Legal concerns over benefits for Irish working in Britain

Minister for Foreign Affairs Charlie Flanagan has expressed confidence that Irish people working in Britain will not be disadvantaged by a change to the British benefits system should the UK vote to remain in European Union.

The European Commission is understood to have legal concerns about a move to ensure Irish citizens in Britain are exempted from in-work benefit restrictions.

The restrictions were among the concessions secured by Britain at an EU summit in February, and Irish officials have been working to ensure Irish citizens in Britain are not affected.

There is concern that allowing Irish workers in Britain such an exemption could be judged by Brussels to be in breach of EU law.

Mr Flanagan, who was in Belfast yesterday , said it was an “important issue” that must be resolved.

He said he had raised the matter with the British foreign secretary Philip Hammond.

“The Taoiseach has raised this issue continuously in his engagement with prime minister Cameron,” he added.

“I am confident that this issue will be addressed in a way that no Irish person will be at any disadvantage,” said Mr Flanagan.

On the June 23rd Brexit referendum, Mr Flanagan said: "My Government is clear we wish the UK and Northern Ireland to remain active and constructive members of the European Union."

Question marks

Meanwhile, British ambassador to Ireland

Dominick Chilcott

said question marks over the benefits deal are “best left” to be addressed after the referendum.

He said both the Irish and British governments are in close contact on the issue and are confident of “finding a way through”, Mr Chilcott said.

In his address to an NUIG debate yesterday on the economic and political implications of Brexit, Mr Chilcott said the “steadying effect” of EU membership on bilateral relations between the two countries needed to be recognised.

He said he would worry the two countries could “drift apart” over time.

Concerns

The future status of the Border with the North if a “leave” vote was carried was an “open question”, he said.

He said British voters had valid concerns about European legislation, the budgetary contributions to Brussels and immigration.

Opinion polls were predicting a “very close race” in the referendum, he added.

Economists were virtually unanimous in their view a "leave" vote would not pass any cost-benefit tests for Britain, Irish Fiscal Advisory Council chairman Prof John McHale said.

This would result in a “very large shock to trade and income”, he said.

Studies had shown that the EU has increased trade between it and Britain by about 75 per cent, and British trade could fall by 20 per cent if Britain exited.

He said there would be a fall in foreign direct investment (FDI) if Britain left. While a small amount of FDI might divert to Ireland, the lower FDI in Britain would lower British income and would have a strong negative effect, he said.

Referring to effects of Brexit on Ireland, the ESRI had calculated that for every 1 per cent decrease in GDP, there would be a consequent 0.3 per cent decrease in Irish GDP.