Northern Ireland Assembly, 12 December 2000

86 contributions from 39 members. The official report.

Assembly Business: Visiting Clerk

John (Speaker, Belfast East)

Members will note that we have a new Clerk at Table today. Dr Heather Lank is a Clerk of the Canadian Parliament and is here to assist in the training of our Clerks. It is traditional when a senior Clerk visits another Parliament on duty, that he or she is invited to assist at Table. I am delighted to have the help of such a distinguished Commonwealth parliamentary colleague. [Applause]

Revised Budget (2001-02) and Public Expenditure (2002-03 and 2003-04)

Mark Durkan (Social Democratic and Labour Party, Foyle)

With permission, Mr Speaker, I would like to make a statement on behalf of the Executive on the Budget for 2001-02 and the Executive’s public spending plans for 2002-03 and 2003-04.

When I introduced the draft Budget on 17 October I set out the Executive spending plans for 2001-02 as a basis for debate and comment in the Assembly and more widely. Many have taken this opportunity, and I am especially grateful to the Finance and Personnel Committee for the attention that it has given to this issue. The Assembly had a very fruitful and important debate on this subject last month, and Members will also have seen the report of the Finance and Personnel Committee on the Budget. There has also been extensive comment from other Assembly Committees.

We have received several important comments from social partner organisations and other interested parties. We held two seminars on the impact of the Budget proposals on equality of opportunity, which was also the subject of comments from the Equality Commission. I am very grateful to the Commission, and to all who attended the two conferences, for their thoughtful input.

As well as the comments from the Assembly and others, the revision of the Budget has been affected by several developments in the public spending figures. Decisions by the Chancellor of the Exchequer gave rise to some changes in the total available, especially his confirmation that we will receive a Barnett-based share of the latest round of allocations from the Treasury’s capital modernisation fund.

Within our own management of spending, it has been possible to correct an anomaly in the treatment of rate rebates which up to now has had the effect of denying us some of the subsidy to which we were entitled from the social security system. The correction of this anomaly increases our spending power in the departmental expenditure limit as fixed by the Treasury while having no effect on those who need rate rebates. The rules on entitlements remain based on parity of social security legislation with England, Scotland and Wales.

Details of the additional amounts available for allocation as a result of these changes, together with some savings that have emerged in departmental budgets since October, are set out in the Budget document.

In finalising the Budget proposals, the Executive have had regard to the views expressed by the Assembly on a range of issues. The Executive propose that the additional resources available should be used as explained in the Budget document and in the table attached to my statement.

To outline the revised Budget proposals, I will comment on the position for the Executive programme funds and for each Department in turn. I will set out briefly the changes to the allocations now proposed for each Department as compared to those announced in October, as well as a few key points about the indicative figures for 2002-03 and 2003-04.

The Executive have agreed the indicative allocations for 2002-03 and 2003-04. We do not have as much in the forward plans as we would wish, because of the effects of the Barnett formula. We want to achieve a new steer on our spending to deliver our Programme for Government in the best possible way. It is important, therefore to remember that the figures for departmental allocations for the later years are indicative. They understate what will, in the end, be allocated to many functions, because they will be augmented by allocations from the Executive programme funds. They will also be subject to review next year. To emphasise this they are, in line with convention, rounded to the nearest £10 million.

The Executive programme funds are a key element of the Executive’s determined strategy to ensure that spending plans are adjusted from previous patterns and brought into line with the Executive’s strategic priorities as set out in the Programme for Government. They are also designed to promote cross-cutting working, whereby proposals and initiatives can be brought forward for consideration by an appropriate group of Ministers working together. That will help the new structures of Government to promote a better way of working and managing programmes and projects.

The attribution of resources to the funds has now been confirmed and is set out in the Budget document. That includes the increase of £9 million for 2001-02, made possible through planned carry forward from 2000-01 as announced last month. There are also increases for the new directions fund, which I will say more about later. Early in the new year, proposals from Departments for the allocation of those funds will be considered and put to the Assembly in due course. We believe that the special allocations from these funds, managed and approved at Executive level, will make a real difference in applying our Programme for Government in contrast with previous patterns of expenditure. That will be an important demonstration of new political direction, based on direct accountability to the people, through the Assembly.

Because some spending power is being placed in these new funds, it follows that the amounts allocated to Departments, especially for 2002-03 and 2003-04, understate the final spending power that will be available to functions in due course. Thus the spending plans in the revised Budget document will be augmented by successful bids on the five Executive programme funds from Departments. We want to proceed with this as quickly as possible and to consider the allocations from the funds for the next three years so that the spending plans for all Departments are set out as clearly as possible.

With regard to EU programmes the draft Budget showed how the Peace II programme would be added to the mainstream allocations for Departments. These are also shown in today’s revised Budget, though they are indicative allocations which we will need to revisit once the programme has been agreed. The Executive are committed to ensuring that the new programme is truly additional and distinctive, as intended. A factor in settling the detail of the revised Budget is the Executive’s provisions in their spending plans for the actions proposed for the other aspects of the new round of EU structural fund programmes, namely the transitional Objective 1 programme and the community initiatives. Unlike Peace II, these do not provide additional spending power to the region over and above our Barnett-based public spending allocation.

In finalising the Budget for 2001-02, and in setting indicative plans for 2002-03 and 2003-04, the Executive have ensured that there is appropriate provision for the content of these EU programmes. This has meant making special provision of £15 million in 2001-02 and £20 million in each of the two later years. That includes an allowance of some £11 million a year for aspects of the transitional Objective 1 programme which are outside the normal budgets of Departments. There is also £4·5 million in 2001-02, and £9 million a year thereafter for the four community initiatives — INTERREG III, URBAN II, EQUAL and LEADER+. Details of the allocation of these amounts to Departments are shown in the Budget document. These roll forward similar and successful actions from the previous round of EU funding and show that the Executive are determined to ensure that we work fully and effectively with the EU in applying the structural funds as a key contributor to the region’s development. We are very grateful for the special assistance that the EU continues to provide, especially for the Peace II programme, which is such a unique and significant commitment by Europe to our situation.

The proposed allocation for 2001-02 for the Department of Agriculture and Rural Development is increased by £2 million from that announced in October. The further allocation is to provide for the likely cost of essential functions in relation to animal health together with allowance for EU programmes, in particular the LEADER+ community initiative. The Department of Agriculture and Rural Development receives a substantial increase in spending power in 2001-02, and this is then rolled forward into 2002-03 and 2003-04 in the Executive’s indicative figures.

The Department of Culture, Arts and Leisure received a significant boost in expenditure in the draft Budget, especially for the arts. Some further provision has been added to permit further work on the libraries capital programme in both 2001-02 and 2002-03. The Budget also provides for the agreed increase in the provision for the North/South Languages Body, which was announced in November following final recommendations from the North/South Ministerial Council. The Department of Culture, Arts and Leisure is to get a substantial increase in 2001-02 with smaller increases in the later years, though, as for all Departments, these may be revised when the allocations from the Executive programme funds have been completed.

The proposals for the Department of Education include an additional £1·3 million in 2001-02 compared to the draft Budget.

The uplift from 2000-01 to 2001-02 will be 7·2%. This demonstrates the Executive’s determination to make appropriate provisions for schools which is a fundamental investment in our future. The Minister of Education will provide further detailed information in due course.

In the Department of Enterprise, Trade and Investment there is a new provision for the development of the information age initiative, which is a significant aspect of the investment that we must make in the economy. The investment from our own public spending resources will be complemented by the proposals currently under discussion with the European Commission for inclusion in the Peace II programme. Again, there will be scope for funding proposals for the Department of Enterprise, Trade and Investment functions to be considered in the Executive programme funds.

The budget for the Department of Finance and Personnel has been increased from the position proposed in October. This is to include an allowance to cover technical assistance, with the new round of EU structural funds programmes. The indicative figures include a roll forward of these proposals, which also take into account the needs of accommodation services for all Departments in future years.

The largest single programme in our departmental expenditure limit is for the Department of Health, Social Services and Public Safety. The proposals now presented, which involve the allocation of £7 million more than proposed in October, make provision well above the rate of inflation, with a 7·6% increase over 2000-01. That should help the Health Service to develop and address the needs of our population.

I recognise the significant demands on the Health Service at this time, and it is right that it should receive substantial resources in the spending review. The indicative figures for years two and three of the period provide for further substantial increases. Furthermore, many aspects of health programmes will be eligible to bid on the Executive programme funds; thus there is scope for these allocations to be increased.

In the Department of Higher and Further Education, Training and Employment the main development arises from the Executive’s decisions last week regarding the approach to the student support review, which I will turn to shortly. The departmental figures now include details on the welfare-to-work programmes, which have been transferred to our responsibility following the conclusion of the Spending Review 2000 by the Treasury. The plans also include the continued provision of support for training, which is to be provided by non-governmental organisations and is likely to receive support under the European structural funds transitional Objective 1 programme.

The plans for the Department of the Environment remain largely unchanged from those announced in October 2000. There are some additional provisions for the environmental aspects of the European transitional Objective 1 programme, as well as a small increase for administration costs in planning and environmental heritage.

The Programme for Government included a commitment to introduce free travel for the elderly. The spending plans for the Department for Regional Development make provision for this commencing from April 2002. The Executive decided to cover three quarters of the estimated cost, rather than one half, which was the figure in the models discussed up to now with district councils. Such details must be explored further with councils. However, this is an area to which the Executive are committed to making an important change which will benefit many. Also for the Department for Regional Development there is an addition of £2 million for roads maintenance in 2001-02.

The Department for Social Development will receive an additional £2 million for housing aimed at targeting the particular difficulties affecting north Belfast at present. This area is a high priority for the Department for Social Development and the Housing Executive. The plans also provide for continual support for the voluntary sector under the transitional Objective 1 programme, subject to the ongoing negotiations with the European Commission.

Finally, the Office of the First Minister and the Deputy First Minister has a budget largely unchanged from October. The additional £0·4 million in 2001-02 will be used to fund key research on equality and policy effectiveness and to expand a number of existing programmes.

In particular, the Executive have agreed to provide for some aspects of the student support review presented by the Minister of Higher and Further Education, Training and Employment, and to ensure that, after further consultation and discussion, there will be scope to make more specific decisions when the time is right.

In considering that, the Executive are focusing their attention on action to help the groups and sectors in greatest need of assistance, and that will address the factors that cause under-representation. The proposals, which Seán Farren will explain in detail later in the week, include action to help those students in higher and further education who are most affected by the restrictions on support for living costs, and for additional higher education places.

The full proposals need further consideration by the Executive and the Assembly, but the Budget provides an additional £5 million in 2001-02, £7 million in 2002-03 and £8 million in 2003-04 for some key aspects of the review, mainly for further education. The Executive concluded that this aspect of tertiary level education is where there had been the greatest neglect of students’ needs in recent years, and that the additional funding presents a major opportunity to make a difference. The Executive agreed to act immediately to provide help for that sector. These increases come on top of the additional £3·4 million for parity-based increases in the student support regime provided in the draft Budget.

The Executive have increased the allocation for the new directions fund by £15 million in 2002-03 and £20 million in 2003-04. Those funds will be earmarked to make it clear that there are resources available to allow a response to some of Seán Farren’s proposals, after they have been considered further by the Executive early in the new year. That will allow further time for evaluation and discussion of the proposals and for a proper response when the processes have been completed.

I stress again that the figures for 2002-03 and 2003-04, as set out in the tables attached to my statement and in the Budget document, are indicative at this stage. Departments can and will use them as a basis for planning. In particular, they will allow capital programmes to move forward, though the Executive will monitor the evolution of the public service agreements and information on actions and targets to ensure that there is a major change in the quality and detail of our analysis of what we are getting for the money used in expenditure programmes.

The Executive considered carefully the points made about the uplift in the regional rate, but concluded that the increases were needed to ensure that we have sufficient resources for our services.

In introducing the draft Budget on 17 October, I said that agreement on the Programme for Government and the Budget represents a very important step in the evolution of our new institutions. Again, we have demonstrated that we can, and do, work together as an Executive, having regard for the full range of responsibilities of all Departments and the services which are provided for all the people in the community. The next step will be a full debate in the Assembly next week, when I will introduce a motion seeking the Assembly’s approval of this revised Budget.

Because of this year’s constrained timetable, it has been necessary to eat into the original Christmas recess to take time to fulfil this central and important function. As I explained earlier in the autumn when this timetable was being settled, it is essential that we reach agreement on the position, so that those responsible for public services will have a clear basis for planning. The Finance and Personnel Committee, in its report on the Budget, urged that in future cycles the presentation of the draft Budget should take place as soon as possible after the summer recess.

I agree that that is the best way to ensure that the Assembly and its Committees have as much time as possible to undertake scrutiny. However, the process can and should begin before the summer recess, when Departments are preparing their input to each Budget cycle.

My other major concern is the overall position for determining public spending levels for the region, given the consequences of the Barnett formula. It is clear, especially as we look at the indicative figures for 2002-03 and 2003-04, that we do not have sufficient resources to take forward all the policy initiatives that the region needs in the context of the unique opportunities provided by devolution and the Good Friday Agreement.

We have inherited a backlog of under-investment in infrastructure, and difficulties in funding for health, education, transport and a range of other services that are now being addressed with large amounts of money in England. The Barnett formula means that we cannot match all of the increases available, and that will have an increasingly serious effect as the years go on. As I have said previously, the Executive remain determined to engage with the Treasury on the examination of these issues and to make as much progress as possible.

We also have a clear responsibility to ensure that whatever resources we have are used as effectively as possible. Already the Assembly’s Public Accounts Committee has examined a range of value-for-money issues, and my Department will continue to work with and on behalf of all Departments, and in line with the requirements of the Public Accounts Committee, to promote the best possible use of resources.

We are also working in conjunction with the Economic Policy Unit of the Office of the First Minister and the Deputy First Minister to develop better public service agreements, incorporating actions and targets and work on the evaluation of policies and programmes. That will improve how spending is managed and controlled.

I commend these Budget proposals to the Assembly. This has been a time-constrained cycle. However, I believe that we have an outcome that will begin to make a real difference which, especially through the Executive programme funds, will mean that everyone will begin to see the impact of the Executive and the Assembly in the management of our services.

Francie Molloy (Sinn Féin, Mid Ulster)

Go raibh maith agat, a Cheann Comhairle. I welcome the statement from the Minister of Finance and Personnel on the revised Budget. It is good that we have another look at the Budget in the ongoing review process. I can only speak on my own behalf, as the Committee has not discussed the revised Budget. The Committee will meet the Minister this evening and will be giving full consideration to the revised Budget.

I have a couple of questions. The first relates to the new money. Is that part of the extra £40 million in the 2000 spending review period? If that is the case, would it not be possible to use that money to keep the increase in the rates in line with inflation?

I welcome the commitment that the money that the Government will put into the European funding will be additional. I would appreciate a clear statement on when these funds will be available for Peace II, as that is an ongoing saga. The community is finding that the gap in funding is increasing and that Peace II is not on the ground.

Mark Durkan (Social Democratic and Labour Party, Foyle)

I thank the Member and the Committee for their work on the draft Budget.

First, the extra resources that we have available to allocate come from several sources, as I explained in my statement.

Some of them are a consequence of the Barnett formula, arising from the allocations announced in the pre-Budget report by the Chancellor of the Exchequer, and some arise from the difference in the treatment of rate rebate for owner-occupiers, which gives us some more resources to manage.

The Executive considered the option of using those moneys to achieve a lower increase in the regional rate. However, the Executive were also very conscious of the fact that various departmental Committees were saying that they wanted to see increases in departmental budgets. Departments, and their respective Committees, were indicating that they needed even more resources next year. If we were to make more resources available, then we needed to use the extra moneys that were becoming available between the draft Budget and now. In particular, we have the significant issue of student financial support, on which proposals have come forward in the interim as a result of a review. It was important that the Executive should make provision in respect of all of those issues.

We are continuing to work very hard with the European Commission on the Peace II programme to ensure that we can have the operational programme agreed as soon as possible. All discussions on the community support framework have been completed, although not as early as we would have liked. We are now dealing with the operational programmes, and when they are agreed we must then bring forward the programme complements.

We have already appointed the monitoring committees; some are in shadow format as that is all we are allowed to do at this stage. This is evidence that the Executive are determined to make progress as soon as possible. We are very conscious of the need, the expectation, and the frustration on the ground in relation to the delays in Peace II funding, and the uncertainty as to timing.

James Leslie (UUP, North Antrim)

I commend the Minister for bringing this statement to the House a week before the substantive Budget debate. Members will be very thankful for the opportunity to study the figures over the next six days.

In relation to the Department for Social Development, the Minister’s statement allocates an extra £2 million to target housing difficulties in north Belfast. This is very welcome. The House is aware of the considerable difficulties in that area. However, I am very disappointed to see that that amount seems to be all that there will be. The House is aware that the Minister for Social Development continues to insist on increasing rates by 2% above the level of inflation, which will cause great hardship for those who actually pay their rent.

What plans does the Minister have for allocating some money to the other pressing problems in housing, namely fuel poverty, and the need to upgrade basic kitchen and bathroom facilities in Housing Executive homes?

Mark Durkan (Social Democratic and Labour Party, Foyle)

In response to representations made by many people, not least the Social Development Committee and its Chairperson, the Executive have responded, in the revised Budget, with an allocation of £2 million. This is specifically aimed at supporting the Housing Executive’s work in north Belfast.

In relation to future monitoring rounds, the Executive will, as they have done in previous monitoring rounds, pay due regard to the needs and programmes of all Departments. We will be making allocations in the December monitoring round, and we want to make the provision that would be appropriate for a monitoring round at that stage of the year.

The question regarding rent increase cannot be dealt with in the context of a monitoring round. The spending plans for the Department for Social Development presume a rent increase of GDP plus 2%. If we worked on another basis, then there would be £7·8 million less for the Housing Executive programme.

These issues raised by the Member, and similar points made by other Members, will be considered alongside all the other pressures and proposals to be taken into account in the December monitoring round.

Eamonn ONeill (Social Democratic and Labour Party, South Down)

I also welcome the Minister’s Budget statement, which contains many elements that we can all support. However, on behalf of the Culture, Arts and Leisure Committee, I ask the Minister if he understands our disappointment at the absence of any undertaking to buy out the salmon fishery nets licences on our coastline. Does he recognise that for slightly over £1 million, these licences could be bought out and that this would be a major step towards the recovery of our wild salmon stocks? This problem has been well identified by experts, but will it be given a sympathetic hearing when further adjustments are made to the Budget? The situation is so bad that, within perhaps 12 months, some of our premier wild-stock salmon rivers could be making a nil return.

John (Speaker, Belfast East)

Will Members, and indeed the Minister, be as concise as possible with their questions and answers so that every Member who wishes to ask a question can do so. This is not an opportunity to make statement; it is an opportunity to press questions. Speeches can be made during next week’s debate.

Mark Durkan (Social Democratic and Labour Party, Foyle)

Mr ONeill has indicated what is not in the Budget, but we also need to remember what is in the Budget. Resources of £0·7 million have been provided for inland waterways and fisheries in 2001, with indicative allocations of the same amount for the following year, and £0·8 million thereafter.

I accept his point, and I understand that his case is supported by many experts. I do not pretend to be an expert. He asked if this issue can be considered when further adjustments are made to the Budget, but this is the revised Budget, as approved and agreed by the Executive. Therefore, neither the Executive nor I can make any further revisions. As I indicated in a previous answer, other specific proposals and pressures may be addressed in the December monitoring.

Peter Robinson (DUP, Belfast East)

I am sure that the House will agree with the Minister that there has been a legacy of underfunding, particularly for infrastructure. The House will want to support the Minister in anything that he can do to bring about a revision of the Barnett formula so that the situation in Northern Ireland is dealt with more equitably. However, I regret that in his revised Budget statement he still holds on to the intention to increase the regional rate by 8%. I thought that there had been fairly widespread criticism of this decision in the House and that the Minister had been advised to review the matter.

If Mr Durkan is looking for some suggestions about how he might save an equivalent amount of money and cover that shortfall, I would direct his attention towards the Civic Forum and the unnecessary "North/Southery". The public will find it difficult to understand this rise in the regional rate, which is considerably higher than the rate of inflation.

I raise my second issue so that he will know how to deploy his troops next week —

John (Speaker, Belfast East)

May I press the Member to put his questions. I urge all Members to ask questions rather than make statements.

Peter Robinson (DUP, Belfast East)

And in doing that I have taken significantly less time than have other Members before me.

I want particularly to draw the Minister’s attention to the Executive programme funds. I want him to try to convince the House of their benefit, for money is being held back that could be put into projects immediately. These funds must have the same criteria applied to them which apply to departmental projects.

Finally, the Minister’s figures do not indicate very clearly what the roads expenditure will be for the following two years. Figures were shown to the Regional Development Committee which indicated that in years two and three the amount available for capital funding in year one would be cut. Will the Minister indicate whether he intends to cut the roads funding in years two and three?

Mark Durkan (Social Democratic and Labour Party, Foyle)

There are quite a number of questions there, and I am not sure that I will manage to answer all of them.

First of all, Members cannot have it both ways with regard to the regional rate increase. They cannot come in here and vote for motions that call for more expenditure — for instance, motions asking for the speedy implementation of recommendations from the Higher and Further Education, Training and Employment Committee — and then insist that we cannot have the resources as an Executive to try to respond to the review on student support.

The Member has mentioned the amount of money allocated for the Civic Forum this year: that sum is £300,000.

I must repeat a point I have already made in the House in relation to North/South spending. The money that is being earmarked for North/South implementation bodies does not all represent new spending. Much of that money represents work that has already been done — but not by North/South implementation bodies. Many of the people employed on North/South work were already doing similar work. They are similar now doing that work as part of an implementation body, rather than on any other basis. That is fact. It is not all new work. It is not all new spending.

I pointed those figures out previously when outlining the allocation of £11 million for North/South implementation bodies. This issue has been dealt with before.

Secondly, in relation to the Executive programme funds, the Executive have made a clear decision that they want to use those funds to make sure that the Executive’s priorities as laid down in the Programme for Government are properly discharged by Departments and through interdepartmental co-operation. In my statement, I indicated that we hope to take decisions on the programme funds early in the new year. We hope that those decisions will carry through for three years, lending them more certainty and shape through reliable planning than would some of the more conventional departmental allocation methods favoured by the Member.

Seamus Close (Alliance, Lagan Valley)

In his deliberations on the revised Budget, was the Minister aware of the recent family expenditure survey which showed that gross weekly income in Northern Ireland was £102 per week less than in the UK as a whole? If so, why does he insist on pulling more people into the poverty trap by imposing an 8% increase in the regional rate? Why has he ignored the pleas of councils, Members of the House, other organisations and Committees in insisting on mimicking that which was previously carried out by former Tory overlords? Why does he penalise those who are less well off by insisting on inflation-plus hikes in rent and rates?

Mark Durkan (Social Democratic and Labour Party, Foyle)

I thank the Member for the now familiar points which he has just made. I must now make the familiar reply.

Yes, I was aware of the family expenditure survey. Yes, the Executive have also been aware of it. That is why the Programme for Government is trying to ensure that all Departments set about targeting social need more effectively than before. Therefore, it is wholly inappropriate to talk about people mimicking Tory overlords. In the Programme for Government we have measures that are aimed at targeting social need and the needs of the less well off. I would contrast that approach with that of the Member’s party. Not so long ago it was voting for the Executive to commit themselves to even more expenditure. The party voted for us to engage in substantively significant expenditure over and above what was in the draft Budget. However, a couple of weeks later it was saying that we should not have the resources to meet the draft Budget plus the additional items, not least for student support.

We need this regional rate increase if we are to fund all the services to the levels we have indicated. The less well off are protected by the housing benefit scheme and rate rebates. I accept that some people will still be caught just above benefit levels, and I have already indicated that we want to address that in the overall rating policy review. We must make serious plans, not send out sound bites. As the Minister of Finance and Personnel, I, on behalf of the Executive, must present a comprehensive Budget that adds up and works out. Fortunately, the Member does not have to do so.

Monica McWilliams (NIWC, Belfast South)

The Minister may recall that I asked during his previous Budget statement if he could tell us what he meant by a reclassification of the welfare-to-work expenditure. In other words, how much of this money is new and how much of it is due to the reclassification of that expenditure, which we all know to be substantial? In light of that, the Minister may be aware of some concerns. He will have received a communication — during his last statement he said he had not, but between then and now he undoubtedly has — from people working in the community who say that they will have to make substantial redundancies or else go to the wall if funding is not set aside between Peace I and Peace II.

Mark Durkan (Social Democratic and Labour Party, Foyle)

On the latter point, I am aware of the needs in relation to Peace II and the needs of groups on the ground. I indicated in my response to Mr Molloy that we are aware of their expectations, needs and frustrations. In monitoring rounds this year, both last month and in the summer, we moved to provide gap funding out of departmental budgets to try to meet those needs. We are keeping that matter under review because we understand and appreciate that the particular funding difficulties faced by bodies vary according to the programme or sector involved. For some it is not so much a funding gap between Peace I and Peace II, as a funding warp in relation to Peace II.

I indicated during my previous statement that the welfare-to-work figures now appear in departmental budget lines. As I have explained in the House twice before, welfare-to-work money is treated differently because it now forms part of the departmental expenditure limit. Previously, it was annually-managed expenditure and thus ring-fenced. We had no discretion on its use. The amount we get for welfare-to-work is now included in the departmental expenditure limit and is under our overall control. The amount allocated to Northern Ireland has been reduced because of the reduction in unemployment.

Alex Maskey (Sinn Féin, Belfast West)

Go raibh maith agat, a Cheann Comhairle. I would like to make a couple of points. First, I would like to thank the Minister for his statement this morning. We welcome the way in which he has underlined the inadequate level of funding that we had for many years under previous Administrations and the need for a revision of the Barnett formula.

I acknowledge the difficulties faced by the Executive and the Minister in dealing with the competing demands. It is also interesting to listen to people with no responsibilities for meeting any of those demands, including the Ministers who do not even go to Executive meetings to argue for their own Departments. They will be able to make some kind of popular statement —

John (Speaker, Belfast East)

The Member should ask his question.

Alex Maskey (Sinn Féin, Belfast West)

I would like to ask the Minister two questions, although I appreciate that he may not have the answer to hand for one of them. I would like each Department to provide evidence that there is a Budget allocation for targeting social need —

Peter Robinson (DUP, Belfast East)

What is your question?

Alex Maskey (Sinn Féin, Belfast West)

That is my question — the Member should listen. Is there a Budget allocation for targeting social need and the equality provisions required by the agreement? Secondly, what impact will the increase in the regional rate have, particularly on the retail sector? As other Members have said, that issue raises some concerns. The Minister may not be able to answer today, but I would appreciate an answer before next week.

Mark Durkan (Social Democratic and Labour Party, Foyle)

To be honest, Mr Speaker, I thought the Member was making good progress without asking questions.

Departments were asked to consider the implications of the new targeting social need programme and the requirements of section 75 for their budgets. That occurred at the bidding stage. I am sure that the Member is aware that all bids that the Department of Finance and Personnel received were copied to the Office of the First Minister and the Deputy First Minister, the Equality Unit and the Economic Policy Unit.

As part of its draft targeting social need action plan and proposed equality scheme, the Department of Finance and Personnel is determined to assist all Departments in measuring and focusing their equality and targeting social need actions. The Executive are committed to those actions, and all Departments have responsibility for them. I hope that the departmental Committees will take an active interest in those matters.

As I said, there have been two consultation conferences since the announcement of the draft Budget, and community and voluntary sector groups were invited to participate in the consideration of the equality and targeting social needs aspects of the Budget. Our considerations benefited from the queries from that sector, and we want to build on that in the future.

The Executive’s commitment to equality and targeting social need cannot be measured simply by a particular budget line. It is not a matter of each Department’s having a mere budget line for equality; it is a matter of ensuring that we have an overall Budget for equality.

Esmond Birnie (UUP, Belfast South)

I would like to ask the Minister about paragraphs 26, 27 and 28 of his statement, which relate to student support. I welcome his statement, as, I am sure, does the Committee — as far as it can, ahead of further clarification from the Minister of Higher and Further Education, Training and Employment.

In fiscal terms, these paragraphs are the opposite of the dance of the seven veils — layers are to be progressively added, rather than the reverse. The Minister states in paragraph 26 that

"there will be scope to go further, when the time is ripe for more specific decisions."

What is the timescale, given that we are moving closer to the start of the next academic year in autumn 2001? Will the further provisions for student support be in place by autumn 2001?

Mark Durkan (Social Democratic and Labour Party, Foyle)

My statement made clear that the Executive have already made an initial commitment in response to proposals brought forward by the Minister of Higher and Further Education, Training and Employment. That initial response is in the departmental budget figures and amounts to £5 million next year, £7 million in the second year and £8 million in the third.

As I said in the statement, we have also earmarked £15 million and £20 million respectively from the Executive programme funds for the second and third years. Those resources are there so that the proposals that finally come forward on student financial support will have first call on that money. The Minister, like all Ministers, is obviously free to bring forward other bids and proposals in the course of future Budgets and monitoring rounds. The Executive are making these provisions now on the basis of the three-year planning that we are trying to bring forward for the Assembly’s consideration.

Alban Maginness (Social Democratic and Labour Party, Belfast North)

There are many good aspects to the statement today but, with particular reference to regional development, I welcome the Executive’s commitment to introduce free travel for the elderly and their important initiative to cover three quarters of the estimated costs, as opposed to the half previously suggested. I congratulate the Minister and the Executive on that.

Did the decision to provide three quarters of the funding come from the Executive? Will the Minister and the Executive encourage the Department for Regional Development to get on with the vital task of tidying up details and discussing with local councils — which are important — the need to introduce this important change as soon as possible, to meet the deadline of April 2002?

Mark Durkan (Social Democratic and Labour Party, Foyle)

That is a significant commitment on the part of the Executive Committee. The Executive offered the commitment to introduce a free travel scheme for the elderly in the Programme for Government. There were already proposals under way, and papers had previously come to the Executive in this regard.

A scheme such as this would not be funded from a single source, since, as a result of the squeeze on resources, we do not have the money available at this time to fund it fully at regional government level. Since it involves several councils, as well as the transport providers, it will take time to work through. I have recently spoken to the Minister for Regional Development about this, and I am aware that he has been working with a number of councils to bring forward the scheme as previously planned.

The allocation that we have been able to make in the draft Budget should assist the Minister in doing that and should help in those areas where people are reluctant to become, or resist becoming, involved in supporting and contributing to a comprehensive scheme across the region. I hope that the additional resources now made available in the Budget will encourage that. There were already commitments in the draft Budget to an assisted fares scheme, but this takes them further. I hope it will assist the Minister and the Department in bringing forward the scheme that the Executive Committee want to see.

Mervyn Carrick (DUP, Upper Bann)

Further to Dr Birnie’s question, I want to press the Minister on student support.

I note in the Minister’s statement that provision is made for some aspects of the student support review and, in the case of further education, for some key aspects. Will the Minister tell us when funding will be made available to both higher and further education sectors to address in full the student neglect acknowledged in the Minister’s statement?

Mark Durkan (Social Democratic and Labour Party, Foyle)

I indicated in the statement that the Executive Committee have now made provision — some directly into the Higher and Further Education, Training and Employment departmental budget line, particularly for some items for further education students, and some in the new directions of the Executive programme funds.

The Minister of Higher and Further Education, Training and Employment brought proposals to the Executive, which they agreed last week. He will make the details of those proposals public and available to the Assembly Committee later this week. Of course, as well as the Committee and others wanting to consider those proposals for their purposes, the Executive have to subject proposals to further evaluation and appraisal. There will also be the all-important equality consultation. That is why the Executive have made the provision through earmarked allocation into the Executive programme funds.

John Kelly (Sinn Féin, Mid Ulster)

Go raibh maith agat, a Cheann Comhairle. I thank the Minister for his statement. I note that four paragraphs have been devoted to the question of student finance, which might be, and probably is, gratifying to the students. However, one might ask, where is the meat?

The extra £5 million will not go anywhere near to meeting the current question of student hardship and debt. What did the Executive receive from Dr Farren in relation to student finance? Also, can the Minister confirm that the increased allocation in the revised budget for higher and further education is the result of representations from Dr Farren?

Finally, in last night’s ‘Belfast Telegraph’ we read about the £300 million shortfall in the health budget. Is that just speculation, or can we do something about it?

Mark Durkan (Social Democratic and Labour Party, Foyle)

First, I have already indicated, both in the statement and in an earlier answer, that proposals brought forward by Dr Farren to the Executive last week were agreed by the Executive Committee. It was on that basis that, subsequently, the Executive Committee agreed the Budget and the Budget allocations. That is how the Executive work, in case people do not understand.

The proposals that came forward as a result of the review were the subject of work and contact between officials in the Departments of Finance and Personnel and Higher and Further Education, Training and Employment. There were also bilateral discussions between Dr Farren and myself, just as there are between other Ministers and myself when significant new items come forward. This was a significant new item that was not in the draft Budget, simply because the review of student finance had not concluded and been brought to the stage of proposals. That is why those provisions are there.

I cannot go into detail about the exact number of meetings we had or about the amounts bid for. As most Ministers do, and will recognise, the Minister of Higher and Further Education, Training and Employment came in with proposals at a higher spending level than the Executive have been able to meet.

If we get into the details of bids then I might have to say which Ministers were objecting to those concerning further and higher education. I am not sure that would be fair to one Minister or another, because of the possible implications it might have for their Departments. If we are to open up the debate on the basis of what each Minister said, there might be red faces in several corners of the Chamber.

Derek Hussey (UUP, West Tyrone)

I appreciate the initial set of costs of restructuring government in Northern Ireland. However, what happened to the commitments to savings promised by making administration more effective and efficient? Indeed, in Annexe C we see increases of 10% in total departmental running costs. Future increases in running costs are also listed in the main statement.

Furthermore, I, like other Members, would voice my extreme concern at proposals for the ongoing rise in the regional rate. We are finishing off the third part of the devolved Government’s commitment to the 8% rise, running to — over the three year-period — 26% or so. Can the Minister explain how, in the public expenditure plans table, the increase in "Regional Rate and other items" is 23% from 2001-02 and in the following year it will be 29%? How do these figures relate to the 8%? I realise that the Minister has addressed the correction of previous anomalies, but what other items bring up these percentages? We are really concerned that the Executive are robbing Peter to pay Paul, and that small and medium-size enterprises in Northern Ireland will suffer.

Finally, I want to welcome the commitment to press for further funding. Major infrastructural improvement —

John (Speaker, Belfast East)

Order. I plead with Members to be more concise and to limit themselves to one question. We have already had two questions, expanded upon by the Member, who is now making a statement.

Derek Hussey (UUP, West Tyrone)

I will ask a final question. The Minister has said that there is a certain amount of additional European funding — the transitional Objective 1 programme and the community initiatives. He stressed that they were additional. However, paragraph 13 of his statement says

"Unlike Peace II, these do not provide additional spending power to the region over and above our Barnett based public spending allocation".

Will the Minister explain that?

Mark Durkan (Social Democratic and Labour Party, Foyle)

The two points made by the Member form the explanation. The only additional money will be from the EU Special Support Programme for Peace and Reconciliation. When we are referring to additional money, we are talking about the Peace II programme.

The transitional Objective 1 programme and the various EU initiatives are not additional. The Member might have been thinking of the point I made in the statement with regard to the further match funding that will come forward in relation to some of those measures.

As regards the review of public administration, we must look carefully at the needs that arise. That includes the additional work that has been generated by devolution — the Assembly, the work of the Committees, the questions that are asked by Members, and the higher rate of public contact and interaction with the Departments. Additional costs come in at those levels.

In terms of the overall provision for departmental running costs, the rise from £628·4 million to £691·4 million is not totally accounted for by the type of running cost pressures I have described. A large part of that increase relates back to the change in the treatment of the welfare-to-work programme, which has been transferred into the main departmental expenditure limit. The running costs associated with that are now counted as part of the departmental running costs in the overall departmental expenditure limit. That partly explains the bump in the figures. We must also make realistic provision for departmental running costs at this stage. It is not good enough for us to limp along, and continually make provision for departmental running costs in monitoring rounds, if the best way to deal with the issue is to take account of the fact that departmental running costs were originally underestimated. That is what we have tried to do.

In relation to the regional rate, I do not like a regional rate increase of that level, or to project it over a number of years. It has clearly not made me any friends in this Chamber, but the Executive have to do this if additional money is needed. The Member’s point about the Barnett formula seems to suggest that he recognises that additional money is needed. We will not be in a strong position to tell the Treasury that we need an improvement on the Barnett formula if the Treasury can in turn say "Yes, you are looking for more money from English taxpayers, but you are not prepared to ask for more money from the people of Northern Ireland." Members should remember that although the rate increase of 8% is significant, it does not compare adversely with projections across the water. Northern Ireland’s average rate levels are considerably lower. They are a fraction of what households across the water pay.

John Dallat (Social Democratic and Labour Party, East Londonderry)

I will be both precise and concise. Can the Minister indicate what measures and consultations were undertaken on the Budget in respect of equality issues?

(MrDeputy Speaker [Mr McClelland] in the Chair)

Mark Durkan (Social Democratic and Labour Party, Foyle)

As I indicated in an earlier reply, Departments provided equality assessments of their bids when they were submitted to the Department of Finance and Personnel. These were then copied to the Equality Unit. The assessments were taken into account during consideration of the Budget proposals. The draft Budget was also, of course, the subject of equality consultation under my Department’s draft equality scheme. The draft Budget was circulated to all of the 120 groups that my Department’s equality scheme recognises, and copies were also made available in alternative formats. In addition to the opportunity to respond in writing with their views, all the groups were invited to attend two consultation conferences, which I addressed, in Derry and Belfast on 22 and 23 November. I also received a report on the views expressed by delegates, which helped to guide our final recommendations and future thinking.

Ian Paisley Jnr (DUP, North Antrim)

The Minister of Finance and Personnel came to the House today in an attempt to create the perception that his pockets are stuffed full of cash for Christmas. He is a bit like Bruce Forsythe, saying to the Executive Ministers "Come on down. The price is right". Can he explain to the House whether this is an economic miracle or a mirage? In examining the figures, does he agree that today’s statement — which follows fast on the heels of his statement of 20 November on the reallocation of funds to Departments — will cause the community to note that Nationalist-controlled Departments are receiving considerably more money than Unionist- controlled Departments in an allocation being made by a Nationalist Finance Minister? How will he address that issue and the perceptions created by it?

In particular, I note that today he is allocating an additional £400,000 to the Office of the First Minister and the Deputy First Minister. That results in a budget that is some £8 million less than it takes to run the entire Assembly. How does he justify that amount of money going to that Department, given that we never see its two invisible men — the junior Ministers, Mr Haughey and the other one?

Will the Minister tell the House whether the additional £2 million for agriculture will make a difference? Can he explain why he has not made any further allocation to the £10 million deficit in funding for the vision group? He knows that it is seeking £10 million, and it is not getting it.

It appears that the Minister’s allocation today is giving money to the Department of Agriculture and Rural Development, but, yet again, the farmers’ pockets remain empty. Does the Minister agree that, if you were to do a quick tally of the sums, the Unionist Ministers outside of the Executive appear, once again, to have done considerably better than their Unionist Colleagues who wish to attend the Executive? Does he also agree that those Unionists should leave the Executive and that they are, perhaps, failing to fight their corner in the Executive?

Mark Durkan (Social Democratic and Labour Party, Foyle)

I thank the Member for a question that, once again, reveals his obsessive sectarianism. The fact is that Departments here are served and headed by Ministers from several parties. I do not treat Departments according to the party label of their Ministers. I think that Ministers would bear me out on the fact that I have equal and proper dealings with all of them and their Departments. If Mr Paisley were insinuating that there is any discrimination on my part, I would ask him to take the appropriate course of a proper legal challenge on that basis. There is no discrimination on my part or on the part of the Executive Committee.

His final bit of point-scoring to try to get at the Ulster Unionist Ministers actually undermined his initial point. He tried to say that I was discriminating against people on party political grounds, but then he ended up talking about how well — as he would put it — the DUP Ministers appeared to be doing. Either we are treating people fairly and properly, or we are not.

As Minister of Finance and Personnel, I am treating people fairly, and so are the Executive. We do not look at Departments according to the party political attachments of their Ministers. We look at them on the basis of the services they run and according to their customers’ needs. Their customers are the Northern Ireland public — Unionist and Nationalist alike.

As a Minister, I have taken a Pledge of Office, as have all other Ministers, to serve equally all the people of Northern Ireland. I am alarmed at the suggestion by a Member of this House that Ministers might be, should be or could be working on the basis of motives depending on the person who is coming along with the request. It does not matter to me what Department or what area applications come from, for I, my Department and the Executive Committee at large are treating people according to our public service needs and priorities. We treat all members of the Northern Ireland public equally.

Billy Bell (UUP, Lagan Valley)

I am glad that the Minister has highlighted the under-investment in infrastructure that has been inherited from the direct rule regime. I am sure, however, that he is aware that in England, Scotland and Wales this is being addressed by private finance initiatives of various kinds, as well as public sector ones. Why is there is no commitment in the Budget to ratchet up the investment levels in infrastructure here by partnership with the private sector?

Mark Durkan (Social Democratic and Labour Party, Foyle)

The Executive recognise, as did I in my statement, that there has been historical underfunding in relation to infrastructure. We are trying to address that in a couple of ways — by the allocations that are going to the Departments which have key responsibility for infrastructure and by the further creation of Executive programme funds.

The details, management and criteria of those funds have yet to be fully agreed by the Executive, but using them to generate a higher and more productive participation in private finance initiatives and public and private partnerships is one important consideration that we have in mind. Obviously, our interest in private finance initiatives and public and private partnerships is not confined to infrastructure, but this is a very obvious area in which we can try to improve our rate of investment.

We will be working with the relevant Departments to see that they are able to do that with the funds available to them. We will also be working with them in relation to what funds might be made available from the Executive programme funds in relation to whatever bids might come in.

Joe Byrne (Social Democratic and Labour Party, West Tyrone)

I welcome the revised Budget and the increases for all Departments. Will the Minister comment on the importance of public service agreements (PSA) in the pursuit of good government? What relation do the PSAs have to the allocations in the Budget statement?

Mark Durkan (Social Democratic and Labour Party, Foyle)

Public service agreements link the resources allocated in the Budget to the objectives of the Northern Ireland Departments, regardless of who heads those Departments. They aim to deliver modern and accountable public services. Quantifiable targets are set for specific improvements in services or for the results that those services will achieve. PSAs show what the public can expect from the resources allocated in the Budget.

Public service agreements should be a key instrument for the Executive and the Assembly. When the Assembly votes money for a Budget, Members will want to know what the money is for. The Assembly will want to ensure that it can monitor the effectiveness and efficiency of that spend. PSAs will help the Assembly to discharge that requirement satisfactorily.

Edwin Poots (DUP, Lagan Valley)

I would like the Minister to clarify an item in the table entitled "Increases to Allocations to Departments and EPFs from Draft Budget" on page 9. It shows that the Department of Enterprise, Trade and Investment will receive an additional allocation of £2 million and an extra £4.5 million for EU programmes. The total shown is £1 million. I note that the Minister of Enterprise, Trade and Investment is missing, although I am not suggesting that he has made off with the other £5·5 million. Can the Minister explain the anomaly?

Will the Minister also tell us what bid he received from the Office of the First Minister and the Deputy First Minister for e-government? The initial request was for £14·9 million, but that was not met in the initial round. E-government must be taken seriously if we want to have a modern, serviceable Government.

An initial request for £500,000 for victims’ groups was not met in the first round. Subsequently, an offer of £200,000 was made. Can the Minister not allocate more money to victims, rather than allocating £400,000 to departmental spending?

Mark Durkan (Social Democratic and Labour Party, Foyle)

As the Member said, an allocation was made to victims’ groups in the October monitoring round. The Department of Finance and Personnel is unable to meet every bid, even if it comes from the Office of the First Minister and the Deputy First Minister. Earlier, Mr Poots’s Colleague appeared to suggest that the Department of Finance and Personnel was being unduly soft and generous to the Office of the First Minister and the Deputy First Minister, because of the allocation of an additional £400,000. Members should be consistent in their approach to such issues.

We all attach huge importance to e-government. The bid from the Office of the First Minister and the Deputy First Minister was not a bid for its own work, but for work throughout Government. All Departments must continue to develop that work from their baseline. In the future, Departments may make a bid to the service modernisation fund for work relating to e-government.

The additional allocation to the Department of Enterprise, Trade and Investment that is shown in the table on page 9 is over and above what was in the draft Budget, namely £2 million. The correct figure is £6·5 million; what appears in the table is a simple typo.

George Savage (UUP, Upper Bann)

I wel- come the Minister’s comments, but with a degree of caution. The Minister said that there was a backlog of under- investment in many Departments, but he left out the Department of Agriculture and Rural Development. How much money will be available for LEADER+ and the rural development programme? Rural development committees in councils are quite concerned and do not know where they stand.

Mark Durkan (Social Democratic and Labour Party, Foyle)

I thank the Member for his question. There was a significant increase in the draft Budget, and that increase is sustained here. The increase in the draft Budget recognises that many Department of Agriculture and Rural Development programmes have been underfunded. It also tried to take account of some of the new work coming forward, such as the vision group. We gave an advance for the beef quality scheme, and that is a clear indication that other proposals from the vision group can also draw on Executive programme funds.

With regard to community initiatives, LEADER+ focuses on rural development, and that will be additional to the figures that are provided in the budget table for rural development. The INTERREG programme will have a rural development aspect as well. Proposals relating to INTERREG and LEADER+ have now been given to the Commission and will be the subject of negotiation over some five months. The amounts that we are reckoning on for LEADER + are included in the tables in the Department of Agriculture and Rural Development’s budget line.

Roy Beggs (UUP, East Antrim)

Will the Minister explain the significant increase of about £6·2 million in the 2000-01 capital allocation for roads in this year’s Budget? Next year, compared to the October budget expenditure and to today’s announcement, there is a further £9·6 million.

Furthermore, will the Minister confirm that the increase for transport in this year’s allocation of £72 million, next year’s £93 million, and the subsequent year’s £130 million, is largely as a result of increased expenditure on railways?

Mark Durkan (Social Democratic and Labour Party, Foyle)

I thank the Member for his question. He mentioned several points from the Budget. The Executive are trying to respond to the needs in key areas of infrastructure such as roads. People need to take account of the Chancellor’s initiative money in the Department for Regional Development’s budget line, which is essentially for roads. That is where the total figure for spend on roads comes from, and we have been trying to make a commitment in that area.

The fact that there will be a fall-off in the Chancellor’s initiative represents a problem that happens when one-off, time-limited benefits come to an end. We have made a commitment to rail transport, as we did in the draft Budget, that we believe will assist the Department and other relevant interests in taking forward the consolidation option. Clearly, railways and roads are key areas of infrastructure that are eligible to bid for the Executive programme funds.

Children: Residential and Secure Accommodation

Joe Hendron (Social Democratic and Labour Party, Belfast West)

I beg to move

That this Assembly approves the first report of the Health, Social Services and Public Safety Committee on residential and secure accommodation for children in Northern Ireland and calls on the Minister of Health, Social Services and Public Safety to implement the Committee’s recommendations at the earliest opportunity.

As Chairperson of the Health, Social Services and Public Safety Committee, I am very pleased to bring the Committee’s first report before the Assembly. The report examines children’s residential and secure accommodation in Northern Ireland. I am particularly grateful that the report enjoys the unanimous support of the Committee, and I wish to thank each and every Committee member for their very hard work and positive support. I also wish to thank the Clerk to the Committee and the Committee’s support staff for their outstanding help and co-operation at all times.

12.00

The Committee wishes to place on record its gratitude to over 60 individuals and organisations for their excellent written submissions and oral evidence. The introduction of the Children (Northern Ireland) Order 1995 was welcomed as an enlightened piece of legislation. It placed the best interests of the child at the heart of the services for children by imposing a raft of new duties on statutory authorities.

However, its implementation has been severely emasculated by a lack of accompanying resources. Indeed, some witnesses to the inquiry attested to instances where resources had been diverted out of children’s services into other "priority" areas.

Given the moral, as well as legal, obligation on statutory authorities to provide proper support and guidance to children in a safe environment, this is clearly an unacceptable state of affairs, and must cease immediately. There has been mounting concern in recent years about the quality of provision of children’s residential services in Northern Ireland.

The former Department of Health and Social Services recognised the problem in 1997. It commissioned a review of residential care, and that resulted in the report ‘Children Matter’, which was published in 1998. That report recognised the deepening crisis in the children’s residential care sector, but also emphasised that it formed only part of a complex set of interrelationships in children’s services. Consequently, the report emphasised the importance of taking into account the level and nature of unmet specialist need, staffing, training and complements, fostering, educational needs, preventive measures, leaving-care needs and commissioning arrangements.

It is therefore deeply regrettable that the crisis in children’s residential care has, if anything, deepened since the publication of ‘Children Matter’. While the setting up of a ministerial task force to drive forward the model of expanded, differentiated provision envisaged in ‘Children Matter’ is clearly a welcome development, it is nonetheless a sad reflection of the lack of progress on the report’s recommendations since its publication over two years ago.

Secondly, there was a historical over-reliance on the voluntary sector, which unsurprisingly led to a succumbing to intolerable pressures, and a dramatic reduction in its provisions. Regrettably, this year saw the closure of St. Joseph’s in Middletown, which had provided 24 residential places in the voluntary sector and which had been renowned for its excellent educational input.

Thirdly, the Criminal Justice (Children) (Northern Ireland) Order 1998 has had the effect of diverting even more children into the care system. Fourthly, and critically, there has been an unwillingness, or an inability, by the Department to commit sufficient resources to the residential sector and preventive family-support measures.

The Committee does, however, acknowledge recent efforts by the Department to inject much needed resources into this area, but much more needs to be done. The continued retraction of children’s residential places has meant higher thresholds for admission, resulting in the inappropriate placement of children with conflicting and complex needs and behavioural difficulties, as well as increased demands for secure accommodation. The Committee was appalled to learn, from various witnesses, of a myriad of problems resulting from the lack of adequate provision. It heard of widespread instances of overcrowding, placement instability, violence, absconding, alcohol and drug abuse, and inappropriate sexual behaviour, including prostitution.

We are faced with the stark reality that the system, the very raison d’être of which is to provide the most vulnerable and disadvantaged children in society with a safe and secure home environment, is exposing children to further risk and to inappropriate placements.

The central theme running through the evidence provided to the Committee was deep concern about the historical underfunding of the residential sector for children and young people in Northern Ireland and the leaching away, on occasion, of the limited resources to other so-called priority commitments. No public service can operate or plan effectively under such circumstances. The tag of "Cinderella service" must go. The Committee fully agrees with those witnesses who argue passionately for sufficient ring-fenced resources to be made available for facilities and staff for the additional children’s homes needed.

It also believes that the use of these resources should be closely scrutinised through audit trails to ensure that they are used efficiently to achieve the desired outcomes. The word "earmarked" is often used in presentations by Government Departments. While I appreciate the massive financial constraints on all Departments, I welcome what the Minister said earlier about the £7 million addition to the health budget over and above what was allocated in October.

I am also aware of what Mr John Kelly said about the statement regarding the four boards, the representatives and the fact that hundreds of millions of pounds are being spent in Scotland above what is being spent here. The commitment of such funds will facilitate the specialised and greatly expanded model of residential care provision described in ‘Children Matter’, which will properly serve the differentiated and complex needs of children and young people in appropriate care settings.

The ‘Children Matter’ model is pyramid based, with a range of general and locally based children’s homes at the bottom, a middle tier of more intensive support units for those with more complex needs, and, at the top, a small number of secure care places for those who pose a risk to themselves or to others. This model of provision represents a realistic way forward. However, it must be emphasised that to facilitate choice, surplus places must be available.

It is recommended that homes should not operate at more than 80% occupancy. At present, not only is the sector operating at almost full capacity, but some homes are also exceeding full capacity. The impact of the Criminal Justice (Children) (Northern Ireland) Order 1998 is an additional consideration which needs to be addressed alongside the ‘Children Matter’ proposals. This has heaped further pressure on the children’s residential care sector by diverting young offenders there who would previously have been kept in a custodial setting.

Witnesses recorded that these young people pose serious management difficulties and disrupt the routine of other children. The Committee notes that the voluntary sector has already drawn up development plans to meet the distinctive residential needs of this very specific group of children. It recommends that the Department’s strategic regional plans provide for suitable facilities for looking after offenders. It also urges the Department to award the voluntary sector longer term contracts of at least five years to facilitate the strategic development of its services in the residential sector.

The guidance in the 1998 Order states that a home should treat each child as an individual and promote and safeguard his or her welfare. However, a culture of "get them in anywhere you can" has developed owing to the sheer lack of places. This inevitably leads to children with conflicting needs being accommodated in the same home, jeopardising their safety and well-being. Some children are being exposed to problems that could exacerbate their own problems.

The registration and inspection report of the Northern Health and Social Services Board 1999-2000 confirms

"The lack of placement options continues to be the most pressing concern arising from inspections. Many of the problems and stresses for children, and for staff, arise from the inappropriate mix of residents in four of the general purpose homes."

Situations such as that in Harberton House in the Foyle Health and Social Services Trust area — where, at times, up to 33 children have been accommodated in a 27-bed unit that is funded for only 20 children — are unacceptable and must become a thing of the past.

Given the grave concerns for the safety of children in residential care, it is vital that a placement risk analysis be completed for each child prior to admission, or as soon as possible thereafter. In addition, the care plan for each child should include a protection strategy approved by the registration and inspection unit.

Critical to the success of an expanded children’s residential sector will be the ability to attract and train the estimated 150 to 200 extra social workers needed. The difficulties here have as much to do with the retention of staff as with recruitment. The recent closure of St Joseph’s in Middletown resulted in the devastating loss of 30 highly qualified staff from the sector. Only four remain within the children’s residential sector. Staff are working under extreme pressures in overcrowded homes where there tends to be a high concentration of children with challenging behaviour, who can be difficult and disruptive. The low ratio of staff to children makes it difficult to do any real constructive work with children, or even to supervise them properly.

The Committee learned of the high proportion of casual staff who supplement staff rotas due to chronic absenteeism rates — up to 30% in some trusts. Staff have to work unsocial hours, including frequent weekends, with little time to share with their families. Radical steps, therefore, are needed to entice new social workers into this sector as well as maintaining the current staff. These should include a review of pay and conditions, the establishment of a sophisticated staff complementing unit, and a training and support facility for social workers specialising in children’s care.

The fact that there are only eight secure places for children in Northern Ireland has meant that a queuing system has developed, with young people being inappropriately placed or remaining at risk in the community. There can be as many as 15 young people waiting for a placement at any one time. The Committee was shocked to learn that young girls are being held in the women’s section of Maghaberry Prison because there is no appropriate secure care accommodation. The Northern Ireland Court Service said

"We remain astonished that one of these children has not killed, or been killed, in the past four years."

It is a most appalling indictment and serves as the starkest warning of the need to rectify the situation immediately. The Committee understands that the Department has commissioned six extra places at the Lakewood facility, and urges that this provision be expedited. It also recommends that consideration be given to changing the subordinate legislation to allow the voluntary sector to provide additional places that are clearly needed in the short term. St Patrick’s in west Belfast, which is closing, is one place that could considered in that regard.

While the Committee is loath for any child to be deprived of his or her liberty, it also recognises that secure care accommodation is required for a small number of children and young people who pose a risk to themselves or others. However, based on the positive outcomes from an experiment in Scotland, it believes that the Department should invest some resources in pilot studies to test the effectiveness of alternatives to secure accommodation. That is a very important point.

Lack of specialist provision for children with disabilities and mental health problems has been highlighted as giving particular cause for concern. The Committee was deeply concerned about the treatment of children in adult psychiatric wards — a practice that should cease immediately. The current provision of six inpatient adolescent beds in the Young People’s Centre is clearly insufficient and should be urgently complemented by an additional eight-bed mental health unit.

Dr Ewan McEwan of the Young People’s Centre gave evidence to the Committee, and we were most impressed by what he told us. Members will be aware that the adolescent psychiatry services have only half a dozen places. That also needs to be remedied.

The Committee also wants the forthcoming departmental report, which outlines the future provision of adolescent psychiatric support, to focus on preventative measures. The development of mental health support services should include an input from the adolescent psychiatric service. A study of the residential needs of disabled children should be urgently commissioned.

The present level of educational achievement by children in residential care is depressingly low. Up to 50% of young people in Northern Ireland leave care with no educational or vocational qualification, thus further disadvantaging this most vulnerable group. Maintaining children and young people in mainstream education continues to pose considerable problems for staff in children’s homes, for they are having to cope with a growing number of children who have been either excluded or suspended from school.

The Department of Education highlighted the pressing need for improved communication between social services and educational professionals in relation to children in care. I witnessed this at Muckamore Abbey Hospital, which I visited several months ago. The staff work so hard with the young people there who have learning difficulties. The young teachers do their best, but, again, there are not enough resources; there are not enough people involved. The Department of Education must, therefore, liaise with social services to discuss the education of young people in that situation.

The Committee believes that, with proper support measures, a significant improvement can be made. It welcomes the joint funding by the Department of Health, Social Services and Public Safety, the Department of Education and Save the Children for research into the education of young people in care. It strongly advocates the establishment of a joint working group, involving the Department, the NIO, the trusts, education and library boards as well as the voluntary sector, to formulate an agreed protocol regarding the education of young people in care. Particular attention should be given to young people who are excluded from school.

I want to move on to the question of independent visitors. Although the Children (Northern Ireland) Order 1995 provides for independent visitors to advise and befriend children in care, the Committee was concerned to learn that, due to the narrow drafting of the legislation, only a minority of children in care have been able to avail of the scheme. Research shows that children strongly value these provisions. These children are severely disadvantaged in relation to others, and therefore each has access to an independent visitor.

The Order also imposed a new duty on the trusts in respect of leaving and aftercare responsibilities. Programmes were to be designed to help young people in care to prepare for the difficult transition to adulthood and independent living. This already vulnerable group is expected to cope with a wide range of issues in a very short time at a much younger age than the remainder of the population. The Committee was greatly alarmed to learn that, according to the 1999 report, despite the terms of the Order, nearly half of the trusts did not have a framework for developing their leaving and aftercare programmes.

The Northern Ireland Leaving Care Bill, which is due to be introduced next year, is warmly welcomed as a legislative measure specifically aimed at producing better outcomes for this most vulnerable group. It should ensure that trusts discourage young people from leaving care too early, and before substantial preparatory support is given. Furthermore, they must provide better services for young people in the areas of education, employment and housing.

The Committee endorses the recommendation from the Northern Ireland Leaving Care research project that all young people in care should have a "through-care" plan to address their preparation and aftercare needs and so enhance their practical living skills. It is conscious of the positive impact of the Quality Protects programme in England and Wales with regard to children leaving care. It also welcomes the Minister’s proposal for a regional review that will replicate its objectives as appropriate.

Witnesses repeatedly emphasised the important role that family support services can play in helping to prevent children from entering the residential care system and possibly ending up with mental health problems. Conversely, failure to invest properly in prevention is a false economy and only stores up a multitude of problems further down the line, resulting in more costly interventions, both in human and financial terms.

The Committee strongly welcomes the Executive’s plans for an extension of the Sure Start scheme for disadvantaged families and the creation of a new children’s fund to provide support for children in need and young people at risk. These types of commitments must be sustained over the long term to facilitate proper planning of family services.

A year or two ago there was a programme run by the previous Administration to do with youth at risk. Lack of funds stopped that, but it was an outstanding exercise to help young people from the most vulnerable parts of our society, and I hope that it will be reinstated.

The shortage of children’s residential places has placed ever greater pressures on foster carers, who have to care for children with more complex and challenging needs than before. As failure to find suitable foster placements can lead to children having to go into care, it is crucial that the recruitment of foster carers keeps pace with demand. The Committee was therefore very concerned to learn from a recent social services inspectorate report on fostering that almost 70% of carers are aged between 40 and 60, and that the overall numbers are falling. It warmly welcomes the Minister’s commitment to develop a regional strategy to address recruitment and retention difficulties. This must address the support needs, the respite provision and the training requirements of foster carers and raise the boarding-out rates to reflect the skills and demands of foster caring.

Research shows that adopted children fare better than those who remain in care throughout their childhood. It is therefore disappointing to note that Northern Ireland’s adoption rates compare poorly with those of Great Britain. The Committee therefore welcomes the social services inspectorate’s current review of adoption services with a view to promoting it as an option for children in care. It is clear that the successful implementation of an expanded model of the children’s residential sector will require a co-ordinated overarching strategy, involving clear policy objectives and outputs, and encompassing the statutory, voluntary and private sectors’ working in close collaboration. The Committee very much welcomes the Minister’s commitment to involve the voluntary and private sectors in the regional plan for children’s services. However, it was very concerned about the absence of the voluntary sector from the ministerial task force which was created to drive forward the strategic plan for the children’s residential sector. That omission should be remedied at once. The task force must be afforded full responsibility and dedicated resources to enable it to implement the strategic plan over a five-year period, reporting on progress regularly and directly to the Minister. It should also consult with young people with experience of residential care on the future provision of services.

Planning has become a major obstacle to the provision of new children’s homes in recent years because of the strength of opposition from local communities. The Committee fully endorses the Minister’s view that public representatives should work with local communities to promote awareness and understanding of the special needs of vulnerable children in care. The Committee was convinced by the very persuasive arguments of many witnesses in favour of a commissioner for children, especially in view of our very serious concerns about funding for children’s services, the increasing numbers affected by mental health problems, and children’s rights and safeguards under the Children (Northern Ireland) Order 1995.

The Committee joins me in saying that a commissioner for children, such as exists in other countries, would be a major step forward in co-ordinating services for children, and especially for those most in need and in care. We therefore strongly recommend the appointment of a commissioner for children to heighten the profile of children’s issues, to assist in the development of services for children and to act as a watchdog over their welfare.

Finally, the Committee looks forward to the implementation of the measures in the Programme for Government which are aimed at helping children and young people at risk. It recognises fully the need for cross- departmental collaboration and for close liaison involving the statutory, private and voluntary sectors on the strategic planning which is vital for building the specialised model of provision of children’s residential care. The Committee trusts that the recommendations of this report will form part of a co-ordinated, inclusive approach to bringing about significant improvements in the quality of life and outcomes for children in residential care.

I look forward to the debate, which will give an overdue platform to the children’s residential care sector. It behoves us to add our voices to the cause of the most vulnerable children and young people. At the very least these severely disadvantaged children are entitled to the type of stable and secure home environment that the majority of our people take for granted. I sincerely hope that the report will receive the widespread support of the Assembly.

Donovan McClelland (Social Democratic and Labour Party, South Antrim)

Before calling the next Member, I remind Members that a substantial number of Members have put down their names to speak and that we need to leave appropriate time for the winding-up speeches by the Minister and Dr Hendron. For that reason I will limit the time available for each Member to five minutes, but that does not mean that Members have to take the full five minutes.

Robert Coulter (UUP, North Antrim)

I congratulate Dr Hendron, the Chairperson of our Committee, on his excellent speech that covered every aspect of the report. The only problem is that there is very little left for the rest of us to say.

It is encouraging to realise that children’s services have now become a priority. When we realise that young people are growing up in the jungle of modern society it is not surprising that many need help. The number of individuals and organisations who were prepared to give evidence to the Committee was an eye-opener to its members and is testimony to the level of concern that is felt.

That there are serious shortcomings in the children’s residential sector is proved by the fact that the Committee had to include 36 recommendations in its report. That is not something new — there has long been recognition of these problems. These problems were recognised in the early and mid-1990s. The tragedy has been, however, that they were not properly addressed.

The shortage of places has been mentioned, and I do not want to point the finger at anyone. Rather, we need to take the problems and look at them seriously and see what can be done to help these young people.

The fact that we are told that we are 30% short of places and suitable accommodation — which is leading to overcrowding — is an indictment that not enough has been done in the past. These young people who come from very difficult backgrounds are sometimes left to lie on mattresses on the ground, and that is neither adequate nor acceptable. We have a moral responsibility not only to highlight their needs but to go further and do something about them.

The lack of adequate provision in specialist residential places to meet the needs of children with mental health problems and disabilities must be addressed immediately. In connection with that, the respite provision for disabled children is inadequate. It is not only the children but the other members of their family who must have respite provision in place.

The shortage of staff is one of the greatest problems. Recommendation 7 goes to the heart of the problem — the modernisation of pay and conditions of service for children’s residential social workers. That includes careers structures to take account of the specialist demands of the job, the high levels of stress and the unsocial hours involved. If we are to get the 150 to 200 extra staff, recommendation 7 must be addressed immediately.

There are only eight places in the whole of Northern Ireland for secure care provision. Young people are housed with adults during those formative years, and that will leave a mark upon them for the rest of their lives.

It struck me, when Dr Hendron was making his report and telling us that young people were being housed in a prison, that we are back to the age of the Victorians, who put children in jail. Let us face the problem. Let us be honest enough to say that in a modern society we are not prepared to allow this to happen.

It is of serious concern that the 1999 report on the Children (Northern Ireland) Order 1995 revealed that nearly half of the health and social services trusts did not have a framework for developing their leaving-care and aftercare programmes. I hope that the Northern Ireland Leaving Care Bill, to be introduced next year, will address these problems and take education, employment and housing into account.

Funds must be made available and there must be accountability in the Department. There should be no redirection of funds which have been set aside for this area of concern.

The sitting was suspended at 12.31 pm.

On resuming (Mr Deputy Speaker [Sir John Gorman] in the Chair) —

John Gorman (UUP, North Down)

I remind Members that they each have five minutes in which to speak.

Paul Berry (DUP, Newry and Armagh)

The report from the Health Committee, of which I am a member, does not make for pleasant reading. As one of the witnesses made it clear, the changing shape of the family, with more parents working and more one- parent families, has produced many of the problems faced by society today.

The report highlights the fact that the state makes a bad parent. Not only that, but here, as in every other sector, bureaucracy is paramount rather than the task it is supposed to be dealing with. This problem has mushroomed beyond what the services can cope with at present. Young children in state care are not being enhanced educationally, except in a negative sense, and this helps to explain why half of the children who are in care get no qualifications at all.

To make matters worse, given the fact that many children in the system are becoming criminals, the quality of the service they are getting must be seriously questioned. At the same time, a number of staff members are on long-term sick leave, and this is having a detrimental impact on the provision of services. This, combined with the lack of applications for posts, makes for a very serious situation in children’s care services.

We were also reminded very forcibly that a lack of proper assistance for family support services results in a multitude of problems later on. There is overwhelming evidence of the fact that children are best raised in families with stable environments. It is therefore rather sad to see a decline in the number of foster parents and adoptions. Much more can and needs to be done on this. It is quite ironic that those who are supposed to be being helped by a myriad of statutory bodies and a host of legislative measures are today no better off than they were a decade ago.

Surely that tells us that something, not least simple effectiveness, is almost entirely absent from children’s services. Adding more layers of bureaucracy and passing new laws is not the answer. What we need, first and foremost, is a determination that what is in place will be done well. We also need a resolve to fund what exists properly and to remove the restriction on the voluntary sector’s providing secure care and accommodation. It must be recognised that foster parents are invaluable in this. The fact that they have been treated so poorly is an indication of the current state of affairs. It is vital therefore that the rates paid to foster parents be reviewed and updated.

Given the cost of residential care and the amount paid to foster parents, there is a strong case for retaining the fostering system. But the diminishing number of foster parents is an indication that urgent action must be taken.

In conclusion, the evidence presented to us of prevalent drug use in residential homes, of inappropriate sexual behaviour and of children being taken advantage of by sinister individuals ought to send a shudder down the spine of every Member. We must ensure that the service is overhauled and improved forthwith.

As the Health Committee listened to one consultation after another over a period of months, a number of clear indications emerged, one of which was that a commissioner for children must be appointed immediately to deal with the problems. Children across Northern Ireland, whether in care homes or not, are suffering.

More money must be ring-fenced to deal with this problem and a commissioner for children must be appointed as soon as possible. I trust that the House will not only support this motion but strive to work very hard so that children in Northern Ireland are well treated in homes across the country. Money must be provided and a commissioner for children appointed immediately.

John Kelly (Sinn Féin, Mid Ulster)

Go raibh maith agat, a LeasCheann Comhairle. I rise to support the motion. We hope this report will mark the first step on an overdue journey to address and redress the plight of so many of our young people who find themselves in vulnerable circumstances when they are coming to terms with the difficult transition from childhood to womanhood or manhood. It is also a time when they are starting to cope with their emerging sexuality and the difficulties that that entails. In many cases these young people find themselves in circumstances over which they have no control.

I reiterate all that the Chairman said this morning; he covered the majority of the points that we made in the Committee. I would like to pay a special tribute to all the Committee staff, the Clerk and others, who put in hours of work organising and compiling this report, and also to all those who appeared before the Committee and made their submissions.

It is unfortunate, a LeasCheann Comhairle — and I know it is not your fault — that only five minutes could be set aside for such an important debate about a critical set of circumstances. I am not going to labour the point, but I support the report and endorse all that it contains. I hope that in the future we will be able to make life better for these young people who find themselves in such unfortunate circumstances.

Kieran McCarthy (Alliance, Strangford)

The situation is diabolical, shameful and unacceptable. I come to this debate today with mixed emotions. I am not a member of the Committee, but I have to say that I am totally and absolutely horrified at what is contained in this report. When I read it I was horrified, angered, shocked, and even ashamed. As a society we have completely failed to look after our most vulnerable members. The provision of care for children and adolescents is desperately inadequate. As the Committee said, this lack of provision does more than breach the United Nations Convention on the Rights of the Child. It also breaches the Children (Northern Ireland) Order 1995 and the Human Rights Act 1998.

I thank the Health, Social Services and Public Safety Committee for bringing this report — horrible as it is — to the Assembly, and I thank everyone who contributed to it.

This inadequate provision is not only illegal, it is also immoral. We are putting the physical, mental and emotional health of our children at risk. It is only through luck and the dedication of our overstretched and under-resourced staff that death or serious injury to some of our youngsters in care has been avoided so far. As the Northern Ireland Court Service has so rightly pointed out

"We remain astonished that one of these children has not killed or been killed in the past four years."

Truly, that is a totally appalling statement. I repeat myself: I am horrified and ashamed that we have treated our needy and vulnerable children so badly. We have waiting lists of more than twice as many children as there are funded places. We have waiting lists of over two years for counselling services. Our lack of provision means that children are housed in adult psychiatric wards and young girls are housed in Maghaberry Prison. Even in cases of sexual assault the victim is housed in the same building as the perpetrator of the attack.

It is coincidental that in today’s post I received a copy of this booklet from Kids for Peace, entitled ‘Endangered: Your Child in a Hostile World’. That could be applied equally to children in care in Northern Ireland, and we should be totally ashamed. We have failed — at least those politicians who were in power over recent years have failed. This is not a situation that we can allow to continue. It is, I repeat, illegal and immoral, and surely someone somewhere should be made accountable.

The present Minister of Health, Social Services and Public Safety cannot be held responsible. However, if improvements are not made immediately the Minister and her Department will have to face the Assembly in the days ahead, and they will then be held responsible. I do not want to spend any more time highlighting the reported instances of failure and poor provision. The question now is: where do we go from here?

As with so many other things, funding is needed. I am pleased to note that the Minister is putting more money towards preventative measures, and I hope that the Executive’s fund for children will help to rectify these problems. However, a decision to increase funding is simply not enough. The Committee could not find evidence that past increases in funding had been spent on these services. I am totally alarmed, as are others here, by the evidence that moneys meant for children have been spent by trusts on other activities, such as clearing overdrafts. This is totally unacceptable.

I cannot emphasise this strongly enough: I serve notice to the trusts, to the Assembly and to the people of Northern Ireland that this behaviour simply cannot continue. I will do all that I can to see that the situation is rectified. Money allocated for the provision of children’s services should be spent on those services. When the Assembly, the Executive, the Health, Social Services and Public Safety Committee or the Minister decide to direct funding to children, it must be spent on those children.

My Colleagues David Ford and Eileen Bell have tabled a notice of motion asking the Assembly to appoint a commissioner for children, and I hope that that will come before the Assembly very soon.

Monica McWilliams (NIWC, Belfast South)

This is our first debate on looked- after children, and it has taken us the best part of two years to get round to this. This category is not small. It comprises 2,414 children. The report could equally have been titled ‘An Inquiry into the Lack of Care and Insecure Accommodation’. That is not to reflect on the dedicated staff but on the lack of resources.

The Minister has inherited a legacy, and we urgently need to do something about it. This is a sad and pathetic story. We are 115 places short in residential care at the minute, and as a consequence we have excessive numbers of disturbed and disturbing young people concentrated in fewer centres. As Ewan McEwan from the Young People’s Centre told us "It is a story of containment rather than constructive intervention."

He came to a conference two weeks ago on the issue of contact between children and parents and the danger of domestic violence. He talked about what can happen to children when family care breaks down. He made one very poignant observation: "You have not lived in that country." If we think for one minute what it must be like for a child in need and at risk to be taken from home and placed in care, we can imagine the loneliness, isolation, and vulnerability he feels. It is a horror story when he enters the residential homes.

We do not have therapeutic communities in this country, particularly for adolescents and young people who are suffering from mental health problems. I have sometimes found that they are locked up to protect them from others in the home or because there is an insufficient number of staff to deal with them. I went to Maghaberry prison after Ewan McEwan had given evidence to the Committee. He told us that he was visiting a 15-year-old girl there the following Saturday. I spoke to the Governor and he told me that we would not find 15- and 16-year-old girls in prisons in England, Scotland or Wales.

I am aware that the Minister is not responsible for criminal justice, but one of the report’s pleas is that we urgently need to set up a working party to address both the criminal justice system and the health and social services needs of young people. The young girls are in Maghaberry; the young boys are in juvenile detention centres. This is the year 2000, not 1800 or 1900. That young woman was in court on that day, but I was told that she felt alone and had no one else to talk to other than the staff. Under the human rights legislation she is not able to receive visitors at the same time as the adults. If we were to put ourselves in her shoes, we could begin to understand how badly the system is letting down girls like her.

There is a story to be told about juvenile justice, but, given that we only have five minutes, that will have to be left to another day. Our residential care centres understand that they have overstressed workers. We were presented with evidence that 52 young people in the Western Board area alone had absconded for less than 24 hours; 18 went in the front door and out the back and were gone for more than 24 hours; one was gone for 69 days.

Young girls in my constituency are now being pimped for prostitution, and I live in south Belfast, not south-east Asia. There is an ongoing police investigation into young girls of 13, who have been taken out of care homes, being used for prostitution. I am sorry that an excellent home in Middletown in sough Armagh, which I also visited, has closed, because there I saw a linked-up service with some attempt being made to educate the young women. That is gone, and many of the voluntary residential homes have closed, particularly those run by religious orders. That is why we are facing such a crisis.

We were told "it is a make-do response"; "the staff are on strike"; "we can no longer cope"; "there are no places on a Friday night"; "there are camp beds on corridors"; and "we do not know how many children are at risk".

I received a written answer to a question I asked a Minister. We do not know how many children are in poverty in this country. The prevention strategies are laid out in front of us dealing with education, respite care, adoption and the needs of foster carers. In particular we are making a plea for adolescent and mental health services.

It is not good enough currently to have over 240 children being discharged from adult psychiatric wards. Protection facilities are also needed. We need a protection strategy and we need placement risk analysis. The good practice at the Young People’s Centre provided us with an excellent example. But most of all we need an action plan. The Children (1995 Order) (Amendment) (Children’s Services Planning) Order (Northern Ireland) 1998 is not working; we desperately need a children’s commissioner. We need the resources, and we need to make children matter now.

Alan McFarland (UUP, North Down)

It is fair to say to all those reading this report that children’s services are in a bit of a shambles. Our children are not being properly looked after. The dedicated staff is hard-pressed. It is not just a matter of finance, although Members can see from the report that money is being frittered away and needs to be ring-fenced. A serious question arises over leadership, strategy and planning. An even bigger question is how the current situation has been allowed to arise.

It is a travesty that around 50% of the children coming out of care are low achievers with no proper qualifications. They are falling through the net. It is important that there be a joint working group to look at this to try to produce some form of through-care path so that this does not happen.

Secondly, I wish to address fostering. There is a clear need to protect children. However, I know a couple who foster children. They see it as their duty to care for children, and they tell me that many hoops are put in their way. Fostering is not an easy business, and we need to examine ways of making it easier. With regard to the age profile of those who foster, a system needs to be devised to encourage younger people to participate in this important activity.

The procedures for adoption are similarly problematic. Adoption is the best option for a child likely to spend a lot of time in care. Examples from England and Scotland have indicated that nonsense and political correctness have made it extremely difficult for children to be adopted. As a result, couples have gone to Mexico, Romania and elsewhere to get children they can call their own.

As Prof McWilliams has said, the criminal justice system is in confusion about the different regulations and Acts. We must ensure that the Department and the Northern Ireland Office clarify the demarcation lines on this issue. We must continue to bring pressure to bear so we do not fail in our duty of providing loving care for children who, usually through no fault of their own, find themselves in lonely and stressful circumstances. Action must be taken now, and I call on the Minister to take the lead. I commend the Committee for its hard work, and I commend this comprehensive report to the House.

Tommy Gallagher (Social Democratic and Labour Party, Fermanagh and South Tyrone)

I support the motion. I agree with the Chairperson’s comments about the effort and energy of our Committee colleagues, and the work and commitment of all staff associated with that Committee.

Members do not have to read the report to gather from the list of recommendations that the system delivering services and support to young people in care is underperforming. Significant improvements can be made in this sector if there is a fair allocation of resources. This is particularly true of children’s residential accommodation. The four health boards have jointly published an integrated plan addressing the needs of children in care, entitled ‘Implementing Children Matter’. This plan suggests that over £26 million is necessary for capital costs and that £11 million per year for recurrent costs will be required over five years. The Minister has already made a strong commitment to provide substantial funding for improving the circumstances of these children.

In the past, money initially allocated for children’s services was sometimes diverted to other areas considered a higher priority. To avoid a repeat of this, I ask the Minister to ring-fence the funds that will be allocated towards the ‘Implementing Children Matter’ report. We are talking about the most vulnerable children in the community, and there is a most compelling case for ring-fencing the money. If the Minister cannot give an open-ended commitment, I urge her, at the very least, to pledge to ring-fence the money for the immediate five years.

The Department of Health, Social Services and Public Safety shares responsibility with the Department of Education as regards the education of children in care. This requires the co-operation of the Departments, and the co-ordination of the education boards, the health boards, and the hospital trusts. Our schools and teachers are best placed to provide the security, continuity and reassurance needed by children in care. The Committee has concerns about the shortcomings in the present procedures for the identification and support of children at risk.

The report draws attention to instances where teachers have not been informed about children who have been taken into care. It is hard to comprehend and very disappointing to find out that schools do not always have this information. While responsibility for the children rests with the trusts, the two Departments must put mechanisms in place as soon as possible to ensure that the school is also informed in every case where a child is placed in care. To this end, we need a central system to distribute information on children in care to both Departments as well as to education boards, trusts and health boards.

As we know, these children are educated in a variety of settings. Some of them are in mainstream education; a high proportion have special needs, and some, because of suspensions or expulsions, receive all their education outside school. It is widely accepted —as has been referred to by Assembly Member Alan McFarland — that the educational attainment of young people and children in care is poorer than average. If they are to reach their full potential, they will require the assistance and support of teachers, psychologists, educational welfare officers and others.

It is essential to have a co-ordinated approach between the Departments and the agencies. If the educational needs of the vulnerable and the marginalised — the group to which we are referring — are to be addressed, a co-ordinated, multidisciplinary and multi-agency approach is required. There can be no excuse for failure to communicate important information among any of the agencies relevant to children in these circumstances.

Sue Ramsey (Sinn Féin, Belfast West)

Go raibh maith agat, Mr Deputy Speaker. I too rise in support of the motion. At the outset, I wish to state my disappointment that there is a five-minute time limit on Members who wish to speak, for a great deal of hard work and effort has gone into this report. I feel that this five-minute rule makes a mockery of many months of work.

I wish to thank the Committee Clerk and support staff for their excellent work in facilitating the Committee’s coming to this report. I also want to mention the various children’s groups and individuals who put time and effort into providing written and oral submissions. I should like to mention the fact that the Minister is here with us and has attended the debate. I welcome her commitment to ensuring that the rights of children are centre stage.

We are all aware of the serious underfunding in the Health Service, as mentioned previously. However, children’s services have, in my view, come a poor second. The Committee Chairman, Dr Hendron, mentioned that they are regarded as the Cinderella service.

In a more positive vein, I welcome and support the Executive’s decision to set up, under the proposed Programme for Government, a children’s fund to tackle the problems of children in need and young people at risk. However, to me this points out the clear need for a cross-departmental policy on children’s services, which cut across all Departments. We need assurances that the programme will not consist merely of empty promises of the sort we have heard over the last few years.

I also welcome the establishment of the Children Matter task force. It was due to report last month, and I am somewhat concerned that it has not. I would appreciate the Minister’s telling us why.

People have mentioned that the report is very comprehensive. It contains most alarming statistics and shocking quotations from various people involved in working with children.

We concluded with 36 recommendations, and, in my view, many of them can be acted on now. Some will cost money, but others will not, and I believe that small amounts of money can make a great difference, with a knock-on effect on services for children and young people. It will greatly change the quality of life we propose for them.

It is right that we point out that some of the recommendations have been about for a number of years. The Department has only to agree joint protocols on these recommendations and implement them.

I am conscious of the fact that the Chairperson covered a lot of the report earlier, but there is an issue concerning secure accommodation in the juvenile justice section. The Children (Northern Ireland) Order 1995, which is the under the remit of the Department of Health, defines children as "under 18 years of age". However, in the juvenile justice section they are defined as "under 17". I know that this is not within our remit, but we were finding that it is creating problems in the other parts of the system.

The Department informed us that the reason the definition was "under 17" was that in England there were a large number of cases, which were overburdening the juvenile courts. I do not accept that as a good reason for the definition. If we are treating them as adults for this reason, will there be a knock-on effect? Are we going to continue allowing people to vote at 18, or are we just treating them as adults at age 17 to accommodate ourselves?

I have a problem with secure accommodation in that the Departments of Health and Education have no say in the health or education of these children — they are within the remit of the Northern Ireland Office. One recommendation is for a joint working group to be set up to facilitate that. I am happy that the Department of Health has just announced, in the Health and Personal Social Services Bill, that staff in the probation and juvenile justice centres will come under the remit of the proposed social care council. This is a positive step, and it will be another safety valve for children in this sector, because we are all aware of the stories and reports concerning the care of children.

I am disappointed that there was no recommendation for a junior Minister. In saying that, I welcome the proposed recommendation for a commissioner, which is the first step to ensuring that the rights of to children are placed centre stage. Go raibh maith agat.

Danny Kennedy (UUP, Newry and Armagh)

As Chairperson of the Education Committee, I am grateful for the opportunity to speak on this important issue. My Committee recognises the importance of this, and we responded to the Health Committee’s request for comments by providing a memorandum. I am pleased to see that the concerns we highlighted, from an educational perspective, have been included in the Health Committee’s first report.

Members will be aware that the great majority of children in care attend mainstream or special schools. As stated in the Education Committee’s response, the present level of educational achievement of children in residential care is very low indeed. This must be addressed, and I fully support the Health Committee’s view that with necessary support measures a substantial improvement can be made. The level of low achievement is also compounded by the fact that children in care have a higher rate of non-attendance at school than their peers. I am pleased that the Health Committee highlighted my Committee’s concerns about this and the issue of multiple suspension.

My Committee also recognised the lack of information about these children’s education. This must be addressed if we are to ensure the quality planning needed to enable decisions about their education to be taken in an informed way. We support the full integration of young people’s educational needs into care planning arrangements. Again, I note that Colleagues on the Health Committee have also recognised this as a priority. We also endorse the formation of a joint working group to consider the education of young people in care and strategies for keeping them within the school structure.

I will be seeking my Committee’s agreement that the Health Committee’s recommendations in respect of the education of these children be given our full support. We will include the educational issues raised in this report in our work programme for consideration in the new year.

Patricia Lewsley (Social Democratic and Labour Party, Lagan Valley)

The report of the inquiry into residential and secure accommodation for children only served to underpin the existing knowledge that children’s services in Northern Ireland are chaotic and totally inadequate to meet the needs of young people at risk and in need.

There are many aspects to these care services. Inadequate resources and inappropriate placements over the years have meant that children’s needs have not been assessed or catered for properly in residential care. Increasing pressures on staff are also a problem. One such pressure stems from insecurity of tenure, which has already been mentioned today; others result from the use of short-term and casual contracts, which has resulted in low morale and huge inconsistency in the care provided to children and the support given to staff.

It is important that we act now to redress years of underfunding and neglect and, as other Members have already said, to provide ring-fenced funding on an ongoing basis. Priority must also be given to family support measures to try to reduce the number of children who are being placed in care.

I want to refer to young people suffering from mental illness. It is absolutely appalling. The system of service provision for young people is patchy, disjointed, poorly co-ordinated and overloaded. The few services we have are under severe pressure and struggling to cope. The pattern of children’s and adolescents’ mental health services is varied, with differences in expenditure by local trusts and boards. Where specialist services exist, waiting lists continue to increase and we find children inappropriately placed on adult wards. This is surely more than inappropriate. It is harmful, dangerous and an infringement of the basic human rights of any child.

Allow me to put this in context. Young people whose illnesses may often be tied in with abuse have found themselves in wards with perpetrators of abuse, and they have also been witness to the behaviour of some very disturbed adults. This is nothing short of a disgrace, and the Minister must assure us that under no circumstances will such a situation ever occur again.

While I welcome the additional beds for which money has been allocated in the Budget, I wonder where these beds are to be placed, how they are to be staffed and whether additional funds have been secured to train and retain staff to cope with the new places. Allocating extra acute beds on its own is not enough. They must form part of a co-ordinated approach throughout the Health Service to deal with the problems of young people who suffer from mental illness.

We must ensure that appropriate residential places are available, especially for young people who have problems with drug and alcohol abuse and have mental health problems. Services for children with conduct disorders and challenging behaviour should fall within the child and adolescent mental health remit. The evidence suggests that there is a growing and unmet need in this area. Such units should be open seven days a week and must cover the geographical spread of our services. Currently, there is only one specialist service for young people — the Young People’s Centre in the South and East Belfast Trust area. This centre has a six-month waiting list.

Eating disorders are also on the increase, particularly in female adolescents. Again, only one specialist service for these conditions exists to cover the whole of the North of Ireland. Once more, this unit is in the South and East Belfast Trust area, and the waiting list for it is four months long.

We have heard many issues raised here today. I do not need to tell every Member that mental health services are in a crisis. The services for young people and adolescents are stretched to breaking point. It is time to develop a proper regional strategy. First, the Department of Health, Social Services and Public Safety must carry out a proper assessment of need. How, for instance, was the figure of 10 beds arrived at when we do not know how many young people suffer from psychosis, eating disorders or challenging behaviour? How many of the young people in residential accommodation suffer from mental illness? We have let our young people down, and it is time to own up.

Civil servants must stop hiding behind procedure and bureaucracy, assess what is needed and develop a regional strategy to deal with the broken minds of the young.

The humanitarian and financial reasons for investing in youth mental health services are irrefutable. It would be shameful for us to ignore the situation, implement piecemeal measures first to treat the symptoms and not take preventative measures to tackle what is a growing problem. Children are our investment in the future. I believe that it is the responsibility of every Member in the Chamber to act now to improve dramatically the situation that has been outlined today in this report.

Pauline Armitage (UUP, East Londonderry)

Much has been said today, so I will say little, as I am sure that it has all been said better than I could say it anyway. There is a chronic problem with the provisions for children in relation to services, care, protection and secure accommodation. This has been well documented since 1997, and yet the problem remains as we approach 2001. The number of residential places currently available is about 30% short of the estimated need. Due to a lack of suitable accommodation, children of varying ages and conflicting needs are being placed together in general provision homes. The result of mixing and misplacing these very vulnerable children is intolerable.

Pressure on staff and the consequent effects of low morale and a high incidence of sick leave are leading to a drift of qualified social carers into less demanding occupations. The pressures on staff include the need to deal with a level of violence in the homes, and regular incidents of absconding, drug abuse and even prostitution. There is an undeniable lack of adequate provision to meet the needs of children with mental health problems and a lack of secure accommodation for children and young people who pose a risk to themselves and others. Basically, the choice of proper care and placement does not exist for these children and their individual needs.

If children’s homes were immediately available there would still be a problem in attracting suitably trained staff to care for the children. Bricks and mortar can produce a building, but that in itself is not a home. These children need and deserve a loving, comfortable and caring environment of the same standard that we would provide for our own children.

Recruitment of staff for children’s homes should be stepped up. Last year, approximately 15% of residential social workers left the profession due to unsocial hours, violent incidents and, in general, the long working day. Social workers do not shut the homes on bank holidays; they do not leave early to avoid the rush-hour traffic; and they do not just put the job off until tomorrow. That is not how a social worker operates.

There should be greater incentives to attract the right type of people to this work — people who will accept the unsocial hours and the degree of commitment that is required. A body should be established to determine proper staffing ratios for existing and proposed units specialising in child residential care, and adequate training and support facilities. It should also review the pay and conditions of service to reflect the demands and stresses of the job. I am not aware of a mechanism whereby social workers can award themselves a massive payment for work performance. I doubt if they would want to.

The situation has become worse in recent years due to a lack of willingness in the community to consider fostering. This might reflect our social lives and the changing pattern of childminding. A registered childminder earns approximately £100 per week. That week lasts five days, usually from 8·30am to 5·30pm. There are no wake-up calls in the middle of the night and no weekend commitments. Although childminding and fostering are two very separate issues, I believe that if we do not encourage, support and train prospective foster carers, their talents may well be channelled into childminding.

That may already be happening: almost 70% of foster carers are aged between 40 and 60, and, in the past year, insufficient numbers of foster carers were recruited to compensate for those who had retired. There should be a review of boarding-out rates to reflect the skill and commitment needed for such a valuable community service.

Educational performance among children in residential care in Northern Ireland is poor; 50% leave with no qualifications at all.

My time is up, Mr Deputy Speaker; I assume that you want me to sit down.

John Gorman (UUP, North Down)

I do not want you to, but the system requires it. Thank you.

Mary Nelis (Sinn Féin, Foyle)

Go raibh maith agat, a LeasCheann Comhairle. I commend the report. Having listened to the Members who have spoken and read some of the reports, I concur with the conclusion that the overall picture is one of long-term neglect by direct rule Ministers — minimal strategic planning, little policy development, a narrow focus on children’s needs, poor co-ordination and, worst of all, the historic underfunding of services. In effect, public expenditure on family and childcare services fell from 17·6% in 1995-96 to 16·7% in 1997-98. Is it any wonder that vulnerable children in the North of Ireland have been way down the political agenda and way behind those in England, Scotland, Wales and the South of Ireland?

The Minister has inherited a situation in which children in need are excluded. Those children and young people are among the most vulnerable groups in society. They live on the margins of our health, education and training systems, and they often fall into the gaps between departmental responsibilities. The Children (Northern Ireland) Order 1995, which we welcomed at the time, gave core legal responsibility for care and safety to the Department of Health and Social Services, and responsibility has passed to this Minister. However, the needs of children and young people are often too complex to be met by a single agency. That complexity is even recognised by the current Government, and their policy places increasing emphasis on multi-agency collaboration in both the delivery and planning of services. Such collaboration might be facilitated by a children’s commission.

The underfunding of the measures contained in the Children (Northern Ireland) Order 1995 has already been recognised as a major problem. The old Department of Health and Social Services did not release sufficient moneys for that important legislation to be effective. That resulted in untold suffering and the death of a child who walked out of a so-called secure unit in Belfast, stole a car, crashed it and died. He was 12 years old. In fact, the introduction of the Children (Northern Ireland) Order 1995 coincided with a major downsizing of the voluntary residential childcare sector. Those of us who voiced strong objections at the time can now see the inevitable outcome of such downsizing. The report bears out all our concerns.

The ‘Children Matter’ report, compiled two years ago by the social services inspectorate, emphasised the extent of the difficulties and made several recommendations. Its main finding was that there was an urgent need to create smaller specialist units of accommodation, with adequate staffing and resources, which would require considerable capital and revenue expenditure. As Members have said, we cannot accommodate children with severe emotional needs or disabilities.

The Committee for Health, Social Services and Public Safety has done what the Department under direct rule failed to do: it has asked questions about children and been informed fully of their needs. I believe that the Minister will endeavour to address those needs.

I share Ms Ramsey’s disappointment that there was no recommendation for the appointment of a Minister for Children. If it is suggested that a children’s commissioner be appointed, it is important that he or she be given as much seniority and authority as possible. Only then will the low priority given to children in need be properly addressed. Go raibh míle maith agat.

Joan Carson (UUP, Fermanagh and South Tyrone)

I welcome the report on the serious issue of residential and secure accommodation for children in Northern Ireland. I congratulate the Committee and its support staff on producing the report. It is hoped that all Members will fully support the recommendations in it.

At this festive time, there are heart-rending stories in newspapers and other media, and appeals for finance. Northern Ireland people are known throughout the world to be the most generous when faced with pictures of children in need. Who would have thought that Northern Ireland would be faced with such problems in the twenty- first century? There is an urgent need for secure accommodation for children.

Children’s services are important, and any funding designated for residential homes and services should be used for that purpose and not channelled into other Departments to be lost, perhaps, through poor financial management. Can the cost of implementing the report’s recommendations be met fully by the Department? This excellent report must not be left to gather dust.

Bairbre de Brún (Sinn Féin, Belfast West)

Go raibh maith agat, a LeasCheann Comhairle. Chuir mé suim mhór, agus mé ag éisteacht, sna pointí a luaigh Teachtaí le linn dhíospóireacht an lae inniu ar thuairisc an Choiste Sláinte, Seirbhísí Sóisialta agus Sábháilteachta Poiblí ar chóiríocht chónaithe agus dhaingean do pháistí.

Ba mhaith liom an Dr Hendron agus baill uilig an Choiste a mholadh as tuairisc chomh cuimsitheach inléite sin a chur le chéile. Bhí faill agam i mí Dheireadh Fómhair fianaise a thabhairt don Choiste agus is feasach domh an tsuim agus an tiomantas atá ag baill an Choiste maidir le leas na bpáistí. Ag an phointe seo, ba mhaith liom mo bhuíochas pearsanta a ghabháil le gach eagraíocht agus le gach duine aonair a thug fianaise don Choiste as a gcion tairbhe luachmhar.

Tá an tuairisc féin fadréimseach cuimsitheach agus cuimsíonn sí 36 mholadh shainiúla. Ar ndóigh, beidh am de dhíth orm leis na moltaí seo agus na himpleachtaí a bhreathnú chomh maith le hiomlán na bpointí a luadh sa díospóireacht inniu a chur san áireamh. Beidh orm na himpleachtaí praiticiúla, reachtaíochta agus airgeadais a mheasúnú.

Níl rún agam trácht ar gach moladh, nó, mar a dúirt mé cheana, beidh am de dhíth orm lena mbreathnú. Ach is mian liom trácht ar chuid de na príomhábhair chúraim sa tuairisc agus sna moltaí a bhaineas léi. Cé gur ar chúram cónaithe agus cóiríocht dhaingean do pháistí atá an fócas, baineann sí le saincheisteanna níos leithne, mar an t-altramas, an t-uchtú agus an tacaíocht theaghlaigh. Aontaím leis nach féidir an cúram cónaithe a bhreathnú ar leithligh ó sheirbhísí eile.

Tagraíonn an chéad mholadh don riachtanas dóthain maoinithe a chur ar fáil do sholáthar áiteanna breise cúraim chónaithe do pháistí. Agus caithfidh mé a rá maidir leis an ábhar seo go bhfuil mé buartha go gcaithfidh mé — go gcaithfimidne uilg — feabhas a chur ar sheirbhísí páistí. Beidh mise ag déanamh mo sheacht ndícheall le cinntiú go mbeidh an maoiniú cuí ar fáil le déanamh deimhin go dtig linn an feabhas sin a chur i bhfeidhm.

Is ábhar buartha domh nach raibh an maoiniú agus an t-airgeadas a bhí de dhíth ar fáil le roinnt blianta. Déanfaidh mé mo dhícheall a chinntiú go mbeidh tuilleadh airgid ar fáil uaidh seo amach. Cuireadh maoiniú breise ar fáil i mbliana do sheirbhísí do pháistí agus cuirfear maoiniú breise ar fáil sa bhliain seo chugainn. Dá n-ardófaí an líon áiteanna cúraim chónaithe go dtí an leibhéal a mholann an tuairisc, ghlacfadh sin roinnt blianta le baint amach. Ar ndóigh, beidh mé ag iarraidh maoiniú breise bliain i ndiaidh bliana, ach caithfimid uilig a aithint go bhfuil tosaíochtaí éagsúla san iomaíocht d’acmhainní agus tá seans nach n-éireoidh liom i mo thairiscintí. Caithfimid mar sin bheith réalaíoch faoi cad is féidir a bhaint amach.

Tá an Tascfhórsa Tábhacht le Páistí a bhunaigh mé ag tabhairt aghaidhe ar shaincheisteanna maidir le hairgeadas, foireann, pleanáil agus saincheisteanna lóistíochta eile. Beidh mé ar mo dhícheall na hacmhainní a bhaint amach a ligfidh do mhéadú teacht ar an líon áiteanna cúraim chónaithe sna blianta seo chugainn. Beidh mé ag brath ar an tascfhórsa le cinntiú go gcuirfear le feabhsuithe sa tseirbhís cibé acmhainní a chuirfear in áirithe do chúram cónaithe do pháistí.

Ní maith le duine ar bith, ar ndóigh, árais páistí a bheith ag feidhmiú thar a dtoilleadh, agus is ábhar buartha domhsa sin chomh maith. Caithfimid, mar a dúirt mé, cinntiú go mbeidh airgead ar fáil don réimse leathan seirbhísí atáimid ag iarraidh a chur ar fáil do pháistí sa tsochaí seo.

I have listened with considerable interest to the points raised by Members during today’s debate on the Health, Social Services and Public Safety Committee’s report into residential and secure accommodation for children. I would like to congratulate Dr Hendron and all the members of the Committee for producing such a comprehensive and readable report. In October I had the opportunity to give evidence to the Committee, and I am aware of the considerable interest and dedication of its members to children’s welfare. I would also like to add my personal thanks for the valuable contributions made by the organisations and individuals who gave evidence to the Committee.

The report is wide-ranging and comprehensive and contains some 36 specific recommendations. Obviously, I will need some time to consider them and their implications, as well as time to take account of all the points that have been raised in today’s debate. I will need to assess the practical, legislative and financial implications. I do not propose to comment on each recommendation, because, as I have said, I will need time to study them. However, I do want to comment on some of the main areas of concern raised in the report and in the related main recommendations, as well as on the points raised by Members today. Although the focus is on children’s residential care and secure accommodation, the report also touches on broader issues such as fostering, adoption and family support, and I agree that residential care cannot be viewed in isolation from other services.

The first recommendation refers to the need for sufficient funding to be made available for the provision of additional children’s residential care places. This was raised by many Members today including Prof McWilliams, John Kelly, the Committee Chairperson, Dr Hendron, Rev Robert Coulter, Paul Berry, Mary Nelis and others. I am very concerned to see measurable improvements in children’s services and will wish to ensure that the resources allocated are applied to ensure such improvements.

I am also concerned, and am aware of the concerns expressed by others, about the underfunding of children’s services and the leeching off of resources. I will be making strenuous efforts to secure appropriate funding for these services in the future. Additional funding has been provided this year for children’s services, and further funding will be provided next year. An expansion in the number of residential care places to the levels suggested in the report would take several years to achieve. I shall, of course, be seeking additional funds year on year, but we all recognise that there are competing priorities for resources, and I may not be successful in the bids that I make.

We must be realistic about what can be achieved, and the Children Matter task force that I have established is already addressing the practical matters to do with finance, staffing, planning and other logistical issues.

Again, the question of ring-fencing was raised by several Members, including Mr Gallagher, Mr John Kelly and Ms McWilliams. I will be doing all that I can to secure the resources that will allow for an increase in the number of residential care places over the next few years.

People will know, as I have already stated, that there are some difficulties regarding the specific ring-fencing of money. I will look to the task force to ensure that resources earmarked for children’s residential care are applied to ensure improvements to the services. It is undesirable and unacceptable, as people have said in the debate, for children’s homes to operate beyond full capacity. I am aware that some trusts have taken innovative steps in using temporary accommodation to relieve short-term pressures. I reiterate that I will do everything in my power to ensure that we are given the resources to achieve the significant increase in the number of places that we are planning to have.

Recommendation 5 states that a regional group should be established and charged with producing precise staffing requirements for the existing homes and more specialised provision as the service develops, and a subgroup of the Children Matter task force has been set up to address this very issue.

I join several Members in praising the efforts of existing staff, and I would like to associate myself with those who have praised the professionalism, dedication, and enthusiasm of staff who work, often in very difficult circumstances, in children’s homes. We owe them a great debt of gratitude.

I fully agree that there is a need for training and support for residential care staff in the areas highlighted in recommendation 6 and highlighted by Members here today. The social care council is due to be set up in October 2001, subject to the legislative will of the Assembly. We need to consider whether this would be the appropriate mechanism and, in fact, whether it would be practical for the council to undertake this training and support work. However, the task force subgroup on staffing issues will consider this matter carefully.

It is clear that if we are to expand children’s residential care, the work must be made more attractive to those involved. We share the concerns of those who have highlighted the difficulties that staff face. I agree that career structures, high levels of stress and the unsocial hours involved in this work are all issues to which further consideration will have to be given.

As regards the recommendation to lift the current restriction on the voluntary sector’s providing secure accommodation — a matter raised by Dr Hendron, Rev Robert Coulter, Ms Armitage and Mr Berry — I should say that the current pressures on secure accommodation will be eased by the seven new secure places to come on stream at Lakewood within the next few weeks.

I will have to consider very, very carefully whether further expansion of secure accommodation would be advisable at this time. I will consider the points raised by Members. However, putting children into secure accommodation must be the last resort, and we wish to ensure that secure accommodation is used only when necessary, and then only as an interim measure. The aim must always be to facilitate the return of the child to the community.

I am also aware of the human rights concerns that people have in this area. The legal criteria for the use of secure accommodation are extremely tight, and its use for any significant period requires the authority of the courts.

Members have raised other queries regarding recommendation 13 about the liaison with the courts, and we need to look at that question. We will also look at the whole question of liaison with the NIO regarding the juvenile justice system, which I will come to later.

On the provision of an additional mental health unit, the Programme for Government gives priority to this issue and to a bid for additional resources to provide 10 adolescent mental health inpatient beds. Therefore, the question of the provision of those beds has been addressed in the Programme for Government, and my Department will also address the issue of providing residential facilities for disabled children.

Regarding Ms Lewsley’s question about the inadequacy of general mental health services, each of the boards has undertaken a comprehensive needs assessment of children’s and adolescents’ mental health services. These clearly indicate that services are to be developed as resources become available. The draft strategy ‘Minding our Health’ sets out the key priorities for the development of action to promote mental and emotional health, and I hope that Members will join with me in pointing out the need for us to secure resources for the whole wide range of children’s services so that these can be brought forward.

The residential and community support needs of children with psychological and psychiatric difficulties are ones which, I believe, the task force and the ‘Minding our Health’ strategy will address by trying to seek more responsive and accessible services for children.

Clearly the lack of residential and respite facilities, a matter raised by Rev Robert Coulter, is a matter of concern to me and is presently being looked at by the Children Matter task force. I note and accept the Committee’s call for research in this area.

The education of young people in care, a matter raised by Mr Gallagher and Dr Hendron, straddles not only my responsibility but also that of those in the juvenile justice system. This is an issue which is very important, and Members will know that some preliminary work has already started in liaison with the Department of Education. We will certainly consider the involvement of the NIO. Specific facilities suitable for looking after offenders are a matter we will need to consider further.

Mr McFarland and Ms McWilliams raised a point about the need for an interdepartmental group to consider the position of young offenders and young people who are inappropriately placed in custody. I will certainly consider the issue of children in the justice system and will take this up with the NIO.

Ms McWilliams also asked about the absence of therapeutic services for children and the placement of children in services not designed for them. This is of significant concern to me. The issue of the use of adult prisons for girls is one I wish to consider more fully in collaboration with the NIO to ensure the appropriate protection and well-being of young women. I hope I have addressed the Member’s point regarding the provision of money for 10 additional adolescent beds next year.

We also need to look at the fact that many children admitted into care have a range of very complex needs, and I certainly want to consider what further steps can be taken to improve the life chances and opportunities of these children and ensure that their rights are being taken care of and protected.

There are already statutory provisions encompassing risk analysis, and this duty rests with the trusts, which have parental responsibility for looked-after children. Registration and inspection units are concerned with quality standards, and to involve them in emergency placements for individual children might compromise their work. The planning for individual children is clearly the responsibility of the trust.

As I indicated to the Committee when I met with it on 4 October, I intend to produce a regional overview of the way forward for children’s services. I will be bringing forward a range of proposals relating to children’s services to address the same broad issues covered by the Quality Protects programme which was issued in England. We will also be looking at the National Children’s Strategy in the South.

I intend to issue a consultation document in the new year relating to care leavers. It will set out detailed proposals for improving the life chances of young people moving from care to independent living. These proposals will, however, require legislation, and I intend to bring forward a Children Leaving Care Bill next year. I will also bring forward proposals to address the support needs, respite provision and training requirements of foster carers as soon as possible. I absolutely take on board the points raised by Members about the crucial place of foster carers in the whole continuum of care for our children. I accept what has been said about our need to express a particular debt of gratitude to those taking on this task and our need to look after them.

The Children Matter task force will shortly produce a regional plan which will set out a programme of specific developments over the next two and a half years to increase the number of places by about 90. The capacity to implement this programme will depend on the availability of financial resources and the ability to recruit and train the necessary additional staff. It is intended to involve the voluntary and private sectors in the implementation of the task force’s work. However, in relation to the task force itself, there are several issues which I need to consider regarding any potential conflicts of interest.

To secure the expansion of children’s residential care services — which we all want to see — it will be important to work with local communities. No doubt there will be a need for innovative approaches. I will be pleased to see how we, as public representatives, can work together to improve the perceptions of children’s residential care and — I was happy to see this pointed out — to improve our chances of being able to open children’s residential care places to ensure that those valued young members of our society receive proper care and that their needs are met in the most appropriate manner.

I would like to pay particular attention to the question of a children’s commissioner, which was raised by Paul Berry, Dr Hendron, Prof McWilliams, Kieran McCarthy, Sue Ramsey and Mary Nelis. The Deputy First Minister said on 6 November

"The Executive Committee is determined to ensure that our arrangements for protecting children and upholding children’s rights are based on best practice. We will carefully examine key developments through Europe, including the Waterhouse Report on child abuse in Wales, the appointments of a Children’s Commissioner in Wales, a Children’s Rights Director in England and an ombudsman for children in the Republic of Ireland. We will also look at the roles of commissioners for children in the Scandinavian countries."

A question was raised about the pilot scheme. I know that the Sycamore Project in Fife — run by a voluntary organisation, the Aberlour Child Care Trust — is providing a regional service for all of Scotland in this regard. It is sited in three units — in converted terraced houses, in a housing estate with close links to the local community and in six local schools. One unit cares for under-14s, another for over-16s, while the main unit copes with the core population of 14- to 16-year-olds. The children are those at risk of being admitted to secure accommodation or who have been discharged from secure provision. An intensive programme of work is undertaken with the children. The director of the project is acting as a consultant to Extern, which is to open a similar model of service in the Ballyduff area of the Northern Board during the spring of 2001.

Ba mhaith liom deireadh a chur le mo chuid cainte ag rá go gcuirim fáilte roimh thuairisc an Choiste Sláinte ar chóiríocht chónaithe agus dhaingean do pháistí. Cion tairbhe luachmhar í dár smaointeoireacht ar roinnt saincheisteanna deacra. D’fhéach mé le freagra a thabhairt ar chuid mhaith de na saincheisteanna a luadh agus scríobhfaidh mé chuig Teachtaí ar bith nár fhéad mé a gceisteanna a fhreagairt inniu. Luaigh mé na réimsí sin ina mbeidh tuilleadh machnaimh riachtanach má táimid le fuascailtí praiticiúla a fhorbairt ar na fadhbanna atá ag an chóras cúraim chónaithe do pháistí. Ba mhaith linn uilig na bearta atá riachtanach le cúram agus cosaint páistí inár gcomhphobal a fheiceáil á gcur i bhfeidhm chomh gasta agus is féidir. Caithfear saincheisteanna acmhainní agus ama agus an gá le reachtaíocht a d’fhéadfadh a bheith ann, caithfear iad sin a chur san áireamh. Ach, na coinníollacha sin san áireamh, glacaim leis an rún atá os comhair an Tí.

In conclusion, I welcome the report of the Committee for Health, Social Services and Public Safety into residential and secure accommodation. It is a valuable contribution to our thinking in relation to a number of difficult areas and issues. I have endeavoured to respond to many of the issues raised in the report and the contributions made by Members today. I will write to any Members whose concerns I have been unable to address in this debate. Furthermore, I have indicated those areas where further consideration will be necessary if we are to develop practical solutions to the problems facing the residential care system for children. We all want those measures that are needed for the care and protection of children to be implemented as soon as possible. The issues of resources, of timing and of the possible need for legislation will need to be taken into account, but, subject to this, I accept the motion before the House.

Joe Hendron (Social Democratic and Labour Party, Belfast West)

I would like to thank the Minister and all my Colleagues, both on the Health Committee and in this Chamber, for their participation in this most important debate. I thank the Minister for her presence here during the debate, for her contribution and for her answers to the questions. I also thank her for setting up the special task force. There are 36 recommendations to consider in this report, and as the Minister said, she cannot go over all of them. I agree with her that residential care cannot be viewed in isolation from other services. Despite the additional £9·5 million provided this year and the £3 million that is expected for next year, we do need additional funding. In relation to the Children Matter task force resources that have been earmarked for children’s residential care, steps must be taken to ensure that this money is ring-fenced for that most vulnerable section of our community. Audit trails are important; accountants and financial experts should be able to follow audit trails from the Minister, the boards and the trusts the whole way through to the coalface. This will identify how funding for children’s services is spent, and that will apply to other matters as well.

We welcome the subgroup set up by the task force that is involved in the staffing of social care and which will work in association with a social care council. The Minister referred to career structures for staff and to the fact that she agrees with the idea of secure accommodation — such as at Lakewood — only when it is necessary and only as an interim measure. We accept that. However, it is necessary to have sufficient places. I welcome her remarks on adolescent mental health. Many of my Colleagues spoke about that, as it is a major problem.

In respect of the education of young people, recommendation 20 of the report refers especially to those in the juvenile justice system, and the involvement of the Department of Education and the NIO is very important.

The Minister mentioned a regional overview of children’s services, the very important Quality Protects programme, the whole question of care leavers, children going into care, and the ‘Children Matter’ task force. I hope that the regional plan will be announced by the Minister very soon.

Many of my Colleagues in the Assembly spoke in the debate. Bob Coulter mentioned historical underfunding, accountability, no redirection of funds and the staffing problems. I agree with him. It is so important that funding meant for children’s services reaches its target. Mr Paul Berry mentioned family support, adoption, funding — everyone mentioned that — foster carers and their rates of pay. He supported, as did all my Colleagues, the idea of a commissioner for children.

John Kelly mentioned righting past wrongs in relation to children. He also mentioned resources, funding and foster carers. Kieran McCarthy used the words "diabolical" and "shameful". We all agree. The Minister inherited this problem, and there is no blame on her, but it is diabolical and shameful that society has failed. We in this Assembly must not fail in this regard.

Monica McWilliams talked about two years’ work for the looked-after children, but we are talking about a population of over 2,000 people. She is quite right about containment rather than constructive intervention. She mentioned Maghaberry, so I will not repeat those points, and talked about adolescent mental health. That is a major problem for all of us, but especially for those concerned and their families.

Alan McFarland talked about the dedication of staff, ring-fencing, leadership, strategy, fostering and adoption. He and many Colleagues talked about education, which is very important. Tommy Gallagher also talked about the staff and resources, planning, ring-fencing the funding and about a multidisciplinary approach to education.

Sue Ramsey mentioned the five-minute limit. That is not something I want to go into now, but it should be looked at in the future. This was, and is, an extremely important debate, and five minutes was not enough. I agree with Ms Ramsey and with the others who said that. Sue Ramsey also thanked the staff, as did many others. I am very pleased to thank all my Colleagues, together with the Committee Clerk and his staff. Sue Ramsey went on to mention secure accommodation in the juvenile justice system and the cross-departmental policy. We all agree with that.

I very much welcome the fact that the Chairperson of the Education Committee, Danny Kennedy, said that his Committee wanted to include consideration of recommendation 20 of our report in its forthcoming work programme. That recommendation deals with the establishment of an agreed protocol involving the Department, the Northern Ireland Office, the trusts and the education and library boards regarding the education of children in residential care.

Patricia Lewsley talked about the chaos in children’s services, and about inappropriate placement, as did many others. She also mentioned assessment of needs, and looking after staff, social workers and, again, the mental health of adolescents and their psychiatric problems. That is a massive problem. Pauline Armitage talked about the 30% shortage of places and inappropriate placing, staff, drug abuse, prostitution, mental health and how we can get more social workers. Like others, she talked about the whole education of these young people.

Mary Nelis talked about vulnerable children and how we must look after them. They are on the margins of our system. She also mentioned comparing funding with that in England and, especially, in Scotland, where much more funding goes towards this problem. Finally, Joan Carson talked about the cost of implementation. The Minister made reference to that.

I thank the Minister and all my Colleagues on the Health Committee and Members of this Assembly. I am honoured, as the Committee Chairperson, to have presented this most important report today and to have moved this motion. I know that the Assembly will give it its full support.

Question put and agreed to.

Resolved:

That this Assembly approves the first report of the Health, Social Services and Public Safety Committee on residential and secure accommodation for children in Northern Ireland and calls on the Minister of Health, Social Services and Public Safety to implement the Committee’s recommendations at the earliest opportunity.

Aggregates Tax

Joe Byrne (Social Democratic and Labour Party, West Tyrone)

I beg to move

That this Assembly notes the serious economic and environmental implications the aggregates tax will have for the quarry and construction industry in Northern Ireland and calls upon the Minister of Enterprise, Trade and Investment and the Minister of Finance and Personnel to make representations to the UK Treasury on behalf of the Quarry Products Association to prevent the introduction of this tax in this region.

Taxation, as Members are well aware, is a reserved matter. In recent weeks, representatives of Northern Ireland’s quarry industry have brought a taxation issue to my attention and to the attention other Assembly Members, including Mr Hussey, whose name also appears on the motion.

This tax is known as the quarry or aggregates tax, and its imposition in Northern Ireland in April 2002 will have serious economic consequences on the quarry industry throughout the North, particularly along the border area.

Furthermore, the imposition of the tax will not produce any discernible or environmental benefits and will have a detrimental impact upon the spending power of the devolved Departments of this Administration, inhibiting the ability of the new political dispensation to deliver on the commitments given in the draft Programme for Government.

The introduction of the aggregates tax was announced by the Chancellor of the Exchequer in his Budget speech in March 2000. Detailed provisions will be included in the 2001 Finance Bill, and the tax will come into effect in 2002. It will apply to all virgin sand, crushed rock and gravel and their products such as tarmac, bricks, blocks, concrete et cetera, which are subject to commercial exploitation in the UK. The tax will be collected by Customs and Excise, but unlike VAT, which is charged as a percentage of value, it will be charged on a weight basis at £1·60 per tonne. The tax will apply to exported products, but exported aggregates will not be taxed. Although imported aggregates will be taxed, imported products made from aggregates, such as concrete blocks, et cetera, will not be taxed.

This amounts to a tax which will make imported products cheaper and will put the industry in Northern Ireland at an unfair disadvantage. The Government’s primary stated reason for introducing the tax is environmental. They want to encourage a shift away from virgin aggregate as part of their sustainable development strategy and to encourage the use of recycled aggregates.

The aim is to integrate fiscal strategy with environmental concerns and reduce environmental damage by shifting the taxation burden away from what the Government consider as "goods" to "bads". The Government intend to use the revenue raised from the tax to contribute towards a cut in employers’ national insurance contributions and to set up a sustainability fund to produce "benefits to local communities affected by quarrying".

However, the Government’s rationale for this tax on construction simply does not fulfil their own objectives. First, the research upon which the taxation is based is highly questionable. Secondly, we should consider the inevitable job losses, the costs to the construction industry and the fact that the aggregates tax might not even raise the necessary revenue to fund the intended reduction in national insurance contributions. When these factors are taken into account, it seems ill-advised for the Treasury to impose such a broad tax, expecially on this region.

The reasoning for the aggregates tax was first raised in Labour’s 1997 Budget and was based upon a paper produced by the Institute for Public Policy Research (IPPR), which promoted the idea of green taxation. The Government have since then justified the tax using research commissioned by external consultants — London Economics (LE) — which showed that quarrying had an external environmental cost of around £300 million.

This cost was based on a controversial form of analysis called contingent valuation in which interviewees were prompted to place a monetary value on the negative impacts of quarrying. The results were multiplied to produce a national value. However, according to the Quarry Products Association (QPA), in the promotion of these research results, and the decision to introduce a tax, the Government neglected some important points. For example, the research assumed there would be no benefits from quarrying, only cost — which the QPA accused the Government of inflating by 30% — and, therefore, that there would be no benefits from quarry restoration nor in the use of quarry products. Additionally, at least 90% of those surveyed did not identify any cost from quarrying.

Doubts about this research were expressed by a peer review, commissioned from Profs David Pearce and Susanna Murato of University College, London. In response, the Department of the Environment, Transport and the Regions commissioned a second report from London Economics, and again the same professors found it lacking, particularly in any benefit analysis of quarrying. Therefore, the London Economics’ report has an inbuilt bias against the quarry industry. To introduce a tax on the basis of such questionable and unscientific research, which alone has cost the taxpayer £500,000, does not stand to reason.

The basis of charging this tax amounts to no less than a tax on construction, as it will only apply to crushed rock and sand gravel used as construction aggregates. As demand for these products is price-inelastic, construction clients will meet any tax introduced through increased costs.

The introduction of the aggregates tax is particularly bad news for the industry in Northern Ireland, which has an annual turnover of £300 million, with an estimated output of approximately 20 million tonnes. It employs between 5,000 and 6,000 people in hard rock, sand and gravel quarries and in concrete, asphalt and block plants.

The QPA estimates that in Northern Ireland, where the average price of stone is £3 per tonne, the imposition of this tax on Northern producers will represent an increase in price of about 53%. In any town North and South where producers are equidistant from the border, the Southern producer will be able to deliver products to the consumer £1·60 per tonne cheaper than his counterpart in the North.

Given that we have a land border from Derry to Newry, and given the fact that we have so many quarries in the border zone, we can see the industry being devastated if the tax is introduced. When one considers that five out of the Six Counties have a border with the Irish Republic and that Southern producers already have a competitive advantage in terms of the punt/pound differential, lower corporation taxes and lower fuel costs, the impact on Northern producers will be devastating.

For many decades, the quarry industry has been an important source of employment in rural areas of Northern Ireland, which have already been hard hit by job losses in the agriculture sector, the textile industry and the petrol retailing trade. For example, in west Tyrone there are over 30 quarries, and over 1,000 jobs in the county are dependent upon quarrying. In Fermanagh, 750 jobs are at stake. Overall, the percentage of the workforce employed in quarrying in Northern Ireland is much greater than in Britain. It is the only region where this tax will apply — a region which has to compete with cheaper imports coming across a land border.

(Madam Deputy Speaker [Ms Morrice] in the Chair)

The existence of the border will also make the tax difficult for Customs and Excise to implement and collect. It will encourage the emergence of a black economy in aggregates which will irrevocably damage reputable producers. It is estimated that 70% of the 5,000 to 6,000 jobs the industry provides could be at risk, resulting in over 4,000 job losses. This, by itself, should be enough to prevent the imposition of this tax, which could cost the Government up to £60 million in lost tax revenues and unemployment benefit.

The environmental reasons for introducing this tax do not add up either. Due to the nature of the local economy, and the greater dependence on the rural economy in the North, we do not have the same opportunity to avail of recycled aggregates in the same quantities as they do in Britain because we do not have the same level of urban regeneration.

Our society is a largely rural one, whereas Britain has a highly industrialised urban society. In addition, there is a more even distribution of rock in Northern Ireland, and quarries are located closer to the customer with the result that lorry mileage and haulage costs are lower. An increase in imports and a relocation of businesses across the border will result in an increase in the number of lorries on our roads. This will have adverse effects on the environment and damage our roads.

With regard to our current spending constraints, this taxation on construction will have a detrimental impact on the spending power of a number of Government Departments. For example, an increase in construction costs would result in a 10% to 15% reduction in the spending power of the Department for Regional Development’s Roads Service. This would have a major impact on the roads budget and would further extend the existing backlog in roads maintenance requirements, particularly in border areas.

In the North, the public sector represents 60% of all expenditure on construction, and the introduction of this tax will force construction costs up by between £18 million and £20 million across the capital spending budgets of all Government Departments, creating a net cut. This tax is expected to raise an estimated £32 million in the North, but only about £14 million will be left to administer the tax and fund the reduction in national insurance contributions. Given the cost to the regional economy of 4,200 extra unemployed people, the aggregates tax will cost the Treasury more in Northern Ireland than it will yield.

Of course, I accept that we must take on board environmental concerns. However, it makes more sense to adopt a balanced and fair approach which is sensitive to the environment and which does not, at the same time, wipe out the quarry industry and impose enormous costs on the construction industry.

In July 1999, the QPA submitted its alternative to the Treasury, which was rejected. The QPA’s new deal for the whole of the UK was a 30-point plan of voluntary and regulatory initiatives. These included a commitment to establishing an index-linked sustainability foundation, which would be financed by the industry, amounting to £125 million; the introduction of an industry-wide quality mark for environmental performance; environmental purchasing policies; major investment in recycling plants and equipment; the introduction of a restoration scheme for all aggregates; and guaranteed environmental impact assessments.

The House of Commons Environmental Audit Committee’s Sixth Report ‘Budget 2000 and the Environment’ found the Government’s rejection of these proposals difficult to comprehend. In spite of the QPA’s submission, Mr Stephen Timms, the Financial Secretary, argued to the puzzlement of the Committee, that there was no scope for differentiating between suppliers on their "green credentials". The Committee remarked, in its report, that it was "bizarre" that it did not seem possible for the Treasury to differentiate between the aggregate produced by a quarry which had shown due concern for environmental considerations and one which was environmentally reckless.

The Environmental Audit Committee said that even the Government have accepted that the aggregates tax is "a very blunt instrument" for dealing with the environmental impact of quarrying given that the demand for aggregate is "very inelastic". Furthermore, the Committee’s report highlighted the difference between the Government’s conciliatory approach to the agriculture and agrochemical industries on the pesticides tax and their uncompromising and unsympathetic attitude to the quarrying industry.

Finally, and probably most incredible of all, the Committee’s report highlighted the QPA’s concern about whether the revenue raised throughout the UK from this tax could actually fund the intended cut in national insurance contributions. The QPA estimates that the £330 million raised by this tax in 2002-03 would not be enough to fund a 0·1% cut in national insurance contributions, costing £350 million, even before one can consider contributing an additional £25 million to an environmental sustainability fund to help local communities.

In short, in relation to Northern Ireland the aggregates tax is, at best, an ill-conceived policy that will do more harm that good. It will not encourage the use of recycled aggregates. It will not finance a sustainability fund or cover the cost of the proposed cut in national insurance contributions. The Government’s proposals as they stand would treat bona fide quarry operators with high environmental standards — and these operators are in the majority — in the same way as those with low standards, and that would ultimately result in the loss of many jobs.

In conclusion, when we elected representatives consider the commitments given in the draft Programme for Government to promote a competitive economy, a balanced regional development strategy and greater environmental sustainability, it seems totally illogical to introduce such a tax to Northern Ireland. This tax will increase the cost of building new hospitals, schools, social housing and roads infrastructure and, according to the Confederation of British Industry (CBI), it will not alter behaviour in favour of the environment.

Representatives of the QPA’s steering committee have already met with my Colleague the Minister of Finance, Mr Mark Durkan, and with UK Treasury officials to express their concerns about this tax. They will also seek to put their case to the Minister of Enterprise, Trade and Investment, Sir Reg Empey.

On many occasions in the House the need for the Executive to take a joined-up approach to Government has been expressed. The aggregates tax will affect all Departments and will increase the cost of all capital spending projects. The Environmental Audit Committee called for a partnership-based approach to the subject of environmental taxation, and the Ministers of Finance and Personnel and Enterprise, Trade and Investment could set up a review group which would listen to the views of the stakeholders. That review group could report back to the Executive who would forward those views to the Treasury. However, time is limited.

The Government’s proposals in their current form should not be introduced into Northern Ireland, and the House should send a clear message to the Treasury that alternative arrangements are needed which will address the particular issues facing this region.

Jim Wells (DUP, South Down)

I speak as someone who through his interest in wildlife, waste disposal and nature conservation issues can claim to have visited every quarry in Northern Ireland over the last 10 years. I have come to know quite a few of their owners. I also speak as someone who considers quarrying to be a very important industry in south Down. However, I would like to dwell on the environmental issues, because this tax is being levied to bring about environmental benefits.

It must be said that there is a world of a difference between quarrying as practised in Northern Ireland and that practised in the rest of the United Kingdom. If you go to England you find the Wimpeys and the Tarmacs of this world — huge multinational companies with quarries which can be of 400-500 hectares in size and employ several hundred people. As these are absolutely enormous holes in the ground, this type of quarrying has a huge environmental impact.

The situation in Northern Ireland could not be more different. Almost every quarry in Northern Ireland is a family-owned concern, and they are relatively small. There is a larger number of quarries in Northern Ireland, which means that the overall impact on the environment is much less, and the distances travelled to carry the products to the farmers and the construction industry are much smaller. While there may be one or two bad examples, such as the one in west Belfast, which is quite large, these are not the norm. Therefore, to impose a tax in Northern Ireland which is designed to bring about an amelioration of environmental damage in the rest of the United Kingdom is absolute nonsense.

The second reason for my opposition to this tax is that there are 6,000 jobs at stake. Those jobs are in areas which have suffered the worst economic deprivation over the last decade. I am talking about areas such as Londonderry, west Tyrone, Fermanagh, Armagh and, of course, south Down. Just when the quarrying industry was getting itself back on its feet after many difficult years of lay-offs and reduced production due to underinvestment in infrastructure, it gets a kick in the teeth in the form of this tax. To those who thought up this hare-brained tax, I contend that it could not be more ill-timed.

In many depressed agricultural communities quarrying is an alternative source of income and employment. Many people farm in the evenings and work in the local quarry, or deliver materials from the quarry, during the day; it is a second income. This tax therefore runs the risk of removing one of the very few alternative sources of income for these people. I have direct experience of areas such as Kilkeel, where quarrying is a crucial part of the rural economy. Yet when other elements of the rural economy, in particular farming, are going down the plughole and incomes are falling fast, an unnecessary burden is imposed on one of our most important rural industries.

As has already been said so eloquently by Mr Byrne, if I were a potential investor and had the opportunity to expand my quarry business in the Irish Republic, just across the border in Cavan, Leitrim, Monaghan or wherever, or the option to expand a quarry in Fermanagh, south Down or Armagh, and I thought that this quarry tax was on its way, where would I choose to invest? I would invest where I could produce the goods more cheaply, and this tax will not apply to indigenous material produced in the Irish Republic.

If this were an EU decision that applied to all member states, we would be on an equal footing, but we are not. Surely we as an Assembly have seen enough of what has happened to fuel over the past four years to realise the obvious opportunity there is for fraud. Recently I had a phone call from a gentleman in my constituency — I will not say where he was from because it might be too revealing. He said "Jim, can you explain something to me? At 3 o’clock every morning a tanker of fuel freewheels down the main street into the rear of a certain garage, rapidly unloads its fuel, then freewheels down to the roundabout, starts its engine and sails away." You can draw one of two conclusions from this: either that individual is being very sympathetic to residents’ needs and does not wish to disturb them, or perhaps there is something in that tanker that he does not want Customs and Excise to know about. I will leave it to hon Members to decide which is the more likely.

Because this tax will not be imposed on both sides of the border, it is going to make life very difficult for our quarry owners. We are effectively placing a 50% increase on the materials produced — £1·60 a tonne does not sound very much, but this material is sold in bulk as sand or as aggregates for roads. It is often sold at £2·90 or £3·00 a tonne, so some 50% is to be added to the cost of the finished product.

The quarry industry simply cannot bear that type of burden. Running costs are already much lower for quarry owners in the Irish Republic who use legitimate fuel, and they also have the advantage of the pound/punt difference. Wages are lower and products are cheaper there, yet we are now going to impose another burden. We really are asking for trouble. There is absolutely no need for this tax. As Mr Byrne has said, it is quite clear that it will not even raise enough money to make it cost-effective. Circumstances in Northern Ireland are so different that we constitute a special case.

If it is decided not to go ahead with this aggregates tax in Northern Ireland, it will have no overall impact on the sum produced by this tax throughout the United Kingdom. But what it will do is save a lot of jobs, many of which are at the outer rim of Northern Ireland and close to the border. Indeed, one of our major quarries straddles the border and is the most important employer in Fermanagh.

We simply cannot allow this decision to go through. An argument will be made that this decision has been taken at Westminster and that we as an Assembly have no control over these matters. Unfortunately, as yet we do not have control over fiscal matters. I appeal to the Minister of Finance to go back to his Colleagues at Westminster and the Chancellor of Exchequer and explain the implications of this tax. It is scheduled for 2002, so we have time to argue our point and argue it forcibly. If we are going to show our teeth and really represent the people of Northern Ireland, particularly those in hard- pressed rural areas such as west Tyrone, we need to ensure that their voices are heard before irreparable damage is done to our rural economy.

Mick Murphy (Sinn Féin, South Down)

Go raibh maith agat, a LeasCheann Comhairle. This aggregates tax that has been introduced in a cowardly way by the British Government is not a proper piece of legislation for the Six Counties. I would like to see the Regional Development Committee open an inquiry into it.

First, I will address the unfair tax that will increase the financial constraints already experienced by our roads programme. As we have seen from our proposed Budget, the roads fund lacks proper investment. What will happen if the tax is given a green light? A clear distinction has not been made as to where this tax will be spent. The British Government’s rationale for introducing this levy is national insurance and the impact that it will have on the environment. They do not give a reason for refusing to consider the QPA’s green purchasing proposals as part of an alternative approach to taxation.

The quarry industry provides raw materials for the construction and maintenance of homes, hospitals, schools, railways, other buildings and infrastructure. We have inherited a backlog of underinvestment in those areas, and the aggregates tax will serve to increase underdevelopment. The underinvestment in the raw materials that we have seen today in the proposed Budget is the reason that Sinn Féin is requesting an inquiry by the Regional Development Committee.

We must also consider the high value of the pound and its effect on business in Fermanagh, Tyrone and the border counties. Fermanagh and Tyrone depend on the quarry industry for jobs. I am asking the Committee to hold an inquiry to see the effect that the proposed Budget will have on the environment. Go raibh maith agat.

Tommy Gallagher (Social Democratic and Labour Party, Fermanagh and South Tyrone)

I support the motion. It calls for the Minister of Enterprise, Trade and Investment and the Minister of Finance and Personnel to make representations to the Treasury. However, the motion goes further than that in that it requires positive action from the entire Executive, and not just from the two Ministers specified. I note that the Minister of Finance and Personnel is present for the debate, and I acknowledge this. If we are to lobby the Chancellor effectively, there are issues for the Department of the Environment and its Minister to consider. We should have received a report from that Department in which comparisons between environmental issues in Northern Ireland and those in England, Scotland and Wales were made. One of the Members who spoke earlier pointed that out. That would be a useful way of preparing ourselves for pleading our case to the Chancellor.

There are also serious issues here for the Department for Regional Development. In England, an estimated £70 million out of the extra £250 million for roads will be eaten up by the tax. In Wales, the aggregates tax will cost the construction trade £40 million a year and possibly 3,000 job losses. Similar figures have been estimated for Scotland. It is time that the Department for Regional Development estimated the impact that the tax will have on our roads budget. The best estimate that I have been able to get is £13 million. However, before we go to the Chancellor, we need to prepare the figures.

I am concerned about the quarry owners and their employees whose livelihoods depend on this industry throughout the North. They will be immediately affected, and there will be knock-on effects for people involved in the construction industry — those involved in the construction of houses and roads and in renovations, as I mentioned earlier. The greatest impact will be felt in the border areas, as has been the case so often. My constituency of Fermanagh and South Tyrone will be particularly hard hit because there are, in this area, at least 1,000 jobs in quarrying. The border constituencies are already enduring a crippling of the economy because of currency differences.

The Executive face the challenge of preparing an adequate case, and this will involve every Minister. I have no doubt that there is a case to argue. When the two Governments submitted their application for European assistance they wrote a common chapter in which they discussed plans to develop and harmonise the economy, particularly in the border areas. The current proposals of the Chancellor of the Exchequer for fuel tax are contrary to the commitments made in this chapter.

Oliver Gibson (DUP, West Tyrone)

We are having an interesting day. This morning, the Chancellor of the Exchequer here was criticised for his idea of taxing buildings — a tax commonly known as rates. He also referred to the mobile phones carried into this place. We know that Chancellors tax airspace. Governments have, over the past few years, tried to move from direct taxation to other means of taxation. At an international conference on environmentally friendly attitudes, it was unsurprising that a move towards tax benefits was seen as a way of encouraging Governments to consider the environment. When they returned from the conference, representatives from the South of Ireland sobered up and responsibly — or irresponsibly — said they would withdraw from that agreement on the grounds that it was not sensible. Either Westminster has remained in a state of inebriation, or it is incapable of thinking the dilemma through.

However, the Minister and the Executive have more difficulties over and above those highlighted in the arguments this afternoon. This issue is really about taxation. The same clamour was not made when we willingly, or unwillingly, paid £2 per tonne — not in value added tax — to deposit waste in the earth. There were howls from councillors, and a little murmuring was heard at this level. It was perceived as another form of taxation, and the scheme was sold on the grounds that it was environmentally beneficial. If a product is taxed, people will seek an alternative — we have already seen that. Let us look at alternatives open to the construction industry. If you want wood, you cut down more trees — this is not environmentally productive.

I suggest that the Minister and the Executive give the Chancellor of the Exchequer a few ideas more like those originally sold to the Government about the possibility of making money from airspace. I should never wish to be the one to suggest a method of taxation, for I hate the very idea. However, I am sure that the wit and brilliance of the Executive and their Ministers should be able to defend the countryside environmentally.

There are good reasons for that. Omagh gold, a natural product of the ground, is being launched in my con- stituency this week. It is being marketed all over the world. To get it, one must extract rock, but this dream from international conferences will add another £1·60 per tonne to the cost of that. That is just one point. Rock is a natural, God-given product.

We talked about the farming industry this morning. We know that our Government have a policy of rural proofing. How, in West Tyrone or any other border region, could one rural proof the idea of a tax on extracted items, the natural products of the ground, which have been the baseline of survival for many local family enterprises? I could easily add another hundred names to the list appended to the article that came in from the quarry interests. There are well-known families associated with quarrying and extracting, not only in my constituency but also in neighbouring ones.

Does this mean that Coalisland clay and brick will be taken off the world scene? What about limestone, the farmer’s basic fertiliser? What is our thinking on products such as cement that come from lime chalk? What do we think of the other natural products that make brick? We are talking about taxing something that is a natural product and is environmentally friendly.

This imposition will mean that — even if the South of Ireland got responsible, or irresponsible, and went into the conference saying that it would charge £1·60 — all that one will have is a cross-border quota system whereby a quarry in West Tyrone would ring up its counterpart in west Donegal and say "I have 0·25 million tonnes of rock to sell to a man in your constituency." The other would reply "I have 0·25 million tonnes to sell to a man in yours. I will send your man mine, and we shall just cross the paper." One could have all sorts of ridiculous situations.

Jim Wells (DUP, South Down)

That is dishonest.

Oliver Gibson (DUP, West Tyrone)

Of course it is dishonest, for one is changing the paper. However, that is what Governments want.

A move must be made, through the North/South procedures, to see what is happening and what the real effects are. Someone talked about research. What about inequality? This situation becomes more unequal if one examines the extraction of other products from the ground, for example, coal, oil, gas, iron and aluminium. Are they being taxed in the same way? Are we talking about open or underground extraction? The matter gets more ridiculous when we enter that area.

The proposer of the motion hinted at some of the studies and surveys that have already been carried out. At the end of the day, however, this is not really about environmental protection, for it was originally conceived as a tax. The Government sold it on the basis that employers stood to benefit. Then, as is natural in all things this century, they gave it an environmental spin. However, it has been exposed as environmentally unfriendly and, worse still, as a destroyer of jobs. Worst of all, it could never be rural proofed, never mind equality proofed. By its very nature, it is taxation on the open extraction of natural products.

I support the motion, but I ask the Minister, along with the Executive, to inform the Chancellor that there are other more equitable and rural-proofed methods of raising taxation. Above all, consider a little common sense. Anyone walking the lanes of County Tyrone, and hearing that he is going to tax the natural products of the ground, would look at him and say "Go home, son, and sober up". The Minister should go to the Chancellor and tell him to have a sober thought about the next conference he is going to.

Seamus Close (Alliance, Lagan Valley)

Members may recall that I first raised this issue in the Chamber on 24 January 2000 by way of an Oral Question to the First Minister and the Deputy First Minister. I referred to the potentially adverse effects of national fiscal policies on the Northern Ireland economy. In my supplementary I referred specifically to the aggregates tax and urged them to make a strong case to the Treasury for at least some form of abatement to Northern Ireland industry in this respect. The record shows that on that day I received assurances that these issues would be raised with the Treasury. I hope I am not here today recognising and acknowledging that we have failed in that. I hope today’s debate will be used to further emphasise the need for and importance of making a very strong case to the Treasury. This is a classic example of the nonsense and damage that can be done to a region by the importation of national fiscal policies.

As has already been stated, it has been introduced on the terms that it was an "environmentally-friendly" tax. Quite honestly, that is rubbish. The basis of that is that recycling could take place. Where is the recycling for the volume and quantities of aggregate in Northern Ireland? It does not exist. The Government have stated that they intend to use the taxes raised to fund a decrease in national insurance contributions for all employees in the UK. Does anybody believe that? Taking it a step further, if this tax is imposed upon the quarry industry in Northern Ireland, it will lead, as it says in this booklet, to the death of that industry. What will that mean? It will mean thousands of people out of a job, and people who are not employed do not pay national insurance contributions. So who is going to benefit? It is not going to be Northern Ireland. Our economy can ill afford to lose other industries.

We are in close proximity to the South of Ireland — 25 to 30 miles from the border. Lorries will trundle across and sell their product, and the people of Northern Ireland will effectively be denied the ability to compete. We all know, from previous debates, that excise duty and fuel are more expensive here. At the moment people are competing with one hand tied behind their backs. If this type of tax were passed — I understand it will be £1·60 per tonne — they will be expected to compete with both hands tied behind their backs. In fact, they will be crippled.

With regard to this whole question of the environment, the location of quarries in Northern Ireland means that there is not the damage to the environment that there is, relatively speaking, in other parts of the United Kingdom. We have the machinery and production capacity to make the bricks and so on that have already been referred to.

My final point should come as joy to the ears of the Finance Minister following what happened this morning. He told us — exerted us and exhorted us — to seek ways to reduce the amount of public expenditure required to finance the various programmes in Northern Ireland. Here is one: if the tax is imposed, the spending capacity of the Department of the Environment will be reduced by some 10% to 15%. What we are saying is therefore in the Minister’s interest as well as in that of the quarry owners and everyone who lives in Northern Ireland. We can rest assured that the tax will be passed on; it will be passed on in every facet of life. We cannot allow that to happen, so I exhort the Minister and his Executive Colleagues to get over to the Treasury — sooner rather than later — and make the case for Northern Ireland. They must not come back saying that they have failed.

John Dallat (Social Democratic and Labour Party, East Londonderry)

If only stones could speak. Experience shows that if taxes are not harmonised, the part of the island where taxes are higher faces economic disaster. Recently, that has been Northern Ireland. I will not labour the point.

There must be a level playing field to give our industries a fair chance of surviving. Local businesses have built up lucrative niche business in the Republic in road and other construction. The European Union should nurture those industries rather than kill them off with unfair taxes. I recently visited east Germany, where I noted that the Government were spending massive sums on a new road infrastructure. Our entire road and rail infrastructure faces the aftermath of thirty years of the troubles and abject neglect by an absentee Government. It is downright crazy to be contemplating a quarry tax that could kill off an industry that must play a vital role in creating a new infrastructure.

Members have referred to quarries in the border region. No quarry in Northern Ireland will be safe if the tax is introduced. In east Derry, there is substantial employment in all parts of the quarry industry, and none of those jobs would be safe if the tax were imposed. As those industries introduce new technologies, costing million of pounds, it is most likely that they will relocate where taxation is more favourable. The hills of Donegal will become more popular than ever — not for their beauty, but for their stone. That serves the interest neither of Northern Ireland nor of the Republic.

The experience of the fuel industry is well documented. Not only is fuel flowing freely over the border — legally and illegally — but the haulage business has largely relocated. Could the stone and concrete businesses relocate in the same way? I should think not. I represent a large, rural constituency where jobs are hard to come by. Many people depend on the construction industry. Are such people now to be sacrificed, as others have been, because of tax differentials? The case must be made to Brussels before the legislation is passed.

I am happy to leave the hills of Donegal in Donegal, where I go frequently to admire their beauty. I prefer to see stones being quarried locally, on a scale — approved and controlled by Government — that will never damage the environment. Today all parties in the Assembly have been united on this issue. Let us go forward together and, with the support of the Minister of Finance and Personnel, deliver the message that a tax on stone will bleed our industry dry.

Alban Maginness (Social Democratic and Labour Party, Belfast North)

I speak as Chairperson of the Regional Development Committee.

The matter of the aggregates tax was recently brought to the attention of the Regional Development. Committee. It greatly concerns us. Regional development is essentially about developing our physical infrastructure as a region. As we know, one of the aims of the Executive, as outlined in the Programme for Government, is to create a competitive economy. That objective will not be attained without proper infrastructure. Therefore the Department for Regional Development aims to create and renew our infrastructure, which has almost reached a crisis point because it has been starved of proper investment for so long. It is important that the Committee and the Department look at the overall effect that this tax will have on the development of our infrastructure.

Many Members talked about the effect that it would have on local producers. However, that will be passed on, not just to private sector customers but to the Government and the Department for Regional Development in the public sector. The public sector will have to bear the additional costs that this tax will create. The additional cost could be quite damaging to the process of renewing our infrastructure, particularly road building.

It is estimated that the public sector uses 40% of the materials used per annum in Northern Ireland. If 20 million tonnes are expended, the additional burden on the public sector will be £12·8 million. That is an enormous amount of money, which would be sufficient in many ways to put back Northern Ireland’s road development programme. The Executive, and in particular the Department for Regional Development, are strapped for cash. They do not have the necessary money to engage in a proper road- building programme.

This additional burden could wipe out some of the Minister of Finance’s generosity — and the extra funding he has provided for the Department has been generous. It will be very damaging, because we will have to run hard simply to stay still. That is the reality of the situation. The Regional Development Committee is very concerned about the effect that this tax will have on the private sector and, especially, on the public sector, which is our particular responsibility.

It behoves all of us to support this motion, to lobby the Government centrally and to outline to them the effect that this tax will have on our public sector. Successive Westminster Governments failed to invest properly in infrastructure here. Now that we have a devolved regional Assembly and Executive, the Government are imposing an excessive burden upon us. There are good reasons for implementing this tax, but unfortunately the outworking of it will harm us and harm our development.

We are faced with a historic legacy of underinvestment by the Government at Westminster, and now that Government are imposing a burden that, frankly, will be hard to bear. Therefore, it is right and proper that the Minister of Finance and Personnel should go to London and explain carefully to the Chancellor of the Exchequer the harmful effects that this tax will have on us. The Minister should plead with the Chancellor for an exemption for Northern Ireland — one that we truly deserve.

We must at least be given some time and space in order to get on our feet, otherwise it will be unfair of the Government to insist on this. This will be a recurrent theme in the Assembly over many other issues as yet undetermined. As a devolved Assembly and Executive, we are in conflict with central Government whose interests, aims and objectives do not necessarily suit us. I have no doubt that we will come back to this theme in the future. This issue highlights the classic conflict between central Government and this devolved Assembly and Executive.

I reiterate and endorse what other Members have said. The circumstances of Northern Ireland in relation to this tax are unique. We have a good case, and the Minister should go to London with our fullest backing and support.

Mark Durkan (Social Democratic and Labour Party, Foyle)

I welcome the opportunity to respond to this motion and to hear the views of the Assembly on the aggregates tax. I have received several representations on this matter, and recently had a very useful meeting with the QPA to hear its concerns at first hand. I will say more about that meeting shortly.

First, I will provide some information about the tax and its stated purpose. Secondly, I wish to inform the Assembly about representations made to me and the actions I am taking in response. Thirdly, I would like to set out for the Assembly the wide range of issues that the new tax raises for us in the context of our Programme for Government. Lastly, I will explain how I propose to take this matter forward in conjunction with my Executive Colleagues.

I lay particular emphasis on that last point, as some other Members have done in their remarks. The one thing that has been made abundantly clear to me today is that this is a cross-cutting issue that will impact on a range of departmental interests. Obviously, it would be inappropriate for me to speak on behalf of others, but I know that Sir Reg Empey, who is unfortunately unable to be here this afternoon, has a keen interest in the economic impact of the tax. He is concerned that it will damage the competitive position of Northern Ireland quarry companies.

I know from interdepartmental discussions that others will be affected. The Roads Service in the Department for Regional Development is, as some Members have mentioned, the largest user of aggregate in Northern Ireland. It anticipates a major increase in its costs as a consequence of this tax.

From a different perspective, the Department of the Environment is seeking to promote a range of environmental improvement policies, including the greater use of recycled aggregates. There are various factors that need to be considered, and I will explain some of the background to the tax.

In this year’s Budget the Chancellor announced his intention to introduce an aggregates levy which will come into effect from April 2002. According to the Chancellor the purpose of that levy is to ensure that the environmental impacts of aggregates production are more fully reflected in prices, encouraging a shift in demand away from virgin aggregate towards alternative materials such as recycled aggregate.

The levy will apply to virgin sand, gravel and crushed rock which is subject to commercial exploitation in the UK — including that dredged from the seabed in UK territorial waters. It will be charged at £1·60 per tonne. The levy will not apply to recycled aggregates or to certain secondary aggregates such as those derived from reworking old spoil heaps.

To protect competitiveness, exports will be relieved and imported aggregates will be subject to the levy when they are first sold or used in the UK, though this will not apply to imported processed products.

There will be a range of exemptions or relief for certain rocks and industrial minerals, for the production of lime or cement from limestone and for silica sand or limestone used in certain agricultural and industrial processes.

The Chancellor claims that the levy furthers the Government’s aim of shifting the burden of taxation from — as Mr Byrne mentioned — what the Chancellor describes as "goods" to "bads". The revenues from the levy are to be fully recycled to the business community through a 0·1% reduction in employers’ national insurance contributions and the newly created sustainability fund. It is contended that the reductions in national insurance contributions will provide a significant benefit to Northern Ireland employers. We will need to quantify that accurately.

Details of the sustainability fund have recently been announced. Around £35 million per annum will be set aside from April 2002 to establish that fund. Of that, almost £1 million per year will read across to Northern Ireland under the Barnett formula. The figure is £0·97 million in 2002-03 and 2003-04.

In October, the Treasury suggested that the devolved countries should pool their shares of the fund with the English resources. That would create a UK-wide pool from which groups or organisations could bid on a competitive or challenge basis to fund projects which would achieve a number of environmental objectives. These will include reducing the environmental costs of quarrying, promoting environmentally friendly quarrying practices, supporting conservation and increased biodiversity, retaining the natural landscape and encouraging the construction industry to use recycled aggregates. I considered this with Sam Foster and, after consultation between our Departments, we resiled from the proposal to take part in the pooled fund.

Jim Wells (DUP, South Down)

Does the hon Member accept that due to the way that quarrying was carried out in Northern Ireland it is not unusual for a closed-down quarry to be declared an area of special scientific interest? Does he accept that many quarries eventually become havens for wildlife in what is often a green desert?

Has the Minister done any research to find out if the impacts of quarrying in Northern Ireland are in any way similar in scale to those in the rest of the United Kingdom? Many of us contend that they are not and therefore believe that we do not need to take ameliorating action.

Mark Durkan (Social Democratic and Labour Party, Foyle)

I am setting out the background to the tax and explaining about the sustainability fund. I have said what the Chancellor is advocating. I will subsequently address the points arising from the various representations we have received including those raised in this debate. I do not disagree with the Member. Perhaps he has a misapprehension concerning my point about the proposal that the Northern Ireland interest in the sustainability fund should be reflected through the pooling of the fund with the other devolved regions and with England. It is a straightforward matter of information. We have resiled from that suggestion.

On 29 November I had a very useful meeting with some representatives of the QPA. They presented a very cogent case for seeking exemption from the aggregates levy. In view of the cross-cutting nature of the issue, officials representing the departments of Sir Reg Empey, Gregory Campbell and Sam Foster also attended the meeting. The association argued that the tax would have a negative impact on the local quarrying business and would damage the wider Northern Ireland economy. It said that the tax would have a detrimental effect in border regions, which are already suffering from the impact of the exchange rate and from a depressed agriculture sector. The QPA argued strongly that the levy would make quarry operations here less competitive and would probably have the effect of displacing quarrying businesses from North to South. Crucially, it claimed that the tax will not lead to a switch by the local construction industry to other materials such as substitute or recycled aggregates.

Northern Ireland has a much higher dependence on newly extracted aggregates and therefore is unlikely to be able to make the desired change easily. As a result of this, the association made a strong case for suggesting that the displacement effect of the tax will not have a positive environmental impact. In fact, the association maintains that it will achieve the opposite because there will be no reduction in the extraction of raw materials and there will be a significant increase in the transportation of raw materials and aggregates.

The tax rate of £1·60 per tonne will add over 60% to the cost of Northern Ireland aggregates, which currently average around £2·50 per tonne. This compares with an average price of aggregates in Great Britain of around £7·00 per tonne and would provide the Exchequer with up to £40 million in revenue, based on the QPA’s estimate of current aggregate production here. Hence, the tax rate in Northern Ireland would be 60% compared with 22% in Great Britain. As a consequence of this, the association claims that the jobs of up to 80% of the 5,000 people who work in the quarrying industry are under threat.

I have asked the association to provide further information to support its claims. However, on the basis of the evidence provided there appear to be grounds for concluding that the aggregates levy will have a more profound and damaging impact on the quarrying industry in Northern Ireland than was originally imagined.

Members’ contributions today echo the QPA’s strong arguments that this levy could have a perverse environmental impact here, which would match its adverse economic impact on this region. However, as I made clear to the association at the meeting, there are a number of competing issues to be considered. Apart from the very real risks which the quarrying industry now faces I must, in conjunction with my ministerial Colleagues, also have regard to the objectives on sustainable development which the Executive have signed up to in the draft Programme for Government.

Mining and quarrying impact on the environment, and the levy is the Westminster Government’s response to public concern about the construction industry’s involvement.

Edwin Poots (DUP, Lagan Valley)

Will the Minister give way?

Mark Durkan (Social Democratic and Labour Party, Foyle)

I think I am about to make the point that you are going to make.

Edwin Poots (DUP, Lagan Valley)

I do not think so.

We live in the European Union, which is an area of free trade. In this case, if the UK Government were to introduce a tax on aggregates coming into the United Kingdom, other countries could take the United Kingdom up for creating unfair trade within the European Union. Is there a case for the quarry people who manufacture the aggregates to take a case against their Government for destroying trade and creating an unfair market for them?

Mark Durkan (Social Democratic and Labour Party, Foyle)

I am not sure that the Member wants to continue down that road, given some of the recent discussions at the Nice Summit which went to the heart of the very sensitive issue of the sovereignty of member states on taxation. I would have thought that on that issue he would be on the side of those who say that taxation should remain squarely in the domain of the national Government.

Clearly, any challenge based on distortions of trade can be pursued if people want to pursue them. Given the difficulties of effecting change in these areas, any point is clearly worth pursuing. However, mounting that course of action would not be the most productive challenge that the parties most affected could make.

The Westminster Government claim that the tax is a means of encouraging the construction industry to use recycled aggregates, which are exempt from tax, because that would be in line with their sustainable development strategy. We must also bear in mind that, to protect competition, the Treasury decided that imported aggregates will be subject to the levy when they are first sold or used in the UK. I do recognise the validity of the points that have been made here and that the scale and nature of the quarrying industry in Great Britain is quite different from the scale, nature and operating context of the industry here. The reality is, however, that we are dealing with a tax that has been proposed, set and established at Westminster.

It is clear that the Executive have to weigh the environmental and economic costs and benefits carefully when dealing with this issue. If this is not the best means for Northern Ireland, we are duty bound to identify alternative ways of achieving these important environmental objectives. I am pleased to say that the QPA recognises this, and we have asked its members to propose workable, alternative ways of reducing the harmful effects of their industry.

I hope this provides a flavour of the range of issues which my Executive Colleagues must now consider. Please note that, without pre-empting our deliberations, I do not wish to downplay the difficulty of securing any form of derogation from this tax from the Treasury. The devolved Administrations have been conceded very few exemptions from UK-wide fiscal policies. We can predict that the Treasury will resist any special pleading on this issue. Merit, validity and compelling reality from a regional perspective do not have a strong record of sway with the Treasury. Therefore, before making representations to the Treasury on this aspect of fiscal policy, we must give the most careful consideration to the impact that this may have on the broad range of financial issues which we are pursuing with the Treasury.

This has been a most useful and informative debate. It has been vehemently argued that the aggregates tax could profoundly damage the Northern Ireland quarrying industry while simultaneously failing to deliver the environmental benefits which it seeks to secure. I would therefore like to assure the Assembly that we will take full account of the outcome of the debate in determining our response.

As I indicated earlier, the QPA has been asked to provide further material in support of its case, and I expect that we will be able to conclude our discussions after we have had an opportunity to consider that. Those discussions will involve the Departments already mentioned — my Department, the Department of Enterprise, Trade and Investment, the Department of the Environment and the Department for Regional Development. It will also involve the Office of the First and Deputy First Ministers.

Members should understand that the First Minister and the Deputy First Minister play a key role representing Northern Ireland’s broad interests. That includes making fairly fundamental and significant representations to the Treasury. Just as I did in the meeting with the QPA, along with the officials representing other Ministers, I will give further consideration to, and put more work into, the issue, in conjunction with the other interested Departments and Ministers. I hope that we will arrive at ways that will allow us to deal actively with the key concerns voiced in support of the case.

Derek Hussey (UUP, West Tyrone)

I thank the Minister for his presence and the Members who contributed to the debate. It has been a wide-ranging and cross-party debate. From the sober elements of Mr Gibson to the stoned elements of Mr Dallat, I welcome all the contributions from five major political parties in the Assembly — I hope the fifth party welcomes its inclusion in the top league.

I welcome the recognition that this is very much a cross-departmental issue, and that has been widely echoed around the House. Capital programmes of all the Departments may be affected, but the Departments particularly affected have been well addressed by all Members, so I do not intend to delay a positive vote on the issue by going into too much detail.

The figure of between 10% and 15% on the cost of the capital structure programme for regional development is something that the House must take seriously. Remember where the job losses could and probably will occur if the tax is brought into being. They will be in already deprived areas, areas in which the textile industry and farming are suffering. It has been suggested that those areas are along the border. How far in does the border stretch?

The tax of £1·60 will allow producers from the Republic to go a further 20 to 25 miles into Northern Ireland. That means that five of our six counties will be directly affected. If you were to draw that line on the map, you would be talking about two thirds of the Northern Ireland land mass. That is the significance of what we are taking about — up to 4,000 jobs and to gather what in taxes? A figure of £30 million has been suggested. How much will it cost to pay for 4,000 unemployed? A fair figure to suggest might be £60 million in Northern Ireland alone, yet they expect to put between £30 million and £35 million into the sustainability fund.

There is the immediate impact of Northern Ireland on the Treasury figures. What the Treasury will lose on those two figures alone wipes out what it could possibly put into the sustainability fund. I do not intend to dwell long at this point in the debate. The issues have been well put by the Members, and I congratulate Mr Byrne — if I had been making his opening speech, we would have been using the same notes. I also congratulate all the contributors to today’s debate.

I welcome the Minister’s investigations and his collaboration with the aggregate producers. I urge him to continue these investigations for the good of the many people in that deprived community which lives in the two thirds of Northern Ireland that will be affected — those who live outside County Antrim — which is essentially what we are talking about.

I note Mr Close’s reference to a question posed earlier in the year. I also note that the Minister said that the issue referred to in that question would have to be strongly pursued by the First and Deputy First Ministers. This should have been started already, as promised, as a result of that earlier question — but that will happen now.

The Minister referred to the potential difficulties of trying to change United Kingdom fiscal policy. This is evident from the fuel tax debates and representations from this part of the United Kingdom. Remember, however, that success was achieved with the climate levy change. I urge the Minister to make sure that, once again, the Assembly proves that it can work for the good of the people of Northern Ireland.

Question put and agreed to.

Resolved:

That this Assembly notes the serious economic and environmental implications the aggregates tax will have for the quarry and construction industry in Northern Ireland and calls upon the Minister of Enterprise, Trade and Investment and the Minister of Finance and Personnel to make representations to the UK Treasury on behalf of the Quarry Products Association to prevent the introduction of this tax in this region.

Adjourned at 4.47 pm