• Request for meeting comes as new Eurostat GDP figures show regional inequality continues to remain high in Ireland.

• The Northern and Western Region’s GDP per capita is now only 71% of the EU27 average in 2020

• The Assembly believes urgent action is needed to implement Project Ireland 2040 and address regional inequalities

The elected members of the Northern and Western Regional Assembly have called for an emergency meeting with senior government representatives to express their concern that government policy is currently not delivering for the Northern and Western Region of Ireland.

Chairperson of the Northern and Western Regional Assembly, Cllr Christy Hyland said:

“These figures show regional inequality continue to remain too high in Ireland. The matter goes beyond politics and government. The Assembly recognises that the Government has committed considerable resources to the region, but less than the east and south. We need a new approach and accelerated investment”

In this regard, the elected members of the Northern and Western Regional Assembly want to meet senior representatives of government to highlight that urgent action is needed to implement the vision and objectives of Project Ireland 2040, address regional inequalities and support balanced regional development in Ireland.

The request for this meeting comes as new Eurostat GDP figures show regional inequality in Ireland continues to remain notably high. As per the latest data, the Northern and Western Region’s GDP per capita – as a percentage of the EU27 average – was estimated to be 71% in 2020, which was down 34 percentage points on its previous peak of 105% as of 2006 and was down 17 percentage points on the region’s performance a decade ago, when the region’s GDP per capita was 88% of the EU27 average in 2010.

Revised Eurostat figures were also provided for 2019 which showed the region’s GDP per capita – as a percentage of the EU27 average – was estimated to be 67% in 2019; the first time the region’s performance dropped below 70% of the EU27 average since this timeseries data was released.

If the evaluation period for EU funding was to be applied using the last three years of data – namely 2018, 2019 and 2020 as opposed to the existing evaluation period – the Northern and Western Region would have been downgraded as a “Less Developed Region”, instead of its existing status as a “Transition Region”. In contrast, the Southern Region and the Eastern and Midland Region are classified as “More Developed Regions”, which are regions with a GDP per capita above 100% of the EU27 average during the evaluation period.

Furthermore, Eurostat have also released their latest sub-regional GDP figures, with these statistics showing the economic performance of the Border and the West relative to the EU27 average between 2000 and 2019. Notably, it was found that the Border’s GDP per capita – as a percentage of the EU27 average – was estimated to 64% in 2019, whereas the corresponding figure for the West was 69%.

Considering these trends – along with recent developments highlighted in CSO’s “County Income and Regional GDP” publication – the elected members of the Northern and Western Regional Assembly feel that an emergency meeting with senior government representatives is urgently required to tackle this growing inequality.

A detailed briefing note on regional GDP and disposable income figures can be downloaded below.

Briefing Note on Regional GDP and Disposable Income

Correction on the County Incomes and Regional GDP 2019 published by CSO on the 16^th of February 2022. According to the CSO, the GVA/GDP results reported by the CSO for the West region (2017 – 2019) have been revised upwards by between €2bn and €4bn in each of these three years.  There have also been smaller revisions to the prior years back to 2013.  In addition, the 2020 projections for the West and Midlands regions have been increased.  These revisions are largely explained by the CSO’s initial incorrect allocation to the East region of data related to large foreign-owned Multi-National Enterprises with production sites in the West region.  There have been corresponding reductions in the results for the East region with no overall change in the National GVA/GDP results. Therefore, it should be noted that the CSO GDP figures presented in this article and briefing note are outdated – since the CSO’s revision occurred after its publication – and they do not reflect the above updates from the CSO. GVA / GDP results that take into account these updates can be found in the CSO’s “County Incomes and Regional GDP” publication or on the Eurostat website

New CSO data shows regional inequality in Ireland continues to rise, with urgent action needed to support the Northern & Western Region

• New CSO figures on disposable income show rising regional inequality in Ireland.
• The gap between the Northern & Western Region* and the national average in 2020 is now estimated to be three times higher than it was a decade ago.
• Underinvestment in key infrastructure assets is likely to have contributed to rising regional inequality in Ireland.
• A policy of “Positive Discrimination” is urgently needed to close the gap and achieve balanced regional development.

New disposable income figures from the CSO show the estimated gap between the Northern & Western Region of Ireland and the national average has increased to €3,237 per person in 2020, which was three times higher than the corresponding gap in 2010 – when it was only €1,136 – and the gap in 2000, when it was on €1,307

Notably, the gap between the Northern & Western Region of Ireland and the national average has progressively risen over the past decade, with the Northern & Western Region underperforming in terms of disposable income growth in 8 of the last 10 years.

The latest increase in regional inequality can be credited to the fact that disposable income in the Northern & Western Region of Ireland is estimated to have increased by 6.3% or €1,204 per person in 2020, which was less than the national growth rate of 7.2% or €1,583.

Such trends worsen when this new CSO data is examined on a sub-regional level, with the estimated gap in disposable income between the Border and Dublin increasing to €8,235 per person in 2020, which was significantly higher than the same gap in 2010, when it was €3,463. Similarly, the estimated gap in disposable income between the West and Dublin increased to €6,928 per person in 2020, which was considerably higher than the same gap in 2010, when it was €2,074.

Furthermore, all eight counties based in the Northern & Western Region of Ireland recorded disposable income levels that were below the State average of €23,615 per person, with Donegal recording the lowest average disposable income in the region at an estimated €18,656 in 2020.

Rural regions such as the Northern & Western Region could be left behind unless this trend is reversed according to the Northern & Western Regional Assembly, which has analysed the newly released data and believe a step change is needed to close the gap and deliver balanced regional development in line with Project Ireland 2040.

Commenting, John Daly, Economist of the Northern & Western Regional Assembly said:

“Underinvestment in the key infrastructure assets of the Northern & Western Region is likely to have contributed to rising regional inequalities. Over the past decade, the region has experienced long-term underinvestment in national roads, third-level education, further education and research infrastructure; with such infrastructure key to growing a region’s economy and disposable income levels. For example, the Higher Education Institutes based in the Northern & Western Region – on average – received capital funding of €316 per undergraduate enrolled between 2010 and 2020 – which was below the corresponding national figure of €375 – while such capital investment was below the State average in 8 out of the last 11 inclusive years**.

Investment in Higher Education is central to growing productivity levels, export capabilities, private investment and creating high value jobs; and if struggling regional economies – such as the Northern & Western Region – are receiving below average investment from central government, then such underinvestment is likely to be a key factor behind the rise in regional inequalities in Ireland. Such trends further reinforce the need to provide additional funding to grow and expand the forthcoming Atlantic Technological University – along with other education bodies in the region – as they are vital to improving the region’s economy and reducing regional disparities.”

 David Minton, Director of the Northern & Western Regional Assembly, said:

“Considering the performance of the Northern & Western Region’s economy in recent years, such results are unsurprising. The European Commission has already downgraded the region from a “More Developed Region” to a “Transition Region” – the only region in Ireland to hold such a status – while the Northern & Western Region is now the only region in Ireland to be classified by the European Commission as a “Moderate Innovator”.

To overcome these challenges and reduce regional inequality, it is clear that a policy of “Positive Discrimination” needs to be urgently adopted towards the Northern & Western Region of Ireland. In this regard, “Positive Discrimination” would involve a higher rate of investment – per head of population – being provided to the Northern & Western Region in order to stimulate the region’s economy, improve the region’s skills base, enhance the region’s innovation and research capabilities and deliver the vision and objectives of Project Ireland 2040.    

Failure to do so could further intensify rising regional inequalities, weaken social cohesion and undermine the delivery of key national policies such as the Programme for Government, Project Ireland 2040, the Climate Action Plan and Housing for All.”

* The region consists of Galway, Mayo, Roscommon, Sligo, Leitrim, Donegal, Monaghan and Cavan

** Download Pre-Budget Submission 2022