The UK Government said it wants to give “certainty as quickly as possible” over the future of two Northern Ireland city and growth deals, with an update expected on October 30.
Northern Ireland Secretary Hilary Benn said Chancellor Rachel Reeves will set out the first phase of the spending review at the Budget, which includes consideration of the Causeway Coast and Glens and the Mid South West region deals.
The new Labour administration at Westminster initially paused four of the deals over concerns about funding, but it later emerged that the Belfast and the Londonderry and Strabane deals would go ahead.
The deals for Causeway Coast and Glens and the Mid South West region are awaiting the conclusion of the spending review to hear whether the funding pause will be lifted.
Responding to an urgent question in the House of Commons, Mr Benn said he has met First Minister Michelle O’Neill and her deputy Emma Little-Pengelly since the decision was announced last month.
Mr Benn blamed the decision to halt the projects on the Conservatives, saying: “As the Chancellor set out in July, the Government has inherited a £22 billion black hole in the public finances. As a result the Treasury is having to consider a range of measures to deal with this significant problem.”
Mr Benn added: “Everyone in Northern Ireland understands (the deals) importance to economic growth and encouraging investment, and this Government is committed to working with the Northern Ireland executive and businesses to make the most of the huge economic opportunities that now lie ahead.”
He went on: “The Chancellor will set out the results of the first phase of the spending review on October 30, which will include an update on the two outstanding city deals.”
DUP leader Gavin Robinson said it was “unnecessary” to pause the Causeway Coast and Glens and the Mid South West deals.
He said: “When there wasn’t a position in place to agree the financial requirements necessary, there was no need to pause them because of lack of finance.”
Mr Robinson added: “This decision places in jeopardy the match-funding from private investors, it puts in jeopardy the ability to proceed with the food and drug development centre in Coleraine or the Enniskillen bypass and a myriad of other important and strategically significant proposals.
“So injecting confidence at this time as we wait until October 30 would be to suggest that a) this Government recognises the important value of city deals, b) is determined to deliver on the aspirations that will be key significant regional drivers in Northern Ireland and c) recognise, as I think he does, to pause the proposals was foolish.”
Mr Benn replied: “Well, I don’t agree with his last proposition because… given the fiscal inheritance, for the Government to say we need to look at a range of things in the round is the prudent thing to do.
“I recognise entirely that it’s unwelcome to many, many people and the best thing we can do is to give certainty as quickly as possible, which would assist, but I understand entirely and will learn more about that when I meet the chief executives of the deals, the practical difficulties it creates in the meantime.”
Mr Benn added there is a “shared desire to maximise economic growth” in Northern Ireland.
For the Conservatives, shadow Northern Ireland secretary Alex Burghart earlier asked for an “apology for how this was handled” and said the deals are “badly needed”.
Mr Benn, in his reply, said: “If any apologies are required, a belated apology from the other side for the mess they left us would be much appreciated.”
SDLP leader Claire Hanna said city deals are a “serious tool” for economic growth and drive “much needed regeneration and infrastructure” in “overlooked” parts of Northern Ireland.
She said: “While I’m pleased the Government is honouring its commitments to Belfast and Derry, it should know that the decision and announcement on a Friday night caused very serious frustration and loss of public trust in Northern Ireland, although the Tories do still have a thing or two to teach about uniting the parties in revulsion at their announcements.”
Ms Hanna asked Mr Benn to clarify the reasons for the pause and assure MPs that he will be a “champion” for the deals with the Treasury.
Mr Benn replied: “I will indeed be that champion.”
He added: “Let’s be frank here, when there is bad news that is forced upon the Government, the truth is whenever it was announced it would have been unwelcome.”