Speech

A major step towards a more peaceful, stable and prosperous Northern Ireland

This was published under the 2010 to 2015 Conservative and Liberal Democrat coalition government

Theresa Villers reflects on the Stormont House Agreement and says the significance of what has been achieved should not be underestimated.

Theresa Villiers at QUB

It’s a great pleasure to be with you this morning and to share some thoughts about the Stormont House Agreement - why it was necessary, what it achieved and some of the challenges ahead.

Last September, in my speech to the Conservative Party Conference I announced that the Government’s realistic assessment was that the time was right to convene a new round of cross-party talks.

The reasons were clear.

First, there was the continuing stalemate over those issues that were holding politics back, damaging relationships within the Executive and in some cases fuelling community division and public disorder, and the unresolved legacy issues of flags, parading and the past.

None of these was dealt with by the 1998 Belfast Agreement or St Andrews in 2006.

The 2010 Hillsborough Castle Agreement proposed new arrangements to devolve parading, but the draft legislation was withdrawn later that year.

My Labour predecessors launched a number of initiatives to find a way forward on the past, but were unable to find sufficient consensus.

And in 2013, despite the efforts of Dr Richard Haass and Professor Meghan O’Sullivan, a successful conclusion to the Haass talks proved elusive.

So that was the first of the reasons why we need to resume the kind of cross-party process which led to previous Agreements.

The second reason was the impending budget crisis faced by the Northern Ireland Executive.

I should first say that the block grant had not been reduced by anything like the amount some other areas of UK Government spending have seen.

In cash terms it had actually risen modestly over the spending review period, with real terms reductions of around 1% a year.

But the impasse over welfare reform was putting very significant strain on the budget.

The severity of the situation was compounded by increasing pressure within certain departmental budgets, and the difficulty in establishing consensus within the administration to embark on major reform of the public sector; something which governments across the western world have had to do over recent years.

By September of last year the Executive had belatedly agreed its June monitoring round which imposed departmental cuts or some 2%.

It was clear that further reductions would be needed in October, but there was no firm indication that this would be achievable.

The Head of the NI civil service wrote to HM Treasury warning of a potential breach of control totals - or in simpler terms, the Executive was in danger of overspending its budget.

And the First Minister wrote to the Chancellor requesting a £100m loan.

This situation had the capacity not only to seriously impair the effectiveness of the Executive, but it also cast doubt over the ability of the devolved institutions to continue to function at all.

If we had not secured a successful outcome to the cross-party talks, I could well have been standing here talking to you today in the aftermath of a sudden Assembly election, and very possibly - and with huge reluctance - preparing for a return to direct rule.

And let nobody be in any doubt that the collapse of devolution would have been a disastrous backward step for Northern Ireland and all that has been achieved in the 20 years since the start of the peace process.

So the talks began at Stormont House on 16 October.

I must confess, that morning as I sat with my officials in Stormont House we were never certain as to which parties would actually turn up.

I gather that one participant, I don’t know who, told the official who greeted him on arrival “Don’t give me a pass, I won’t be staying long”.

In the end, though, all the 5 Executive parties participated fully in the process.

As a co-signatory to the Belfast Agreement the Irish Government was also rightly involved throughout in those matters for which it has a responsibility.

And I would like to repeat the warmest tribute to the Irish Foreign Minister, Charlie Flanagan, and his team for their invaluable contribution to the ultimate success of the talks.

The process also benefited very positively from continued US support in the form of Secretary Kerry’s Special Representative, Gary Hart, and the Consul General here in Northern Ireland, Greg Burton.

As I found when I visited Washington a fortnight ago, US interest in Northern Ireland continues to be high, and the Administration stands ready to help maintain the momentum brought about by the Stormont House Agreement.

And of course Charlie Flanagan and I had the full backing of our respective Prime Ministers who played a key role in pushing things forward when they visited Stormont on 11-12 December.

But I should stress that while we worked very closely together across a range of issues during the process, both the UK and the Irish Governments fully respected constitutional boundaries.

The well-established 3-stranded approach was maintained, meaning that the internal arrangements for Northern Ireland remained exclusively for the UK Government and the Executive parties to decide.

So the process rolled on with practical challenges to face as well as political ones.

In previous years, such discussions often took place at comfortable country house hotels.

Not so for these austerity talks where Northern Ireland’s political leaders graciously put up with rather over-crowded and spartan facilities in Stormont House.

And with the Christmas deadline getting ever closer it looked during the week starting 15 December as if the talks were doomed to failure.

Minister Flanagan and I were getting ready to wind things up in the face of continued and wide divisions between the parties - and we told them so.

And suddenly things started to unblock, with intensive work through the night by the 5 parties to reach an accommodation on the welfare and budget questions.

So we came back after all on Monday 22 Dec for one final push.

And after just over 11 weeks, around 150 hours of negotiations, 1,000 or so cups of tea and coffee, and a marathon final session lasting just under 30 hours, the talks concluded around lunchtime on 23 December when the Heads of Agreement was tabled with the parties.

So, as one distinguished Northern Ireland member of the House of Lords put it to me last week “what does it all mean?”

Well, first, the Agreement sets a path for the Executive to put its finances on a sustainable footing for the future.

This includes the implementation of welfare reform - with certain agreed adaptations paid for out of the Northern Ireland block grant - alongside efficiency measures and reforms to the public sector.

And let me say this about welfare reform.

At the heart of the new system is the presumption that work should always pay and that people should be better off if they choose to work rather than stay on benefits.

By contrast the old system is both expensive and traps far too many people into a life on benefits, leading to a cycle of welfare dependency and poverty.

So I believe that the reforms going through the Assembly will be fairer to those on benefits and to hardworking taxpayers who foot the bill.

For our part, to help the Executive deal with its budget problems the UK Government has offered a package of financial support amounting to £2 billion of additional spending power.

That is made up of a combination of new funding and important flexibilities in relation to existing resources.

And it is targeted at Northern Ireland’s specific circumstances - the legacy of its past; a divided society; and its overdependence on the public sector.

Secondly, a Commission on Flags, Identity and Culture is to be established by June.

And based on the party leader discussions that took place last summer, proposals are set out by the Government which open the way for a devolved system of adjudicating parades, to replace the Parades Commission.

Thirdly, the Agreement also sets out broad-ranging new structures to address the legacy of Northern Ireland’s past.

These include an Oral History Archive; a new Historical Investigations Unit to investigate the deaths that occurred because of the Troubles; and an Independent Commission for Information Retrieval established by the UK and Irish Governments.

These new bodies will put the needs of victims and survivors centre-stage and have reconciliation as a key goal.

Crucially, the Agreement requires all of these new bodies to operate in a fair, balanced, proportionate, transparent and accountable way.

As this government has made clear, we will not be party to any process that permits a subverting or re-writing of history.

And I am confident this Agreement contains robust safeguards to prevent that from happening.

As I said earlier, consensus on how to deal with Northern Ireland’s past has eluded successive governments since the Belfast Agreement was signed 17 years ago, so the significance of what has been achieved should not be underestimated.

And as part of the additional £2 billion spending power the Government has made available to the Executive, £150m will help fund measures to deal with the past.

This helps relieve the pressure on PSNI resources so they can devote their efforts to policing the present rather than the past.

Fourthly, the Agreement contains measures to improve the way the devolved institutions work.

These include provision for an official opposition, a reduction in the number of government departments and cutting the number of MLAs by 2021.

And last but certainly not least, the Agreement paves the way for legislation to devolve the power to set the rate of Corporation Tax for Northern Ireland.

The Bill to give effect to this should complete its remaining stages in the Commons very soon before going to the House of Lords. So I am confident that it will be on the statute book before Parliament is dissolved for the General Election.

And I welcome that fact that it’s this Government which is delivering this momentous and potentially transformative change, subject to the important conditions contained in the Agreement.

I firmly believe that the Stormont House Agreement represents a major step forward for Northern Ireland.

And it has been warmly welcomed across these islands and in the United States, where I’m pleased to say it was the first item on the agenda when David Cameron and President Obama held talks at the White House in January.

Since the Agreement was published, politics has begun to move forward in a way we haven’t seen for at least the last 2 years or so.

A new Speaker was elected in January.

A budget that deals with the economic realities has been passed.

The welfare reform Bill is progressing through the Assembly.

And I am happy to say the Assembly has agreed to allow the National Crime Agency to operate to its full extent here, thereby providing people in Northern Ireland with the same protections from organised crime as everywhere else in the United Kingdom.

The first review meeting consisting of the UK and Irish Governments and the 5 executive parties took place on 29 January at which all present expressed clear commitment to implementing the Agreement.

That means implementing the Agreement faithfully and in full.

I fully accept that delivering an Agreement is only the completion of the first stage of a longer process and that implementation can be long and difficult.

I am in no doubt there will be bumps in the road before that work is completed.

Complex legislation will be required at Stormont, in Westminster and some in the Dáil to establish the new institutions that the Agreement envisages.

And we have the small matter of a general election in a few weeks’ time, followed by Stormont and Dáil elections next year.

I’m also the first to admit that there are areas where we were unable to make as much progress as we would have liked.

But while there are key questions still to be decided on matters such as flags and parades, at least the Agreement has set a path towards settling these matters.

It takes us closer to a final resolution than has ever been the case before.

But of course even if the Agreement had produced a detailed blueprint for a new system of regulating parades, we would still be left with the impasse in north Belfast and it’s on this subject that I want to say a few words before concluding today.

In December I decided that the proposed panel on parading in north Belfast that I had intended to set up no longer had sufficient support - on either side of the community - for it to have a chance of succeeding.

Some of those most closely associated with the dispute were either firmly against the proposal, or lukewarm in their support.

So against that background I concluded that I could not justify spending taxpayers’ money on this initiative.

I have already expressed regret and apologised in the House of Commons for the manner in which this announcement was put in the public domain.

I would like to state once again that my decision on the panel is not part of the Stormont House Agreement.

It was not part of any deal or side arrangement between the United Kingdom Government and any of the parties at the talks.

There are no such deals.

My decision was not taken in the face of any threats or ultimatums from anyone; none was made.

But even though the panel proposal is not viable, I accept that we cannot just go on as we are in north Belfast.

We cannot have a situation which year-on-year threatens to undermine stability in Northern Ireland and consumes thousands of pounds of limited police resources every week.

So I continue to believe that we need some kind of process in place that will help to bring the 2 sides together and take us closer to resolving the impasse - a process which delivers the structured and resourced initiative for which the Parades Commission called in their 2014 determination.

All of the many people with whom I have discussed this problem has agreed on the need for some kind of initiative, though they were sharply divided as to what form it should take.

As Secretary of State I accept my responsibility to do what I can to try to find a way forward.

But is important to avoid a groundhog day repeat of the work which led to the failed panel proposal.

To have any chance of getting off the ground successfully, any new initiative needs to come about through the efforts of a broad range of people, from different backgrounds and different sides of the community.

With that in mind, I and my colleague, Minister Murrison, now propose to embark on a series of meetings and consultations with interested parties to seek an inclusive way forward.

And today I call on the business community, civic society and Northern Ireland’s political leadership to step up to the plate and work together on this with the same determination and vision which has resolved so many intractable problems here in the past.

It is in nobody’s interest for this dispute to continue indefinitely.

All of us with an interest in building a peaceful, stable, inclusive and prosperous Northern Ireland have a responsibility to do what we can to help resolve the north Belfast question.

That is what I propose to do and I urge others to do the same.

In conclusion, I’d like to return to the subject of the Stormont House talks.

There were many times during those 11 weeks and one very long day when I thought that the talks would end in failure.

But I under-estimated the commitment of Northern Ireland’s leaders to making this place work.

We were genuinely on the brink of a major crisis for devolution - an existential crisis - but Northern Ireland’s leaders came back from the cliff edge rather than launch us all over it.

They took some very difficult decisions to find a way forward and in doing so they have demonstrated their own courage, determination and leadership.

They have also demonstrated the resilience of the political settlement here.

A settlement constructed to bring peace has shown it can adapt to changing circumstances and even withstand the pressures caused by austerity as we deal with the largest structural deficit in the UK’s peacetime history.

I believe the Agreement is a further stage in the journey towards a more peaceful, stable and prosperous Northern Ireland. It was an honour to play a part in it and I commend all of the people who made it possible.

Published 20 February 2015