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Theresa May today spent £1 billion of taxpayers’ money on a deal with the Democratic Unionist Party to prop up her wobbly government.

A smiling Prime Minister welcomed Arlene Foster, the leader of the Northern Ireland party, to Downing Street this morning to shake hands on the agreement.

The headline sum is understood to be worth about £96 million for each of the 10 Northern Ireland MPs promising to back Mrs May in certain key votes.

But the full cost to UK taxpayers will be far greater because the deal also includes dropping Tory manifesto plans to means-test winter fuel payments to pensioners and scrap the “triple lock”, which ensures above-inflation state pension rises. In addition, some £183 million of farming subsidies for Ulster are also guaranteed after Brexit. The entire deal is due for renewal in two years.

Mrs Foster, with her Westminster group leader Nigel Dodds and chief whip Sir Jeffrey Donaldson, posed in triumph with Mrs May outside No 10 before going in to formalise the deal.

But ex-Tory chairman Chris Patten said the “toxic brand” of the DUP would taint Mrs May, while Mayor Sadiq Khan winced at “pork-barrel” politics that would cost Londoners in higher taxes.

Mrs May said the “confidence and supply agreement” would work for the whole of the UK

“I welcome this agreement, which will enable us to work together in the interest of the whole United Kingdom, give us the certainty we require as we embark on our departure from the European Union, and help us build a stronger and fairer society at home,” she said. “In the interests of transparency, the full terms of this agreement have been published.”

Mrs Foster said the headline deal was worth £1.5 billion in extra spending power for the Northern Ireland executive. In addition to “financial support” of £1 billion over two years, she said, further devolution will give the executive more control over spending worth £500 million.

Mrs Foster said the deal would allow the executive to boost “the economy and invest in new infrastructure, as well as ... in the future of our health and education sectors”.

“We welcome this financial support of £1 billion in the next two years as well as providing new flexibilities on almost £500 million previously committed to Northern Ireland,” she said. “As a consequence, spending power of almost £1.5 billion will be available to address the unique circumstances of Northern Ireland and the effect these have had on the economy and its people.”

The headline deal is equivalent to handing every man, woman and child in Northern Ireland £550 each to spend on local services. But the cost to UK taxpayers will include much higher sums. The winter fuel payment cuts were expected to save the Government £8.5 billion over five years, which will now have to be found. Curbing the triple lock might have saved £7 billion in some years, according to estimates.

The two-year length of the deal suggests the parties expect another general election in 2019. Otherwise it will be renegotiated, meaning more bills.

The agreement also includes a consultation on cutting air passenger duty for Northern Ireland, raising the prospect of another giveaway in future. Corporation tax in the province may be devolved to the Stormont executive, allowing cuts in the rate. Blocking means-testing of the winter fuel allowance paid to 12 million pensioners and the abolition of the “triple-lock” is another huge victory for the tiny party. Both were contentious items in the Tory manifesto that were dropped from the Queen’s Speech.

Former Conservative chairman Grant Shapps tweeted that the party would have won this month’s general election outright if the pensioner benefits had been guaranteed, not threatened. He wrote: “Hmm. No change to winter fuel payments, triple-lock pensions & long-term care. With this manifesto, we could have had a stonking majority!”

Mrs May said the deal respected the Good Friday peace agreement and urged Nationalists and Unionists to restore the Stormont executive before a deadline for direct rule to be imposed.

“Time is running short for the parties to come together and reach agreement to re-establish a power-sharing executive by June 29,” she said. “I hope the parties will look beyond their differences and come together with a shared sense of common purpose to serve all communities in the best interests of Northern Ireland.”

Women's March against Tory deal with DUP 8 show all Women's March against Tory deal with DUP 1/8 Activists hold placards as they gather in Parliament Square EPA 2/8 Women march to Downing Street for a rally EPA 3/8 Activists gather in Parliament Square for a women's protest against the Tories' deal with the DUP EPA 4/8 An activist holds a placard in Parliament Square EPA 5/8 Activists gather in Parliament Square EPA 6/8 A woman holds up a pro-Jeremy Corbyn placard EPA 7/8 An activist in Parliament Square holds up placards during the women's protest EPA 8/8 Two women hold up pro-Jeremy Corbyn placards EPA 1/8 Activists hold placards as they gather in Parliament Square EPA 2/8 Women march to Downing Street for a rally EPA 3/8 Activists gather in Parliament Square for a women's protest against the Tories' deal with the DUP EPA 4/8 An activist holds a placard in Parliament Square EPA 5/8 Activists gather in Parliament Square EPA 6/8 A woman holds up a pro-Jeremy Corbyn placard EPA 7/8 An activist in Parliament Square holds up placards during the women's protest EPA 8/8 Two women hold up pro-Jeremy Corbyn placards EPA

Lord Patten said the DUP’s hardline stance on issues such as gay equality would harm the Tories and cost taxpayers. He said: “The DUP is a toxic brand and the Conservative Party has got itself back into the situation where there’s a danger of it looking like the ‘nasty party’, to borrow from Theresa May. Every vote will cost you.

“Every vote, you will have to find some way of paying for it and then explain to the Scots and the Welsh and people in the North-East why they can’t have the same thing too.”

The agreement covers four areas of House of Commons divisions where defeat would bring down the Government or be against the national interest, including votes on Brexit, future confidence votes, the autumn Budget and issues of national security. However, it does not cover day-to-day voting on other matters, which means the DUP is free to hold the Government to ransom if it wants to get its way.

DUP backing means this week’s critical vote on the Queen’s Speech package of proposed laws — the moment Mrs May’s new government must “prove” itself to remain in power — should be passed by a slender majority of up to 13.

Northern Ireland already gets about 21 per cent more public spending per head of population than the UK average. It is understood that the DUP asked for more money for infrastructure, including new roads, enhanced spending on schools and health as well as economic reforms including lower corporation tax for the region.

Mr Khan told the Standard: “There is understandable concern that the Government will throw gratuitous pork-barrel projects at the DUP in order to buy their support — but that will come at the expense of every other region of Britain.

“Like many Londoners, I feel deeply uncomfortable about the idea of the DUP playing any role whatsoever in propping up a minority Tory government.

“The Prime Minister must make a crystal-clear statement that she rejects the illiberal and intolerant social views of the DUP and give a cast-iron guarantee that LGBT rights and women’s rights will not stall or go backwards at the expense of her staying in power.”