MEPs push strategy for extended EU aid

THE Government should consider establishing regional structures to allow parts of Ireland to remain eligible for special EU aid, MEPs told the Minister for Finance, Mr Quinn, yesterday.

The Minister said the Government would make a case for the re- examination of aspects of the eligibility criteria for special assistance. Mr Quinn said while Ireland had done well in the last few years, the State "has and will continue to have for some time very substantial development needs".

He believed a strong case could still be made for continuing EU support into the next century. The call to establish regional structures came initially from the Munster MEP, Mr Gerry Collins, who presented a report on Ireland's use of structural funding to the European Parliament's Regional Affairs Committee.

Mr Collins said that with Ireland likely to reach 91 per cent of EU per capita Gross Domestic Product (GDP) by next year, the country as a whole would not be eligible for the "Objective 1" status for the next round of structural funding in 1999.

This status defined as those with less than 75 per cent of Union GDP per capita allows member states access to higher levels of structural funding.

Mr Quinn, responding to question from the Munster MEP, Mr Pat Cox, confirmed Ireland would make the case to its EU partners for the eligibility criteria to be based on Gross National Product (GNP) figures rather than GDP.

While for most countries GNP and GDP figures are broadly equivalent, substantial repatriation of multinational profits means that the Irish GDP is some 10 per cent higher than GNP.

He also said he hoped the criteria for funding after 1999 would include a reference to unemployment.

Reviewing the impact of structural funding on the Irish economy, Mr Quinn rejected the contention that it had been the crucial element in the growth of the economy.

Mr Quinn said. "Our performance reflects the consistent application over more than a decade of appropriate fiscal, monetary and incomes policies." In the period 1989-93 EU support boosted the GDP by only 0.5 per cent a year and was likely to contribute only some 1 per cent a year in the current 1994-99 phase, he said.

The Fianna Fail spokesman on structural funding, Mr Martin Cullen TD, said there was a strong case for reviewing the methods used by the Commission to compare the relative prosperity of different regions of Europe".

Mr Cox took issue with Mr Quinn's description of the effects of structural funding on the Irish economy as "significant but not decisive" to the current health of the economy.

Were the funding to slow down or decline, the effect could be more than just "significant", he said.

Mr Tony McKenna, vice president of the Council of the Regions, said there was a need for local and regional authorities to be more closely involved in forming plans for structural funds and their administration.

Mr McKenna's call was strongly endorsed by the Munster MEP, Mr John Cushnahan, who said the Government had failed to take account of unanimous local support for a second Waterford bridge in its application to Brussels.

The president of the Irish Farmers' Association, Mr John Donnelly, said there was a strong case for specially designated rural areas similar to designated urban areas where subsidised investment could be targeted.