many European universities are already moving their schemes to Irish universities in response
British universities have spent the last three years making sure that their partnerships with European universities are sound. And continental European unis have partnerships with the UK and Ireland, it's not an either/or.
You don't need Erasmus to study overseas, though it is clearly very nice to get the money.
I really hope the British government sees the value of the scheme, but according to the article in the Times today, they think its a middle class perk. (Apparently, their new voters in the north don't go to university).