10/06/2013 Stormont Today


10/06/2013

A political programme focusing on the day's events at the Assembly and Northern Ireland Executive. Mark Carruthers is the guide through the corridors of power at Stormont.


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Coming up on the programme tonight: Incredible incompetence or wilful

:00:25.:00:28.

corruption? The Social Development Minister reveals the Housing

:00:28.:00:38.
:00:38.:00:39.

Executive overpaid contractors by 18 million pounds. The scale of what

:00:39.:00:44.

has been uncovered has been a scandal. Let's not forget this is

:00:44.:00:47.

tax payers money. Ahead of the G8 summit this weekend, the First

:00:47.:00:50.

Minister says the Executive is close to agreeing a financial way forward

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with the UK government. We hope an announcement can be made in relation

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to the economic pact later this week. And our Political

:00:59.:01:02.

Correspondent, Martina Purdy, will be here with her analysis of today's

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Eighteen million pounds - that's how much the Housing Executive overpaid

:01:09.:01:14.

four contractors for planned maintenance work. The figure was

:01:14.:01:17.

revealed by the Minister for Social Development in a statement to the

:01:17.:01:20.

Assembly today. A review had already found that six firms were overpaid

:01:20.:01:23.

for response maintenance contracts, but the Minister said that paled in

:01:23.:01:28.

comparison to today's findings. We'll hear more from that statement

:01:28.:01:30.

in a moment, but first our correspondent, Martina Purdy, is

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with me. This is not the first time the Housing executive has been

:01:39.:01:43.

making the headlines. No, this is the latest instalment. There's been

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a series of problems around contract going back a few years which has led

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to controversy and a BBC investigation and a damning report

:01:54.:02:00.

from the public accounts committee. Basically, in 2011 Housing executive

:02:00.:02:07.

terminated a �70 million contract with Red Sky amid allegations of

:02:07.:02:12.

overcharging and substandard work. The Minister Nelson McCausland was

:02:12.:02:16.

convinced this was not an isolated case and believed the problems in

:02:16.:02:23.

the executive were widespread and he initiated a review. The findings of

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the review are coming out today that there are problems around

:02:26.:02:33.

maintenance contractors to the tune of �18 million has vindicated the

:02:33.:02:36.

Minister and it will add impetus to his desire to see change at the

:02:36.:02:44.

executive. The Minister will be more determined than ever perhaps to

:02:44.:02:49.

transform the executive. Yes, and the Minister would like to scrap the

:02:49.:02:54.

Housing executive but when the media speculated that was his intention,

:02:54.:02:58.

he had to row back because he ran into difficulties with the executive

:02:58.:03:05.

that it's fairly clear the plan is radical changes, breaking up the

:03:05.:03:09.

executive, he wants to take the executive, stop it being a landlord

:03:09.:03:14.

to the 90,000 houses and it would be in charge of waiting lists and

:03:14.:03:21.

management and other bodies would look after the housing stock.

:03:21.:03:27.

There's been some robust reaction to this financial scandal. There has

:03:27.:03:30.

been considerable reaction, some of it is putting it back on the

:03:30.:03:34.

ministers Department saying the department has questions to answer,

:03:34.:03:40.

Michael Copeland said it was a catastrophic failure of the

:03:40.:03:47.

Department to exercise appropriate Judah legend is and we heard from

:03:47.:03:51.

Mark Durkan who said it is shocking in light of the housing shortages

:03:51.:03:54.

and what would have been done with the money instead. Thank you for

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now, Martina. We'll hear more from you later.

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Let's hear more now from that statement by the Minister, Nelson

:03:58.:04:07.

McCausland. The findings are extremely disappointing. Given the

:04:07.:04:11.

scrutiny the organisation is already under for its management of response

:04:11.:04:17.

maintenance contracts and I totally concur with this. The figure is

:04:17.:04:24.

estimated to be some �18 million. Let me say that again, in case you

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misheard. �18 million in overpayments to four contractors. I

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have been advised by the Housing executive that the contractors are

:04:37.:04:46.

PK Murphy, barn, mascot and Dixons. I am sure you are astounded at the

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amount. And wonder at the level of incompetence within the Housing

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executive that led to this state of affairs. The scale of what has been

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uncovered has been a scandal. Let's not forget this is the taxpayers

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money. It could have been used to build around 200 much needed social

:05:08.:05:14.

homes. In type -- in tackling these issues I appoint a new chairman,

:05:15.:05:20.

Donald Hoodless he was taken on a difficult job but is determined to

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put in place clear governance and assurance -- systems to tackle the

:05:27.:05:31.

issues and make the organisational changes that are required to bring

:05:31.:05:35.

this organisation into line as to ensure appropriate services are

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delivered to tenants, along with value for public money. What has

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happened in the past must not happen in the future. As yet, it is not

:05:49.:05:58.

clear if this is a result of incredible incompetence, or wilful

:05:58.:06:07.

corruption. Time will tell. Would he agree there is a legacy here of

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access pricing in contracts, a historic legacy of culinary trees

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and this has been used as a factor -- paramilitaries. It is not a new

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issue. Housing executive board shaken by contracts report, reports

:06:28.:06:33.

recommended this system should be changed, a headline in the Belfast

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Telegraph in 1978! So, more than 30 years ago there were issues about

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housing contracts, it is not new. What we have identified clearly if

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the scale and the scope of this, it's been identified �18 million and

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bear this in mind, when you are dealing with the �18 million, that

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is not spread evenly. In the case, I understand one of the contractors,

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highest amount was eight or �9 million overpaid. That is the scale

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of it. Can I ask, in view of this statement, he did say that there was

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problems with the contracts for over 30 years. Somebody somewhere should

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have seen what was happening and not allowed it to reach 18 million

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pounds of public money going astray. Could the Minister Teller, is there

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any possibility that somebody will be made accountable for this error

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and criminal proceedings will be initiated so that some of the money

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will be recouped on behalf of the taxpayer. We do need to get to the

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bottom of responsibility here. did this happen, how did it happen

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and people have two take responsibility for their actions. Or

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inactions, as the case may be. With the Minister agree that those

:08:13.:08:19.

elected representatives who made representation on behalf of East

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Belfast Red Sky and who were pilloried in the press are doing

:08:24.:08:32.

so, have now been completely ruined decay to -- vindicated. On the basis

:08:32.:08:39.

of the report, there is really no doubt that the issues with Housing

:08:39.:08:42.

executive contracts were not unique to Red Sky.

:08:42.:08:48.

Indeed, it is clear there were significant contractors engaged in

:08:48.:08:55.

similar practices. At the time that the Red Sky contracts were

:08:55.:08:59.

terminated, it was argued by some people that Red Sky was singled out

:08:59.:09:04.

and the motivation behind the decision was questioned. The

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department received representations from a number of political parties,

:09:08.:09:13.

as he knows from East Belfast, the DUP and ultimate unionists and

:09:13.:09:18.

Alliance party. All of the parties spoke out at that time on the

:09:18.:09:28.
:09:28.:09:30.

matter. I have to say that the first point I made there, the other

:09:30.:09:34.

contractors that were around when gauged in similar prayer forces.

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That has been vindicated by the report. The Minister for Social

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Development, Nelson McCausland. Joining me now from the Committee

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for Social Development is Sinn Fein's Fra McCann.. What is your

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reaction to today's announcement? There is a lot the Minister said I

:09:52.:09:56.

could not disagree with. It is a scandal, a scandal that needs to be

:09:56.:10:02.

dealt with. But I draw the line, it is easy to say there is an �80

:10:02.:10:08.

million overspend but there is no flesh on the bones of how it

:10:08.:10:14.

originated and where it came from and where the money was paid out and

:10:14.:10:19.

who paid it out. Are you satisfied with the action the Minister has

:10:19.:10:23.

taken, there will be an audit and a review and he says serious questions

:10:23.:10:29.

need to be answered. I agree with that. I have no difficulty with that

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but I would go further and I am on record saying what he needs to do is

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include his own department in any review that takes place. When all is

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said and done, his department is the governing body, the parent body of

:10:46.:10:52.

the Housing executive and they have not picked up some serious problems

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that existed in contracts and there are serious questions to be answered

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and the buck stops with the Minister. He stood up today and said

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people must take responsibility for the actions or inactions. You saying

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the Minister is responsible? Minister has to be responsible for

:11:13.:11:21.

his actions. And I think when you look at this scandal going back, it

:11:21.:11:26.

originated at the time of the introduction of the contractors many

:11:26.:11:31.

years ago, there are a number of ministers including his predecessors

:11:31.:11:36.

who could have dealt with this over a period of time. You say the buck

:11:37.:11:42.

stops with him, �18 million of taxpayers money, are you saying he

:11:42.:11:49.

is responsible? Of course.He needs to have an independent enquiry, that

:11:49.:11:54.

needs to include the role and lack of leadership by his department and

:11:54.:12:02.

it leads to him. There needs to be flash put on the bones of what has

:12:02.:12:09.

been said today, not only is �18 million overpayment, in the past two

:12:09.:12:15.

or three years, there's been 25 million underspent. If he is found

:12:15.:12:19.

to have taken his eye off the ball, what then? He needs to make a

:12:19.:12:27.

decision whether his leadership or lack of leadership has to regular

:12:27.:12:32.

lead to not dealing effectively with what has happened. It is serious.

:12:32.:12:36.

�18 million, we are dealing with the longest waiting lists there has

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been, my constituency is chock-a-block at hostels are full of

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people trying to get houses, a �27 million underspent could have been

:12:48.:12:57.
:12:58.:12:59.

spent on housing. We leave it there. Peter Robinson is

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hoping to announce an economic pact with the UK government. Pressing the

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government for the devolution of Corporation Tax remains a key

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protein. We are examining the actions that can be taken forward

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now so a devolved rates could be implemented as soon as possible

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after a positive decision by the UK government in 2014. We are

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disappointed the Prime Minister does not intend to make a decision on the

:13:26.:13:31.

devolution of Corporation Tax until 2014, the executive remains

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committed to securing these powers to rebalance the economy, create

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jobs and increased prosperity. Devolution will allow us to meet a

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shared objection -- objective to rebalance the economy. The proposals

:13:51.:13:57.

Karoly been developed as part of the impact will stimulate economic

:13:57.:14:00.

growth and its intended the measures will be put in place pending the

:14:00.:14:05.

Corporation Tax decision, we hope an announcement will be made later this

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week. It's important to state the measures being discussed as part of

:14:11.:14:16.

the economic pact are not sought as a replacement for Corporation Tax,

:14:16.:14:19.

the executive will continue to push for Corporation Tax powers to help

:14:19.:14:26.

provide stimulus to move the economy forward. We will consider the case

:14:26.:14:30.

for an additional fiscal powers to assist incoming growth and we are

:14:30.:14:34.

conscious of the implications for the grant and the Minister of

:14:34.:14:39.

Finance is pressing the government to take action on issues like fuel

:14:39.:14:45.

duty, short haul air passenger duty and VAT for the hospitality sector

:14:45.:14:49.

and construction sectors. The key element in terms of the Friday of

:14:49.:14:55.

this week, if that is the date we can get the pact agreed with her

:14:55.:14:59.

majesties government, the key element is not just the commitment

:14:59.:15:07.

they will definitely take a decision in 2014 but as important to us that

:15:07.:15:10.

if that's a positive decision, it will be implemented during the term

:15:10.:15:19.

of the coalition government. Could I ask him if he is aware of and

:15:19.:15:23.

whether he has given any consideration to the roofing paper

:15:23.:15:29.

is by Amnesty International, one covering child abuse and the other

:15:29.:15:37.

about abuse in the Magdalen laundry institutions. In relation to the

:15:37.:15:42.

abuse perpetrated by the clergy, that clerical abuse, it is no less

:15:42.:15:49.

important, or no less a motive than the institutional abuse, and we are

:15:49.:15:56.

mindful of the equally destructive impact that that abuse has upon

:15:56.:16:02.

individuals. I have said in the house before, following the enquiry

:16:02.:16:06.

into historical institutional abuse, it will be for the executive to

:16:06.:16:10.

consider how to deal with abuse that does not fall within the enquiry's

:16:10.:16:18.

terms of reference. In relation to the Magdalen laundry, I know there

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is a question later on, can I say that anyone who was resident here

:16:23.:16:32.

within the map: Laundries or similar institutions as a child, between

:16:32.:16:36.

1922 and 1995, can go forward to the enquiry into historical

:16:36.:16:41.

institutional abuse to relate their experience. They will be able to

:16:41.:16:45.

talk in private about their experiences to members of the

:16:45.:16:49.

enquiry acknowledgement forum, and the contact details are available on

:16:49.:16:53.

the website. The Junior Minister Jonathan Bell.

:16:53.:16:56.

There is clearly something going on with the distribution of energy

:16:56.:16:58.

costs here - that's what the Enterprise Committee was told last

:16:58.:17:01.

week when it heard from the Authority for Utility Regulation and

:17:01.:17:04.

local business representatives. A report found large businesses face

:17:04.:17:08.

some of the highest energy prices in Europe, as we can hear now in our

:17:08.:17:18.
:17:18.:17:18.

weekly look at committee business. The main findings of our work was

:17:18.:17:22.

that domestic prices were around about the European average, which is

:17:22.:17:27.

not a bad place to be, given where we are in the energy supply chain.

:17:27.:17:33.

But we will come onto that later on. Also, the prices for small business

:17:33.:17:38.

customers were around the EU average and they make up 70% of the total

:17:38.:17:47.

businesses. For the remaining 30% of business customers, those using more

:17:47.:17:54.

than 20 megawatt and, prices were among the highest. We in Northern

:17:54.:17:59.

Ireland are challenged by our size and our isolation and our dependence

:17:59.:18:06.

on imported fuels. When you add that all up, we are not in a fantastic

:18:06.:18:10.

race to begin with. First of all, the utility regulator sets the

:18:10.:18:16.

amount of money that they can charge consumers and you all know that that

:18:16.:18:24.

issue, they did not accept the proposals for expenditure over the

:18:24.:18:28.

next five years. That issue is now with the petition commission to be

:18:28.:18:35.

resolved. We take the view that we scrutinised that long and hard and

:18:35.:18:40.

we are trying to do the best we possibly can for consumers whilst at

:18:40.:18:47.

the same time ensuring that we have the right level of investment in the

:18:47.:18:50.

network to maintain long-term reliability and security of supply

:18:50.:18:59.

for consumers. The other point is that, and it is the distribution.

:18:59.:19:04.

This is a key point, the distribution of network charges

:19:04.:19:08.

amongst different consumer groups. What is very interesting, when you

:19:08.:19:13.

compare us to the Republic of Ireland, network charges on average

:19:13.:19:17.

are 20% lower than they are on average in the Republic of Ireland.

:19:17.:19:22.

What is very interesting is when you look at what large users are paying,

:19:22.:19:27.

they are paying something like 20% higher. There is clearly something

:19:27.:19:33.

going on in distribution. The distribution of charges has to be

:19:33.:19:38.

significantly different and we can come back to that point that it is a

:19:38.:19:44.

key finding. What I would like to say is I run a small Northern

:19:44.:19:50.

Ireland company. We started off in Northern Ireland and we want to play

:19:50.:19:55.

our part in Northern Ireland. We want to be part of the food and

:19:55.:20:05.
:20:05.:20:10.

Trent strategy. -- food and Trent strategy. -- drink strategy. Costs

:20:10.:20:18.

are close on forcing us to move the part of our production that goes to

:20:18.:20:28.
:20:28.:20:30.

the mainland. We will save in some processes. We will save the guts of

:20:30.:20:39.

100,000 on alert visiting and we will save the cost of 100,000 on the

:20:39.:20:49.
:20:49.:20:50.

transport -- we will save the cost of 100,000 on electricity. 100 staff

:20:50.:20:57.

would go. That is how serious it is in this moment in time. It is now

:20:57.:21:01.

four years since we first presented this problem to the committee.

:21:01.:21:05.

During that for years the only policies we have seen our policies

:21:05.:21:09.

which will make the problems worse, policies which will compound the

:21:09.:21:14.

problem and increase cost. There is no policy whatsoever to address the

:21:14.:21:16.

high cost. Bryan Gray from Manufacturing

:21:16.:21:20.

Northern Ireland. Sinn Fein was accused of "fairytale

:21:20.:21:22.

economics" by the Finance Minister today as he answered questions on

:21:22.:21:26.

the devolution of fiscal powers. First up, however, Sammy Wilson was

:21:26.:21:29.

asked how much his department has spent on flags and flagpoles in the

:21:29.:21:37.

last five years. The department has spent �7 on flags

:21:37.:21:42.

and flagpoles in the last five years. You can see that we get good

:21:42.:21:52.

bargains for the flag in Northern Ireland. Does the Minister recognise

:21:52.:21:58.

that by erecting flag poles in Belfast city centre, this could

:21:58.:22:02.

potentially raised tensions unnecessarily and further to that,

:22:02.:22:11.

was there consultation carried out by people before the decision?

:22:11.:22:16.

see, this question amazes me. People who objected to the steps of which I

:22:16.:22:22.

have taken, Mr Deputy Speaker, are actually responsible for the powers

:22:22.:22:28.

which I have exercised. I am exercising my powers through the

:22:28.:22:33.

flags and regulations Northern Ireland 2000 at it. What was the

:22:33.:22:42.

origin of this act? The origin of this act was the Belfast agreement.

:22:42.:22:49.

Who negotiated the Belfast agreement? Sinn Fein, the SDLP, and

:22:49.:22:55.

to end all state? Who encouraged people to vote for it? So I could

:22:55.:23:02.

almost say thank you to the members party for giving me the ability and

:23:02.:23:06.

for encouraging people to give me the ability to direct flags on

:23:06.:23:11.

government buildings in Belfast city centre. Many businesses have

:23:11.:23:17.

expectations that revaluation will lead to a lowering of rates and this

:23:18.:23:24.

is evident from the many radio broadcasts which we have heard.

:23:24.:23:31.

I ask the Minister what action he intends to take to manage those

:23:31.:23:34.

expectations? Some businesses will pay more because economic conditions

:23:34.:23:39.

have moved in their favour. market has pushed consumers towards

:23:39.:23:44.

certain types of businesses or areas. Some businesses will pay less

:23:44.:23:48.

because either the areas that are in, or the locations they are, have

:23:48.:23:53.

had a fall in the number of customers, footfall, economic

:23:54.:23:58.

activity and therefore that is reflected in the relevant rents that

:23:58.:24:03.

they pay. I think that is the first thing, to try and get this message

:24:03.:24:08.

over. The same of -- same amount of money will began that so there will

:24:08.:24:12.

be winners and losers. The Finance Minister, Sammy Wilson.

:24:12.:24:16.

And Mr Wilson had a busy day as he presented details of the budgets for

:24:16.:24:19.

the Stormont departments to the Assembly. More than eight billion

:24:19.:24:29.
:24:29.:24:38.

pounds were up for discussion. resolution covers the house and the

:24:38.:24:42.

estimates are set up. The committee's scrutiny of the main

:24:42.:24:46.

estimates focused on scrutinising the background for the allocations

:24:46.:24:51.

for each department. The amounts of money is involved were significant

:24:51.:24:57.

including a total of almost �100 million in resource allocations and

:24:57.:25:02.

�313 million in capital allocations. The Minister did say rather

:25:02.:25:09.

encouraging words in relation to the current economic situation. I would

:25:09.:25:14.

hope that he would perhaps expand on that and give us even more

:25:14.:25:19.

encouragement in relation to the economic situation. It does seem to

:25:19.:25:25.

me that we are still in the doldrums. The current financial

:25:25.:25:30.

climate remains challenging as the amount of money for public

:25:30.:25:33.

expenditure in Northern Ireland continues. The Assembly wants those

:25:33.:25:37.

public funds that are available to be spent wisely. The Assembly must

:25:37.:25:43.

be able to hold to account those public oddities that have that task.

:25:43.:25:53.
:25:53.:25:55.

-- those public bodies. And so I thought a new vibrant opposition

:25:55.:26:02.

party, NI 21, that there would be nothing for me to do today, but to

:26:02.:26:10.

my dismay I discover that we now have to add the acronym a wall --

:26:10.:26:17.

AWI OL to it. They must come forward and say with one voice, this is what

:26:17.:26:22.

we intend to do, this is where we will allocate resources and where

:26:22.:26:26.

there is clarity of vision, clarity of the way forward, we will provide

:26:26.:26:34.

the necessary oversight and clarity of presentation? It is nice to see

:26:34.:26:40.

that the new party of Northern Ireland is on a lead and that the

:26:40.:26:47.

end of a lead is Jim Allister. of a sudden, Mr MacRae appears in

:26:47.:26:56.

the chamber. I thought it was last Thursday, the 45 on Monday. There

:26:56.:27:02.

are signs of growth. But let's be realistic about this. There are

:27:02.:27:06.

still big chine just for us and since we plunged the very depths of

:27:06.:27:14.

the recession, it will take a long time and growth will be very slow.

:27:14.:27:20.

Even the predictions for the UK economy are for 1.5%. Going back to

:27:20.:27:24.

the heights of where we will does where we were before will take some

:27:24.:27:28.

time. Sammy Wilson. I'm joined again by

:27:28.:27:38.
:27:38.:27:38.

our political correspondent, Martina Purdy. It will be a busy week with

:27:38.:27:44.

the G8 coming to town. We will have heard from Barack Obama. He will

:27:44.:27:52.

begin a keynote address. I think you will talk about seizing the

:27:52.:27:59.

initiative and keep on going. And what about the finance package?

:27:59.:28:05.

that happen before the G8? The First Minister suggested that could happen

:28:05.:28:10.

before Friday. Obviously, we were not expecting a big file --

:28:10.:28:17.

obviously, we are not expecting a big pile of money. There are

:28:17.:28:21.

enterprise zones which will create jobs and access to finance. It is

:28:22.:28:30.

not just Arab Obama coming to town, it is a pretty -- it is not just

:28:30.:28:35.

Barack Obama coming to town, it is a pretty impressive line-up. And there

:28:35.:28:42.

A political programme focusing on the day's events at the Assembly and Northern Ireland Executive. Mark Carruthers is the guide through the corridors of power at Stormont, and is joined by key people from decision makers to opinion formers to make the experience enlightening and entertaining.


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