Stephen Farry stated: “The Barnett Formula has served Northern Ireland pretty well over the past thirty years, more by accident than by design. A move to a needs-based system would be a leap into the unknown. A needs-based system would be superficially attractive and could offer enhanced protection for public spending based on the higher needs of Northern Ireland at a time of fiscal tightening. However, it could also present its own challenges including greater subjectivity and perhaps less control for devolved Assemblies.
“In its evidence to the Lords Committee, the Northern Ireland Executive originally argued for retention of the Barnett Formula. Last month, the then Finance Minister Nigel Dodds resisted the notion of Northern Ireland preparing for life after the Barnett Formula. However, the current Finance Minister, Sammy Wilson, has now welcomed the report.
“What is clear is the need for the Northern Ireland Executive to begin making preparations to argue Northern Ireland’s case under any needs-based system. This report from the House of Lords is one set of recommendations but it does confirm an inevitable trend in UK regional spending. There are subtleties relating to the circumstances of Northern Ireland that will have to be explained and defended.”