Next Monday the 8th May is the tenth anniversary of the restoration of the Northern Ireland Assembly, memorable in many people’s minds for being a beacon of what could be, as we reflect on an incredulous journey of two of the most politically, religiously, socially and culturally opposed leaders the North has ever seen.

This was the original ‘fresh start’ agreement.   The complications and distrust of the collapse of the Assembly five years earlier were to be left behind and while there were was no doubt of the immense task in hand, there was hope and expectation that something great could be achieved.

Who could have foreseen a full decade later that with both men passed, the renaissance of a future of political, social and cultural acceptance and integration would appear to be as far away as it ever had been prior to that landmark corral.  A decade on, our political representatives have not learnt the lessons of the past.

The feel good factor in Northern Ireland at that time was palpable.  The economy was booming, employment was plentiful and the housing market was buoyant.  However, just like the local political accord the foundations were built on quick sand with easy credit and over exuberant lending funding the boom with banks chasing profits and consumers believing the good times had arrived.

Nobody saw the extent of the bust coming locally, nationally or internationally.  The first trigger was on the 9th August 2007 when the French bank BNP Paribas triggered a sharp rise in the cost of credit. By the time of the collapse of the Lehman Brothers in September 2008, which nearly brought down the world’s financial system, the writing was on the wall. 

While cultural and ethnic attitudes had a significant impact on the change in world order regarding anti–globilisation, protectionism and the Brexit and Trump votes,  anti–establishment sentiment and the poverty accruing from the financial crisis was more than a contributory factor.

Locally the fallout of the property crash was economically devastating and far reaching.  And of course we still have the on–going saga of the NAMA scandal, temporarily usurped by RHI.

On a UK wide basis, to mitigate against any future repetition irrevocable changes to the financial industry was needed and followed.  The FSA was replaced by the Financial Conduct Authority (FCA) and the Prudential Regulation Authority (PRA).  The Financial Policy Committee, along with the PRA, became part of the Bank of England and was tasked with overseeing the stability of the UK financial system while the FCA would oversee the behaviour of firms within the financial markets.

There was a clear commitment that there would be accountable financial regulation and responsible lending. The robustness of those institutions are now being tested with the FPC outlining concerns regarding the level of unsecured loans, which have been rising too rapidly resulting in an uncomfortable level of household debt.  

Cheap credit has helped to drive a boom in borrowing, which worryingly saw credit card debt grow at the fastest pace in 11 years in February, to £67.3bn

The Bank of England’s survey of UK wide lenders highlighted that a net balance of 18.8% expected to tighten availability of unsecured loans to consumers, the largest number that plan to do so since the financial crisis of 2008. 

As always, timing is everything in economics.  Households are starting to feel the squeeze of rising inflation which is outstripping wage growth, all adding to the potential for a further slowdown in consumer spending which has to date staved off the cold economic winds following the Brexit vote.  Last week’s ONS report that the UK economy had grown by lower than expected at 0.3%, supports the view that there is a bumpy ride ahead and Theresa May had more than a Brexit Westminster majority on her mind when she called a snap election. Increased consumer spending, predicated against the backdrop of growing debt is not the basis for sustainable economic growth. 

The economy south of the border has seen exponential growth over the last couple of years and despite the clouds of Brexit looming there, forecasts still remain positive with a projected rise in GDP of between 3.4% and 4.2%. 

However, there is also growing concern that the housing sector in the Republic is in danger of overheating with mortgage lending governance brought in after the crash being overridden to support increased demand within the market. 

House prices have risen by 5% in the first three months of the year and are expected to rise by as much as 8% to 10% by the year end.  Simon Coveney the Housing Minister has denied that the Government’s tax break policy for first time buyers is contributing to the rises with claims the Central Bank, following Government pressure, is easing mortgage lending rules to accommodate demand.

Coveney’s assertion that there is a housing shortage in the Republic is correct but the relaxing of the rules on lending is a concerning development following the catastrophic economic implications that were a consequence of irresponsible lending by Irish banks a decade ago.

In Northern Ireland the growth in the housing sector over the last couple of years has been on a much more sustainable basis.  The Ulster University’s Quarterly House Price Index in conjunction with Progressive Building Society revealed a slowing of the local housing market in the final quarter of 2016, yet the price and volume of sales are at healthy levels with affordability an important factor.

The great British economist John Maynard Keynes said, ‘The difficulty lies not so much in developing new ideas as in escaping from old ones’. 

In the process of escaping from the mistakes of the past, whether it’s Westminster, the Dáil or the Northern Ireland Assembly it would inconceivable and certainly unforgiveable to repeat them.