Stormont is to receive less infrastructure funding than expected from the UK government as a result of money being reallocated into defence spending, the finance minister has said.

John O'Dowd said that over the next four years the Northern Ireland Executive would get £117m less than previously planned.

"The reason we lost that money is because it is going to military spend," he said.

The Treasury has been asked for comment.

It is understood the change relates to a budget "reprofiling" which was first announced by Sir Kier Starmer's government.

That involved shifting some infrastructure, or capital, spending into defence from other departments.

That was confirmed by the Chancellor John Healey in Wednesday's Budget.

"I am ‌fully funding the Defence Investment Plan, including through capital reprioritisation across Whitehall," Healey said.

That has a negative impact on Northern Ireland's budget because of the way the devolution funding formula works.

Northern Ireland gets a population-based share of additional spending allocated to public services in England, so long as those services are devolved.

Defence is not devolved so moving money into it from other areas means the devolved administrations lose out.

O'Dowd said the move was "a major blow at a time when additional investment in areas such as critical infrastructure and social housing is urgently needed".

The government makes the case that additional defence spending benefits all areas of the UK through contracts for arms manufacturers and other businesses.

For example Thales, the French arms company, is expanding its Northern Ireland operations after winning a large contract to supply missiles to Ukraine.