Ulster University’s Strategic Policy Unit (SPU) has published Unlocking NI’s Potential: A Framework for Economic Transformation, a comprehensive new blueprint designed to support a more prosperous, sustainable and inclusive future for Northern Ireland.
As the region approaches its next electoral cycle, SPU presents this framework as a mechanism for policymakers, political parties, businesses and civic society to engage with to drive economic renewal and a longer-term vision for the region’s future – one that will last beyond the next Programme for Government.
The economic transformation framework contains 33 recommendations spanning public sector transformation, productivity enhancement, private sector growth and future-focused policymaking.
The Strategic Policy Unit, an Ulster University think-tank that undertakes policy analysis for the greater good of Northern Ireland, publishes this work in the context of the current absence of an overarching framework to connect issues such as infrastructure deficits, economic inactivity, energy sustainability, productivity and pressure on public services and finances – all of which are inter-related and fundamental to economic transformation.
The framework draws out these policy linkages, as well as the foundations upon which progress in these areas relies; namely trust, confidence and stability.
It sets out four critical pillars for transformation:
- Public Sector Reform
- Productivity
- Private Sector Growth
- Future Foresight
At the heart of the framework is a crucial proposition: sustainable, inclusive economic growth and improved productivity are not distinct from social progress and citizen wellbeing, but in fact are key enablers of this – and should be treated as such by policymakers.
Governments’ capacity to support vulnerable households, provide social housing, tackle poverty and inequality, and invest in the future all depends on the strength of its underlying economy and associated health of its public finances.
Professor Jodie Carson, Professor of Strategic Policy in Practice & Co-Director of the Strategic Policy Unit said:
“The events of recent weeks have served as a painful reminder of the fragility of any society and the importance of peaceful and stable institutions, first and foremost for the wellbeing of people, but also for our economy.
SPU’s framework for economic transformation has been developed to draw out policy linkages that are often overlooked, to enable a more cohesive and future-proofed approach to policymaking in NI. It is centred around driving sustainable economic growth and productivity gains, as a mechanism to deliver wider social and environmental outcomes.”
A central feature of the report is future foresight, a perspective which the SPU believes is largely remiss from the policy discourse in NI. The report contends that insufficient attention is being given to future risks, such as climate change, demographic change, technological disruption, energy security and the long-term costs of policy inaction.
Professor Carson added:
“Future-orientated thinking has been crowded out by the imminency of other pressures and is relatively absent from policymaking in Northern Ireland. There is a need for a fundamentally different approach that looks beyond immediate electoral cycles and enables government to anticipate, rather than simply react to, emerging challenges.
For example, energy affordability and sustainability – often treated as an issue for another day – is a very real threat facing households, businesses and indeed governments, today. This has the potential to derail progress on a wide range of social, economic and environmental objectives.
SPU has therefore identified a dedicated Future Foresight pillar and recommends that the Executive consider creating an NI Future Foresight Unit, acknowledge the costs associated with policy inaction and adopt green budgeting approaches and the greater use of behavioural science to develop future resilience.
The SPU Framework for Economic Transformation also proposes specific reform to the incentive structures and accountability mechanisms facing the NI Executive to encourage more sustainable decision-making.
The report highlights that as it stands, the NI Executive currently reaps no fiscal benefits for driving economic growth or reducing welfare expenditure, as any associated proceeds accrue directly to the UK Treasury. Furthermore, recent Treasury bailouts, whereby Executive overspends have fallen to the UK Government to absorb, have created a risk asymmetry within NI public finances known as moral hazard with implications for future behaviour. This has inadvertently altered incentive and accountability structures facing the NI Executive.
The report calls upon UK Treasury to acknowledge and address this issue of incentivisation and accountability. It suggests that the development of new mechanisms that would allow Northern Ireland to retain a share of additional revenues generated through economic growth and productivity gains could provide a collective financial incentive for all Executive Ministers and apply a new lens to decision-making.
Further, it argues that any additional funding provided by Treasury should be highly conditional to drive better outcomes, for example via an Enhanced Transformation Fund.
Professor Stephen Farry, Professor of Strategic Policy in Practice & Co-Director of the Strategic Policy Unit, commented:
“There is a growing appetite for revised thinking about how Northern Ireland does business. A prosperous, sustainable and inclusive Northern Ireland is a realistic aspiration; however, it will require more strategic thinking across inter-related policy areas. As attention increasingly turns towards the 2027 Assembly Election and the next Programme for Government, we believe there is an opportunity to move beyond short-term debates and consider a more ambitious and strategic vision for the future. Our hope is that this framework contributes to that conversation and provides a basis for renewed thinking.”
Find out more by reading the full Unlocking NI’s Potential: A Framework for Economic Transformationreport.