In the wake of this week’s IRA decommissioning announcement, the Financial Times carries an interesting article on the economic realities driving the British Government’s approach to the peace process.
With the London government, inspired by the Treasury, pressing for Northern Ireland to start "paying its way", this could coincide with real cuts in public expenditure. The budgetary allocations for 2006-07 are set to be announced next week.
"The danger is that cutting back public expenditure, without at the same time doing something to help the private sector, could leave Northern Ireland worse off than before. The trick will be to get things moving in parallel," says Sir David Fell, head of the Northern Ireland civil service at the time of the 1998 Good Friday agreement.
Northern Ireland receives about £22bn a year to support its public services, while it raises £14bn in taxes, leaving a gap of £8bn, which is funded by central government. On a per capita basis, this is more than Scotland or Wales and 25 per cent more than Merseyside. (FT.com)
There have already been significant cuts in education in Northern Ireland, and taking control of ministries with shrinking budgets will not be an attractive prospect for local politicians, but in the long run only accountable democratic Government can deliver a sustainable economy.