Cost of a United Ireland and the GFA

No

Before any referendum on unification was put to the people the terms and conditions of what would happen if it was passed would have to be clear.

The cost of unification should not matter to people, if they really want unification they will vote for it, irregardless of the economic impact that it will bring.

It wasn't with Brexit. Lies and bluster filled the air, and the true cost was not published - nor did anyone really know what it was.

Big things like this are never typically thought through. It would be done under ideological terms only, not with rationality and careful economic thinking happening. Only AFTER the vote was done would the realities hit.

With regards pensions, the British are under no legal obligation to continue paying them. If they decide not to then we would have no choice but to pay it instead.

A lot if what you've mentioned is related to the subvention and it's true amount. The major costs come from increases in PS pay and welfare to Irish levels.

Then you have adjustments needed to keep the markets happy. Our per capita metrics are going to significantly drop due to the huge increase in population with little in the way of a revenue increase. So even if we find the cash to pay these extras we still have to reduce spending to get the per capita stuff back in line.

Our GDP is 350bn for 6m people, after unity it would be 385bn for 8m. Fitzgerald has already given research saying just the subvention at 10bn alone would require similar adjustments to the last recession.

This is a very simplistic analysis and does not take account of a number of issues.

Regarding pensions, you could make the same claim in respect of unemployment benefit or other social insurance payments as they are based on credits already acquired. The rUK taxpayer is going to pay for the rUK pensioners and unemployed. You see, what your analysis misses is that NI taxpayers are moving over, and UI tax income increases as a result. NI pensioners move over as well, and are paid out of UI taxation. There is absolutely no reason why the rUK taxpayer should pay for NI pensions out of their reduced tax income.

The cost of unification doesn't come down to a few major items, and even pensions are only a small part of the overall huge cost.

Take social welfare for example. At the moment, social welfare rates in NI (under a SF/DUP government) are far lower than in Ireland and are paid out of NI taxes plus rUK subsidy. What will happen with unification? If they are levelled upwards, they will cost more than NI taxation plus rUK subsidy. Those wishing away the rUK subsidy or pretending that the EU and the US will pick up the tab are deluding themselves. There is no doubt that, unless you want to cut social welfare rates in the South, that the cost of a united Ireland will be significantly higher than the current UK subsidy.

There's a huge issue with regards to the NI public sector as well. It's incredibly bloated at 27% of the total employee jobs in NI. This would be unsustainable in a United Ireland and would necessitate a huge number of redundancies.

This is also likely to exacerbate the inevitable unionist violence as there'll be grievances from some who lose their livelihood through the necessary streamlining as public services are amalgamated. While it's probably easy enough to calculate the additional spend that would be needed for whatever the unified Gardai / PSNI would be called, the repair bills for the impact of any bombing campaigns on public infrastructure (and the health spending for the victims of same) are understandably far more difficult to quantify.

No doubt there'll be a shinner bot along soon to link to their "Modelling Irish Unification” research paper authored by "world leading experts" which has claims of unification leading to a huge boost for the GDP of the island as a whole and which certainly reads well if you're economically illiterate or have no understanding of data modelling but which uses a lot of guesstimates as inputs to a model designed for analysing the impact of lifting trade barriers along the US / Canadian border i.e. it's garbage data fed into a data model that's a poor fit for the scenario being modelled.

I'm sure we'll see a referendum on unification in the next 20 or 30 years but I'd have no faith that it will be presented alongside any detailed plan on how the social institutions of both countries are to be merged, the costs of same and how the whole exercise is to be paid for. It's worrying tbh as I can see the Irish electorate voting for unification from a position of almost total ignorance of the economic hardships it'll bring and the lives it will destroy on both sides of the border.

Sorry,thought it was 6. The 35bn is the GDP increase after 8 years if unity was done as outlined in the SF approved Hubner Report. The GDP of NI is 54bn according to Google.

So, 350/5 becomes 404 /7 overnight and if we are lucky 439 bn after 8 years. That 70k per person before unity becomes 58k per person overnight and possibly 62k per person after 8 years if we are lucky and NI accepts the conditions set out in the Hubner report. The markets will expect adjustments to counter the dilution of the economy and that needs to be factored into the cost too.

With regards pensions, the law is it comes from current spending. If the British decide we should pay it instead of them there is nothing we can do about it. We accept it or reject unity.

Let's start with some basics. Pensions in the UK are paid out of the Social Insurance Fund. So is Jobseekers, Maternity Benefit and some other (but not all) social welfare allowances.

How do you therefore claim that pensions are different to unemployment benefit?

Now look at this link. You will see three things:

(1) There is already a separate NI Insurance Fund

(2) "The National Insurance scheme is financed on a pay as you go basis with contribution rates set at a level broadly necessary to meet the expected benefits expenditure in that year, after taking into account any other payments and receipts, and to maintain a working balance."

(3) There is a subsidy from rUK taxpayers of €500m to the NI Insurance Fund.

So, unless someone can point to some unbelievable generosity on the part of the British, it is plainly obvious that the Fund will be handed over (and it amounts to 16.7% of one years benefit) and our taxpayers will then pick up the tab.

Now it gets even better when you consider that the social insurance rate in Ireland is generally 4%, while in the UK, it is generally 12%. So that means that if we switch to UI rates, then the fund will require a subsidy of more than €500m. So even if you wish away the €500m subsidy, you need to explain how we could make up the difference of up to half the missing contributions, around €1.3bn. Alternatively, you could suggest increasing SI rates for those of us living in the South.

I have explained it as clearly as possible to you now with extensive links.

There is a separate fund for Northern Ireland, it includes more than pensions, it is funded on a pay-as-you-go basis, requiring an annual subsidy of £500m from rUK, and the reduced PRSI rates in the South will create an additional hole of £1.45 bn (I actually underestimated 50% of the cost in my previous post).

The absolute best that you could get from the UK if your pipedream came true would be a continuation of the £500m (or more particularly, around £400m which would be the subsidy of the pensions element). It still leaves you with a gap of £1.5bn or more, before we even look at the other areas of social welfare where the Irish taxpayer would have to pick up the tab.

It is even worse than that.

The pro-unity claims all sorts of optimistic nonsense for economic growth with no real solutions for the core problems in Northern Ireland (third-level education, public service too big, political division), yet when you present hard facts around costs like detailed data on social welfare rates or pension funds, they dismiss the costs either as requiring a plan or that the EU/UK/US (delete as appropriate) will be delighted to pay for it all.

Brexit gave absolute no idea of what the future would hold. No agreements or framework.Brexit voters voted for unicorns and castles in the sky.

I would vote for a UI despite being fully aware it will cause economic problems but I think long run it will work out.

I would certainly vote against reunification if it was one of those wishy washy UK referenda and not more like here where you know what you are voting for.

So you think the SF-sponsored studies are makeyuppy? Glad we agree on something.

All of the details will affect the costs though. If the NI public sector is to be kept as is, that's an extra €1bn a year the exchequer has to find, if (as would realistically be necessary) it's to be cut in half to avoid duplication of service provision and waste, there'll be an expensive redundancy package to be funded and a large increase in our social welfare bill. If the 6 counties are to keep NHS like services as part of some new "HSE-NI" political sop, there'll be costs involved with that. Even changing the flag, passports, anthem etc could cost hundreds of millions.

TBH, Northern Ireland has a lot of work to do before it can come to the negotiating table with anything other than a begging bowl and a list of crazy unionist demands.

There are so many fallacies in this post that I don't know where to start.

Firstly, did you read the article you posted? You claim that the deficit to be attributed to Ireland "would be about £1.5 billion or less than €2 billion", yet nowhere in the article is that assertion made. A number of estimates included in the article range from €5.7bn to €11.3 bn, and for the lower figure, some extremely optimistic assumptions are made. For example, it assumes that a unified Irish state would be a net beneficiary rather than net contributor to the EU, but given economic trends since 2018, this would not be the case. How you get from an out-of-date extremely optimistic scenario of €5.7 bn to €2 bn just by waving something away is completely unexplained in your post and removes all credibility from your calculations.

Secondly, you make further wild assumptions that have no foundation in reality. You say savings could be made by "moving some State administration to the NI public service". Say what? Have you never heard of the failure of decentralisation? I would really love to read your thoughts on what that would actually mean in practice as it sounds like complete fantasy. Furthermore, you talk about "fostering inward foreign investment in NI". How would you do that? FDI wants to go where there are qualified graduates. Because of the mess that is the NI education system (brilliantly overseen by SF among others), there isn't a hope that they will want to go there.

Thirdly, you then offer "sugaring the pill" through increasing social welfare. There are about 400,000 pensioners. Increasing the pension by €50 per week as you propose costs around €1 bn. Who is going to pay for that?

Fourthly, you make up some of the gap by increasing VAT and excise duties in Northern Ireland post-unity. Are you seriously suggesting that a referendum on a knife-edge in Northern Ireland will be swung towards a positive outcome for a united Ireland by promising the people of Northern Ireland that taxes will increase in a united Ireland?

Finally, you call "allocated expenses" a makey-uppy number and assume it just goes away. It requires you to assume that not only will the UK continue to pay for every pension but also that they will hand over NI without any debt.

Those are only examples of the numerous flaws in your analysis that wouldn't last five minutes in any coherent debate on the costs of a united Ireland.

To be honest, your post amounts to nothing more than wishful thinking. There is no substance, there is no logic, there is nothing backing it up. Even the article from 2018 (pre-Covid which changed an awful lot about public finances) which you quoted gave a minimum figure for what we would require to cough up of three times your figure. And all of that is before your tax increases in the North and your sugaring the pill with €1 billion of pension increases. Like did it ever occur to you that if the rUK sees an Irish government willing to pay out €1bn in pension increases that it would take a tougher negotiating position?

It's a massive assumption that the intention is to get an agreement that a United Ireland is carried. Quite frankly, there's a hell of a lot of us in the Republic who don't want it, and there are even more who don't want to spend the rest of their lives paying for it.

Your point about the NHS costing less per head is another fallacy. The NHS benefits from economies of scale in a way that even a United Ireland couldn't match. Ever wonder how Tesco are able to sell OTC medication so much cheaper in the North than in the Republic (e.g. their 15p packets of paracetamol)? It's because licensing those drugs for sale in the Republic isn't worth it: the market is simply too small to justify the pharmaceutical company's time and costs to do so. Now multiply that effect throughout the entire supply chain for the NHS, from drugs to equipment to software. The cost of Healthcare provision will increase dramatically in the six counties post any unification and that's before we even get to the subject of unifying service levels (free GPs/Dental etc.).

No matter how well the negotiations go, make no mistake that there'll be a need for a unification tax of some form, we'll almost certainly have to endure decades of unionist paramilitary violence, any increase in FDI in NI will take decades to get off the ground (arguably an entire generation since it'll be a *minimum* of a full education cycle - infants to graduate - before the NI education system could be in a position to produce an equivalently educated population).

"The Passports are already in place" - really? There's no such thing as a passport for a United Ireland and you can be sure the Unionist Community will object strongly to a United Ireland still being called the Republic of Ireland so, yes, passports, driving licenses, virtually every piece of the state will need to be renamed, rebranded and re-printed. If you recall that it cost Aer Lingus over €8m just to tilt their shamrock logo in a rebrand in the mid 90's, it's safe to say we'll be talking billions to do any such rebrand (never mind the entire cost of the necessary restructures). Unionists are not going to buy into a United Ireland that simply sees them being subsumed into the existing Republic of Ireland with the same flag, anthem and name. A unified Ireland would have to be a new nation.

On the public sector - Northern Ireland's PS is vastly bloated. In part this is down to some of their functions operating for the entire UK. These positions will be obviously redundant. And many more redundancies would have to follow unless the public are prepared to accept an even more inefficient public sector than we already have. A United Ireland wouldn't need two Departments for the Economy, two Departments of Agriculture, Environment and Rural Affairs, two Departments of Education etc. etc. etc. and in any merger of such departments there simply won't be any need for the entire staff of both departments to remain - yes, the front-line staff would likely be safe but the entire administrative and management functions would need to be restructured and streamlined.

And finally, on your last point (which I tend to agree with), historically Unionist politicians have never stayed bought for long. They make Danny Healy Rae look positively statesmanlike and many of their Republican counterparts aren't much better. Their inclusion in Dáil Eireann (or whatever the new Parliament for a United Ireland is to be re-named as), is not a bridge to be crossed when we come to it. It's something that will require extremely careful consideration and planning far in advance of any proposed unification if we want to avoid a scenario where the entire island ends up running without a government for years on end.

For the bail outs and never ending costs of the NCH, cost was just something we had to take on.

Yes- and even by conservative estimates a united ireland would be equivalent to funding a NCH every year, possibly two. That will be funded by tax increases or spending cuts most likely. The difference is we get to have a say in this.

It would be an easier sell if it was some once off cost or a time limited cost but there doesn't seem to be any economic benefits for the island as a whole

If bean counters like you held sway we'd still be a pathetic rump province of little England.