Professor John Doyle:

That is true at one level in the sense that Northern Ireland is a radically different place than it was before the ceasefire, so all the critique of the economy is that. There has been a big increase in North-South trade. With the Brexit figures still hard to disentangle and with the Windsor Framework and others, it is somewhat a moving target. There is an improvement in North-South trade.

Going back to the discussions in the 1990s, everyone’s assumption was that the economic benefits that would flow from peace would be mostly in Northern Ireland and the Republic would gain as well because it is a small island. However, the balance would primarily be in Northern Ireland because the impact of the armed conflict was most immediate there. Dr. Bergin’s and Professor McGuinness’s research clearly shows that for Northern Ireland, the reverse has been the case. The economic growth has been primarily in the South – the growth of wages and living standards. With regard to productivity, Professor McGuinness or Dr. Bergin quoted Nobel prize-winning economist, Paul Krugman, that productivity is not everything when it comes to wage levels but it is nearly everything. We have a situation where the two economies were broadly similar at the time of the Good Friday Agreement, and now there is this 40% gap in productivity, North and South. Two thirds of that is because the Northern economy has disimproved from the point of view of the living standards. However, there is very little unemployment in Northern Ireland. Unemployment is actually a bit lower than in the Republic. It is close to zero. However, people earn low wages. Even though only 3% of people are unemployed, the latest figures show that up to 27% of the working-age population received benefits because they were earning so little that even with the low benefit levels, people needed a top-up to what they earn. Northern Ireland is fundamentally a low-wage economy.

The reason for the oversized public sector is not that there are too many public services - anyone who has tried to access the health service knows the opposite is true - but that the private sector is so weak and because of the wage levels in the private sector. With regard to economic growth, if Belfast looked like Cork and Kerry, the level of revenue available for public services would be sufficient to meet the needs and the clear deficit. There is no miracle growth pattern. We are just looking for a level of growth that would be equivalent effectively to Munster. Therefore, it is not unimaginable; rather, it is a drive away.