Dáil Éireann - Volume 433 - 01 July, 1993

Adjournment Debate. - EC Structural Funds.

Proinsias De Rossa: Thank you, Sir, [930] for the opportunity to raise this important matter here today. From the very beginning the performance of the successive Governments responsible for negotiating Ireland's Structural Fund allocation under the Delors II package has been a tale of gullibility, ineptitude and downright dishonesty. It is worth briefly recapping.

The saga began in the lead-up to and at the Maastricht Summit where, allegedly to ovecome some Spanish opposition, the Taoiseach was taken aside with the other three so-called “cohesion” countries and given a peep at what Mr. Jacques Delors would be proposing in his second Community budgetary package. This was interpreted to mean that Ireland's receipts from the Structural Funds would be doubled in 1997 compared to 1992, that is, £1.8 billion compared to £0.9 billion, and that over the five year period to 1997 Ireland would receive a total of 7.8 billion ECU, that is, £6.25 billion at today's exchange rate. Thus was the £6 billion myth born, which in the following six months in the lead-up to the referendum on the Maastricht Treaty was hawked around Ireland by the four largest parties here in their campaign for a “yes” vote. At the appropriate moment the twin oracles, Delors and MacSharry, were invited over, each of whom confirmed that the £6 billion was in the pipeline, provided of course that we voted “yes” in sufficient numbers. Those of us who challenged this version were labelled unpatriotic, or worse. In the crude terms in which the “yes” campaign was conducted, a “yes” vote was worth two loaves where a “no” vote earned no bread at all.

With the referendum out of the way and a “yes” vote safely in the bag, the ground was gradually prepared for a climbdown. The Lisbon Summit failed to reach agreement on a drastically reduced version of Delors II, which left the initiative up to the UK Government, whose Edinburgh Summit was charged with reaching agreement. Here another myth was born and, apparently on the strength of a chat between two civil servants over a cup of coffee, the Taoiseach, Deputy [931] Reynolds, claimed that after a tough fight he had achieved a great victory by winning £8 billion over the seven year period 1993-1999. The political and news media establishment who had been so enthusiastic in promoting the “yes” vote in June conveniently chose not to make any unfavourable comparisons with the cast iron promises which were very much a crucial part of the “yes” campaign six months previously. Even now it is not too late to show up the difference. By the crucial year 1997 when receipts are supposed to have doubled, the Edinburgh £8 billion package will yield approximately £1.3 billion compared to £1.8 billion guaranteed during the referendum by MacSharry and Delors and 90 per cent of the Deputies in this House. It would seem that if the votes are in the bag, what is half a billion pounds per year between friends. Now even that balloon is beginning to lose air and given that it is difficult to cut the allocation to Portugal and Greece the implications for Ireland are obvious and serious.

Now as everybody starts to run for cover and shift the blame, journalists who could not previously get a quote are being briefed at the drop of a hat. One version is that it was all nailed down by the Taoiseach at Edinburgh and that it is now up to the Tánaiste, Deputy Spring, with Commissioner Flynn as his inside man, to do the easy part and bring home the money. Clearly neither the Tánaiste nor Commissioner Flynn are too happy with that scenario. Meanwhile anybody in Brussels who is prepared to listen is being assured that for six months now the Commission has been telling Irish Ministers that there never was an £8 billion deal and to scale down expectations.

It has even reached the pathetic stage where the Commissioner and Commission official responsible, are dispatched to Madrid to intercede with Felipe Gonzalez and perhaps allow a few extra pounds to be allocated to Ireland. How low can we sink?

If it was not so serious and degrading it might be funny. Our economic and fiscal policy has been made dependent [932] on receiving the £8.6 billion allegedly promised at Edinburgh. Not content with misleading, even lying to, the electorate at the time of the referendum 12 months ago, it now seems that even the inferior Edinburgh package is melting away. As usual, the price will not be paid by anybody in, or associated with, the golden circle—rather the effect will be felt in more health and social welfare cuts, and by lack of investment in education, training and the upgrading of our technological capacity on which wealth and job creation substantially depend.

It is time for the Taoiseach to come clean. We need to know exactly what undertakings were received with regard to Structural Funding at the Edinburgh Summits. We need to know what discussions took place and who was involved in those discussions which led the Taoiseach to proclaim that he had £8 billion pounds in the bag. We need to know what advice, if any, was received at that time and immediately following, from Commissioner MacSharry. It would also be useful if Mr. MacSharry would explain what caused his pre-referendum confidence to evaporate so quickly. We need to know, in view of previous experiences, why whatever assurances were received in Edinburgh were not obtained formally or at least written into the record of Commission business as the Spaniards apparently did.

We need to know what communications, if any, there have been from the Commission suggesting that the £8 billion deal proclaimed was not assured and would probably not be met. We need to know what efforts are now being made to ensure that something is rescued from this fiasco.

Finally, we need to know whether the Taoiseach, and his Ministers responsible, will take the honourable course and resign if we fail to obtain the full moneys promised at Edinburgh.

Minister of State at the Department of the Taoiseach (Mr. T. Kitt): The European Council at Edinburgh in December 1992, in its programme of future financing for the Community, not only [933] increased the amounts to be spent on Structural Actions, but also specified:

expenditure on Structural Actions should be concentrated on the least prosperous member states, outermost regions and rural areas of the Community in accordance with Article 130A of the Maastricht Treaty.

It set aside an amount of 85 billion ECUs for the four Cohesion countries, for the period 1993 to 1999. Part of this—somewhat over 15 billion ECUs—was for the new Cohesion Fund. This fund has already been put into operation, on time, by a decision taken at the General Affairs Council in March. Our share of this will amount to over £1 billion.

The Structural Funds regulations for the period after 1 January 1994 must now be settled. This debate is under way at present and as the current round of Structural Funds runs out at the end of the year the new regulations should be in place in good time before then.

In line with the undertakings which the Taoiseach received in Edinburgh, Ireland submitted, in May, detailed objective indicators to the EC Commission, justifying the maintenance of our share of the funds for the Objective 1 Regions of the four Cohesion member states. These criteria, which follow from the Edinburgh Conclusions, include not just income per head, but peripherality, unemployment and long term unemployment, migration, rural disadvantage and other factors.

The emphasis on peripherality is important. Two regions could have the same income per head, but one could for example, be more peripheral and face correspondingly greater difficulties requiring a higher level of funds.

There have of course been leaks or reports, of a selective nature in recent weeks about the views of some as to the share Ireland will actually get. These are not new. From our direct contacts with the Commission at the highest level we know that they do not represent the official Commission position.

I can assure the House that the Government is pursuing the question of [934] our share of the funds in the firmest way, to ensure that we get an outcome in line with the Edinburgh Conclusions. It is not surprising that others should put their positions too. It is for us to put our case, which we are doing, and will continue to do. I have every confidence of success.

The regulations that will be coming before the Council tomorrow deal with the implementation of the Structural Funds. They include two general regulations: the Framework Regulation and the Co-ordination Regulation, as well as separate regulations on the three funds: the Regional Fund, the Social Fund, and the Guidance part of the Agricultural Guidance and Guarantee Fund. In addition, there is a Finance Instrument on fisheries.

The Council meeting tomorrow, which will be attended by the Tánaiste and myself, will not finally adopt these regulations. When the Council completes its consideration, the European Parliament will have to examine them again before the Council finally takes the decision to adopt the legislation. The texts of the regulations contain many of the improvements foreseen by Edinburgh and by the Maastricht Treaty. Among these, I might mention that the rate of Community funding in the Cohesion countries may be increased to 80 per cent in some instances, so as to reduce the requirement for matching national funding.

In addition, the funds will be more flexible in that they will be available for a wider range of actions, in particular in the areas of training.

There are many aspects of the regulations that are still of concern to other member states, who may not yet be in a position to agree on the texts of the regulations. For example, the question of the designation of Objective 1 regions, outside the Cohesion countries, still has to be settled, as has the procedure for designating Objective 2 and 5b regions, outside Objective 1 regions.

The texts of the regulations do not set out the allocations for the various regions. However, this is such an important issue for Ireland that we would naturally insist on being satisfied with regard [935] to it before the regulations could be adopted.

The adoption of the regulations will require the agreement of Ireland. This is because the key regulation, the Framework Regulation, must be adopted by unanimous vote under Article 130D of the Treaty. The question of availing of the Luxembourg compromise to hold up agreement does not therefore arise. Ireland's vote is required to allow the regulation to be adopted.

The situation therefore is that we have a clear commitment at Edinburgh to give increased concentration of funds for structural purposes in the four Cohesion countries. The rate of increase for all of these must therefore be significantly higher than the rate of increases for regions outside these. The Copenhagen European Council confirmed that the Edinburgh principles should be respected. We are confident that we will achieve our share.

The House can be assured that the Government will continue to negotiate firmly, that all necessary steps are being taken to ensure that the negotiations are successful and that Ireland gets an allocation of £8 billion.