Official Report: Minutes of Evidence

The Chairperson (Mr Brett): From the Department for the Economy, I welcome our friends and colleagues Niamh and Conor. Thank you very much for coming along today. I wish to pass on my sympathies to Johanna on her recent bereavement.

Ms Niamh McGarvey (Department for the Economy): Thank you.

The Chairperson (Mr Brett): Thank you, guys, for being here today and for the work that you are doing. I am very happy to hand over to you at this stage.

Ms McGarvey: Thank you, Chair. I am joined today by my colleague Conor McStravick. We are here to provide an update to members on DFE's final budget position and expected outturn for 2025-26. The DFE 2025-26 non-ring-fenced resource departmental expenditure limit (RDEL) budget is £842·4 million. That is broken down into £799 million of a controllable allocation and £43·4 million of Executive and Treasury-earmarked funding, covering the Open, the graduate-entry medical school, PEACE PLUS, city deal CPD fees, the Windsor framework and UK Shared Prosperity Fund (SPF) moneys.

Turning to capital, DFE has received £12·6 million additional funding as part of December monitoring and has processed technical transfers in the December and January exercises totalling £19·4 million, bringing our total capital to £235 million. That is inclusive of £71 million of earmarked funding, of which £50 million relates to city deals. Details of our December position and allocations to business areas and our partner organisations have been provided to you in the tables in our briefing. However, due to the timing, the briefing does not include the January technical exercise. Therefore, in relation to RDEL, there were three significant movements. The energy group transferred out £1·2 million, and the skills and education group received a further £0·3 million, both within the controllable allocation.

The further education colleges received £0·6 million from the UK SPF, within the earmarked funding and RDEL. There were two significant movements in the capital departmental expenditure limit (CDEL). The energy group received £1·7 million, and the entrepreneurship, innovation and economic strategy group received an additional £3·8 million for the Pride in Place programme, both within the controllable allocation.

Members have also received a copy of our Department's ring-fenced resource DEL and capital DEL budget bids, which were submitted to the Department of Finance as part of December monitoring, as well as our reduced requirements, all of which are related to earmarked funding.

Following our submission, DOF advised Departments that it would welcome bids for financial transactions capital (FTC). As a result, we submitted a bid for £2·5 million, which was successful and has been allocated in full to Invest NI, bringing our total FTC budget to £10·8 million for 2025-26. The DFE 2025-26 budget will be fully utilised to support our Minister's priorities of creating good jobs, promoting regional balance, raising productivity and accelerating progress towards net zero, while enhancing our capability to deliver against key Programme for Government outcomes.

That concludes my opening statement, Chair. Conor and I will do our utmost to answer any questions that members may have. If a detailed response is required, we will ask our business areas to follow up in writing.

The Chairperson (Mr Brett): Thank you very much, Niamh and Conor, for stepping up and coming to the Committee today.

I will start with FTC. I pay tribute to you for bidding further for FTC. Historically, across government, we have been poor at trying to utilise FTC. Is the figure of £10·8 million a record for the Department for FTC allocation and hopeful spend by 31 March?

Ms McGarvey: I do not know whether it is a record, but I know that it is higher than it has been in recent years. I can check if you want.

The Chairperson (Mr Brett): No, I just wanted to say thank you for doing that. At a time when we have limited resources, it is very important to utilise FTC.

Will the allocation to Invest Northern Ireland allow it to continue current programmes?

Ms McGarvey: Yes, it is to continue current programmes. It is for the investment fund for Northern Ireland.

The Chairperson (Mr Brett): Very good.

Ms McGarvey: It is getting £2·1 million of that. The £0·4 million is for TechStart III.

The Chairperson (Mr Brett): Very good. I have a final question about city deals. There had been some movement and reduced requirements in relation to that. Is that just reprofiling for the next financial year?

Ms McGarvey: It is reprofiling. It is good financial management to declare easements as we find out about them so that they are saved for the Northern Ireland block into the next year.

The Chairperson (Mr Brett): Thank you. The easements that you have done in your Department are exemplary compared with capital easements in other Departments. In flagging them up so early, you have ensured that the money can be reprofiled and used in wider government. On behalf of the Committee, I thank you for all your work on that. It has been very important.

Mr Honeyford: Thank you for the presentation. Table 1 shows us that the budget for the energy group has risen from £3·5 million to £6·7 million. What does the energy group include? What is in it?

Ms McGarvey: Is that in the resource DEL allocations?

Mr Honeyford: Yes. The allocation rises from £3·5 million to £6·7 million.

Mr Conor McStravick (Department for the Economy): The £3·5 million is the opening capital budget.

Ms McGarvey: The £3·5 million was the opening allocation for capital. It is for the group's capital requirements.

Mr Honeyford: What is the energy group? Is it in the Department?

Ms McGarvey: Yes.

Mr Honeyford: The energy section?

Ms McGarvey: Yes.

Mr Honeyford: What is the reason for the doubling, basically, of the amount?

Ms McGarvey: That was an allocation that we got in June for specific energy projects. Part of it has been utilised in the transfer that we have just made for energy-intensive industries. Some of it has been utilised for other projects such as the renewable heat incentive scheme.

Mr Honeyford: Can we get detail? There seems to be so little happening in the Department. I am trying to work out where the doubling of the allocation is going.

Ms McGarvey: Yes. That was in June, so then —.

Mr Honeyford: There has been a 100% increase in cost, but there has not been a 100% increase in output. Can we have a breakdown of spending?

Ms McGarvey: Yes. We can give a breakdown of what exactly energy is spending that money on.

Mr Honeyford: I would like to see where the money is going.

The allocation for tourism has dropped from £25 million to £20 million.

Mr McStravick: It was earmarked resource.

Mr Honeyford: It was earmarked resource?

Mr McStravick: Sorry, £5 million is for earmarked resource. The table shows £20 million in the controllable column, with an extra £5 million in the earmarked column. Perhaps the table that you got does not have the total, but it is £25 million.

Mr Honeyford: OK, so it shows as £25 million.

Ms McGarvey: There were so many columns because we are now so far through the year that I did not add in the total column when I was preparing the briefing. That is entirely my fault, because, with my eyesight, I could not read it all, so I just took that out. However, we can add it and update it.

Mr Honeyford: No, that explains it. I was just trying to work out why.

Ms McGarvey: We can update it for the few wee movements in January, if you want.

Mr Honeyford: Yes, that would be perfect. No bother. I have no more questions. Thank you.

The Chairperson (Mr Brett): Thank you. I have no other questions.

Ms McGarvey: Oh. [Laughter.]

The Chairperson (Mr Brett): That is a useful outcome for the December monitoring exercise. The Committee will be interested to see, when the Budget is finally agreed, the outcome for the Department. Discussions may be somewhat more prolonged then.

Thank you for your update on the outcome of the December monitoring round.

Ms McGarvey: Thank you so much.