Finance Minister John O'Dowd has announced a significant agreement with the UK Treasury, which will deliver an additional £600 million for public services in Northern Ireland. This latest allocation brings the total additional funding secured through negotiations with the Treasury to £1.3 billion.

Speaking after the publication of the agreed methodology for assessing the Executive's relative funding, Minister O'Dowd stated: "Today's agreement is the culmination of months of intensive and constructive negotiations with Treasury. It will deliver an additional £600m of funding provided for vital public services here."

The Minister highlighted the strategic importance of this funding. "This will enable the Executive to take a long-term strategic approach to public service delivery," he said. "It helps avoid the potential cliff edge in public funding that could have occurred when the restoration financial package comes to an end and the resulting damage this would have done to frontline public services."

The agreement was informed by Professor Gerry Holtham's independent review of Northern Ireland's relative need, which provided a range of need levels, including a central estimate of 128% when agricultural spending is included. Under the new agreement, the £329m in un-ringfenced agriculture funding from Phase 1 of the Spending Review will be excluded from the relative funding calculation. Without this exclusion, the Executive would have received £600 million less over the Spending Review period. Minister O'Dowd thanked Professor Holtham for his report, noting its role in strengthening the case for fair and sustainable funding. "His report built on the work of the Independent Fiscal Council and added considerable weight in helping us make the case that the Executive must be funded fairly and sustainably," he added.

The Minister confirmed that the agreement ensures Northern Ireland will be funded above 124% (excluding agriculture) between 2026-27 and 2028-29, which increases to 128% with the inclusion of agriculture and non-Barnett funding.

The Relative Funding Methodology, agreed between the Treasury and the Executive and published today, means:

• A needs-based adjustment factor of 124% will apply to Barnett consequentials from the Spending Review, replacing a lower transitional rate.

• This directly increases funding by £600 million over the Spending Review period.

• Discussions on a long-term, full Fiscal Framework will commence immediately, covering areas such as the Housing Executive's borrowing powers, the Holtham Review, the scope of fisheries funding in relative funding calculations, and fiscal devolution.

Concluding his remarks, Minister O'Dowd reiterated his commitment to ensuring public services are properly funded. "This agreement will see £600 million more for public services over the Spending Review period, providing additional investment in the services that we all rely on and delivers on my commitment to support workers, families and communities," he said.

"This brings the total additional provided by the needs based adjustment in the Interim Fiscal Framework to £1.3bn.

"Today is an important step in both providing immediate financial stability and in progressing towards a full fiscal framework that will consider the work of Professor Holtham as part of that process. I will continue to engage with the Chief Secretary to the Treasury towards a full Fiscal Framework which ensures the Executive has the financial tools including borrowing powers and necessary taxation levers to deliver sustainable public finances and public services for the people we serve."