The cost of Irish unity

Sir, – In his thoughtful and balanced article on the financial implications of Irish unity, Bobby McDonagh underlines the value of “well-researched, clearly-presented reports by distinguished academics” (“When it comes to the cost of Irish unity, maybe it’s okay if the heart overrules the head”, Opinion & Analysis, April 10th).

Such work is being published and disseminated by Arins (Analysing and Researching Ireland North and South), a joint project of the Royal Irish Academy and the Keough-Naughton Institute for Irish Studies at the University of Notre Dame. Arins was established in the aftermath of Brexit.

Over the past three years, it has published a large number of high-quality, non-partisan academic articles on a wide range of topics – constitutional, political, economic, social, cultural, international – relevant to the debate on relationships in Ireland and in these islands. These articles are supplemented by monthly podcasts and in-person discussions with political and other leaders. Arins also collaborates with The Irish Times in the production of high-profile opinion surveys, the most recent of which probes attitudes to the economics of unity. All of this work is available at arins/ria.ie.

In 2021, John Doyle of Dublin City University published “Why the Subvention Does Not Matter”. In 2023 Esmond Birnie offered a response, “The Subvention Matters”. Last month’s Arins podcast brought the two authors together with Edgar Morgenroth of Dublin City University, the co-author of the Institute of International & European Affairs research paper (“United Ireland could cost €20 billion a year for 20 years, says new study”, News, April 4th).

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In a calm, informed and respectful discussion all three agreed on the scale of the current UK subvention, how it has evolved and indeed increased over time, the elements which make it up, and the variables which might affect the fiscal impact of unity on the Irish exchequer.

What was clear is that for the foreseeable future there would continue to be transfers to Northern Ireland, but that the range of possible costs is vast. They would depend on factors including diplomatic negotiations, policy decisions and economic growth, none of which can be confidently predicted.

The major new element highlighted in the IIEA paper is the enormous cost of levelling up pensions, social welfare payments and public sector pay. I find it hard to imagine that a situation in which a clerical officer in Newry would be paid markedly less than their counterpart in Dundalk, or an unemployed person in Coleraine far less than someone in Clonakilty, would be politically sustainable for long, even if the case for a slow transition is strong.

However, apart from the financial implications for the Irish exchequer, such a change would surely cause huge difficulties for the private sector in the North.

While I agree with most of what Bobby McDonagh says, I would query any expectation of really substantial EU support. The current, very welcome, EU contribution to the Peace Plus programme averages out at about €35 million a year. Germany paid in full for its unification, and may ask why one of the richest countries in Europe should not do the same. Again, US support for peace in Northern Ireland has been valuable, but the absence of any sustained boost to the Northern economy after the 1998 Belfast Agreement raises questions about a foreign investment-led post-unity boom.

I agree that while practical issues will be important in any referendum, questions of identity and allegiance will probably dominate – but this may not be true of middle-ground swing voters in the North.

One final point: most of the debate on the impact of unity assumes that the Northern economy will remain weak, and the Southern one strong. The former seems likely, unfortunately. As for the latter, past experience points to the need for some caution.

These are just a few of the issues on which I am sure the Arins project will continue to promote research and debate. – Yours, etc,

RORY MONTGOMERY,

(Member of the Arins Steering Group),

Blackrock,

Co Dublin.