In order to tackle the UKs budget defecit Chancellor George Osborne has set out a four year plan to introduce budget cuts of
£4 billion in Northern Ireland. This will significantly reduce the block grant paid by the British government to Northern Ireland which currently stands at between £9 billion to £9.5 billion.
While these cuts will lead to 30,000 public sector job losses and will undoubtably be very painful, it does bring the block grant to a more realistic and sustainable level.
The reason for such a staggering block grant is simply that the public sector in Northern Ireland is much too large (believed to be around 66%).
Every party agrees that the private sector needs to be grown and the public sector reduced accordingly. This dependence on the public sector dissuades potential investors, causing relative poverty in Northern Ireland.
Now that the public sector is to be cut, the next stage in a self sustaining Northern Ireland is to grow the private sector. This is unlikely to happen within the UK. For one thing it would necessitate a reduction in corporation tax to match the Republics 12.5%. No UK government will do this for the North of Ireland. They are more interested in what is right for South East England, and besides could you imagine the reaction in Scotland and Wales if a concession like this was given to Northern Ireland.
Senior economists predict that (at least) a massive
90,000 jobs could be created if the North was allowed to adopt the economic policies of the rest of Ireland.
With the reduction in the block grant through spending cuts and the potential to eliminate it all together with growth in the private sector through All Ireland economic policy, the claim that the Republic of Ireland could not afford Northern Ireland is turned on its head (not withstanding the current economic difficulties south of the border). Also when there is an upturn in the global economy and Irish economies, the
economic argument will further no longer wash as a valid excuse as to why there should not be a United Ireland.
