Economist: Any assessment of the Scotland-Northern Ireland bridge plan should not just be about feasibility but also the cost-benefit
Downing Street has said that a “range of officials” are examining the potential for a bridge linking Northern Ireland to Scotland.
In light of these indications that an official feasibility study on the possibility of a fixed link may be coming, let us consider some of the economic aspects again.
Much of the commentary — in Northern Ireland, in Scotland and internationally — around the idea of a possible bridge has (understandably) focused on the question of could it be done, the feasibility.
This is especially so in an engineering sense — the heights and numbers of supporting towers, the depth of the Beaufort Dyke and so on.
As an economist I think a bit of so-called cost-benefit analysis would be very helpful — not because it would give us a precise yes/no answer on whether the scheme should proceed, but because it can guide us to whether this is a relatively good use of money in a world where money for big projects will always be scarce.
The main (quantifiable economic) benefits of a bridge are:
• a boost to Northern Ireland to Great Britain and GB-NI trade as transport costs would come down
• the value of time saved (comparing a 2.5 hour ferry journey to a one hour bridge crossing), and
• increased interaction between businesses in, say, Belfast and central Scotland (agglomeration effects)
Even on the most optimistic of assumptions, if one combines the sums of money in terms of benefits it will be less than the possible cost— £20 billion or even £30bn.
None of this says for sure ‘do not build’— and it is worth pointing out that a bridge would help the regional economy in what is one of the poorest parts of Scotland, the South West.
But it is indicative that a small amount of that project budget spent in other ways (such as investing in education and applied science) might well yield greater returns.
• Dr Esmond Birnie is senior economist at the University of Ulster