Theresa May’s Conservatives have struck a deal with Northern Ireland’s Democratic Unionist Party, through a confidence and supply agreement signed on 26 June, allowing them to stay in government after losing their majority in the general election earlier this month.
The deal was announced at Downing Street on Monday morning by DUP leader Arlene Foster, saying she was “delighted” the deal had been struck.
Talks between the two party leaders began immediately after the election result, and centred on a “confidence and supply” deal in which the DUP would support the government in any confidence votes and pass budgets.
The Conservatives have 317 seats in the 650-seat parliament after the 8 June election, and need the support of the DUP’s 10 members of parliament to be able to govern. This agreement does not represent a full-blown coalition, but rather an exchange.
The DUP has agreed to support May’s minority government through a confidence and supply deal promising more than £1bn in extra funding to Northern Ireland.
Under such terms, the deal will ensure the DUP’s support of the Conservative government on votes on the Queen’s speech, the budget, and legislation relating to Brexit and national security.
According to the Financial Times, the government has committed the overall sum in funding to the province to be distributed over the span of several years. Of the additional funding, £850m is over two years and £150m over five years. The deal itself is to last the length of the parliament, scheduled to last up to five years. Progress will be reviewed in 2019.
The plans will devolve control over corporation tax to Northern Ireland, allowing it to potentially compete with the lower rate in the Republic of Ireland. It will also consult on how to adjust value added tax and air passengers duty to boost the tourism industry.
Al Jazeera reporter Neave Barker, wrote that under the agreement, Northern Ireland will receive a £1.3bn fiscal package. “This will go on everything from hospitals to roads but also to shoring up their positions in northern Irish politics,” said Barker.
But this deal has also faced immediate criticism, especially from Wales and Scotland. Welsh first minister, Carwyn Jones called the deal “unacceptable”, saying it “further weakens the UK” and “all but kills the idea of fair funding for the nations and regions.”
Scottish SNP leader, Nicola Sturgeon also expressed anger that the money was being paid outside the Barnett formula, which is designed to distribute funds fairly between devolved nations.
Leader of the opposition Labour Party, Jeremy Corbyn, also commented on the deal stating it had “not been done in the national interest, but in the interest of ‘May and the Tories’ political survival.”