Sinn Fein disputes claim united Ireland would cost 20 billion euro over 20 years

Sinn Fein has disputed the methodology of a report which suggested that a united Ireland would cost the Republic 20 billion euros for the next 20 years.

The report, from the Institute of International and European Affairs (IIEA), revealed that the reunification of Northern Ireland and the Republic would require an increase in taxation and a significant reduction in public expenditure.

Irish Minister for Finance Michael McGrath said that Northern Ireland has an opportunity to progress at the moment that “will change the numbers quite fundamentally”.

The report was authored by the IIEA’s John FitzGerald of Trinity College Dublin and Prof Edgar Morgenroth of Dublin City University.

The report said the cost to the British Government of running Northern Ireland amounts to 12.3 billion euros a year.

The costs are based on pre-pandemic 2019 figures.

The report stated that the unification costs minus the UK treasury subvention would run to around 11 billion euros.

But this figure would rise to 20 billion euros when other factors, including social welfare and public service pay, are included.

This would require an increase in taxation and a significant reduction in public expenditure.

Mr McGrath said there had been several reports on the estimated cost of a united Ireland that had come up with “quite a wide variation” of numbers, and that it “all depends on the assumptions that you make”.

He said: “The important thing is that the economy of Northern Ireland now has a fantastic opportunity to progress and to really become a strong enterprise-based economy. And, of course, that will change the numbers quite fundamentally over the years ahead and having good governance with the institutions up and running, with the two governments co-operating with the special envoy from the United States, all of that provides stability and certainty which will help the economy in Northern Ireland and help the all-Ireland economy, which, of course, is underpinned by the Shared Island project to develop and grow and flourish over the years ahead.

“That, actually, I think over time would put a very different complexion on the numbers.

“But it’s not where our focus is now. The institutions are only back up and running, and we really want to see them bed down, continue with their work and the Irish Government is going to do all that we can to support the work of the First Minister, deputy First Minister and the full Executive.”

Minister for Public Expenditure Paschal Donohoe said he will consider the report, and that any future debate about a united Ireland “will have an economic dimension”.

Sinn Fein whip Padraig Mac Lochlainn said that he disputed the methodology used in the report, claiming that the analysis was static.

“You are accepting the amount of subvention on face value,” the Donegal TD added.

“Prof John Doyle of DCU in recent times has written that the actual subvention is much less.

“It’s about 2.4 billion.

“That’s a quarter when you deduct the pensions, debt repayments, contribution to the defence forces of Britain and so on.

“It’s much less than the headline figure.

“But also the report assumes there will be no economic growth in the north.

“We know that since Brexit there has been substantial growth in the all-Ireland economy.

“We know that there is a real opportunity in that thanks to the efforts of all the political parties and people on the island of Ireland.

“That means that the people of the north have access to the British economy and to the European economy uniquely, there is real opportunity for economic growth.

“I do praise them (Prof FitzGerald and Prof Morgenroth) for doing some type of research, some type of planning and analysis, which is very different to (our) own government (which) has no plan whatsoever to look at how we get to Irish unity.”

Mr Mac Lochlainn called for a Citizen’s Assembly and a White Paper from the Government about the issues arising from reunification.