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Martin McGuinness resigns: What you need to know

An election looms in Northern Ireland as the deputy first minister quits over the Arlene Foster row.

Martin McGuinness, the deputy First Minister of Northern Ireland and peace process veteran, has resigned over the scandal engulfing Arlene Foster, the unionist First Minister.

McGuinness, who was Sinn Féin's chief negotiator in the Northern Ireland peace process, said in a letter to the Northern Ireland Assembly speaker that Foster's position "is not credible or tenable". 

He also demanded an election so that voters could "make their own judgement" on the political parties. 

Foster, from the Democratic Unionist Party, is implicated in the "cash for ash" affair, a badly-handled renewables project where public money appears to have been squandered.

McGuinness wrote that "over ten difficult and testing years" he had tried to make the power-sharing government work, but that Foster had refused to stand aside over the scandal.

He continued: "It is with deep regret and reluctance, that I am tendering my resignation as deputy First Minister with effect from 5pm on Monday, 9th January, 2017."

Sinn Féin will not be tendering another candidate for the role, which will put pressure on the government to hold an election, or place the basis of the power-sharing agreement in jeopardy.

So what does this mean for the stability of Northern Irish politics? Here are a couple of things to take into account:

"Cash for ash" is a public money scandal

Although there's nothing good about a botched energy scheme that may have cost taxpayers nearly £500m, "cash for ash" is at least fairly tame by Northern Irish standards, being a scandal that is about taxpayers, rather than sectarian violence.

The Renewable Heat Incentive scheme was designed to encourage more renewable energy use. However, a whistleblower claimed the scheme was a waste of money, with farmers being paid to heat empty sheds.

The minister in charge of the scheme was Arlene Foster, who became First Minister in January 2016. She has so far refused to resign, and has claimed that the criticism of her is misogynistic.

Some already expected Martin McGuinness to step down

McGuinness is one of the heavyweights of Northern Irish politics, having played a key role both in the peace process and in the post-Good Friday Agreement governments. McGuinness is known to be undergoing treatment for an illness, but his party has refused to give any more information about the subject. He missed a trade mission to China on "medical advice" and Sinn Féin president Gerry Adams seemed to suggest it was a challenge.

There are new pressures on the peace process

As Kevin Meagher wrote in The Staggers last week, after McGuinness and Adams step down, a new generation of republicans will have to navigate an increasingly militant fringe, plus a British Prime Minister who seems to have forgotten that abolishing the Human Rights Act would also knock away the foundations of the Good Friday Agreement. 

An election looms

McGuinness was clear in his letter that this is what he is demanding - and because of the unique power-sharing arrangements in Northern Ireland, he is likely to get it. The deputy First Minister is actually a joint office held with the First Minister, so McGuinness in theory at least is bringing Foster down with him. According to the rules: "One cannot be in position without the other."

Julia Rampen is the digital news editor of the New Statesman (previously editor of The Staggers, The New Statesman's online rolling politics blog). She has also been deputy editor at Mirror Money Online and has worked as a financial journalist for several trade magazines. 

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Forget gaining £350m a week, Brexit would cost the UK £300m a week

Figures from the government's own Office for Budget Responsibility reveal the negative economic impact Brexit would have. 

Even now, there are some who persist in claiming that Boris Johnson's use of the £350m a week figure was accurate. The UK's gross, as opposed to net EU contribution, is precisely this large, they say. Yet this ignores that Britain's annual rebate (which reduced its overall 2016 contribution to £252m a week) is not "returned" by Brussels but, rather, never leaves Britain to begin with. 

Then there is the £4.1bn that the government received from the EU in public funding, and the £1.5bn allocated directly to British organisations. Fine, the Leavers say, the latter could be better managed by the UK after Brexit (with more for the NHS and less for agriculture).

But this entire discussion ignores that EU withdrawal is set to leave the UK with less, rather than more, to spend. As Carl Emmerson, the deputy director of the Institute for Fiscal Studies, notes in a letter in today's Times: "The bigger picture is that the forecast health of the public finances was downgraded by £15bn per year - or almost £300m per week - as a direct result of the Brexit vote. Not only will we not regain control of £350m weekly as a result of Brexit, we are likely to make a net fiscal loss from it. Those are the numbers and forecasts which the government has adopted. It is perhaps surprising that members of the government are suggesting rather different figures."

The Office for Budget Responsibility forecasts, to which Emmerson refers, are shown below (the £15bn figure appearing in the 2020/21 column).

Some on the right contend that a blitz of tax cuts and deregulation following Brexit would unleash  higher growth. But aside from the deleterious economic and social consequences that could result, there is, as I noted yesterday, no majority in parliament or in the country for this course. 

George Eaton is political editor of the New Statesman.