HL Deb 10 December 2002 vol 642 cc23-4WA
Lord Kilclooney

asked Her Majesty's Government:

Whether the former Minister for Regional Development in the Northern Ireland devolved executive requested an allocation of £48 million to this department for the purchase of new trains in the present financial year; when these trains were due for delivery; whether any of this £48 million has been re-allocated to other departments; and whether all this £48 million will be spent during the present financial year. [HL119]

Lord Williams of Mostyn

The former Minister for Regional Development did not request an allocation of £48 million for "the purchase of new trains in the present financial year".

Additional resources were provided by the Assembly to the Department for Regional Development (DRD) in December 2000 following the report of the Railways Task Force. The larger part of these resources involved the provision of grant support to Northern Ireland Railways (NIR) for the purchase of new trains. The amounts earmarked for this purpose in 2001–02 and 2002–03 amounted to some £49 million.

A contract for the new rolling stock was let by NIR in spring 2002 involving staged payments to the contractor throughout the period 2001–02 to 2004–05. The department has made and will continue to make the appropriate grant payments to NIR to achieve this, although some rephasing or expenditure has been necessary in line with the contract details. The draft budget for 2003–04 to 2005–06 includes the required provision and I can report that the delivery of the trains in 2004 is on schedule.

The change in government accounting policy following the introduction of resource accounting and budgeting in April 2001 gave rise to a question in respect of the interpretation and application of the new rules on resource budgeting. Clarification of the nature of the stage payments confirmed that they did not create an asset, and hence those payments were not a charge on the department's departmental expenditure limit (DEL).

Although DRD made substantial grant payments to NIR in 2001–02 and 2002–03 in respect of trains, none of this scores in the budget under the resource budgeting rules that apply for those two financial years. As soon as this technicality was clarified, in August 2002, £49 million was made available for re-allocation under the normal rules that apply to all departments. This funding, together with other funds, making a total of £141 million, has been allocated to good effect across departments and is profiled to be spent in the current financial year The details of this expenditure were announced by the Parliamentary Under-Secretary of State for Northern Ireland, Ian Pearson MP, on 13 November, reflecting the proposals put forward in October by the former Finance Minister, Dr Sean Farren.