Official Report: Minutes of Evidence

The Chairperson (Mr Brett): I am delighted to welcome Ian Snowden, permanent secretary at the Department for the Economy; Mark Lee, director of higher education; and Johanna Park, director of financial management. I will hand straight over to you if you are content.

Mr Ian Snowden (Department for the Economy): Thank you, Chair. I have a short opening statement to make, if that is OK. As you said, I am joined by Johanna Park, who is the finance director responsible for budgeting and business partnering in the Department; and Mark Lee, who was, until the start of last week, director of the higher education division in the Department. He is now responsible for the economic strategy group.

We are here to provide you with an update on the bids that the Department has submitted as part of the information-gathering exercise for the 2026-2030 Budget. That information-gathering exercise will inform the Executive's upcoming spending review with a view to setting a three-year Budget. Before I speak about the spending review, it might be useful to provide the Committee with an update on the current in-year position. As the Committee will be aware, the Department received additional funding in June to support the higher education teaching grant, the quality of research and some work in the energy sector. That funding has enabled us to maintain recurrent support for our universities and to move forward with the renewable electricity price guarantee scheme. October monitoring has not been commissioned yet, and it may not be until after the UK Budget in November. Therefore, we have nothing further to advise the Committee about possible changes in the Department's in-year position.

The spending review is an opportunity for us to secure a longer-term financial settlement after several years of single-year Budgets. That will provide us with the foundation for a multi-year business plan that can support our delivery of the Minister's economic vision. The intention is that the spending review will set the resource budget for three years and the capital budget for the next four years. Members will have received a copy of the Department's resource and capital bids, which were submitted to the Department of Finance last month. The Department has submitted 34 resource bids totalling £1·1 billion over the three-year period between April 2026 and March 2029. Three bids totalling £28 million relate to the previous Executive's commitments to fund the graduate entry medical school at Magee and to match fund EU support under PEACE PLUS and procurement costs for city deal projects. There are a further 17 inescapable bids totalling £450 million over the three-year period. In addition, we have 14 bids totalling £595 million that are assessed as being high priority. They include a number of marker bids. Marker bids are for those activities that we anticipate we will take forward at some point over the next three years and for which the exact costs and precise timing of the expenditure remain a little bit uncertain because the policies are still evolving or we are gathering information on them. I can talk about those in this evidence session if you wish. We considered it prudent to include those marker bids to ensure that the Department is able to respond to developments in the policy and the funding framework.

The Department submitted 84 capital bids totalling £2·7 billion over the four-year period to March 2030. Of that, bids worth £1·1 billion are categorised as inescapable. A further £100 million has been identified as pre-committed, with £400 million being categorised as high priority and £600 million as desirable. The remaining £0·5 billion relates to bids for city deals projects and financial transactions capital (FTC).

The bids that the Department submitted are designed to support the creation of good jobs, promote regional balance, raise productivity and accelerate progress towards a decarbonised economy whilst enhancing our capability to deliver against key Programme for Government (PFG) outcomes. The reality of the fiscal constraints under which the Executive are operating means that we accept that not all the bids can be met in full — other Departments will also submit bids — but increased investment remains a critical component of achieving the economic vision and unlocking sustainable economic growth for Northern Ireland. That is why the Department's focus remains on securing the best possible outcomes for citizens with the funding that it has available.

My colleagues and I will do whatever we can to answer your questions.

The Chairperson (Mr Brett): Thank you very much, Ian; I appreciate that. The Committee very much welcomes having you here as chief policy adviser to the Minister. I recognise that things evolve very quickly and change, so I want to check whether you, as permanent secretary, want to update the Committee on any current issues in the Department that it would be useful for us to be aware of.

Mr Snowden: On any issue generally or on any financial issue?

The Chairperson (Mr Brett): Anything that has happened in recent days.

Mr Snowden: OK. There has been an ongoing issue with a potential risk to security of energy supply that the Executive have discussed on some occasions in the past couple of weeks. The background to that is that storm Darragh in December last year damaged Ballylumford power station — it knocked a chimney over — which put it out of action for four months. The context of that is that our security of energy supply policy is that we must have power stations in operation in at least two locations to mitigate any risk of having a single point of failure, essentially.

We have three power stations: Coolkeeragh; Ballylumford; and Kilroot. Ballylumford was out of action for a period of time at the start of the year. It was brought back on in April. Coolkeeragh was due to have planned maintenance earlier in the year, but that had to be postponed whilst the issues at Ballylumford were being resolved. Coolkeeragh was taken out of commission in June for that routine maintenance, and, when it was recommissioned in August, there was a problem in that a fault had developed with one of the bearings in the generating unit. That has taken some time to resolve. The date to restart the unit has been pushed back on a number of occasions and is now 15 October. That would be OK, insofar as Kilroot and Ballylumford are both operating, except that the European industrial emissions directive sets a limit on the length of time that each fossil fuel power station can run, which the UK has interpreted that to mean a certain number of hours. The average run time is 1,500 hours per year, but the maximum limit is 2,250. With Ballylumford out of commission at the start of the year and the subsequent issues with Coolkeeragh, the Kilroot units were running close to that limit, so there has been quite a bit of activity over the past couple of weeks between our Department and the Department of Agriculture, Environment and Rural Affairs and the Northern Ireland Environment Agency (NIEA) to ensure that that annual run-hours limit is changed, which will allow security of supply to be maintained, because we have Ballylumford and Kilroot power stations. That was resolved yesterday.

The Chairperson (Mr Brett): I read this in the news last week in a BBC article:

How close were we to a blackout in Northern Ireland?

Mr Snowden: We were not. We were close to being in a situation in which we would have been relying on one power station, namely Ballylumford. That station could have failed at some point, whether because of another storm or the development of a fault at the station, and that would have placed us into a power failure. We were not hours, days or even weeks away from a blackout; rather, we were very close to being at risk of having a single point of failure.

The Chairperson (Mr Brett): What would have happened if the exemption that the BBC talked about had not been granted?

Mr Snowden: We would have had to rely on Ballylumford, so we would have been in an at-risk situation.

The Chairperson (Mr Brett): What does an "at-risk situation" mean?

Mr Snowden: It means, as I said, that you would be entirely reliant on the one power station being operational until such time as Coolkeeragh came back on stream.

The Chairperson (Mr Brett): That is pretty serious.

Mr Snowden: It would have been a significant risk for us, yes. The system operator for Northern Ireland regularly issues system alerts. If that had happened, the system would have gone to what is called deep amber, which basically means that there is a significant risk to it. It does not mean that a power failure situation is imminent but that there is a distinct possibility that we could be into one.

The Chairperson (Mr Brett): You said that the Executive met recently to discuss the issue. Did they take decisions?

Mr Snowden: On Tuesday of last week, they decided to increase the annual run hours limit by 100 hours. That is because, at that point, we had assumed that Coolkeeragh would be back in commission by 29 September. That did not happen. Coolkeeragh was still not able to get back online by that date, so, yesterday, the run hours limit was increased to another 1,045 hours, which is all that will be required to take us to the end of December in any situation. Therefore, it effectively now covers us until the end of the year, at which point the annual run hour limit will be reset.

The Chairperson (Mr Brett): Is there any additional cost as a result of that decision?

Mr Snowden: No, because we would need to run a power station or power unit for those hours to maintain the electricity supply until the end of the year. It is not just the —.

The Chairperson (Mr Brett): Will those additional hours be at the same price as those for another supplier?

Mr Snowden: That would be for the Utility Regulator to negotiate.

The Chairperson (Mr Brett): You just said that there is no additional cost, so I assume that you are saying that because it has been agreed that the price would be the same as others pay.

Mr Snowden: I cannot speak to the exact prices because I do not know what each power station pays per hour.

The Chairperson (Mr Brett): Does that mean that the correct answer to the question, "Is there additional cost?" is that you are not sure?

Mr Snowden: I am not sure, but I could provide that information for you.

The Chairperson (Mr Brett): That decision was taken last Tuesday, and another was taken last night. I may have missed this, but as Chairman of the Committee, I have received no correspondence from your Department or the Minister, although other members may have. Why is that the case?

Mr Snowden: It is because, until this point, and this is still the case, we have not actually had to do anything.

The Chairperson (Mr Brett): You said that there were two Executive meetings on the issue.

Mr Snowden: It is for the Department of Agriculture, Environment and Rural Affairs to seek agreement on a decision to increase the permitted run hour limit. That is a Department of Agriculture, Environment and Rural Affairs issue, not a Department for the Economy issue.

The Chairperson (Mr Brett): A decision was made because you had concerns about energy security, which is an issue for the Department for the Economy.

Mr Snowden: It would have placed us into that position, but we had not actually reached a point where there was a risk.

The Chairperson (Mr Brett): If it is not an issue, that means that you do not expect the Department for the Economy to issue anything to this Committee or to Assembly Members.

Mr Snowden: Lots of things could go wrong all the time. If I had to relay every single thing that was taking place in the Department —.

The Chairperson (Mr Brett): You do not have to, but if there is an energy supply issue, we should know. You told the Committee that there were two irregular Executive meetings on concerns about energy security. I believe that the Committee should have been informed of that, Ian. We will see today whether the Minister makes any correspondence available to the Committee.

Other good announcements that have been made in recent times include that by the Bank of America about 1,000 new jobs. Does the Department welcome that?

Mr Snowden: Of course. Yes.

The Chairperson (Mr Brett): I was looking at the departmental website before the meeting today, and I saw announcements of the Minister welcoming one or two jobs. I cannot seem to find a press release from your Department on the Bank of America. Is there a reason for that?

Mr Snowden: The investment by Bank of America in Northern Ireland was something that the UK Government took forward. It was negotiated and supported by the Department for Business and Trade. It released a press release about it on the Saturday evening before the announcement was made, when President Trump was visiting, and the Minister included a statement in that press release.

The Chairperson (Mr Brett): Is it an oversight that it has not been uploaded to the departmental website?

Mr Snowden: We could put up the Department for Business and Trade's press statement, which we were a part of, but no, there was not a separate one from this Department. To be fair, the Department has not provided any financial assistance to that investment. It would be difficult for us to take credit for it.

The Chairperson (Mr Brett): I saw another announcement that the Minister made. It was a press statement about funding. As part of the UK-wide scheme, the Northern Ireland universities are taking students from Palestine. That is funded by the UK Government, is that right?

Mr Snowden: That is right. There is a tentative —.

The Chairperson (Mr Brett): Sorry; I will come back to you in a second. Why, then, does the Minister have a press statement welcoming that but not 1,000 jobs?

Mr Snowden: The Minister felt that it was important to welcome the Gazan students to Northern Ireland.

The Chairperson (Mr Brett): But not 1,000 jobs? OK.

If we turn to the —.

Mr Snowden: Sorry, Chair, just to press you: the Minister did welcome the 1,000 jobs.

The Chairperson (Mr Brett): I asked where the press statement is, Ian, and you told me that it is not there.

Mr Snowden: It was a statement in a press release.

The Chairperson (Mr Brett): I realise, Ian, that you have to go at 10.30 am, and I want to bring other colleagues in.

Moving on to your bids, the departmental expenditure limit (DEL) section on bid number 8 is about rightsizing the Department and its arm's-length bodies (ALBs). Is that a code word for redundancies?

Mr Snowden: We have no funding to pay for redundancies. In the DEL bids, you will see that there is a significant pressure on salary and pay increases over the next number of years that amounts to £100 million. By year 3 of the spending review period, that will be the equivalent of about 7% of our budget. We have an obligation to make sure that we are operating in the most efficient way possible, and that will mean that we will have to look at whether we can afford all the posts that are currently in the system. However, we have no plans for redundancies.

The Chairperson (Mr Brett): What does "rightsizing" mean, then?

Mr Snowden: As I said, it means making sure that the organisations are the correct size to deliver our functions from within the resources that are available.

The Chairperson (Mr Brett): Do you think that you have enough staff or too many staff, or do you need more?

Mr Snowden: I think that we have pressures and gaps in all parts of the Department. The Committee has raised a number of concerns about the pace of delivery in some schemes. That pace is happening because we do not have people in all parts of the Department to deliver all things simultaneously. I would never say that we have too many staff; however, we have to live within the financial constraints of the reality that we are in.

The Chairperson (Mr Brett): Bid number 5 talks about a "structural deficit" — this is under DEL again — for higher education. You have bid for £15·8 million. What is that £15·8 million made up of? I have been trying to do some rough calculations, and I could not quite get to that figure, so I am looking for a breakdown.

Ms Johanna Park (Department for the Economy): The Committee will be aware of the bid that we made in June monitoring for structural deficits. That looks at repeating the funding that we got in-year, which ensures that the universities are funded at the recurrent level. We also have the structural deficit, which is a one-off payment to restructure and rightsize the payments across the academic years. That is why there is a higher amount in the first year and it then goes down to the more recurrent amount of around £9 million for each of those years. The first year is described as scalable, meaning that, if you do not get it in the first year, you can start to manage it across the financial years if you get in excess of the minimum requirement for the other two financial years.

The Chairperson (Mr Brett): There is a £7 million shortfall, which could be staggered over the three years for the deficit, and £2 million for National Insurance pressures as a result of the change in those contributions. I am just trying do see how we get up to £15 million.

Ms Park: That covers the inescapable pressures in the university colleges, so that goes alongside the others. That was £7 million this year, but as the academic years go up, it starts to hit at around £8 million or £9 million.

The Chairperson (Mr Brett): Yes. The figure for next year is £15·7 million. What is that made up of? That is what I am trying to get to. It is quite hard to read.

Ms Park: The £7 million has been included in the 2026-27 figures. However, that could be scaled, so the £7 million relates to the structural deficit.

The Chairperson (Mr Brett): OK. What about the remaining £8·8 million?

Ms Park: It will be rounded, so the £2 million for inescapable pressures is across those years and roughly £7 million to £7·5 million is for the recurrent costs.

The Chairperson (Mr Brett): Sorry; I am —.

Ms Park: There is £7 million for Belfast Metropolitan College in June, £7 million for the structural deficit and just under £2 million for inescapable pressures, which brings it up to the £16 million.

The Chairperson (Mr Brett): That makes sense. OK.

Ian, you outlined the marker bids, which are for £18 million, £28 million and £29 million. How can we get the Executive to properly consider those bids, given their wide range?

Mr Snowden: Those are decisions to be taken by the Executive. For example, bid number 18 is for carers' leave and pay and for maternity leave and pay. There are ongoing calls for carers' leave to be paid in Northern Ireland.

The Executive will have to take the decision on whether they wish to introduce paid or unpaid carers' leave. A provision will be made for carers' leave in the employment rights Bill, but it could be paid or unpaid, depending on decisions that the Executive take. When the policy goes to the Executive and the legislation is introduced, if the Executive decide that they wish to have paid carers' leave, funding will need to be made available for it, because that provision has not been made elsewhere in the UK.

The Chairperson (Mr Brett): Yes, so the range in bid number 18 goes from £20 million to £87 million. Will an options paper on that be presented to the Executive?

Mr Snowden: Yes, that will include the number of people who might be available for it. I believe that the Committee has had some briefing from Carers NI on that. It suggested some quite low numbers and small costs, but we do not agree that those numbers and costs will be as low as Carers NI suggests. We do not know what the actual demand will be. That is why, in the final year, the figure of £20 million to £87 million is such a broad range based on potential ranges of uptake.

The Chairperson (Mr Brett): OK. This is my final question before I let colleagues in. From the Department's point of view, is the marker bid in bid number 29 for the multi-campus nature of Ulster University (UU), which is at a cost of £18 million a year, being done as part of the review into the financial needs assessment of our institutions?

Mr Snowden: It will be part of that. The £18 million is our assessment of what maintaining Coleraine and Jordanstown will be in addition to the —.

Mr Mark Lee (Department for the Economy): Ulster University is doing an assessment, so the Department will do some further work to —.

The Chairperson (Mr Brett): Is that the university's view of how much it is? Have you done an assessment yet of how much it is?

Mr Lee: There is some work to be commissioned to look at that more closely.

The Chairperson (Mr Brett): OK. Who is heading higher education in the Department now? The Committee was not aware that there had been congratulations or commiserations on any change.

Mr Snowden: At the minute, it is Mark's deputy, Graham Miller. The Committee has met Graham before.

The Chairperson (Mr Brett): OK. While we are talking about Ulster University, my final point on it is to say that I had a look at the 'Irish News' yesterday. The front-page story was about a student who quit the Derry campus after a week after being told, "We hate the English". Is the Department aware of that?

Mr Snowden: We are aware of the media coverage, yes.

The Chairperson (Mr Brett): Have you been in contact with Ulster University on the issue?

Mr Snowden: I have not, although we are meeting it on Friday morning, so we will discuss that, amongst other things.

The Chairperson (Mr Brett): Will that be on the agenda?

Mr Snowden: I will raise the issue with it.

The Chairperson (Mr Brett): Will you keep the Committee informed about that? It is only an allegation at the minute, obviously, but if any other group of people had said, "We hate this group", I imagine that it would be taken very seriously, and rightly so. The Committee is keen to ensure that no student, from whatever part of the world they come, faces any discrimination or feels that they have to leave the institution. We want to see growth at the Derry campus and for it to be open to one and all, so we are keen to be updated on that if possible.

Mr Middleton: I concur with the Chair's last comments. It is important that there is a thorough investigation into that incident. That is not the first time that it has happened. Sadly, I have heard similar stories, and there is work to be done to ensure that, as Magee expands, it does so in a way that is reflective of an entire community and is welcoming for all communities.

To follow the Chair's point on bid number 29, which is a marker bid, the university has raised that with me in the context of the multi-campus model and the fact that it feels disadvantaged. Remind us when the funding review is likely be completed. Obviously, that will have a particular impact on Coleraine, so it is important to get clarity on when it will come forward.

Mr Lee: There are several strands to that, so excuse the slightly involved answer. The overall funding review, which has multiple strands, will take about a year or maybe 18 months to complete based on similar reviews in England and Wales that we looked at. There are some pieces of work that could be done quicker. The Committee is aware of the financial needs assessment that has taken place over the past few months. We expect to share the report on that with you in the autumn. We are looking at commissioning a specific piece of work on those multi-campus costs. We certainly will not wait a year for that; it is a piece of work that could be done quicker. Until we have the expert consultants' report or heard what we need, I cannot give you an absolutely firm deadline on that, but we certainly want to do it as quickly as we can.

Mr Middleton: There are a couple of other points that I will raise quickly. Bid number 17a is for the reform of post-SEN provision, against which there are a number of figures. How did that bid come about, and how was it developed? Will any additional legislation be required to progress it?

Mr Snowden: There was a recognition that, when people with special educational needs leave school, there is no specific provision for them in the further education or skills system. When the transformation fund was launched last year, the Department, having identified that gap, worked up a proposal. It was not successful last year, but it was resubmitted this year and is through to the next stage of the assessment. The idea of the provision is that, where there are young people with additional needs, there is a way of assessing what those needs are, and that can then be fed into further education or skills provision. We have to accept that some of those young people have profound disabilities that mean that they will never be able to have opportunities for work and a career, but there are several hundred who leave school each year and are under-provided for. They could have worthwhile careers and job prospects in the future. We are looking to put something in place with the Department of Education and the Department of Health to provide support for that cohort of young people leaving school so that there are not any young people who have nowhere to go or have no suitable provision and their parents then feel that the only option that is available to them is to stop work.

Mr Middleton: Could that be done without additional legislation?

Mr Snowden: We could certainly put better provision in place. Some of the parents that are involved believe that legislation is necessary in order to enshrine a right to that kind of provision. Our view is that the legislation in itself will not fix the problem until you have the provision. We are trying to put the provision in place. If legislation becomes necessary later, or if the Executive decide that they wish to legislate on the issue, that will certainly follow.

Mr Middleton: One of the capital bids was for the regional economy fund; I think that it was for £60 million over three years. What exactly does that entail, or what sorts of projects will it support?

Mr Snowden: Some of that will be for the work of the local economic partnerships (LEPs) that the Minister established last year, all of which are now in operation. Some of the funding from that will be for capital projects in local areas. We also have other projects that might be taken forward by the likes of Invest NI and other organisations that are involved local regional development.

Mr Middleton: Will the project proposals come from the local economic partnerships?

Mr Snowden: Many of them will. We also have the Invest NI regional land portfolio programme, which it wants to take forward. That involves the purchase and development of industrial sites.

The Chairperson (Mr Brett): How much is allocated to that currently?

Mr Snowden: Currently? Nothing.

Ms D Armstrong: Thanks for coming in this morning. Ian, you mentioned briefly the anticipated funding for carers. How is the impact of the good jobs Bill recognised in the resource DEL bids?

Mr Snowden: Apart from the carers' leave, where paid carers' leave may be included as part of the outworkings of that, there are not any significant resource DEL implications for us. Some capital expenditure may be required for changes to HMRC systems to permit some of those things to take place, which we have factored into the bids as well, but, beyond that, the good jobs Bill, or the employment rights Bill, is mainly about creating rights for workers, so there is no additional cost to the public purse.

Ms D Armstrong: I just want to touch on regional balance. How did you estimate bid numbers 9, 22 and 23? What level of spending have the local economic partnerships generated to date? Bid number 22 is headed "Regional Balance — Driving Productivity".

Ms Park: Bid number 9, which is headed "Regional Balance — Driving Productivity", relates to the local economic partnerships that Ian just touched on. That is in the "Inescapable" category because it has already been commissioned and committed to.

You asked about regional balance. It is driving up productivity. There is a range of initiatives. Depending on funding, there could be additional investment in Tourism Northern Ireland (TNI), by which I mean investment in our tourism, our marketing and our major events. Additional funding could be put into schemes such as the regional entrepreneurship acceleration programme (REAP) and into an overall package to drive and support innovation enterprises in our regions.

Mr Honeyford: Thank you, guys, for coming in. My apologies for being late. I got stuck on the M1.

You have included in the multi-year Budget information-gathering exercise paper a bid for the UU multi-campus model. Why is that new this year?

Mr Snowden: It is something that the university raised with us as a concern, as it adds to its funding pressures in the system. It is therefore asking for adjustments to be made to the funding model that will compensate for that.

Mr Honeyford: OK. Is additional funding therefore going to UU to compensate it?

Mr Snowden: There is not at the minute, but it is asking for it.

Mr Honeyford: OK. No problem.

You talked about the 1,000 jobs. The day before yesterday, Evri, which is part of the DHL group, announced that its new euro hub has opened in Mallusk. Those are new jobs as a result of our having dual market access: access to the whole of the European Union and to the rest of the UK. There has been nothing from Invest NI or the Department on that announcement. I have just checked again. Surely that is something that we should be selling in order to bring more business and more opportunities here.

Mr Snowden: We are selling dual market access as one of the investment reasons to choose to come to Northern Ireland. It is an important part of our offer.

Mr Honeyford: How are you selling it?

Mr Snowden: Invest NI does that on its trade missions. It does so when it meets external investors that are potentially interested in coming here. We therefore promote dual market access outside of Northern Ireland.

Mr Honeyford: If I go on to Invest NI's website, it does not say that on the home page. In fact, it does not say it at any point anywhere on the website. Was Invest NI or the Department involved in securing Evri's investment, or did it simply come about because a business saw an opportunity and took it?

Mr Snowden: I do not know the details of that specific case, to be honest. I do not know what contact Invest NI had with Evri.

Mr Honeyford: The budget lines are hard to understand because we see the same ones from year to year. What has changed that has resulted in different outcomes? For example, with Invest, there was a review undertaken, and the same budget lines are in there as were previously, give or take salaries and inflation. How can we judge what is value for money as opposed to just what is being spent?

Mr Snowden: That relates to the outcomes that Invest delivers. It set itself quite an ambitious business plan, which was published in September of last year. It contains lots of targets for the numbers of investments that are supported across Northern Ireland and states how those investments will be directed towards the priority sectors that we have here and what the potential is for growth and for job creation. The way in which to judge whether the budget lines represent value for money is to determine whether they are meeting their targets.

I am sure that members will recall that, not long after the Assembly returned last year, the Committee asked for indicators of value for money. It is very difficult to compare one part of a very diverse Department such as ours with another Department in order to understand comparable measures of value for money for, for example, tourism investment and for investment in research or investment in renewable energy delivery. It is incredibly difficult to find a metric that allows us to say that it would be better to spend an extra £1 on one thing over another. Rather, it is about the overall impact that there is on economic growth.

I point to the fact that the most recent figures in the Northern Ireland composite economic index (NICEI) showed that, in the 12-month period up until the end of June, we had the fastest economic growth in the UK and Ireland. We are therefore doing something right. From our perspective, that is not happening by accident. We therefore believe that we can demonstrate that we are having a positive economic impact.

Mr Honeyford: Ian, we as a Committee absolutely welcome that economic growth. From looking at the budget lines, however, I ask what has changed. What has the Department done differently? Has growth happened simply because Evri has seen a market in which to grow? Is it intentional growth by the Department or has it just happened?

Mr Snowden: Do you mean the Evri decision in particular?

Mr Honeyford: I am using that just as an example. You played no part in that, by the sound of it, nor did Invest NI. That business has invested in creating a hub in Mallusk. You are saying that our economy is growing, and I welcome that. All of us in this room want to see that, but is it happening in spite of the Department rather than because of it?

Mr Snowden: Any business that makes a decision to invest in Northern Ireland, or in any other location, will be taking a look at the full range of factors that will contribute to its economic success. We have invested a lot of money in skills over the past number of years. Compared with the pre-pandemic figures from five years ago, there has been a very significant increase in expenditure on apprenticeships and other skills programmes. We have started to redirect the work of Invest NI and other organisations towards achieving more regional balance across Northern Ireland, and there has been a lot of work done on areas such as electricity supply and renewable energy. There has definitely been a shift in where the Department's money is being spent.

Mr Honeyford: There are 25,000 young people without a job, not in training and not in education, so that is not success.

Mr Snowden: We have the youth training guarantee scheme. Any young person who wants a training place is guaranteed one by the Department.

Mr Honeyford: Finally, the Department's accounts have been failed again. They have been brought to the auditor's attention after another year of failure. That is the first time that that has happened in any part of the UK. I have said before that it happens regularly with small businesses. They are fined the first time, so there are consequences for them. If it happens for a second year, not only are its directors struck off but Departments inform the media, and those small businesses are then embarrassed to the world. There is, however, absolutely no accountability for the Department as a result of the same happening. You have over 110 accountants in the one Department, yet this has happened again. Why does it keep happening?

Mr Snowden: Without treading on the territory on which the PAC will want to interrogate me, the accounts for the 2024-25 financial year have not yet been finalised. In the previous two financial years, we were not able to meet the statutory deadline for laying the accounts. I am determined that we will meet that statutory deadline for this year. As a member of the PAC, you will recall, Mr Honeyford, that, when —

Mr Honeyford: I declare an interest as a member of the PAC.

Mr Snowden: — I was in front of the PAC in March of this year, I said that the nature of the issues that the Audit Office identified, which related to prior-period adjustments in the accounts, would take three years to wash through all aspects of the accounts and that the accounts would therefore continue to disclaimed, regardless of what we did in the Department.

You will have heard that, this year, there are concerns from the Audit Office about an additional matter, which is the quality of the information that Northern Regional College (NRC) has provided. We have been taking a number of measures to try to make sure that the quality of its information is improved. I can give the Committee a more detailed briefing when the information becomes available, but, as things stand, there has been a new chair of the Northern Regional College since the summer. We have asked the Northern Ireland Civil Service (NICS) group internal audit service to do a fact-finding exercise for us in order to find out who knew what about the financial situation in the college and when.

To be clear, there is not any suggestion that money has gone missing, been misspent or been misappropriated in any shape or form by the college. It is simply the case that it does not seem to be able to provide us with the supporting information that is to accompany its records and its accounts. The information that it provides needs a lot of work done to it in order to get it into a decent condition. We have also brought in an external forensic accountant to go through the college's records to try to see whether we can establish the adequate audit trail that we need in order to bring the information up to speed. The issues with the quality of information in the Northern Regional College's accounts will have a pervasive effect on the rest of the group's accounts, because the college's accounts have to feed into all the other information that we provide. We are working incredibly hard and putting a large amount of energy into fixing the situation.

You mentioned the number of accountants in the Department. There are 15 who work on the accounts. There are 31 who work in the Insolvency Service. A number of accountants are in non-accounting roles, because they have been promoted into other roles. It is entirely within their rights to take non-accounting roles when promotion opportunities arise. It is therefore not correct to say that there are 110 accountants working on the accounts in the Department. That is not the case. There are also some people working in Johanna's team who are embedded in the business areas, such as in the higher education division or in the apprenticeships division. We also have large contracts with external suppliers that need to be managed by professional accountants. We therefore need to have a lot of accountants, but that does not mean that they are all working on preparing the Department's accounts.

Mr Honeyford: At a PAC meeting, 110 was the figure that you gave me, so that is what was recorded. There is money being spent in the Department. Based on the accounts, is any additional support needed to allow the Department to function?

Mr Snowden: The Department is functioning, and it is functioning well. The Audit Office has not found any evidence at all of money being misappropriated or going astray. We have very significant challenges —.

Mr Honeyford: That is a distraction, because small businesses are fined when their accounts are late. This is an absolute mess.

Mr Snowden: I —.

The Chairperson (Mr Brett): OK. I am going to move on, because I want to give other members a chance to come in, but once the PAC relinquishes primacy of that matter, David, I am sure the that Committee will be keen to take it forward. We have about 20 minutes left, so I want to spread that equally between the next three members who are down to ask questions.

Mr Delargy: Mark, I begin by welcoming you to the role and thank you for your work in your previous role. I am looking forward to working with you. Before I begin, Chair, it is important to note the Palestinian students who have been welcomed here by the Minister. For students who are fleeing a country where genocide and persecution is happening and where they are not able to get the education that they need and deserve, it is really important that we have a Minister who is showing leadership by welcoming those students. I expect a Minister to do that, as that is leadership. I commend the Minister and the Department for putting out a statement.

To go back to the accounts, there are quite a few things in the papers provided that are really important and that demonstrate the regional balance that you and the Minister are emphasising. I will hone in on a couple of points. First, I really welcome the financial commitment to the expansion of Magee and, as you have said, the plan for the years ahead: the continued commitment to invest. I want to get a better understanding of exactly what that will look like and of how the Committee can support you with it.

My second point is on the funding to develop food innovation at the North West Regional College (NWRC) campus in Limavady and at the Strabane campus as well. The NWRC's Foodovation Centre is a really exciting project. I am keen to get an update on where it is at.

Finally, either Diana or David mentioned productivity. It is really good that it is in there as a central tenet of the economic strategy. I am keen to see how productivity will be measured and what sorts of metrics will be used to measure its success.

Mr Snowden: The majority of the money for the Magee expansion is in the capital bids. Last year, the Department supported the university to purchase a couple of sites that will allow expansion of the teaching accommodation. The capital expenditure, which will be used to build on the sites at Timber Quay and Queen's Quay, will allow for the creation of additional teaching accommodation.

We also need to address the student accommodation that is required. Students need somewhere to live if they are going to attend the campus. A significant programme of capital works is therefore required in order to bring the Magee campus up to the standard that it aspires to be at. This year, 6,500 students are enrolled at Magee. We may be able to get that number up by another couple of hundred, but, until the additional teaching accommodation comes on stream, the figure is probably at a ceiling. To have extra student places at Magee and to deliver the additional economic benefit, not just to the city but to Northern Ireland overall, we will need additional funding for higher education places. It is not about moving people from one campus or location to another. We would not end up with a net benefit from taking that approach. The resource bids relate to costs for additional students.

The projects in Limavady and Strabane are city deal projects. The Limavady project is part of the Causeway Coast and Glens growth deal, which was signed in July 2024, I think. I was at the event in Coleraine. The council and other partners are working through those projects' implementation. The Limavady project is some time away from implementation on the ground, because we still have to go through the business case process. The Strabane campus of the North West Regional College is part of the Derry city and Strabane region city deal. That project is further advanced and will form part of the canal basin development in Strabane. The business case for that project has been through the Department's internal processes, and I think that it is now with the Department of Finance. Do not hold me to that. I will confirm in writing.

Mr Delargy: I declare an interest as an MLA for Derry. Sorry, I interrupted you before you were able to answer my question about productivity.

Mr Snowden: Sorry, what was the question on productivity?

The Chairperson (Mr Brett): It is very impressive that you could recall three questions, never mind another. [Laughter.]

Mr Delargy: I am conscious of time. The point about productivity is really welcome, but I want to understand what metrics will be used to measure success. What incremental steps are to be taken?

Mr Snowden: You will see that the Department's business plan contains metrics for measuring productivity in Northern Ireland. We can therefore measure productivity against those metrics. In anticipation of a three-year Budget, we are looking to introduce some additional metrics. The primary one is output per hour worked. We can measure that in relative terms against comparator economies, such as the economy of other UK regions, of Ireland and of other European countries with which we compare ourselves. There is a group of 15. It is not just about measuring productivity in absolute terms but about measuring the relative position of our productivity. Measures will be taken that will lead up to that out-turn, and they are to do with the number of high-productivity firms or the number of people working in high-productivity sectors.

Mr Delargy: I ask one final question for clarification. The metrics that the Department and Invest use have not lined up in the past. Has any assessment been done of whether that will be the case in future for gross value added (GVA)? What metrics will be used to align departmental stats with Invest's stats? Having such metrics would make the Committee's work easier.

Mr Snowden: They will form part of the process that we are working on through our three-year forward plan. We will be working with our partner agencies to determine how best to measure all those things. That may help address Mr Honeyford's point about how we understand impact and value for money.

Mr Delargy: Thank you very much.

Ms McLaughlin: Thank you, and good morning, everyone.

Mr Snowden: If the Committee needs more time, I potentially have an extra 15 minutes, because I do not have to be at my next event until 11.15 am, rather than 11.00 am, as I originally thought.

The Chairperson (Mr Brett): It is just as well that you told us that at the end of the questions. [Laughter.]

Ms McLaughlin: You will be glad to hear that a lot of my questions have been answered. I was going to drill down into some of the Magee figures, but they have already been clarified. In your paper, Ian, you note:

Can you expand on that? How much trouble are our universities in? What are the Executive going to do about their funding?

Mr Lee: I will take the university colleges and the universities separately. When we share the financial needs assessment with the Committee, it will give you a lot more insight and information. The challenge for the university colleges in particular is their size. They have done really well to continue to keep their costs down, but they are running on really tight margins. The challenge to ensure their medium-term sustainability is whether they can continue to make cost savings and work on those really tight margins that do not give them much room for manoeuvre. We will work with them to consider the diseconomies of scale to ensure that they are financially sustainable in the medium term. As I said, the key challenge for the university colleges is their scale, which makes it harder for them to respond to, for example, increases in National Insurance costs.

The universities are on a different scale, of course, and have a more complex operating model. That brings with it different risks, such as changes to international student numbers. The universities have greater exposure to research income and similar elements. A number of changes in recent years have affected them. Both universities made a loss in the most recent financial year, but they have a level of reserves that will allow them to manage that loss. They have plans to get themselves back into the black, and we continue to look closely at their plans. Part of the challenge for the universities over the next few years will be the scale of capital investment that is needed for the city and growth deals, the expansion of Magee and the other elements that are in there. We will therefore continue to work closely with them to see what we can do to support their financial sustainability. As I said, there is no immediate financial risk to the universities, but, in the medium term, they do face some really significant challenges.

Mr Snowden: I will expand a little bit on what Mark said. Universities have four primary sources of income. The first is the fees that students pay. The second is the teaching grant that the Department provides. The third is income from international students. The fourth is the external funding that they attract for research and for external investments and activities.

The agreed position of all the parties here is that fees should not be increased to a level approaching that in the rest of the UK. That means that we have to supplement the funding for universities through the teaching grant. I point out that, in cash terms, the teaching grant has not substantially changed in 20 years. We have not significantly increased the amount of money that has gone into it. That is set out in the bid document.

The UK Government are adopting a different approach to immigration. It affects international students, so that source of income, which has made up part of the growth revenue for universities over the past couple of decades, has now plateaued. The universities face pressures from a number of directions. Although they are not in immediate danger of financial insolvency, unlike some universities in England, they face financial constraints, within which they have to operate.

Ms McLaughlin: OK. Thank you for that. We have talked a good bit about bids 9, 22 and 23, as they relate to regional balance. Specifically, what has been the local economic partnerships' level of spending? What has been generated from that spend? Some of the partnerships appear to have got off the ground, but there is silence from some of the others. Can you give me an update on their spending to date?

Ms Park: I do not know the figures offhand, Sinéad, but I do know that allocations were made at the start of the year. As you said, this is the first year of the partnerships, and, as with a lot of programmes in their first year, the spend will be lower than what is anticipated. I can write to you, however, with the exact figures. The Minister made those commitments at the start of the year. As time has progressed, some of the money has been reallocated.

Ms McLaughlin: I would appreciate it if you could give me an update in writing.

Last week, the British Government announced significant investment in 330 or so deprived neighbourhoods in England and suggested that similar funding may be available for the devolved Administrations. Have you looked into that? Have you factored it into your budgeting? What are your plans for it?

Mr Snowden: That funding, if it were to be matched with allocations to devolved Administrations, would come through the Barnett consequentials and be added to the block grant. It would then be for the Executive and the Minister of Finance to work out how the money would be used. At this point, we have not given any further thought to how that sum of money would be used, other than to say that we would apply it to the issues identified in our bids. Very seldom are additional allocations in England hypothecated to equivalent activity in Northern Ireland, however.

Ms McLaughlin: In England, the Government are talking about the regeneration of town centres in particular. That funding would be quite significant for the Department for the Economy. It is one to keep an eye on.

Will you talk through the challenges that are posed by the fact that the financial sustainability plans are still not agreed? How does that impact the work that you are doing on budgeting?

Mr Snowden: Bids for the future are predicated on an assumption about the amount of work that the Department is expected to do or aspires to deliver. The Budget sustainability plans come into play when it comes to how that activity will be funded. The Department for the Economy does not have significant sources of additional revenue that it could potentially raise. Some of our activities are paid for by fees that are taken from the customers who are involved. For example, the Insolvency Service works to that effect, to a degree. Other than that, student fees are all that we have. Increasing student fee is the only additional lever beyond receiving funding from the Executive that is available to add to the funding for the higher education sector.

Ms McLaughlin: OK, that is grand. That is all from me.

Mr Buckley: Thanks for your answers so far. Is there a reason for the reduction in Northern Ireland Screen's budget?

Mr Snowden: Are you referring to a budget reduction in the current financial year?

Mr Buckley: There are proposed budget cuts of £1·5 million.

Ms Park: For NI Screen? In the current year?

Mr Buckley: In the table that shows resource budgets 2025-26 and indicative June monitoring, Northern Ireland Screen's opening budget is £20·1 million and its in-year is down to £18·7 million. Is there a particular reason for that?

Ms Park: When the budget was set at the start of the year, NI Screen was given certainty about its baseline for the first time ever; it had previously been supplemented by in-year funding, if that became available. Last year, that was baselined for the first time, which gave it certainty with which to plan. As I said, in previous years, it got in-year funding throughout the year. Obviously, we have not finished this financial year, but it was not a budget cut. It actually got an increase to its baseline.

Mr Buckley: OK. Tourism NI is starting off with an opening budget of £19·9 million, going to £25 million, and £5 million of that is earmarked for Executive priorities. Do we know exactly what that entails?

Ms Park: It is for major sporting events.

Mr Buckley: Is it earmarked for anything in particular? Can you be any more specific about those sporting events?

Ms Park: It is for sporting events in the 2025-26 financial year.

Mr Buckley: OK. That is perfect.

I return to one of David's points earlier. We talked about a budget line for the multi-campus model and how it might affect the University of Ulster. Does that place the emphasis back on the Department by saying, "Either you fund the multi-campus model, or it does not exist" or is the onus still on the university, which has reassured us time and time again that it is committed to a multi-campus approach?

Mr Snowden: The starting point is the fact that it is the university's decision to operate a multi-campus model. We have no policy position in the Department that states that there should be a multi-campus model. However, it is part of regional balance, and therefore we are quite keen to see it maintained. The university has approached us and said that it believes that its funding allocation needs to be adjusted to take account of the fact that, compared with Queen's, which operates on a single campus, it has additional facilities management costs and other additional running costs just from maintaining three separate locations — four, in fact, because it still has the Jordanstown campus. The university is saying that we need to think about our funding mechanism in order for it to be able to manage that.

Mr Buckley: I do not underestimate the power of the argument, but I am very concerned about that additional line. I do not want it to be used as an attempt by Ulster University to shirk the responsibility of the multi-campus approach, which is its decision to have. It has reassured us that even the additional resource for Magee will not impact on its multi-campus approach. I am thinking in particular of Coleraine. Have you considered that building of expectation and how it could be used in a way that might undermine that multi-campus approach?

Mr Snowden: Of course, we are aware that that line of argument could be used, which is why we are not just taking the £18 million figure at face value; it will be thoroughly interrogated as part of the higher education funding review.

Mr Buckley: OK. What is the community energy support programme?

Mr Snowden: Which line is it at?

Mr Buckley: You describe it as being "currently underway ... with SIB".

Ms Park: It is in the capital bids.

The Chairperson (Mr Brett): That is going to be the outworkings of the electricity price guarantee scheme.

Mr Snowden: Oh, yes. Currently, we are working on what is called a "pathfinder project" in south-west Fermanagh. The idea there is to see how we can involve local communities in supporting renewable energy or other energy projects. Down there, you have Encirc and Mannok Cement, which are very high energy users. They need to have sustainable renewable energy solutions that will help them. Otherwise, the owners of those two plants may decide to relocate elsewhere where they have zero-carbon requirements to meet. That has an impact on communities, so we are trying to work through a process where there would be a mechanism by which you could give some degree of support to local communities who accept large renewable electricity projects in their vicinity. Lots of ideas are flying around on what that might look like in practice, including things like discounts off bills, for example, for people who are in close proximity to some of that infrastructure, which would include things like pylons or large-scale storage facilities. This bid will start to support the implementation of some of those community responses and/or community-owned energy assets. Where the community actually owns, for example, wind turbines or other renewable electricity generation assets, that might help them to be more acceptable to the community and less likely to be opposed.

Mr Buckley: On the wider theme of renewables, there was the energy efficiency capital grants scheme — obviously, you are aware of it — that was administered through Invest NI. It was heavily oversubscribed very quickly. It has caused a lot of uncertainty in the supply chain, with businesses holding off investing in energy efficiency — particularly solar energy — in their buildings. Do you anticipate that scheme's being reactivated? I know that it is currently paused. Will we get clarity on that?

Mr Snowden: The intention is to reactivate it as soon as we get clarity about what is affordable within the budget. Obviously, with the history of energy efficiency schemes in Northern Ireland, we do not want to create a situation where we are going to overspend massively. The review is currently under way. That will look at things like the budget level that is required; the size of team that is needed at Invest NI to administer the grants, because it was being overwhelmed with the volume that was coming in; and, given the very high level of demand that there is, whether the grant rates, which were quite generous, were set at the right level. We are looking at a number of different factors, but the idea is to re-establish that scheme.

Mr Buckley: OK. I encourage you to provide clarity to the industry, as soon as possible, about the potential direction of travel, because it is having a considerable impact. Regardless of what the ultimate decision is, we need to make decisions on that soon.

I will go back to some of your initial comments. I am a bit confused about the announcement of 1,000 Bank of America jobs. Was the Department aware of that announcement before it was actually made?

Mr Snowden: I found out about it for the first time the day before the announcement was made.

Mr Buckley: OK, so the Minister would have been made aware before the announcement was made.

Mr Snowden: She was made aware the day before, at the same time as I was made aware. We were asked to provide a quotation for the Department for Business and Trade's press release.

Mr Buckley: OK. Is it your understanding that the Minister welcomes that investment?

Mr Snowden: Yes. That was in the statement by the Department for Business and Trade.

Mr Buckley: Why has the Department been unable or unwilling to answer journalists' queries as to whether the Minister welcomes that investment? It seems very straightforward. Is there a reluctance to do so?

Mr Snowden: The Minister has taken the view — of course, I can relay only what she has said to me — that she has already made it clear that she welcomes it.

Mr Buckley: OK, so you anticipate those journalists' queries being answered to that effect very soon? Is that your understanding? I am sure that it is not the normal departmental process to not answer simple queries like that.

Mr Snowden: It is for the Minister to make that decision.

Mr Buckley: Bank of America officials were in Northern Ireland last week. Was the Department made aware that they were coming?

Mr Snowden: Yes, we became aware the weekend before they arrived. Unfortunately, the Minister was not available, due to prearranged appointments. I do not think that she was actually invited to any meeting with them, although senior officials from Invest NI were with the Bank of America for the entirety of that afternoon and were in discussions with them about what kind of support Invest NI and the Department can provide.

Mr Buckley: So officials from the Department for the Economy met Bank of America officials last week.

Mr Snowden: No, Invest NI officials.

Mr Buckley: Was there any invitation from anybody in the Department for the Economy to meet Bank of America officials when they were here last week?

Mr Snowden: No.

Mr Buckley: Was there any attempt by the Department to reach out to them to meet? I imagine that, with such a significant investment, there is plenty to talk about.

Mr Snowden: The best people to speak to them about that investment and the support that they need, including any plans they might have in the future, would be Invest NI officials, because they can give the practical support that is required.

Mr Buckley: Do you not believe that a Minister with responsibility for the entire Department would be a good person to meet? Does she have any plans to meet them going forward?

Mr Snowden: I cannot answer that. The question of whether it is appropriate for the Minister to meet is one for politicians.

Mr Buckley: Does anybody in your Department plan to meet them?

Mr Snowden: We will meet them when they are back in Northern Ireland, or, when there are future plans to go to America, we will attempt to meet them there as well.

Mr Buckley: We look forward to the Minister's press release in that regard.

The Chairperson (Mr Brett): Ian, you have nine minutes left. If you do not mind, I am going to take advantage of those. I was trying to see a budget line for the route development fund going forward. Am I missing something?

Mr Snowden: It is in the regional balance and productivity bit.

Ms Park: This exercise is looking at allocations above baseline. As you know, last year, the Minister had in place the route development for London. The one that is in place — I think it is the public service obligation (PSO) for the City of Derry Airport (CoDA) — is already in our baseline, so there would be no bid as such in these bids for that.

The Chairperson (Mr Brett): I totally understand that. That is the agreement with CoDA. However, in the Department's business plan and in her comments in my debate on aviation, the Minister made clear that we are doing work to have a new route development fund in place.

Mr Snowden: Item 4 in bid number 22 is "Connectivity & Infrastructure Development". That is to enhance regional connectivity and digital infrastructure, and aviation research and policy support and air route development investment are both listed as items there.

The Chairperson (Mr Brett): What is the budget line for new route development on that?

Mr Snowden: We do not currently have one. That is the point of the bid.

The Chairperson (Mr Brett): How much of the bid that you are making is for that?

Ms Park: I can provide a breakdown for you. I do not have that detail. It is all in regional balance and driving productivity.

The Chairperson (Mr Brett): Number 33 of your business plan — the Ministerial priorities and end-of-year progress document that was produced a while ago — is:

Comment:

Where is that?

Mr Snowden: It was passed to the Minister at the end of last week.

The Chairperson (Mr Brett): What does that say?

Mr Snowden: It is essentially how the Department will meet the expectations of the new language commissioner whenever they are appointed. It is to fit in with whatever that will require.

The Chairperson (Mr Brett): Is there a corresponding paper on how they will meet the requirements of the new Ulster British commissioner?

Mr Snowden: As you probably know, there are different layers of languages in the European Charter for Minority Languages. We will have a look at ho we meet the requirements of that when it comes about, but there are already —.

The Chairperson (Mr Brett): There is currently no paper?

Mr Snowden: There is no paper on that yet.

The Chairperson (Mr Brett): Why is there a differential?

Mr Snowden: There are different sets of obligations for the two different languages. There are different obligations in the charter for Irish as opposed to Ulster Scots, because they fall into different categories.

The Chairperson (Mr Brett): I understand that: you have two different obligations, which means that you need two different approaches. Where is your approach on the corresponding one?

Mr Snowden: We do not have one at the minute.

The Chairperson (Mr Brett): OK. So one is getting preferential treatment over the other?

Mr Snowden: It relates to the position of the two languages in the European charter.

The Chairperson (Mr Brett): The official position of you, as permanent secretary, and the Department is that one is coming forward for work by the Department and the other is not.

Mr Snowden: At the minute, yes.

The Chairperson (Mr Brett): OK. Do you think that that is an acceptable position?

Mr Snowden: That is the position that the Minister has asked us to take forward.

The Chairperson (Mr Brett): She has given a direct instruction to you to treat one differently from the other?

Mr Snowden: We have a ministerial request to develop a policy for the Irish language, and we have not received one for Ulster Scots.

The Chairperson (Mr Brett): Finally from me, Nightmovers. The Minister for the Economy wrote a joint letter with the Minister for Infrastructure about late-night public transport. I thank the Minister for committing funding to that. It is being done on a two-year pilot. Is there anything beyond that in this financial ask? It is a two-year pilot scheme. Is that included when it comes to the spending review, or does it not need to be bid for because it is in the baseline already?

Ms Park: No, it is a small amount that will be for the pilot. It could be re-prioritised within whatever allocation we get, depending on the outcome of the pilot.

The Chairperson (Mr Brett): Ian, when you need to go, you can leave.

Mark, I know that it is not completely within your remit, but I will ask you about the higher education stuff. I have had correspondence with the Minister about the treatment of students who come from outside of Northern Ireland to study here, particularly in the context of GB versus the Republic of Ireland. The Minister's position, which she is perfectly entitled to take, is that GB students are treated differently from students from the Republic of Ireland in terms of their inclusion or non-inclusion in the maximum student number (MaSN) cap. What is the impact of the amount of students who are currently coming from the Republic of Ireland to study here in Northern Ireland? How many places are they taking up that could otherwise have been allocated to students in Northern Ireland?

Mr Lee: I am not sure that I have the exact figures in front of me. We will write to you about those, if that is OK. I note that the number has been increasing in recent years, albeit from a small base; it is important to make that point. The Minister is keen that there be a flow in both directions and that we seek to reduce any barriers to students from Northern Ireland going to study in Dublin or wherever it may be.

The Chairperson (Mr Brett): The current position is that those places that students from the Republic of Ireland are taking could otherwise have been filled by students who live in Northern Ireland?

Mr Snowden: Yes. If the MaSN cap is limited and some additional people are coming from the Republic and using up some of those MaSN places, that, by definition, means that fewer places are being occupied by people from Northern Ireland.

The Chairperson (Mr Brett): So the Department for the Economy is actively taking a position that disadvantages students in Northern Ireland.

Mr Snowden: That is a curious way of framing it, but —.

The Chairperson (Mr Brett): How would you explain it, then?

Mr Snowden: The long-standing policy is that the MaSN cap applies to any student domiciled in the island of Ireland, but the fact that the MaSN cap exists at all is what has caused the problem. It is not that we are actively choosing to operate a policy that disadvantages Northern Ireland students at the expense of anybody else; it is a consequence of the way in which the system currently operates. The Minister is in discussions with the Irish Government and has asked on a couple of occasions whether there is anything that we can do to address this problem. Obviously, it will be problematic for the Northern Ireland economy, and, indeed, for the entire island, if we lose people who could otherwise be educated here. Those discussions about how that funding issue might be addressed are ongoing.

The Chairperson (Mr Brett): What is the purpose of the discussions? Is it that the Irish Government would pay for those places?

Mr Snowden: Ideally, we would like that.

The Chairperson (Mr Brett): What progress has the Minister achieved in that regard?

Mr Snowden: At least the discussions are taking place and are proceeding.

The Chairperson (Mr Brett): They are talking about it, but there has been no tangible progress?

Mr Snowden: At this point, no, but the conversations have been started.

Mr Lee: It is worth noting that the MaSN has increased in recent years, with the expansion of Magee and numbers elsewhere, and the Irish Government have funded specific places on courses such as medicine and other things in institutions here.

The Chairperson (Mr Brett): Has the chair of the review of higher education funding been appointed?

Mr Lee: No. There is some advice to go to the Minister on the chair of the expert panel that we are talking about, which will provide advice. We have discussed names of people who might be involved with the institutions, but we have not finalised a list of experts yet.

The Chairperson (Mr Brett): How many experts will there be?

Mr Lee: Again, there is no final number yet. The idea is that there will be a group including the key stakeholders — the universities and other parts of our system — and a number of experts. We will look for a number that is not unmanageably large but gives us a range of expertise and viewpoints from various elements of different systems.

The Chairperson (Mr Brett): Have the institutions signed up to the terms of reference that the Minister has published?

Mr Lee: The draft terms of reference are with them so that they can provide us with any thoughts that they may have. I think that we asked them to come back by 10 October, so we are awaiting any comments that they have.

The Chairperson (Mr Brett): How long did you give them to comment on them?

Mr Lee: I think that the letter went out — I may not be able to find that information quickly —.

The Chairperson (Mr Brett): Was it two weeks?

Mr Lee: I think that it went out last week, which means that we have given them three weeks.

The Chairperson (Mr Brett): It is going to be the most fundamental review of the funding mechanisms for our higher education institutions, and it was meant to have started a long time ago, and the Department has written to the institutions to say, "Here are our terms of reference. You have three weeks"?

Mr Lee: I will make two points. First, the broad approach will not be a surprise to them. We have discussed it with them before, so they know the strands and the general thinking about where the review is going. The other point is that we are always open to having a conversation, if they cannot make the deadline. We can extend the deadline, if they need that, and have done so in the past.

The Chairperson (Mr Brett): You are right, Mark, about there being a perceived view of the direction of travel and general theme of the review. The perceived view of some of our institutions is that this is going to be used to attempt to move funding from one part of Northern Ireland to another. I think that you will receive serious pushback on those terms of reference. I encourage you, or, rather, your replacement, to engage extensively with our institutions. Ultimately, we need to ensure that all institutions across Northern Ireland are fairly and equitably funded. If the Minister is not going to take any decisions to drastically raise the MaSN cap or increase the allocation to increase student numbers, a cut will have to be made somewhere, because her budget is not increasing. Tough decisions will have to be made.

Ian, I recognise that you have another engagement. I appreciate you and your officials' continued engagement with the Committee. If you can write to us on some of the issues that members across the piece have raised, we will look forward to hearing more details. Thank you very much for all your hard work and dedication. It is much appreciated.