For over two decades Irish motorists bumping past traffic cones and over loose chippings have witnessed the effects of the European Regional Development Fund (ERDF). Large road signs bearing the ring-of-stars logo have stood prominently beside major roadworks throughout the State pronouncing that this EU fund has co-financed bypasses, road-widening and motorway construction projects.
The ERDF is by far the largest of the EU's Structural Funds, representing almost half of the Structural Fund budget. It accounted for some 16 per cent of Ireland's receipts from the EU last year.
The fund, one of the four EU structural funds, was set up in 1975 to finance regional development programmes aimed at the most disadvantaged regions.
Ireland has benefited particularly from this fund, as the whole State, and not just 13 counties, was classified as an Objective One region: one whose development was lagging behind the rest of the EU. To qualify for this Objective One status, Gross Domestic Product (GDP) per capita in the region must be less than 75 per cent of the EU average, or there must be other special reasons for inclusion.
The money that flowed in under the fund financed everything from road and rail links to tourism projects, industrial research and development, education and health. ERDF money is aimed at supporting small and medium-sized enterprises, promoting productive investment, improving infrastructure, and furthering local development. The ultimate aim of the ERDF is to create jobs through fostering competitive and sustainable development.
The motive for the transfer of funds to poorer EU regions is not charity but hard-headed self-interest on the part of the richer states. "Under-performance in weaker regions leads to a fall in consumer demand for European products, hinders economic development, distorts competition in the Single Market and ultimately reduces the EU's competitiveness on the global market," according to the European Commission's Structural Funds mission statement.
The single largest area of expenditure in Ireland from the Regional Fund is transport. Over £650 billion from the fund was earmarked for this in the 1994-99 period. This money went on the so-called Trans European Networks (TENS) - part of a planned pan-European network of top-quality roads - and on other primary and secondary road improvement projects.
The fund also aided the upgrading of the Dublin-Belfast railway line, a project to which the EU Cohesion Fund contributed as well. And it has funded improvements to airports and seaports.
For industrial development it has provided seed capital and other supports, such as grants for research and development, human resource development, and marketing and promotion.
The 1994-99 ERDF programme has funded continuing education and staff training projects in all industrial sectors and areas of the State. It has also aided buildings and extensions at Trinity College Dublin, University College Dublin, the University of Limerick and the Institutes of Technology in Dublin, Cork, Limerick, Athlone and Letterkenny.
Environmental services paid for through the ERDF include water supply, sewage treatment, hazardous waste management, waste recycling and coastal protection schemes.
Tourism projects have included the funding of small theatres, galleries and arts centres throughout the State, the upgrading of national monuments and historic properties, waterways, parks and nature reserves, the development of tourist offices and visitor centres.
The bad news is that for at least part of the State, the level of funding from the ERDF is to be reduced over the next seven years. Because the Government succeeded in convincing Eurostat, the EU's statistical agency, that Ireland's 13 western, Border and midlands counties fell below the EU's 75 per cent average threshold, this region will retain Objective One status and will therefore continue to qualify for maximum European and State funding.
However, by the year 2007 it is highly unlikely that any part of the State will be able to rely on the ERDF. The Government - facing a budget surplus this year greater than £1 billion - will be expected to pay for its own infrastructural developments.