ECONOMISTS are clashing over a report putting the bill of a United Ireland at €3 billion in year one.
The estimate comes in a report this week by Professor John Doyle at Dublin City University in collaboration with Ulster University.
The tab is dramatically lower than previous figures of €9billion to €20billion a year.
Prof Doyle’s lower sum is based partly on a more conservative estimate of the cost of Northern Ireland’s subvention, which he pitched at €1.5billion.
The new report suggests the cost of a United Ireland has been exaggerated partly because of how much the UK government subsidises Northern Ireland being “misinterpreted and misunderstood.”
It also maintains that not enough attention has been given to any potential growth if Northern Ireland was back in the EU.
Report author Professor Doyle, Vice President for Research in Dublin City University, insists convergence with the south would spark economic growth in the north.
He said: “With the same set of policies on education, infrastructure, tax and Foreign Direct Investment, there is no obvious reason why Northern Ireland would remain so much poorer and so much less economically productive than, for example, Munster.
“Convergence with the more productive and wealthier Southern economy will take time, but the deficit will close much more quickly.”
But Professor John FitzGerald, from the Department of Economics at Trinity College in Dublin, branded the figures in the work published by DCU around the cost of pensions as “unrealistic”.
A report he co-authored put the cost of unity at €8billion to €20billion a year.
Prof FitzGerald said his view was shared by Dr Esmond Birnie from UU and Professor Edgar Morgenroth from DCU.
‘THE NUMBERS AREN’T SENSIBLE’
He rapped: “You have three economists saying the numbers aren’t sensible.”
Dr Birnie, from UU, also told how he believes Professor Doyle is minimising the assumed financial costs of a United Ireland.
He said: “Prof Doyle, as in his 2021 ARINs article, rather optimistically assumes that the UK government would both meet all public sector pension obligations and release NI from its pro rata share of UK public debt.”
‘NOT CONVICING’
Dr Birnie described the report’s funding requirements under different future growth scenarios as “not all that convincing.”
He said: “It would be desirable if NI moved on to a higher growth path but chronic under-performance in the NI economy suggests some of these things are not easily changed.
“Major constitutional change is neither a necessary or sufficient condition of improving economic performance and this report does not provide evidence that a United Ireland per se would spur performance.”
In response, Prof Doyle said previous work on the cost of a united Ireland in Prof FitzGerald and Prof Morgenroth’s report, Northern Ireland Subvention: Possible Unification Effect, contained “errors/unreasonable assumptions”, which he replied to at length in this week’s report.
