Fine Gael says package is worse than original Commission proposal

The EU funding package agreed yesterday was a setback for Ireland, according to the Fine Gael leader, Mr Bruton.

The Government's presentation of the deal did not include the fact that Ireland's contribution to EU funds would rise over the period to 2006 by up to £600 million a year, and this would aggravate the effect of the halving of receipts from £8 billion seven years ago to £3.4 billion now, he said.

The areas which had been left out of Objective 1 would have a special problem in that grants to industry would have to be at a maximum of 20 per cent, as against 40 per cent on parts of Europe, like eastern Germany, which were still categorised as Objective 1 regions.

Mr Bruton claimed yesterday's agreement was worse for Ireland than the original Commission proposal in two respects. The first was that the level of structural funding for the 13 counties in transition had been reduced from the original proposal, and the second that the rate of reduction in agricultural price supports was greater than was originally proposed.

However, the Labour Party leader, Mr Ruairi Quinn, said that final judgment on the compromise EU aid package should be suspended until the fine print of the deal became available.

At face value, he said, the £3.4 billion package was quite significant and was generally what Ireland had expected before the Agenda 2000 negotiations. But given the watering-down of the package secured at the Edinburgh summit in 1992 by Mr Albert Reynolds, the then Taoiseach, it would be negligent to accept the deal as over and done with, he added.

Mr Quinn said that at this point the most crucial aspect of this deal was how the money would be spent.