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Stormont House Agreement

Volume 590: debated on Wednesday 7 January 2015

With permission, Mr Speaker, I would like to make a statement on the political talks in Northern Ireland, which culminated in the Stormont House agreement on 23 December. When I last had occasion to update the House, after the visit to Belfast of my right hon. Friend the Prime Minister and Taoiseach Enda Kenny, I reported that 10 weeks of talks had so far failed to deliver consensus on any of the key issues. I made it clear that the stakes over the coming days were high, and that without an agreement before Christmas we were unlikely to get so close again for months, or even years.

Further intensive discussions duly took place on Wednesday 17 December and continued on Thursday and Friday of that week. Resuming on Monday 22 December, the negotiations continued overnight, concluding some 30 hours later at around lunch time on the 23rd. At that stage, we presented the parties with a final heads of agreement, reflecting the many weeks of discussion and with the input of both the UK and Irish Governments, in accordance with the three-stranded approach. Key issues covered included the finances of the Stormont Executive, reform of the devolved institutions and the legacy issues of flags, parading and the past. I will take each in turn.

The agreement sets a path for the Executive to put their finances on a sustainable footing for the future, averting the impending budget crisis that was threatening the stability and credibility of the institutions. That includes the implementation of welfare reform, with certain agreed adaptations to be paid for out of the Northern Ireland block grant, alongside efficiency measures and reforms to the public sector. Measures to improve the way the devolved institutions work, including provision for an official Opposition, a reduction in the number of Government Departments and a cut in the number of Members of the Legislative Assembly by 2021 are also part of the agreement. A commission on flags, identity and culture is to be established by June and, based on the party leader discussions in the summer, proposals set out by the Government will open the way for a devolved system of adjudicating on parades, to replace the Parades Commission.

Crucially, the agreement also sets out broad-ranging new structures to deal with the legacy of Northern Ireland’s past. They include an oral history archive, a new historical investigations unit to look at the deaths that occurred as a result of the troubles, and an independent commission for information retrieval to be established by the UK and Irish Governments. All those bodies will be required to operate in a balanced, proportionate, transparent and accountable way, preventing any group or strand of opinion from being able to subvert the process or try to rewrite history.

The new system puts the needs of victims and survivors at centre stage and has reconciliation as a key goal. 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 the progress that has been achieved should not be underestimated. The Government have agreed to contribute £150 million over five years to help fund the structures dealing with the past, meaning that the Police Service of Northern Ireland can devote its efforts to policing the present rather than the past. That funding forms part of a wider package of significant financial support from the Government amounting to about £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 divided past, its divided society and its overdependence on the public sector.

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. A Bill will be presented to the House shortly for First Reading. If the Stormont parties press ahead on agreeing their final budget and on delivering welfare reform legislation, the Government will use all their best endeavours to get the corporation tax legislation on to the statute book before Dissolution. The parties in Northern Ireland have made it clear that they believe that corporation tax devolution can help them rebalance the economy and attract investment, not least because of Northern Ireland’s unique position of having a land border with the Republic of Ireland. I welcome the fact that it is this Government who are delivering that momentous and transformative change, subject to the important conditions contained in the agreement, and I call on the Opposition today to commit to supporting the Bill as a key part of the Stormont House agreement.

The agreement involves compromise on all sides, and it has been widely welcomed. First Minister Peter Robinson hailed it as “a monumental step forward” for Northern Ireland. Deputy First Minister Martin McGuinness called it “a remarkable achievement” and

“a fresh start we need to seize with both hands”.

President Obama said that Northern Ireland’s political leaders have shown that

“there is a way to succeed for the benefit of all”,

and Secretary of State Kerry called their actions “statesmanship, pure and simple”.

Securing an agreement is not the end point—far from it. There is much work ahead on implementation for the Executive, for the UK Government and, where appropriate, for the Irish Government. However, I give this assurance: if the parties in the Executive press ahead on that, the Government will implement our side of the agreement, and we will do it faithfully and fairly. There are no side deals.

In closing, I pay tribute to Minister Charlie Flanagan for his crucially important contribution to the process. I would also like to thank the United States Administration, and in particular Secretary Kerry’s special representative, Gary Hart, for their support. I thank all the officials at the Northern Ireland Office who worked so hard on the process. Above all, I would like to record my appreciation for the leadership and determination shown by Northern Ireland’s Executive parties.

In the Government’s view, the Stormont House agreement represents a genuine and significant step forward for Northern Ireland, offering the prospect of real progress on some of the most intractable issues faced there—problems that have defied multiple attempts to resolve them over the years. This agreement gives the five parties in the devolved Executive the chance to refocus and work together with renewed confidence for a more prosperous, more stable, more united and more secure future for the people of Northern Ireland. I urge them to seize the opportunities it presents to build a brighter future for Northern Ireland, and I commend the agreement to the House.

I thank the Secretary of State for advance sight of her statement. The Opposition welcome many aspects of the agreement that she has outlined to the House. It is not perfect, but it is a genuine advance on the stalemate of the past two years. I congratulate the Secretary of State, the Under-Secretary of State and their counterparts in the Irish Government on their painstaking and, I am sure, at times painful facilitation of the talks. I also recognise the contribution of US Secretary of State Kerry’s special representative, Senator Gary Hart.

Throughout the political impasse of the past two years, we have repeatedly called for the Government to play a more active role. We hope that the right lessons have now been learned about the consequences of disengagement for political stability and momentum in Northern Ireland. I am sure the Secretary of State will agree that there is no room for complacency. As we have seen in the recent past, unresolved issues such as parades and flags have the potential to fuel public concern, disorder and, ultimately, political instability.

I want to pay tribute to Northern Ireland’s political leaders for stepping back from the abyss and restoring some level of public confidence in their capacity to move Northern Ireland forward. It should be acknowledged that they face unique challenges in managing the transition from a society scarred by conflict and sectarianism to a more normalised society. However, that acknowledgement does not mean exemption from difficult political choices about priorities, or an expectation of blank cheques from this or any future Westminster Government.

Turning to the agreement itself, we welcome the adoption of a viable budget for the next financial year. It is right that it includes some elements of welfare reform while excluding the pernicious bedroom tax, which an incoming Labour Government will scrap. However, we remain concerned by the Government’s rush to introduce legislation on corporation tax devolution, a decision that will have profound implications for Northern Ireland and the rest of the United Kingdom. We believe that there should be a proper consultation process, including an analysis of the financial impact of significant reductions in corporation tax on Northern Ireland’s block grant, before legislation is introduced in this House.

It is good news that a comprehensive system for dealing with the past has finally been agreed. It is to be hoped that, over time, victims and their loved ones will develop confidence in the integrity of the new architecture and get the truth and justice that they have been denied for too long. We also strongly support the Government’s decision to make new investment available to boost integrated education. That is one of the most powerful manifestations of what a shared future can mean for Northern Ireland.

I have a number of questions for the Secretary of State. What assessment have the Government made of the impact on the block grant if Northern Ireland reduced corporation tax to the levels of the Republic of Ireland? What criteria will be applied to determining whether penalties will be levied by the Treasury next year in connection with welfare reform? What is the time scale for the creation of the new system to deal with the past? What negotiating process will be put in place to deal with unresolved issues such as parades, flags, and other identity issues such as the Irish language? Finally, what process has been agreed to monitor the implementation of the agreement? I am sure the Secretary of State will agree that it is one thing to reach an agreement, but for the sake of credibility, it is incredibly important that that agreement is now implemented.

I thank the hon. Gentleman for his expression of support for much of what is in the agreement, and for his kind comments about the work in which I and Minister Flanagan took part. As ever, I refute his allegation of a period of disengagement. At no stage have this Government been disengaged from Northern Ireland. We have actively worked throughout our time in office, not least in agreeing an economic pact that saw us working more closely with the devolved Executive in Northern Ireland than ever before, in addition to bringing the world’s media to Northern Ireland for the tremendously successful G8 conference.

I welcome the hon. Gentleman’s comments about progress on budget matters. Those on both Front Benches are united on the point that there will be no blank cheques, and the Government have put forward a significant and important financial package, reflecting Northern Ireland’s specific circumstances. I was disappointed to hear his comments on corporation tax devolution, because I think that change could have a significantly transformative effect on Northern Ireland’s economy. Northern Ireland is in a unique position in the United Kingdom, because it shares a land border with a jurisdiction that has a much lower rate of corporation tax. I urge the hon. Gentleman to urge the shadow Chancellor to allow Labour to support that change, which I believe is good for Northern Ireland.

The hon. Gentleman asked about the implications for the block grant. The Azores criteria mean that any future reduction in corporation tax in Northern Ireland needs to be funded from the block grant. Various estimates have been made of what that might look like, but at this stage it is impossible to be certain, not least because no final decision has been made on what the rate would be reduced to.

On the criteria for calculating welfare shortfall payments, the £114 million due in financial year 2015-16 is dependent on progress on implementing welfare reform. The quicker welfare reform is introduced and is up and running, the lower the shortfall payment will be. The time scale on the past is a key point, and the Government are keen to start working with the Northern Ireland Executive on the work needed for those institutions. They will certainly need Assembly legislation and in all likelihood they will also need Westminster legislation, and we are getting on with those matters.

The agreement sets out provision for a commission on flags to be established by June, and it is important that we press ahead with that. There is clearly more work to be done on that issue and on parades, and the agreement provides for further work by the Office of the Legislative Counsel of the Executive, bringing forth options that can then be consulted on for reform of the parading system. The process for monitoring will start with its first meeting between the Executive and the Government by the end of January. The final paragraphs of the main part of the agreement set out a system for monitoring implementation, and that will be taken seriously by the Government. It will, of course, involve the Irish Government, where appropriate and consistent with a three-stranded approach, and we look forward to getting down to work with the Executive on those matters.

I thank the Secretary of State for providing an advance copy of her statement. What discussions has she had with the parties in Northern Ireland about moving the Assembly and the Executive towards becoming a more efficient decision-making body?

My hon. Friend will find a section in the agreement on that. There is a commitment to draft a protocol on the use of the petition of concern, and to set out more clearly the sorts of issues on which it should be deployed. There are important changes to the way the Executive work, so that Ministers from the smaller parties can get business on to the agenda. There are proposals for reform of the MLA expenses system, and a commitment to a future reduction in the number of MLAs. I am sure that more could be done in terms of institutional change, but the agreement is a real step forward. In particular, I draw the House’s attention to the provision for an official Opposition for the first time in the history of the devolved institutions.

I congratulate the Secretary of State and all the party leaders on reaching an agreement, not least in view of the Prime Minister’s astonishingly premature exit from the previous summit, and his lack of engagement, which has been greater than that of any Prime Minister for more than 20 years. How can the Secretary of State be sure that this process will not long-grass the key flashpoint issues of parades and flags? On corporation tax, is she aware of Sir David Varney’s 2007 report to the Treasury, which showed that 95% of businesses in Northern Ireland do not pay corporation tax? That is not a silver bullet; it will leave a £300 million hole, or 3%, in the block grant, if there is equalisation with the Republic of Ireland.

I assure the right hon. Gentleman that the Prime Minister has been closely engaged with this process, and the visit he made along with the Taoiseach was significant in moving things forward. The financial package that he was able to agree with the Treasury was a crucial part of our progress. This Government have delivered significant achievements on some of the most difficult issues that Northern Ireland faces, and that is in large part due to work done by the Prime Minister.

I have acknowledged that there is more work to be done on the difficult issues of parades and flags, and no one would say for a moment that this agreement is the last word. I will be working, as will my officials and colleagues in government, to find a way forward on those matters, and ensure that they are not long-grassed and that we make real progress. As the right hon. Gentleman pointed out, those issues can cause huge disruption in Northern Ireland and poison the political relationships that are crucial to making the Executive work effectively. He says that corporation tax devolution is not a silver bullet. I agree that on its own it will not transform the Northern Ireland economy, but combined with other economic reform, a focus on skills and competitiveness, and economic reform across the board, it can have a significant and transformative effect. That is why I am disappointed that Labour is not supporting it.

I congratulate the Secretary of State on her statement, and all parties involved on showing real perseverance through some intractable negotiations. On the past, I pay tribute to all those at the Historical Enquiries Team who produced reports on cases that may have been low profile but nevertheless presented a real agony to relatives and friends of murder victims. I hope that the successor organisation will continue to publish such reports as they are of immense importance to those individuals. Looking to the future, the decision to introduce a Bill on corporation tax is tremendous and a tribute to all parties—the Opposition should remember that all political parties wish for it. Grow NI has overwhelming support from the business community in Northern Ireland, and estimates a cost of £200 million to £300 million if the tax were dropped to the level of the Republic. That is a very small investment in total Government spending of £23 billion in Northern Ireland. What issues does the Secretary of State believe might impede the progress of that Bill on to the statute book before March?

I agree with my right hon. Friend about the importance of reports by the HET. Paragraph 30 of the agreement provides that the historical investigations unit will continue to provide those types of reports to families as part of its work. I pay a warm tribute to the work my right hon. Friend has done on corporation tax. He championed it alongside Grow NI, business groups and Northern Ireland’s political leaders, particularly the Democratic Unionist party, and it is a tremendous achievement that the Bill is now so close to being presented to Parliament. That is a real tribute to my right hon. Friend’s work as Secretary of State for Northern Ireland.

Order. The Chair is obviously keen to accommodate everybody, but can I please appeal to each colleague to put one pithy question, not a miscellany of inquiries for which, frankly, we do not have time?

On 15 December, the Secretary of State told this House:

“the north Belfast panel”—

on parades—

“will be constituted shortly.”—[Official Report, 15 December 2014; Vol. 589, c. 1136.]

The Secretary of State knows that we did not negotiate on the issue of parades in the talks and that, of course, the Ligoniel parade was outside the ambit of those talks, but can she tell the House why, eight days later on 23 December, she went back on her word, did not consult the Unionist parties, did not consult this House and has not made any further statement other than to retract and give to Sinn Fein the opportunity to announce that the panel was not going ahead? Why did she do that? Is that not an act of gross bad faith? Is it not something that will cause immeasurable trouble in the days, weeks and months ahead? The festering sort of the denial of human rights to the people of Twaddell is not going to go away. If she does not intervene and do something—it is her responsibility; it is not devolved—it will get worse and worse in the weeks and months ahead.

I fully appreciate how strongly the right hon. Gentleman feels. I am absolutely determined to continue to work with him and with Northern Ireland’s party leaders to find a way forward to ensure that we find a way to resolve the parading impasse. As we have had the chance to discuss, the trouble with the panel was that it did not have enough support. It never had nationalist support. The Unionist coalition that had called for it to be set up in the first place could not produce a public statement in support and had actually broken up—some of the smaller parties had walked out. None of the smaller parties were making the case for the panel publicly, and there was a distinct lack of enthusiasm among the smaller parties. I regret the way the news came out. I have apologised to the right hon. Gentleman for that, but now we need to move forward and find something that will work to try to resolve the impasse in north Belfast.

I congratulate my right hon. Friend the Secretary of State, the Under-Secretary of State for Northern Ireland, my hon. Friend the Member for South West Wiltshire (Dr Murrison) and all the staff who worked on this. It is a real achievement. My right hon. Friend knows that I am not much given to flattery, but it is a real achievement for which she deserves congratulations. She said that this is not the end. Going forward, will she ensure that those who were perhaps stumbling blocks—I understand Sinn Fein was a little bit difficult about welfare reform—are not allowed to stop this process in its tracks, and that we all work towards an Northern Ireland that is exactly like the rest of the United Kingdom, where people can go about their daily lives without fear, without corruption and without criminality?

I thank my right hon. Friend for his kind comments. I echo his praise for my hon. Friend the Under-Secretary of State for Northern Ireland, who worked with great assiduousness and devotion on these matters alongside, as my right hon. Friend pointed out, many of the civil servants in the Northern Ireland Office. It is a tremendously important step forward that the political parties together were able to find a compromise on welfare reform. It does involve a top-up from the block grant to reflect Northern Ireland’s circumstances. Agreement on welfare reform was essential to putting together a sustainable budget. The important thing now is for a final budget to be agreed by the end of January and for progress on a welfare Bill passing through to consideration stage in the Assembly before the end of February. Those are the next steps.

I thank the Secretary of State for her statement. Can she possibly give us a little more detail on the specifics for the implementation of the legislation in the Chamber here in Westminster and in the Assembly? What particular legislation will apply to both? In relation to victims and the past, the detail is quite light. Many people will believe that the information sought in relation to inquests by those who have been deliberately affected—the victims and survivors—will not be met, because it falls far short of Haass and Eames-Bradley.

I expect the House to receive news on legislation on corporation tax in the very, very near future. We are working on how the structure of legislation in the Assembly and Westminster on the rest of the package is precisely to be formulated. The procedures for review and monitoring are set out in paragraphs 73 to 75. In relation to inquests and the provision of information to families, it is crucial that we all work on this. The agreement has a commitment to reform. There is an acknowledgement that the current inquest system is not meeting the needs of the families effectively enough and not delivering the Government’s obligations under article 2 effectively enough. That will be a hugely important priority for the UK Government. We hope to work closely with the Department of Justice in the work that it will no doubt be doing on this.

I welcome the fact that an agreement was reached, but will the Secretary of State set out exactly how much extra money has been given to the Northern Ireland Assembly to make the deal happen? Does she regret that, yet again, we have shown that if the parties of Northern Ireland hold out for long enough, Westminster will eventually cave in and send more money over?

I can outline the financial package, but it is a fair one. It was not a blank cheque. It recognises that Northern Ireland faces specific problems that the rest of the United Kingdom does not. In outline, it involves £150 million over five years to help to fund work on the past; flexibility to use £700 million of capital borrowing to fund a voluntary exit scheme for four years; a contribution of up to £500 million over 10 years of capital funding for shared and integrated education; £350 million of borrowing for capital infrastructure projects; and the flexibility to use the receipts from asset sales and capital funding to repay the welfare shortfall payments.

I welcome the replacement of the Parades Commission, which in my view has done more harm than good. May I take up the point made by the right hon. Member for Belfast North (Mr Dodds)? There is one parade that is causing huge long-term problems in north Belfast. Will the Secretary of State get involved personally? Will she talk to the Orange Order directly? Will she visit Twaddell avenue camp, as many of us have, and actually talk to the people there to understand why they feel so strongly about this very small amount of road that people are deliberately trying to stop them going back along? Until that is sorted, none of this talk about parades commissions or new bodies will work. She has the power to get this solved.

I assure the hon. Lady that I will certainly be meeting the Orange Order and others who have a very strong interest in these matters. I fully appreciate the huge importance that both sides of the dispute place on them. I have been actively involved, and I will continue to be actively involved to try to find a way forward. This dispute is in nobody’s interests and we need to find a way to solve it.

I welcome the Secretary of State’s announcement and I pay tribute to all the party leaders, and the Prime Minister, who helped to make it happen. I am disappointed that there was not more progress on the Parades Commission. We have kicked it back to June and to the middle of the marching season, which is going to be rather difficult. I would also like to pay tribute to the decision to have an independent audit on the cost of division. That will be terribly important to help us move forward. My question, however, relates to paragraph 69 and shared and integrated education. The Secretary of State knows there is a world of difference between shared education and integrated education. I would be grateful for her take on what she believes that means and what impact it will have on education in Northern Ireland.

Clearly, there is much work to be done on parades. Whatever had gone into the agreement, there were always going to be decisions to be made on the implementation process. I agree that the proposal to have an independent audit of the cost of division is very important—a point championed in particular by the Alliance party. There is obviously a slightly blurred division between integrated education and shared education, but what they both have in common is that they ensure that the children who go through those schools have the chance to get to know and learn alongside children from other community backgrounds. That is a crucial means of helping to deliver a shared and united future for Northern Ireland. That is why the Prime Minister has given a substantial commitment to supporting integrated and shared education through funding.

With so many people throughout Northern Ireland feeling profoundly disillusioned with the performance of the Northern Ireland Assembly, will the Secretary of State accept that it is imperative that the political parties make the agreement work this time and that they do so with a generosity of spirit? I speak as someone who absolutely loathed direct rule and who is passionate about devolution and ensuring that the Assembly survives and succeeds to serve the whole of Northern Ireland.

I welcome the hon. Lady’s sentiments. She is absolutely right. This is an opportunity for Northern Ireland’s political leaders to make it work. Anyone who thinks the agreement takes us in the wrong direction needs to reflect on the alternative: increasing chaos over the budget and increasing tension over a range of issues. This is an opportunity. There is work ahead of us all to implement the agreement, however, and I hope that everyone in the House will urge the Northern Ireland parties to seize the opportunity and make the agreement work for all of Northern Ireland.

My right hon. Friend will recall the behaviour of the Democratic Unionist party over the vote on 42-day detention in the last Parliament, the deal for which cost this country about £1 billion. From the numbers she just gave my hon. Friend the Member for Amber Valley (Nigel Mills), it would seem that this latest deal has cost the taxpayers of Great Britain another £1 billion. Does she, like me, fear for the fate of this country if, by some mischance, there is not a clear Conservative majority at the next election and the Administration has to rely on that lot over there?

My hon. Friend will be aware that the Conservatives are campaigning for a majority Conservative Government at the general election, not for coalitions of any sort. I will not comment on the history of the 42-day vote. I am keen to emphasise the crucial role played by First Minister Peter Robinson and the DUP in delivering a significant package of reforms for Northern Ireland.

I pay tribute to the Secretary of State and her team and to the Irish and American Governments, who were involved in the talks over a protracted period. On many of these issues, the Stormont House agreement provides a road map for Northern Ireland, particularly around finances, but much deeper reform is needed than simply filling the holes. I also believe in dealing with the past. However, on other key and volatile issues, such as parading and flags, this has simply become a parking garage where things will be left to sit until the difficult period over the summer. What will she do personally to remain engaged on those key issues? It is clear that there is not the will across all parties to come to a mature resolution on them.

I welcome the hon. Lady’s comments and pay tribute to the sterling work done by her and her party in moving things forwards on all these issues through the cross-party talks and in other ways. She is right to describe the agreement as a road map. As ever with agreements in Northern Ireland’s history, this is a further staging post, and the next journey along the road will be implementation. Of course, I will be directly involved in keeping everything moving on implementation. Given the comments we have heard, I will no doubt be spending a lot of time on parading matters over the coming weeks.

I congratulate my right hon. Friend on her hard work and all the political parties in Northern Ireland on delivering this agreement. However, may I press her for a little more information about how we can rebalance the economy in Northern Ireland? As I understand it, 80% of the economy there is dependent on the public sector. I am keen that there is not a significant impact on taxpayers in my constituency.

On rebalancing the economy, as I have said, the devolution of corporation tax—assuming that the conditions are met—could have a transformative effect. In addition, the economic pact sets out other means to deliver the competitiveness that Northern Ireland needs to rebalance its economy. It will require reform of the planning system—that was proposed in the Assembly, but has not progressed as yet; crucially, a strong focus on skills and education; and measures to reduce red tape, which is why the pact contains a commitment by the Executive to a reduction of red tape. The Enterprise Minister has followed that up with some important work.

I welcome the advance copy of the statement that the Secretary of State gave us, but I am rather perplexed at the attitude towards corporation tax of the Labour Front-Bench team. We have worked hard to achieve this, and for it to be delayed would be a shame.

On the financial agreement, the Secretary of State said that she would allow the proceeds of specific agreed asset sales to be retained entirely by Northern Ireland. What are those assets? Will she confirm whether they include the port of Belfast, Translink, the water service and/or Northern Ireland car parks?

It is important that the Executive give proper consideration to those and all other assets of a similar nature, but it would not be right for me to prejudge what sale proposals the Executive might develop. Each asset will be considered in relation to the provision in the agreement’s financial annexe.

I add my voice to those who are congratulating my right hon. Friend, her team and everyone involved in getting agreement at Stormont House? It is fantastic.

I am pleased that there is to be a new historical investigations unit. Will my right hon. Friend reassure the House that the investigation will continue into what happened to the late Captain Robert Nairac GC and where his body might be located?

I reiterate my sympathies and condolences to Robert Nairac’s friends and family, who must feel the pain of their loss even after so many years. Of course, a process is already in place for seeking the remains of the disappeared, and I do not think it would necessarily be impacted on by the HIU’s work. However, as part of the implementation process, we will work out how it will interact with existing bodies.

I thank my hon. Friend for his kind words about the achievement of this agreement. There were many people who said a Conservative-led Government could not do this kind of thing. Well, they have been proved wrong.

On corporation tax, I am quite happy for the north to adjust its corporation tax to compete with the south, but this is also a Westminster Government, so we need to be clear that doing that will not disadvantage other parts of the UK, including places such as the one I represent.

On the demise of the HET, the Northern Ireland Committee heard just before Christmas that because of budget cuts to the police, the work of the HET, which we thought would end in three years, will not end for nine. We have been told today that there will be legislation in this House and Belfast. When does the Secretary of State envisage the legislation going through and the HIU being put in place? What does she think the time scale for concluding all those investigations will be? Will it be shorter or longer than we thought?

Obviously, the PSNI has made some difficult announcements in recent weeks in seeking to absorb budget reductions, but the funding package and agreement, when implemented, will provide some relief. I hope that means that the work the PSNI indicated would take much longer than it had originally expected can be completed more quickly. We have put forward our proposal, and we hope that the HIU will complete the bulk of its work within five years.

On corporation tax, it is key to recognise that Northern Ireland is different and that there are specific reasons to justify its devolution in Northern Ireland that do not apply to the rest of the UK.

I congratulate the Secretary of State on the patience and resolve she has shown in helping the parties reach an agreement, particularly on the milestone of establishing an official Opposition in Northern Ireland, which is an important step forward in the normalisation of politics in the Province.

On the past, it is great that we have seen a degree of agreement between the parties, but does she agree that nothing in the agreement should imply an amnesty for the criminal gangs who preyed on the people of Northern Ireland for so long?

Absolutely not. There are no amnesties in the agreement. This Government do not support such things, and they would not be justified in this instance.

The Secretary of State mentioned parades a number of times, and those will be a problem in the future. Does she therefore understand the frustration of my constituents at the Drumcree protest, which has been ongoing for 16 years? The panel gave us the possibility of finding a model to deal with that parade, but the rug has again been pulled from under us. Does she understand the complete frustration?

I do, and the hon. Gentleman and I have discussed the Drumcree situation on many occasions. It is important in north Belfast to focus urgently on finding an inclusive process to bring the two sides together. That is why I will be meeting many of the different groups involved in the next few days and discussing these matters with the right hon. Member for Belfast North (Mr Dodds) and the First Minister tomorrow.

I congratulate the Secretary of State on her role in securing the agreement. Does she agree that the proposed independent commission on information retrieval should attach the same importance to requesting information from the British Government as is attached to pursuing the cases of the disappeared people who were victims of IRA murders during the troubles?

Certainly, and it is crucial that the work on the disappeared is allowed to continue. Thankfully, it has been possible to find answers in relation to a number of cases. Sadly, many have so far not been resolved, but the good work done by the Independent Commission for the Location of Victims Remains is a good model on which to base the ICIR’s work for the future.

Let me say to the hon. Member for Reigate (Crispin Blunt) that if he is faced with the choice of the Scottish nationalist party or a Unionist party, he may have cause to think again about the comments he just made.

The Secretary of State will join me in welcoming the progress we have made on dealing with our troubled past in Northern Ireland. She knows the hard work that was put in during the talks to achieve this outcome, which is a victim-centred outcome. However, many of those victims were victims of people operating from the jurisdiction of the Irish Republic; indeed, some were murdered in the Irish Republic. Will she ensure that the Irish Government hold good to the commitment and obligations they have undertaken in the agreement to co-operate fully with all the institutions dealing with the past and release all papers, documents and files held by Irish state forces that will assist in the apprehension of those responsible for those murders?

I thank the right hon. Gentleman for his hugely important work in the cross-party talks and for delivering what I believe is a good agreement overall, although his input on the past has been particularly highly valued. It is important that all participants—the UK Government, the Irish Government and the Executive parties—play their part and live up to the obligations they have undertaken. Minister Flanagan has repeated on many occasions that his Government would co-operate with those institutions; I have every confidence that they will do so.

I commend the statement and acknowledge the comprehensive efforts made by all involved in reaching the agreement. The Secretary of State alluded to the need to ensure that the process did not become a rewriting of history. Will she go further and indicate to the wider public in Northern Ireland that there has to be a distinction between the genuinely innocent victims in the past who were murdered and butchered, and those who caused that murder and butchery and happened to be caught up in violence of their own hand?

Of course there is a very clear distinction between those two. I know that there continues to be controversy around the way that the law defines a victim, which has been the barrier to taking forward the proposal for a pension for severely physically injured victims. The hon. Gentleman will appreciate that the agreement commits to there being further work on whether we can find a way to enable that pension to be taken forward without raising those problems around the definition of “victim”. It is a difficult issue, but one that we should all continue to try to find an answer to.

Failure to agree on contentious issues such as flags and parading has led to violent protests, as we all know. What additional steps has the Secretary of State taken to ensure that the PSNI has adequate resources to guarantee security for the people of Northern Ireland and the capacity to police public events?

The hon. Lady makes an important point. The agreement will help partly by providing extra funding for institutions that are doing work on the past that is currently done by the PSNI, but the financial annex attached to the financial package also contains an obligation on the Executive to do what they can to minimise reductions in police funding. Given the financial realities, it seems inevitable that there will be reductions in PSNI funding to some degree, but the UK Government would certainly like these to be kept to an absolute minimum, which is why it is in the financial annex to the agreement.

I thank the Minister for her statement and for all the hard work that she and many others did to achieve the Stormont House agreement. We in the Democratic Unionist party ensured that the bedroom tax would not be implemented in Northern Ireland thanks to the flexibilities and the top-ups that we secured through the Northern Ireland block grant. Sinn Fein, of course, opposed that, but they never turned up in this Chamber to vote against it. However, this time Sinn Fein have joined with the DUP to agree a deal, which means that there is now no obstacle to a revised welfare reform Bill for Northern Ireland. Can the Minister set out the time scale for welfare reform in Northern Ireland and the legislative process through this House?

I thank the hon. Gentleman for his comment. It is a hugely important step that the five parties reached an agreement on a way forward on welfare reform. It is indeed a matter for the Northern Ireland parties that they have applied the top-up in relation to certain matters, including the spare room subsidy, which they are funding through their block grant. It is now vital that progress is made on implementing welfare reform as soon as possible, so that we can press ahead with the rest of the agreement.

The Secretary of State will be glad that I will not rehearse the issues of welfare and finance that many of us concentrated on in the negotiations. She is right that we should not understate certain aspects of the agreement. However, it would also be wrong to oversell other aspects, where we have superficially strimmed the long grass, not least in respect of parades. Does she now regret her misadventure in proposing a panel on north Belfast, believing that that would somehow assist the talks, when we now know from the Unionist parties that their position was that, on the expected promise of the panel, they were not going to negotiate on parades in those discussions?

We heard it from them today and we heard it from their leaders this week. That is why we had all the nugatory discussions in Stormont House about parades, and therefore ended up with no negotiations on parades, and those who wanted a panel have now ended up with no panel. That is the Secretary of State’s fault.

I pay tribute to the hon. Gentleman and the Social Democratic and Labour party for the work they did on welfare reform and, in particular, the past, where their ideas have been highly influential. I think everyone would acknowledge that there is more work to be done on parades, and that it will be crucial to take that forward for the good of all in Northern Ireland whose lives are potentially disrupted by parades and for those who want to conduct their parades and express their culture in the way they have for hundreds of years.

As for the panel, as I said to the right hon. Member for Belfast North, unfortunately there was just not enough support for it. It was well intentioned, and I still believe that we need to find a way to mediate between the two sides and find an inclusive process that can engage as widely as possible. It became apparent that the panel would not be able to do that. We need to find a way forward, and I will be working with the Northern Ireland Executive and their parties to seek to do that.

The Secretary of State mentioned the establishment of a commission to consider flags and emblems. Does she agree that it is absolutely outrageous that the people of Northern Ireland are not permitted to have their flag, the flag of the United Kingdom, displayed on their driving licences like everywhere else in the United Kingdom—the SDLP is trying to out-green and out-Sinn Sinn Fein—especially bearing in mind that people in Northern Ireland died to keep Northern Ireland a part of the United Kingdom and beat the provos?

These are hugely sensitive issues and these matters have been under discussion in various forums for many years, and the proposal to have a broader civic conversation and debate about finding a way forward is a good one. The hon. Gentleman will be aware that it was first proposed by Dr Richard Haass in the work that he and Meghan O’Sullivan did. We simply do not have all the answers on how all these matters need to be resolved. Including as many people as possible in finding a way forward on these sensitive and crucial questions of identity is an important step towards that.

The additional money made available to Northern Ireland through flexibility and borrowing, and the extra money for the additional institutions, will be welcome. Despite what the hon. Member for Reigate (Crispin Blunt) said in his little Englander outburst, which helps nationalism more than the nasty nationalists of this House do when it comes to the break-up of the Union, this is something that Northern Ireland needed.

The important thing is to rebalance the economy as well. Will the Secretary of State spell out for us what exactly she means when she says that the Government will use their “best endeavours” to get the legislation on corporation tax through Parliament? Does that mean that that might not happen, and if not, why can she not give total clarity that the legislation will go through before the end of this Session?

As I have said before, the reality is that introducing legislation at this stage of a Parliament runs the risk of running out of time for it, in which case we become dependent on the Opposition for getting it through. We will try to speed it through as best we can, assuming that the Northern Ireland Executive do their bit. We had hoped to introduce the legislation in December, in which case we would have been pretty confident of getting it through on time without the support of the Opposition. Given the delay of a few weeks, it is more uncertain. That is why I put the question I did to the shadow Secretary of State, but we will certainly try our very best to get this legislation on the statute book.

I congratulate all the parties involved in enabling the statement to be made and in achieving the agreement, which is a significant step forward for Northern Ireland. The rising inequality and rising child poverty that we have seen under this Government and their hostility to public sector work have had an impact on Northern Ireland, creating a potential breeding ground for paramilitaries and political extremists. Has the Secretary of State had any discussions with the Chancellor about the impact on Northern Ireland of the decisions this Government have taken and of increasing poverty? What is she going to do to support a peaceful future by ensuring that Northern Ireland, and the rest of the United Kingdom, is able to have a more equal future than it has had in the recent past?

I have had many discussions with the Chancellor on Northern Ireland matters. This Government’s economic plan is working for Northern Ireland. There has been significant inward investment and a significant number of jobs created, and the Northern Ireland economy is predicted to grow at a faster rate than the economies of many major developed economies around the world. The economy is turning around in Northern Ireland, which is a result of the work done by this Government.