RHI-20 Response Accepted Self-assessed

Flexible Expenditure Rules

Recommendation

Public expenditure rules should be sufficiently flexible so that false economies can be avoided. In order to deliver a policy objective, Departments should not be required to choose a more expensive option in overall terms because they cannot use the available funding in a flexible cost-effective way. The Department of Finance should engage with HMT to determine how such false economies, impacting as they must on the value for money taxpayers receive for the funds they provide, can be identified and avoided in the future in respect of government initiatives in Northern Ireland.

Published Evidence Summary
The following publicly available evidence relates to this recommendation:
According to the NIAO Second Progress Report (October 2024), flexible expenditure rules have been addressed through updated 'Managing Public Money NI' and business case guidance. According to the available evidence, a protocol for engagement with HM Treasury was also issued to determine how false economies could be avoided, acknowledging that public expenditure in Northern Ireland is governed by UK Budgeting rules.
How was this assessed?
Assessed by gemini-2.5-flash on 19 Mar 2026
Checked data held on this site (government responses, progress updates, independent evidence)
External sources searched: www.gov.uk, www.finance-ni.gov.uk, www.legislation.gov.uk, hansard.parliament.uk
Jurisdiction
Northern Ireland
Response
Accepted
Accepted Department of Finance
07 Oct 2021

[Note: The NI Executive responded to recommendations 19-23, 29-33 together as a group under the 'Governance and Financial Controls' theme.] Accepted with note that public expenditure in NI is governed by UK Budgeting rules set by HM Treasury with limited flexibility. Protocol for engagement with HMT issued. Financial monitoring systems confirmed operational.

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Progress Timeline
Official Report
15 Oct 2024

NIAO Second Progress Report (October 2024): Implemented. Flexible expenditure rules addressed through updated Managing Public Money NI and business case guidance.

Source
Source
Inquiry RHI Inquiry
Report The Report of the Independent Public Inquiry into the Non-Domestic Renewable Heat Incentive (RHI) Scheme 13 Mar 2020
View Source
Responsible Bodies
Department of Finance Primary
Themes & Tags
Inflexible Local Authority Funding Departmental capacity for grant design Governance Public Expenditure Hm Treasury Value for Money
Recommendation age 6.0 yrs
Last formal update 525 days ago