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UK’s £10bn subvention ‘no barrier’ to Irish unity


Professor John Doyle. Credit: Picasa

Professor John Doyle. Credit: Picasa

Professor John Doyle. Credit: Picasa

The UK Government's annual subvention payment to Northern Ireland would not be a barrier to Irish unity, a leading law professor has argued.

John Doyle said that when the likely outcomes of negotiations around Irish unity are taken into account, the new state would have to make up a deficit of around £2.4bn (€2.8bn).

Writing in the Irish Times, Professor Doyle, who is the Director of Dublin City University's Institute for International Conflict Resolution, said the deficit could be covered by a 5% growth in the economy and tax revenues, in line with projections.

Breaking down the current £10bn subvention, he said significant costs would not be carried over to a united Ireland and other costs would form part of post-referendum negotiations between the Irish and UK governments.

"Taking the latest UK published figure for the subvention of £9.4bn, and excluding UK pension liabilities, debt repayments, 80% of defence expenditure, 65% of ‘out of UK expenditure’ and £500m in underestimated tax, but erring on the side of caution, and not making any reduction for ‘accounting adjustments’ or other ‘unidentified expenditure’, leaves a remaining subvention figure of €2.8bn (£2.4bn)," he argued.

He said this could be covered by "once-off economic growth and tax revenue growth of about 5%" to cover the deficit "without disruption". "Existing models of an all-island economy predict a positive impact on growth within a range sufficient to cover this deficit,” he added.

"In the context of a united Ireland, if Northern Ireland’s economy improved so that it simply reflected average Irish economic performance, no subvention would be required."

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Professor Doyle said the subvention "does not present a significant barrier" to Irish unity.

"The economic debate on unity needs to move on to the more important questions of the policy decisions necessary to support sustainable economic growth to maximise the benefits of a larger and integrated all-island economy and to support improved public services in health, welfare, education and infrastructure," he argued.

"These will be the real issues that will shape the costs and benefits of a united Ireland and they will be central in the future referenda debates. Compared with those decisions the subvention is irrelevant."​​​​​​​​​​​​​​​​​​​​​

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