The Stormont executive is to hit householders with a regional rate increase that’s twice the rate of inflation.
The hike, confirmed by Finance Minister John O’Dowd, comes on the back of an inflation-busting rise in the district rate by the north’s 11 councils.
Householders in Belfast will as a result face the greatest upturn in their bills followed closely by Mid Ulster.
News is marginally better for businesses, with the executive agreeing a 3% rise in the non-domestic regional rate, however, when combined with hikes in the district rate, they will still face increases well in excess of the rate of inflation, which is currently 2.5%.
The regional rate increases were included in the draft budget published before Christmas and were agreed at a recent Executive meeting.
With many councils blaming the magnitude of the rates rises on an increase in employers' national insurance contributions, fresh questions have been asked about funds the executive has been promised to cover those costs.
Via the Barnett Formula, Stormont will receive funding to help departments and councils cover their increased national insurance costs.
It’s estimated that the devolved administration could get up to £17.5m to cover the added cost to councils in the forthcoming financial year.
However, it is unclear whether the money will be passed on to the local authorities, many of which have seemingly factored in increased national insurance costs when striking next year’s rates.
Opposition leader Matthew O’Toole, who received confirmation of the regional rate increase in a written response from the finance minister, described the executive’s rate setting and overall budget process as “increasingly shambolic”.
“We now discover that the Executive has signed off an above inflation increase in rates for 2025/26 without even telling the public and before the consultation on the budget has finished,” he said.
“Meanwhile they will not even quantify the additional cost of increased national insurance for the wider public sector, encouraging councils to push up rates even further.”
Last week, Secretary of State Hilary Benn told The Irish News that the Executive was not obliged to pass on the money secured via Barnett consequentials to councils.
“That is a matter for the executive. That is what devolved government is all about,” he said, adding that the funding for increased national insurance costs was on top of what he termed a “record settlement for Northern Ireland”.
In his response to Mr O’Toole’s written assembly question, Mr O’Dowd said: “The Executive has now formally agreed my proposals for the regional rate for 2025/26.
“This reflects the levels already published prior to Christmas in the draft budget 2025/26.
“My department will now make and lay the legislation for the assembly to agree the required statutory rule at the start of March.”
The Department of Finance said it had not yet received formal confirmation of the funds due through Barnett but they were likely to “fall far short of what is required, by tens of millions of pounds, to meet our increased costs”.
“Once funding is confirmed it would be a matter for the executive to decide how it is allocated.”