Burnham's policy announcements bypass Northern Ireland under devolution
Andy Burnham took office as UK prime minister on Monday and immediately announced a package of measures affecting energy bills, bus fares and hospitality rates, but all three bypass Northern Ireland because they concern policy areas devolved to Stormont.
The removal of VAT from household electricity bills for an initial six months was expected to save the typical customer around £45 a year. The UK government said complexity under the Windsor Framework, which keeps some EU VAT rules applicable in Northern Ireland, meant it would not apply in the region, though some Stormont officials believe the cut is fully permissible. Instead, the devolved administration will receive additional funding from Westminster to develop its own relief scheme.
A reinstated £2 cap on single bus fares in England will also have no direct effect in Northern Ireland, where public transport is operated by the state-owned company Translink and no such cap has ever existed. Stormont will receive up to £15 million in consequential funding and will come under pressure to direct it toward Translink, which is currently consulting on significant service cuts due to budget pressures.
A 20 percent discount to business rates for pubs, social clubs and live music venues in England will likewise not apply, as rates are a devolved property tax. Northern Ireland is expected to receive only a small consequential amount, described as insufficient to make a significant difference. The region's regular business rates revaluation was thrown into disarray earlier this year when the hospitality industry successfully lobbied the finance minister to abandon the process.
Stormont has been unable to produce a budget for the current financial year, arguing that its allocation from Westminster is inadequate and would force damaging cuts. Finance Minister John O'Dowd spoke to Chancellor John Healey this week but indicated that a different approach is required. The devolved government intends to lobby the new prime minister for additional funding that goes beyond the normal devolution formula, arguing that Northern Ireland remains underfunded.