the whole fallout yesterday and over this past week or two with respect to the failed nutrients action plan by the AERA Minister and, obviously, the pressure that he is putting on agriculture. I am going to ask you directly: that is for additional, and the Minister of Agriculture wants to reduce livestock in Northern Ireland by x per cent. Is NI Water going to have to reduce people in Northern Ireland by x per cent to play their part? Because this is asking for additional capacity, which I do not have an issue with, broadly, but how are we going to stop the combined sewer overflows? How are we going to stop the contribution to the issue of nutrients in the lakes and rivers, which is a massive problem? What is the Minister going to do to solve our problem? The AERA Minister wants to reduce livestock, so does the Infrastructure Minister want to reduce people? That is the only fundamental solution.

Mr McGeown: As I said earlier, Keith, in thinking our way through this piece of work here and that £50 million bid, we worked very closely with DAERA and DFC and, specifically, the Northern Ireland Environment Agency, and we will continue to do so. Indeed, our next meeting is on Tuesday or Wednesday next week. There are so many things, like the potential withdrawing of the statement of regulatory principles and intent (SORPI), etc, and the implications that that would have, so we need to keep close. We need to make sure that we work together, because there is no point heading down a route that then falls foul of all of our environmental requirements, so we have to work closely. They are at the table. They are keeping us right, and we are advising each other.

Mr K Buchanan: Is DAERA at that table?

Mr McGeown: DAERA is represented by the chief executive of the Environment Agency.

Mr K Buchanan: What is the joint solution, then? There is one attack on one sector, but I have not seen anything happening with NI Water.

Mr McGeown: I do not know about "attack". Certainly —.

Mr K Buchanan: Well, it is, because it is a simple reduction in livestock, so the solution, from an NI Water point of view, is to reduce the population of Northern Ireland by x.

Mr McGeown: Well, I mean, we are just —.

Mr K Buchanan: That is making it very simplistic, but that is what they want to do.

Mr McGeown: We are looking at if from the perspective of what Northern Ireland Water's commitments under the legislation are, particularly around drinking water, etc. We work closely with the Environment Agency on that and honour our requirements —.

Mr K Buchanan: Videos of sewage flowing from pipes into rivers and streams are being sent to me every day. That is obviously heightened by the recent DAERA stuff. It is a problem. You need to go away and have a conversation with the Minister about what she is going to do about it.

Mr McGeown: It would be remiss of me not to come back on that and say that the higher percentage is on the farming side.

Mr K Buchanan: That figure of 62% is modelled, Declan; it is not fact.

Mr McGeown: I can go only on the expert advice, but —.

Mr K Buchanan: It is a modelled figure.

Mr McGeown: If we are going on modelling, it is suggested that around 20% is caused by Northern Ireland Water. More than 60% comes from farming. I am just quoting the figures that have been provided to us, sorry.

Mr K Buchanan: I have made the point. You should have a conversation with the Minister. The nutrients action programme proposals are going to destroy agriculture.

The Chairperson (Mrs Erskine): Well —.

Mr K Buchanan: I think we need to look at reduction of the population of Northern Ireland. I think that is the solution, Chair. I want to get that minuted.

The Chairperson (Mrs Erskine): Well —.

Mr K Buchanan: The human population needs to be reduced.

The Chairperson (Mrs Erskine): Well —.

Mr K Buchanan: I do not know how we are going to do that, but I will leave that to you.

Mr Boylan: The main question for us as a Committee —. I appreciate what Keith is saying. We, as a Committee, should be supporting bids like this, because we need to tackle the pressures, to be honest with you. That is from a Committee point of view.

The Chairperson (Mrs Erskine): We will see once the Minister makes the final allocations and decisions. That is when we will be scrutinising again the decisions that are made and whether they are in line with what is needed.

I appreciate your time today at the Committee. Hopefully, next time, we will have the information in time for the Committee to look at. We appreciate your run-through of some of the bids that have been made. I know that I have said this during the session, but I thank the staff on the ground. They are working in very challenging circumstances, and they are under-resourced. I thank them for the work that they are doing locally. If you can take that back, we would appreciate that.

Mr McGeown: Thank you.