Retirement provision in a united Ireland: redux – Slugger O’Toole


Last week I wrote an article suggesting that in the event of a united Ireland, the British government would propose that the future Irish government take responsibility for paying state pensions from the former Northern Ireland, on the grounds that it would already benefit from the historic advantages of pension contributions which were invested in it in the form of public expenditure. The article noted that this was the proposed arrangement in the event of Scottish independence (see page 139).

This drew quite a bit of criticism in the comment section. In some cases, my argument may not have been clear; in other cases, some people seemed to misunderstand the point being raised or some of the realities of the UK welfare system.

I have not seen a single comment supporting Irish unity while accepting the possibility that a united Ireland could be expensive. This suggests to me that, five years after the Brexit referendum, Irish nationalism has still not made a serious effort to debate the cost of reunification.

Moreover, almost all of the reviews of my paper ignored or dismissed the precedent set in Scotland. Any argument that the Irish government’s idea of ​​covering historic pensions is unrealistic or unworkable must be answered by the fact that the Scottish government has offered to adapt exactly that approach and the SNP has made it a selling point of independence.

I’ve paraphrased some of the typical reviews below, along with my responses in each case.

1. They can’t just take away our pensions and leave retirees destitute.

I did not argue that anyone would take away pensions or leave pensioners destitute.

I argued that the Irish government would take responsibility for covering the costs of paying pensions. Irish welfare state rights, including pensions, would be extended to the whole island.

2. I have paid national insurance for 50 years. The British government must pay what it owes.

The British government has already paid what it owes. The money paid in national insurance contributions was spent at the same time as it was collected – for public services, infrastructure and the social protection system in force at the time. For at least 50 years, if not more, the British government has spent more money in Northern Ireland than it has collected in taxes.

3. But I don’t like the way the UK government has spent the money. I want them to pay for the pensions.

It’s like asking someone to undo a cake. The money has already been spent and Northern Ireland has already benefited. Had the money not been spent and instead kept aside in a jar somewhere, it would either result in a higher share of the national debt in Northern Ireland or in public services not being provided , unbuilt roads or hospitals, etc.

4. If I had known that my national insurance contributions would not be used to finance a pension, I would have refused to pay

If you had refused to pay your national insurance contributions, you would have been fined and/or imprisoned.

5. I have paid tax/national insurance in England all my life, but now live in NI. It proves that your idea can’t work.

First of all, it’s not my idea – it was agreed between the Scottish and British governments in the case of Scottish independence.

The reunification treaty between the Irish and British governments should provide for these different scenarios. The base case, however, is of citizens entitled to Irish citizenship who have paid the majority of their National Insurance contributions within NI.

6. The Scottish precedent does not apply as this was only an informal agreement and the Scottish Government is not sovereign.

There is no reason to believe that the agreement between the British and Scottish governments regarding independence would not have formed the basis of a future treaty, especially since it would have been de facto approved during the independence referendum.

Unless there was an armed insurrection or UDI leading to a vote at the UN, there was and is no way for the UK to negotiate the terms of independence Scottish with a sovereign Scottish government, since the sovereign state will only exist after independence has taken on legal value. effect.

7. The current SNP does not accept the Scottish precedent and intends to renegotiate it.

Perhaps. But it seems unlikely that the British government will change its position.

8. The UK government is responsible for paying pensions under UK law.

Parliament can amend any law at any time. As far as public pensions are concerned, it has done so on many occasions, by reducing payments to pensioners or by modifying the rights of pensioners. It has done so in recent years by raising the retirement age in general, especially for women over 60. A few years ago, they abolished the double pension system and replaced it with a single system. They also recently broke the triple lock guarantee that ties pension payments to inflation. There is no legal or contractual remedy to any of this.

If a border ballot is passed, the UK and Irish governments will draft a treaty which will deal with all these issues, including the responsibility to cover state pensions. When the treaty is agreed, both parliaments will ratify it and enact legislation to give effect to it, which will include amendments to any existing legislation. Thus, existing UK legislation will no longer apply.

9. You are clearly wrong: the UK had to roll back and pay its pensions when it left the EU.

The pension contributions referred to in the EU withdrawal agreement cover pension liabilities as an employer, not pension liabilities under a social protection system. Public sector employer pensions are contractual obligations. My original article didn’t address this (although, especially given the size of the public sector in NI, it’s an area that needs serious attention).

Those who use this argument seem to suggest that a smaller organization leaving a larger one must continue to contribute to some costs incurred by the larger organization before the departure of the first. In our context, this effectively amounts to arguing that in a united Ireland, Northern Ireland must continue to contribute to the United Kingdom so that it can fund Northern Irish pensions. I doubt this is acceptable to northern nationalists (or anyone else).

10. The British government is desperate to get rid of us. They will happily pay just to offload us.

People have a right to believe that if they want to, but there’s simply no evidence to back up the claim that the UK government is planning to unload Northern Ireland, let alone evidence that he is willing to make huge financial concessions to do so.

The UK government has a responsibility to protect its own taxpayers and will be particularly careful not to set precedents which could be exploited by other parts of the UK considering secession, or in other international scenarios.

11. US and EU will make UK pay the fee.

There is no reason to believe that the Americans or the EU will attempt to interfere in what is a bilateral issue between the UK and Ireland in a way that effectively involves forcing the UK to dip into his own pocket to pay for something he needs to claim he has already paid.

12. The Americans and the EU will give us money to cover any shortfall.

Ireland is today a rich and stable country, which succeeds in attracting foreign investment. In a world ravaged by poverty, famine and war, it is incoherent that he should expect cash grants from other countries in order to implement self-imposed constitutional change.

It is also important to point out that Ireland is a country that markets itself, in part, as a tax haven. I have no doubt that there will be goodwill in the western world towards the reunified Irish state and that countries will want to help, but there are political limits to what this can go. The optic of sending cash grants to a tax haven that draws businesses and jobs out of those countries is not an easy sell.

13. These are just speculations. You don’t know what will happen. Everything is to be negotiated.

It goes without saying that any article written about future events is speculation by definition.

And yes, everything is indeed to be negotiated. The British government could, for example, agree to offer a Ferrari to everyone in Ireland. But in practice I think it makes sense to talk about what is realistic, and that means understanding that the UK government will have to strike a balance between ensuring that constitutional change in Ireland leads to a stable outcome, while protecting itself as well as its own taxpayers.

14. You’re just a trade unionist talking about a united Ireland.

Ad hominem criticisms of this kind are not really worth hearing, but no, I am not a trade unionist. Maintaining the British union is not something that particularly interests me. However, a serious conversation about Irish unity must incorporate careful consideration of what it will cost and how it will be implemented. So far, the necessary degree of seriousness has been conspicuously absent.

In my view, there should be no border ballot, at least until a serious plan has materialized and there is consensus on Irish nationalism, and preferably when nationalism can demonstrate that consensus has a chance of winning a majority in a referendum. The absence of serious discussions on issues such as pensions, and a variety of other things, suggests that day is further away than ever.

The author is a member of the Alliance Party, but writes in an entirely personal capacity and does not speak or represent any other person or organization


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