Dr. Stephen Farry:

I thank the Chair, and wish a good morning to our witnesses. For the record, I speak on behalf of the Alliance Party, which does not take a position on the constitutional question. We are open-minded to this and we welcome robust debate around these financial and economic issues. It is fair to say that for the people I represent, these will be key considerations with regard to any decision-making that may come in future years.

I wish to ask questions from a number of different angles. I am very conscious of the skills issues, how they feed into productivity differences on the island and how they would be the key drivers of any productivity convergence in due course. I ask the witnesses to discuss some of the other drivers relating to productivity, around research and development and investment in infrastructure - not exclusively transport infrastructure but more broadly - and the extent to which those types of expenditures, including at a capital level, can also play into an alignment in productivity, living standards and overall levels of income and wealth.

I also want to ask about the current assessment of barriers to labour mobility on the island. There is a certain degree of movement but there are restrictions. To what extent would there be potential for gains from a more efficient labour market across the island in terms of mobility and perhaps a spatial redistribution of economic activity, potentially out of Dublin and the south west of the island?

That leads me on to the next point around the potential benefits from a single strategy in respect of inward investment. I am conscious that at the moment we have the IDA working for the Republic and Invest Northern Ireland working for Northern Ireland, but they have different tools at their disposal. The IDA is serving a nation state and the Government has full control over taxation policy, with corporation tax being one element of several in the context of investment potential. In Northern Ireland, however, we are much more dependent on grants. That means we tend towards attracting cost centres, whereas my understanding is that the Republic can attract profit centres, which can be much more lucrative. If we end up with a single entity, to what extent will evening that out have benefits overall?