Finance officials are finalising a revenue raising plan ahead of a deadline on Monday, part of a multi-billion pound deal agreed following the February restoration of the Assembly and Executive.
But more than a third of the £80m the Department of Finance will claim as extra revenue is made up of this year’s annual rise in regional rates, with the remainder linked to increases in charges across various departments and agencies.
The plan will be announced as part of broader moves aimed at future balancing of the budget and achieving a £569m debt write-off.
Under the deal, the Executive promised to both draw up a longer term plan and come up with ideas to raise £113m in extra revenue. This was in return for a write off of the overspend debt built up over the last two financial years.
It was originally intended the £113m be raised over the period ending March 2025, but this was amended to allow for the money to be generated over 24 months.
The Department of Finance said: “The (budget sustainability) plan will include options to raise an additional £113 million by 2025-26 with current projections indicating that an additional £80m will be raised this year.”
A spokesperson added: “The £80 million is made up from additional revenue generated by the increase to the regional rate this year and a range of previously announced increases to service charges across departments. This detail will be contained in the Budget Sustainability Plan.”
An estimated extra £30m will be raised following the 4% increase in regional domestic and commercial rates, which were announced in February and rose only by the rate of inflation.
New ideas to generate extra revenue are likely to be included in the longer term sustainability plan to be delivered to the UK Treasury by Monday.
Finance Minister Caoimhe Archibald has previously flagged changes to rates, potentially scrapping the cap on homes worth £400,000 or more and cuts to relief support for both businesses, including on vacant properties, homeowners and landlords.
However, there will be no immediate changes to industrial derating, the 70% relief manufacturing companies receive. Legislation is needed to either cut or altogether scrap that scheme, which it is estimated could generate £70m, though the manufacturing sector believes it will be a lot less as many companies will be able to claim other small business reliefs.
Regional rates are the only source of tax revenue available to the Executive, with approximately £1.5 billion raised each year. Rate relief of £247 million was provided to businesses and over £100 million to households last year.
In the longer term, the Executive may be granted limited other tax raising powers similar to Scotland and Wales. A commission on “fiscal devolution” recommended this should happen in a report published more than two years ago.
Currently, the only way for the Executive to substantially increase revenue is to look at where the north either charges less or provides more cash support than England and Wales, so-called “super-parity” measures that would generate somewhere close to £700m a yea if fully implemented.
Approximately half, or £350m, would be generated with the introduction of water charges to a point comparable to other parts of the UK, politically toxic and consistently ruled out by the Executive.
Any increases or changes to university tuition fees are also politically problematic while the north has a range of extra welfare and housing benefits along with no prescription or domiciliary care fees.