This morning, rather unusually, Northern Ireland topped the newslinks. The Prime Minister has had his fingers burned after an attempt to resolve the province’s latest, increasingly serious crisis of government collapsed without agreement.

Both of Ulster’s major parties, Sinn Fein and the Democratic Unionists, have criticised Cameron as has the Irish Government. By all accounts his intervention was at the very least misjudged or ill-timed, if not “ham-fisted” and “amateurish”.

Whether or not a final deal is actually possible remains to be seen – the Irish appear to believe that one might have been. But in the midst of the obloquy it is important to remember that the Prime Minister was attempting to resolve a crisis that has paralysed the province’s administration for months, and the blame rests primarily with intransigent and unrepentantly tribal local politicians.

Readers of my Wednesday column might be familiar with the detail of the problem, but it has its roots in the Coalition’s welfare reforms. Welfare is one of those areas that almost no unionist wants to devolve – all three pro-union parties stressed the importance of maintaining a common British safety net during the recent Smith Commission negotiations for Scotland, for example.

For reasons unclear, Northern Ireland has seen welfare powers passed to the Assembly and Executive – on the condition that they never use them. Instead, politicians in Stormont are supposed to match national welfare policy. Divergent welfare systems are incompatible with a common UK tax and benefit system, the logic runs, so Northern Ireland couldn’t be allowed to set its own.

Former Ulster Unionist leader, First Minister, and now Conservative peer Lord Trimble made this point when he argued that the crisis should be resolved by stripping Stormont of responsibility for welfare… in December 2013. This is a mess long in the making.

When the Coalition passed embarked on its welfare reform programme Sinn Fein, spying an opportunity to burnish their left-wing credentials and grandstand against London, blocked their ratification by Stormont. As a result the Executive is incurring punitive fines from the Treasury, necessitating deep cuts in the provincial budget… which Sinn Fein won’t agree to either.

As a result the First Minister, Democratic Unionist Peter Robinson, has called for Northern Ireland to decide if it is prepared to pay the financial price for the level of self-government it appears to demand, and as months drag past without agreement there is increased mention of the doomsday option – the suspension of the Northern Ireland Assembly and a return to direct rule.

In defence of the architects of the constitutional settlement, the general expectation was that the moderate Ulster Unionist and Social Democratic and Labour parties would remain the principal representatives of each community, and their supplanting by the hard-line DUP and Sinn Fein has been met with bemused horror in London and Dublin alike.

We should be grateful too that this crisis is financial rather than paramilitary in nature, unlike that which led Edward Heath to suspend the Parliament of Northern Ireland in 1972.

Nonetheless, Cameron’s recent embarrassment has finally turned the national spotlight on what amounts to a case study in the risks of when devolution goes wrong – seen by the Telegraph as a worrying portent for the mainland.

Northern Ireland needs reform, and whilst rescinding welfare powers seems sensible it is only treating a symptom of a deeper malaise which has no easy treatment.

David Ford, leader of the cross-community Alliance Party, broached the totemic subject of ending mandatory coalition back in the summer. This seems attractive – forcing the two camps to cooperate has not led to good government – but poses many risks.

It might energise voters but only by whipping up the genuine fear that the ‘other side’ might gain absolute control of the Executive – and with Sinn Fein or the DUP at the head of any tribal coalition. It would also drive the representatives of each community to consolidate with each other, stunting the development of pluralist politics and heralding a return to the age of the “headcount”.

The Belfast flag unrest of 2012-13, triggered when the Alliance voted with nationalist members of Belfast City Council to restrict the flying of the Union Flag on government buildings, demonstrates that there are significant elements of both communities unwilling to accept unalloyed rule, perceived or actual, by the other.

This is the dilemma posed by Northern Ireland. The British Government aims, rightly, to prevent the province slipping back into civil war. Yet also has to contend with unscrupulous politicians using the implied threat of future unrest to turn Stormont into an institutional extortion racket.

Local politicians, strikingly including the unionists, wield the risk of violence the way the SNP or Parti Quebecois wield the threat of secession – as a “knife to the throat” of central government. It will take both ingenuity and courage to disarm them.

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