IN a letter sent to the Minister for Finance, Mr Quinn, at the end of March, the EU Commissioner for Regional Affairs, Ms Monika Wulf-Mathies, said that as the Government had abolished water charges the Commission felt it appropriate to reduce the level of its co-financing of water projects.
The cut in funding from 85 per cent to 80 per cent would affect only projects which had not yet been approved. However, the move does not affect the overall commitment of EU cash to Ireland agreed at the Edinburgh summit. It is likely to be no more than a book-keeping exercise as long as Ireland has other projects in line to take up any spare cash. Indeed, the letter to Mr Quinn also points out that there are currently too many Irish projects queuing up for funding, given the cash that remains.
The Commission's rationale is straightforward: it is committed to "mainstreaming" environmental issues in all areas of spending and it has taken the view - as manifested in the latest, yet to be approved, water directive - that the provision of water free to consumers promotes waste.
Applying the "polluter pays" principle, enshrined in the Maastricht Treaty, the Commissioner feels entitled to penalise the Government.
It is not the first time Ms Wulf-Mathies has taken Ireland to task for its environmental failures. Last time it was the announcement by the Minister for the Environment, Mr Howlin, that he was pressing ahead with the Mutton Island sewage treatment plant before the environmental assessment of the project was complete. Ms Wulf-Mathies, who has had a stormy relationship with Mr Howlin, announced she would not be taken for granted and withdrew EU funding.
But the effect was the same as now: the financial envelope agreed for Ireland remains unchanged and some other project will get the money.
Spending on water and waste projects comes from Cohesion Funds which are expected to contribute up to £1.2 billion to Ireland in the 1994-1999 period and are committed to environmental and transport projects. In Ireland's case this Is largely to water and waste schemes.
The Commission has already approved some £260 million-worth of funding for 54 Cohesion projects, 51 of which are water or waste schemes. The Commissioner's decision, the Department of Finance says, is likely to result in the real-location of a maximum of £5 million to other Irish projects. The separate, but related, issue of the Commission's proposed water directive Involves an attempt by the Commissioner for the Environment, Ms Ritt Bjerregaard, to require by 2010 "full cost recovery for all costs for services provided for water users".
But governments would be allowed to distinguish between domestic users and both Industry and agriculture, and they would also be allowed to ensure "a basic level of water use for domestic purposes at an affordable price".
The proposal requires the application of some form of water charging, although not necessarily metering, but some degree of subsidisation is possible,
Mr Howlin, however, has insisted that he will fight the measure, and diplomats here believe It is unlikely that other member-states will want to force Ireland to introduce a politically controversial charge.
