Opinion

Brian Feeney: New study shows financial benefits of a united Ireland

Brian Feeney

Brian Feeney

Historian and political commentator Brian Feeney has been a columnist with The Irish News for three decades. He is a former SDLP councillor in Belfast and co-author of the award-winning book Lost Lives

In last month's issue of ‘Irish Studies in International Affairs’ QUB’s Mike Tomlinson examines tax and welfare payments in a united Ireland.
In last month's issue of ‘Irish Studies in International Affairs’ QUB’s Mike Tomlinson examines tax and welfare payments in a united Ireland. In last month's issue of ‘Irish Studies in International Affairs’ QUB’s Mike Tomlinson examines tax and welfare payments in a united Ireland.

Writing in this paper on Monday about the conversations swirling around Irish unification, QUB Professor Colin Harvey raised three points to advance the dialogue.

His second point, the developing research on what a united Ireland might look like, is vitally important because it offers potential answers to questions people would ask before they vote in a referendum: questions about pensions, tax, health, education.

Without answers to such questions opinion polls are mainly based on sentiment. People have little or no idea what a united Ireland would look like: a unitary state, a federal state? Would a northern assembly remain? Would current MPs transfer to the Dáil? Would there be more TDs from here than MPs? And so on.

Answering the questions about tax, pensions, health and education have been made much easier in the last couple of years because, as Harvey points out, research in these areas has burgeoned with funding initiatives and research projects and more academics engaging as the discussion about inevitable referendums north and south intensifies.

For example, in May’s issue of ‘Irish Studies in International Affairs’ QUB’s Mike Tomlinson examines tax and welfare payments in a united Ireland. Needless to say his study, ‘Social Security in a Unified Ireland’, developed almost no traction in the north since the unionist electronic and print media are allergic to such considerations. For your information Tomlinson looked at the current rates of tax and welfare payments where there are yawning north-south gaps. For instance, Jobseekers Allowance here is (figures in euros) €91 a week compared to, wait for it, €208 in the south. The basic state pension here is £129.20 (January 2021 figures) compared to €248.30 in the south. You probably knew the UK has fallen to near the bottom of OECD welfare payments, but seeing the figures highlights how bad the UK is. Tomlinson calculates that, using the OECD purchasing power parity measure, the south’s pension is 1.7 times the north’s.

There are significant differences in taxation north and south with the higher rate kicking in quicker in the south.

Nevertheless, all things considered Tomlinson concludes: “Overall, most employees in the north on low and middle incomes would be better off under the south’s PAYE system.”

Tomlinson’s study has been commended by the ESRI’s Professor Seamus McGuinness who, along with Adele Bergin carried out important comparative studies in education and training in Ireland, north and south. McGuinness points out that Tomlinson shows that the post-Brexit social security treaty between the British and Irish government guarantees reciprocal social security rights. In simple terms that means Irish citizens living here benefit from social security contributions accrued working in the UK. The British continue to pay your pension, skimpy though it is.

This conclusion is also supported by Prof John Doyle of DCU in an important 2021 paper, discounting the importance of the British subvention to the north which unionists claim the Republic couldn’t afford. Doyle shows that the cost of pensions (£3.5 billion) is the most significant element in the mythical £10 billion block and the British are obliged to keep paying it. UK defence expenditure adds £1.14 billion to the subvention including per capita contribution to Trident (really) and the costs of colossal failures in Iraq and Afghanistan. That disappears in a united Ireland. After deducting various other elements irrelevant to the north Doyle concludes the remaining subvention figure is €2.8 billion easily absorbed by the south.

Ironically, perhaps the biggest long term cost has been identified by McGuinness and Bergin. That is bringing what unionists claim is the north’s ‘world-class’ education system up to modern standards. Rejecting all expert advice unionists, not only the DUP, have stuck with selection and produced a two-tier system which ejects school leavers at a far earlier age than the south. The lack of further education training and technical university education leaves the north lagging far behind the south. As Colin Harvey suggests, there’s a lot to talk about.