Further memorandum by the Northern Ireland
Economic Council
HOW ARE COMMUNITY DIFFERENTIALS TO BE MEASURED?
A central plank in Peter Brooke's TSN statement
concerned the issue of reducing community differentials. This
raises the seemingly innocuous issue of how these are to be measured.
In the case of unemployment rates—often considered central
to TSN—is it the percentage point difference between
Catholics and Protestants (e.g., 20 per cent10 per cent = 10
per cent) or the ratio of rates (e.g., 20 per cent/10 per
cent = 2)? If defined in terms of percentage point difference
then, other things being equal, policy could be religionblind
and reduce differentials (Policy 1 in Box 2). The ratio of the
rates would, however, remain unchanged at 2 (i.e., 10/5 = 2).
If, on the other hand, by community differential is meant the
ratio, then Government would have to skew resources disproportionately
towards Catholics (Policy 2 in Box 2). This implies, other things
being equal, that Catholics, in similar circumstances to Protestants,
would be treated more favourably. Thus, defining the differential
will have important policy implications.
BOX 2
Reducing Community Differentials. The Case of
Unemployment. An Illustrative Example.
Initial state
   
  

 Unemployment
number
 Employment
number  Unemployment rate percentage

  

Catholic  60,000  240,000
 20 
Protestant  30,000  270,000
 10 
  

  

Policy intervention
Create/assist 45,000 unemployed persons into employment.
Assumptions
— Inactivity, migration remain unchanged.
— No new entrants to labour force.
— No displacement of employed by unemployed moving
into employment.
Policy 1: Religionblind^{1
}30,000 places to Catholic unemployed; 15,000 places to Protestant unemployed

  

 Unemployment
number
 Employment
number  Unemployment rate
percentage

  

Catholic  30,000  270,000
 10 
Protestant  15,000  285,000
 5 
  

Note: Differential (compared to initial state); Percentage Point 10 ‹ 5; Ratio 2 ‹ 2.
^{1} The probability of being selected is the same for all the unemployed, irrespective of religion. In the example the probability is 0.5 or a half (i.e., for Catholics 30,000/60,000; for Protestants 15,000/30,000.
Source: NIEC.

Policy 2: Targeted towards Catholic unemployed^{1
}35,000 places to Catholic unemployed; 10,000 places to Protestant unemployed

  

 Unemployment
number
 Employment
number  Unemployment rate
percentage

  

Catholic  25,000  275,000
 8.3 
Protestant  20,000  280,000
 6.7 
  

Note: Differential (compared to initial state); Percentage Point 10 ‹ 1.6; Ratio 2 ‹ 1.2.
^{1} The probability of being selected is higher for Catholics than Protestants. In the example, the probability for Catholics is 0.58 (i.e., 35,000/60,000; for Protestants 0.33 (i.e., 10,000/30,000).
Source: NIEC.

