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Extra fiscal controls could be way forward

John Wilson Foster talks about the deep disconnect in Northern Ireland that exists between politics and the people, suggesting that it is the citizens ourselves who perpetuate this unhealthy separation (Opinion, March 21).

However, he is too eager to let our politicians off the hook, as it is only they who can change the systems and practices that encourages such a detachment.

If he is correct that a fault-line runs through our public societal collective, then these negative disincentives need to be reversed and what better place to look for a solution than to our financial and governance systems.

Now that Gordon Brown has reignited the interesting proposal for a more federal system within the UK, where the devolved administrations take control over the majority of their taxation, welfare and other powers, can we consider whether the provision of the Northern Ireland block grant reinforces the sense of inertia and division here?

Historically, neither side has had an interest in reforming the block grant, as one side sees it as a source of control and repression and the other as a buttress to the arguments against Irish unity. But Scotland shows that greater financial devolution can encourage legislation that boosts economic activity and creates common purpose.

If greater fiscal autonomy was to be implemented here, a tapering system is required, where the grant is only reduced on a year-by-year basis, based on actual tax receipts from the previous year, thus protecting NI from the worst financial risks and easing the discomfort of all sides and the groups or communities they currently represent.

The potential gains of greater fiscal autonomy are increased prosperity and productivity, but it would largely have a neutral impact on the question of Irish unity, as one side may see it as a means of bringing more powers back to this island, while the other a way of protecting against the inevitable instability, or reduction in the block grant following Brexit that could potentially weaken the financial argument for the Union.

But the real beneficiary would be our collective society - bringing people and policy closer together (for once).


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