The Cabinet will today attempt to finalise agreement on a new regional division of the State for EU funding purposes. The issue retains the potential to cause bitter division among delegates at the forthcoming Fianna Fail Ardfheis.
Controversially, Clare and Kerry are now expected to be included among the poorest region in the plan to divide the State for the application to Brussels for future EU structural funds.
This follows vigorous lobbying by the TD for Kerry South, Mr Jackie Healy-Rae, one of the Independents on whom the minority Government is dependent. ail. The Minister for Justice, Mr O'Donoghue, Fianna Fail's TD in the constituency, also lobbied hard for the inclusion of Kerry. The addition of Clare was strongly urged by the Minister for Arts, Culture, Gaeltacht and the Islands, Ms de Valera.
The parliamentary party has already hotly debated the issue, with Deputies and Senators outside the proposed Objective One region demanding that disadvantaged black-spots in their constituencies be looked after as EU funding tapers off.
As officials in the Department of Finance worked on options open to the Government, the Tanaiste, Ms Harney, said in Brussels that the Cabinet would seriously consider the case for including Clare and Kerry with the 13 other counties being considered for Objective One status.
Strongly supporting the case for regionalisation, Ms Harney said it would allow the State to give up to double the level of industrial aid to the designated counties.
Amid intensive lobbying from the west in particular, the Cabinet has been considering the issue of including the Border, west and midland counties in the application for Objective One status for several weeks. The much-anticipated decision is finally due today, as the application must be lodged by the end of the month.
In order to qualify for Objective One status a region must have a per-capita income in GDP terms below 75 per cent of the EU average. The State as a whole no longer qualifies for Objective One status as its overall GDP figure exceeds the 75 per cent threshold. As a result, the Government insists that splitting the State into two regions - Objective One and Objective One in transition - would yield the maximum funding from Europe.
The Objective One region would also potentially qualify for structural fund transition arrangements after 2006.
Government sources last night said that if the Cabinet decided to include Kerry and Clare, they would be encompassed in the west region in spite of European regulations that the counties must be "contiguous", or adjoining, in order to qualify for Objective One funding.
In addition to finalising which counties should be included in the application, the Cabinet will also consider how regional structures should be organised to deal with the structural funding.
Government sources said the existing eight Regional Authorities would remain in place but that further discussions were required with the European Commission before precise structures were devised.
During last week's debate on regionalisation, the Minister for Finance, Mr McCreevy, said consideration could be given to including some adjoining counties in the new region with Objective One status. He did not, however, indicate which counties might be considered.
He has assured sceptics of the proposed reclassification that the rest of the State would not be treated less favourably. He is expected to bring forward a package of proposals for disadvantaged areas in order to allay the protests of backbenchers.
Motions on regionalisation were tabled for Fianna Fail's 63rd Ardfheis at the RDS at the weekend. One composite motion on the clar from Sligo-Leitrim calls on the ardfheis to resolve that the concept of regionalisation for receipt of EU funds be "promoted vigorously". There are no motions condemning a regionalisation policy.