Dáil Éireann debate -
Wednesday, 18 Jun 1975

Vol. 282 No. 5

Private Members' Business. - EEC Regional Fund: Motion (Resumed).

Debate resumed on the following motion:

That Dáil Éireann deplores the Government's expressed intention of using the EEC Regional Fund to recoup past expenditure to the Exchequer and demands that the Fund be used to finance a special regional development programme in the less-developed parts of the country.

—(Deputy Colley.)

Mr. S. Flanagan

I had virtually finished yesterday evening. I was summing up by saying that there is very little evidence, in this Dublin-orientated Government, of any concern for the people in the West. In particular, the Minister for Finance has proved that he has little knowledge of the situation and has no desire, apparently, to help. I appreciate that he has serious problems on his own doorstep. This evening's paper once again gives banner headlines about the steadily deteriorating job situation in Dublin City.

Only last week similar headlines dealt with the very bleak prospects for the younger people who will emerge from school this year. I can understand why he has problems other than regional problems. Obviously he must be concerned with what is now, to him, the greatest single difficulty of all, that is, a disastrously deteriorating situation where unemployment is concerned, in Dublin. All these facts re-emphasise the necessity for preserving for us on the west coast whatever funds are now available, or may be available in the future, to provide for our existing people there and also for the younger people who are, this year and in the future, to come on the labour market.

As I said yesterday evening, this Minister in particular has not shown any appreciation, or evidence that he appreciates, the situation of the people of the West. It seems obvious that he is concerned with providing them with sops, with substitutes for work. In other words, as far as he is concerned, he is happy enough, and that would appear to be Government philosophy as well that these people, rather than being provided with work, be provided with a place in a dole queue as a substitute.

If this is the situation for older people, what will be the prospects for the younger people, for they appear to be nil? Therefore, it is essential that as a result of this debate, we in this House and the people we represent in the country areas, should extract a firm undertaking from the Government that whatever funds percolate into our economy, intended for the benefit of the western areas and the more depressed parts of the country generally, will be used for the purposes for which they are intended and in pursuance of the Directives of the EEC.

I know that Deputy Kelly as Parliamentary Secretary, with his own personal knowledge of the situation in the West, shares my desires that this development should take place in the future. I know also that he shares with all of us in the West the determination that we, as public representatives, will do everything in our power to redeem the promises we made when asking the people to vote "yes" in the referendum. As I said last night, I am sure the people understand why some of the delay took place. What they would not understand, and would never forgive, is the diversion of any funds intended to be used for regional purposes into the general Exchequer. I look forward to the undertaking asked for by Deputy Colley and sincerely hope that it will be forthcoming.

Mr. Esmonde

This debate is concerned with Regulation 724-75 of the Council of Europe, 18th March, 1975, which establishes the European Regional Development Fund. The suggestion put forward by the Opposition is that the money being made available will be used by the Government for past expenditure. This is patently not so. The Opposition may feel that way, and they may be making a case. But there are certain in-built safeguards in this regulation. What I would like to remind the House of is that this is just not a direction but a regulation, which means it has the force of law in this country, just as we pass any statute or Act in this House.

We have done a lot of work in this sphere of the EEC's activity in the Joint Committee of both Houses which deals with secondary legislation and the implications and effects of European legislation in our laws. As I understand the position, this regulation comes under Article 235 of the Treaty of Rome. In other words, it is a programme which is not provided for in so many words in the Treaty of Rome as it stands. It has to be imported to and added under Article 235.

That has now been effected after considerable difficulties, delays and virtual disappointments of the hopes of people in this country in that the amount of the fund has been so small and so short of our expectations, so short of our actual necessities, and the fund as provided at the moment is virtually a part fund, a trial period fund for three years. It is very important that we administer that fund in the best way possible to leave the door open.

Certain statements have been made in relation to this regional fund which caused me some concern. The reason is that one must bear in mind that so far as the application of the regional fund in this country is concerned, the region involved is the whole of the State. We must look on it as a fund that can be applied anywhere in the State because that is a designated area for the purposes of this fund in its application to this country.

Mr. Cunningham

Including the Department of Finance and Government Buildings.

Mr. Esmonde

Do not be irrelevant.

Mr. O'Kennedy

Did you say irreverent or irrelevant?

Mr. Esmonde

It might be irreverent. This fund is for the purposes of implementing the key article in the Treaty, which is Article 2. The task is to promote the harmonious development of economic activities. We are all aware in this House that we have an under-developed country. We have a difference in our country in relation to the other countries, because as I understand it, the fund cannot be applied in other countries for the whole of the national territory. We are the only one that has our whole national territory under the auspices of this fund. There is good reason for that because a country also badly in need of it is a certain area of Italy. Italy has a very strong industrial element, part of it, and that industrial sector can provide finance for the poorer areas. In other words, Italy has something that she can fall back on. We are not in that position. We are poor right across the board in terms of European wealth and European development. That is why it is important to bear in mind that whereas one's first inclination would be to pour all this money into the west of Ireland and into the north-western areas and exclude the others, if we do that in the next three years during this trial period, we will be making a case for the exclusion of other areas in this country. I will come to that shortly.

As I said, the purpose of this fund is to correct regional imbalances— and it gives the criterion—resulting from a preponderance of agriculture, industrial change and structural under-employment. It is also important to bear in mind when looking at this regulation that one should not confuse the situation that exists under the directive dealing with disadvantaged areas. Some of us in this House have discussed this with various officials who are aware of the ongoing situation in relation to the disadvantaged areas and also in relation to the regional fund. The criteria are somewhat different.

Mr. Colley

I am very dismayed to hear the Deputy use the phrase "ongoing situation".

Mr. Esmonde

As I read the motion, I understand the Deputies across the House are looking back into the past and making the case that all this money is being spent on some past situation. This regulation can only be utilised and availed of in relation to projects since 1st January. That is written into the regulation and it must be on the basis of proposals put up and accepted.

For fear that some people will say that I am talking nonsense or off the top of my head—it will probably be said anyway—I would refer Deputies also to Article 8 of the regulation in which there is a very strict policing of this fund so far as this or any other country is concerned. I do not know whether Deputies realise it but the Government here has to provide a quarterly statement to justify the continuation of payments from this fund for any particular project. There are other very detailed criteria that arise under Article 4, which is the main article that sets out what it can be used for. I understand that there has been quite a bit of correspondence in the public press as a result of articles written and there has been correspondence from the Minister for Finance in the matter, but what I would like to direct everybody who has been involved in this dispute or misunderstanding of the problem that arises under this regulation to is the last paragraph of Article 4 (2) (a) of the regulation. For fear that Deputies opposite may not have this Article, I quote:

The contribution from the fund thus defined made pursuant to a prior decision of the member State concerned communicated at the same time as the request for this contribution either supplements aid granted to the relevant investment by public authorities or remains credited to those authorities and considered as a partial repayment of such aid.

The regulation came in on 1st January, so we are speaking as from that date. I think there must be agreement in this House by anybody who has any legal experience of reading these documents that you are tied down to that and you are tied down to the wording of this clause. This is in large measure where the confusion has arisen.

Mr. Cunningham

You got away from the disadvantaged areas. This was becoming interesting.

Mr. Esmonde

This is a very tender spot so far as I am concerned as a representative from Wexford. There is a large area in my constituency known as the Macamores. The Macamores at the moment apparently do not qualify for the disadvantaged area scheme, though it is a disadvantaged area. It does not qualify under the criteria because the criteria are different under the disadvantaged areas scheme from those under the regional fund regulation. You have to show a drop in population, the land and soil in difficulties and that the income is below the national average. We are hard-working people in Wexford. That is why we generate an income. But we make the best of what we have.

Mr. O'Kennedy

You are not suggesting that is why you differ from the west of Ireland?

Mr. Esmonde

The result is that because of our good work, we put ourselves outside the disadvantaged areas.

Mr. Cunningham

There is no difference between you and the west of Ireland. Is that it?

Mr. Esmonde

I am just talking for myself. I would not pass judgment on my neighbours. We are not a people who are prepared to do that.

Mr. O'Kennedy

For a very good reason.

Mr. Esmonde

I am only talking about my own people and how we suffer under the disadvantaged area scheme. Being in that position, I am naturally very interested in the application of the regional fund. I feel that that fund does give us some hope in my country.

There have been a lot of criticisms of what the Government have negotiated in relation to this fund. I think our position under this fund is unique of all the nations involved. We have held our own on the original proposals. We have in addition to getting 6 per cent of the fund a further six million units of account which brings us up to 6.5 per cent. We are the only country that is treated in that way under this directive; there is a specific mention made of Ireland under this directive.

Mr. O'Kennedy

For a very good reason, because we differ from most other countries.

Mr. Esmonde

We differ from every country that is involved in the regional fund but it just shows that our negotiators looked after our interests so far as they were permitted to do so within the limits of the fund made available. It is commonplace to both sides of the House that the allocation of the fund is utterly inadequate for our purposes. We must do the best we can. Fighting among ourselves, by making false criticisms or saying that the Minister for Finance is going to take the money and shove it into the Exchequer and get lost there, is just so much nonsense. He cannot do it under the regulations, he cannot even get the money unless he carries out a certain procedure. He has to do it in the way that is laid down. This regulation is part of the law of the land and the Minister made that perfectly clear both in this House and outside it. As far as I know from some notes that appeared in the national press, the Commission are satisfied that the Minister is doing the right thing and is, to put it bluntly, behaving himself within the terms of the regulations.

Mr. Colley

It was the President of the Council of Ministers who said that.

Mr. Esmonde

I understand it came also from the Commission. However, the Parliamentary Secretary may know more about that. We cannot limit this to any particular area of the country because if we do we damage ourselves. In my constituency those who could benefit from the regional fund and who come within it are, first of all, Bord Iascaigh Mhara with the mussel industry which requires assistance. The other matter is coast erosion which, obviously, is getting way beyond the capacity of any organisation in this country to deal with on its own. We have a particular situation in Wexford.

Mr. O'Kennedy

As this debate has developed it is becoming clear that two separate issues are arising. The approach of the Government side now to the second of these two issues, namely, that the fund be used to finance a special regional development programme in less developed parts of the country, is becoming quite interesting.

First of all, we had Deputy Desmond yesterday and now Deputy Esmonde implying that because the whole of Ireland has been accepted as an area capable of designation and one which qualifies for assistance from the regional fund, that means that our hands are, for some reason or another, tied and that we have to allocate the moneys from that fund throughout the whole of Ireland. Deputy Desmond made the amazing discovery here yesterday that all parties are now agreed on this fact— that the whole of Ireland qualifies.

To put the historical fact on the record, let me tell Deputy Desmond that, whether or not all parties were agreed at the appropriate time, the Fianna Fáil Minister for Foreign Affairs, now Commissioner, Dr. Hillery, succeeded in negotiating on this issue. He negotiated on the premise which was finally accepted, that all of Ireland qualified for assistance from this fund. This was the basis of our negotiations at all times. The basis of his case then, which was subsequently accepted, was not at any stage to exclude special provision within our own jurisdiction for specially designated areas but, in having this accepted, to prove our right to a greater share from the fund than the other countries. This was the basis of the presentation of the case for all of Ireland, but that did not exonerate our Government when the fund was made available to us. That did not exonerate us from applying within our own jurisdiction special regional programmes or a special regional policy which would be supplemented or assisted by these funds from the European Community. Let me make that point very clear in the first instance. Any suggestion or attempt to imply that we are now almost bound to spread these moneys throughout the whole of Ireland is flying in the face of reality because we are not so bound. The fact that all of Ireland has been accepted as qualifying under the regional fund simply accepts the reality——

Mr. Esmonde

It will be reviewed after three years.

Mr. O'Kennedy

——that even parts of Ireland in our jurisdiction which are comparatively much better off than other parts, here on the east coast, such as Deputy Esmonde's Macamores in Wexford, by the general standards of the Community qualify for assistance from the regional fund. Of course, that does not exonerate our Government from having within our country a regional programme, and that is the point we make.

If the fund in its totality—and this is my second point—had met the expectations that were established in the first instance at the Paris Summit of 1972, the expectations that were raised to a very considerable extent by the present Minister for Foreign Affairs, the statements which he made as to what would or would not be acceptable, then we might have contemplated including areas such as the Macamores or otherwise. I say "might". Of course, the fund did not meet such expectations.

Mr. Esmonde

Is the Deputy arguing against the Macamores being included under any circumstances?

Mr. O'Kennedy

I am indeed, and very much so.

Mr. Esmonde

I will remember that —the Deputy is going to exclude the Macamores.

Mr. Colley

Deputy Esmonde speaking for his own party also.

Mr. O'Kennedy

I am arguing against the Macamores in the same way as I am arguing against North Tipperary. If the Deputy wishes to quote me on that he may do so.

An Ceann Comhairle

Order. The Deputy should not invite interruptions.

Mr. O'Kennedy

Deputy Esmonde this evening, has acknowledged that the area does not qualify. I do not want to concentrate too much on that, because it does not qualify for assistance from the Disadvantaged Areas Fund——

Mr. Esmonde

At the moment.

Mr. O'Kennedy

The Deputy accepts that it does not qualify.

Mr. Esmonde

I do not.

Mr. O'Kennedy

The basis on which it does not qualify is that the Minister for Agriculture and Fisheries and his advisers cannot see that it fulfils the criteria. On the basis that such areas do not fulfil the criteria, Deputy Esmonde seems to think that this is an argument then for putting them in under some other fund which, in fact, was not contemplated by the Fianna Fáil Party when we approached this regional fund and was not the kind of argument that we, or his party, made when we asked our people to vote for membership of the Community and when we made reference to the regional fund.

Mr. Esmonde

The Deputy has no right to argue against the Macamore people like that now.

Mr. O'Kennedy

I do not want to delay too long on that. I am simply saying that is the logic of the Deputy's position at the moment and the logic of anyone else who would try to extend the scope of this scheme outside the undeveloped areas of Ireland.

Mr. Esmonde

Take it away from Connemara.

Mr. O'Kennedy

That is right, and give it to the Macamores or Tipperary for that matter, and that is my constituency. One of the realities is that the people here thought that the regional fund would be available throughout the whole country, through the Government, to correct imbalances in our community. That is how we presented it then. I do not recall anyone saying that when the regional funds were made available, they would be applied only in Wexford, Tipperary, Kildare, or elsewhere. We expected them to be made available for the whole country. This fact cannot now be overlooked.

Mr. Esmonde

The West is an obvious candidate and will get it.

Mr. O'Kennedy

I would say it is the exclusive candidate. There may be some other limited pockets, and they may be of concern to some Deputies in the House. Despite the progress reports we get from time to time from the Minister for Foreign Affairs on his achievements, this fund is not anything like adequate. He is not to be faulted for that exclusively. The achievements have not measured up in any way to the promise of those heady days in 1973. The reality is that the amount available this year is £4 million. This is the sum that will be actually applied. The Government then say: "We are not that badly off." We know they are badly off and that is why we are looking for the assurance that that paltry sum—or £8 million as it will be in a full year —will not be taken into the maw of the Minister for Finance, who has stirred up all this confusion.

We would all be happy if the Parliamentary Secretary could clear up this whole mess now, and also assure us that the money will be applied to our less-developed regions in a special fund, as Deputy Colley has very properly asked for. If there is confusion it is the fault of the Minister. Let me quote from The Irish Press of 7th June, 1975, as per Deputy Charles McDonald. We are told that the Minister reversed his foreign policy. We got this interesting comment and it is a quotation from the Commissioners in Brussels. It does not indicate who the spokesman was, but it says:

We were misreported when it was published that we had accepted Mr. Ryan's original proposal to use the regional fund moneys to reimburse part of the Irish Government's spending on regional development.

Either the Minister made a proposal or he did not. We did not dream that up on this side of the House. Deputy Esmonde is at pains to reassure us that, because an application has to be submitted this year, that in itself is a guarantee that the money cannot be swallowed up by the Exchequer. That is not the case at all. It could, in fact, be said: "This is evidence of what we are doing with the regional fund." It would not prevent the Government from putting money which they had originally allocated through their own regional policy into some other source and using the £4 million from the Community and saying: "There is the clear evidence."

Mr. Kenny

May I ask what is the source of that quotation?

Mr. O'Kennedy

The Irish Press of 7th June, 1975. The piece I quoted is actually given in inverted commas.

Mr. Kenny

Where did that emanate from?

Mr. O'Kennedy

It says that an official of the Commission in Brussels welcomed the news.

Mr. Kenny

That is categorically denied by the Commissioner, Mr. Thomson. It never emanated from his office. He is the Commissioner for regional policy. The Deputy should not quote things he is not absolutely certain about in this House.

Mr. Esmonde

We can all make a mistake.

Mr. Colley

He quoted what the Minister himself wrote and that is enough for us. That is what started the whole confusion.

Mr. O'Kennedy

The Minister said that actual payments from the fund in respect of approved projects will be on the basis of part recoupment on the scale of expenditure already undertaken by the member states. That was said by the Minister for Finance, Deputy Ryan.

Mr. Kenny

That did not emanate from any section of Mr. Thomson's office in Brussels.

Mr. Colley

It emanated from the Minister.

Mr. Kenny

Give me an interpretation of that.

Mr. O'Kennedy

Deputy Esmonde has made some play with the fact that Article 4 of this Regulation provides an inbuilt guarantee and therefore there is no need for concern. Let me point out some of the other provisions of Article 4, and in particular paragraph 2 (a) of Article 4 which says that in the case of infrastructural projects the Government are to take all necessary steps to ensure that assistance from the fund is given suitable publicity.

This, of course, means, and understandably so, that there will be clearly designated projects in a clearly designated fund and this can be ascertained as being evidence of the presence of the regional fund in Ireland, and evidence also of the presence of the European Community in Ireland, the presence which all of us promoted as being of major consequence and major benefit to this country.

I would like to be assured, in the proposals the Government are going to present, that we will have this guarantee, that assistance from the fund will be given the necessary publicity. The only way that can be done is by doing what Deputy Colley has suggested, that is, to set up a separate fund for the undeveloped regions. To do this there must be a policy for the undeveloped regions. Until such time as we see clearly what that policy is, it will be difficult to have a fund.

The Minister for Finance, speaking of other areas said: "It is not a good time for planning." It is not an appropriate time apparently for planning in the context of our overall economy. If it is not an appropriate time for planning on the level of the general economy, it is hardly an appropriate time for planning for the undeveloped regions. Perhaps this, again, is why the Minister is keeping all his options open and is apparently contemplating the possibility of applying this fund elsewhere than in the needy regions.

It must be recalled that one of the principles behind the establishment of this fund was a movement towards economic and monetary union and thereby towards European union. To do this, regional imbalances must be corrected. There may be regional imbalances between Ireland and Germany, or between Ireland and France, but if that is so, surely there are very real regional imbalances between the west of Ireland, in particular, and any part of Germany. How can any talks of economic and monetary union or real union in Europe be meaningful unless we really concentrate the meagre amount we have on the most needy areas here?

I was amused at Deputy Desmond apparently saying that it was a matter that could be applied and that we could rely on the Government anywhere throughout Ireland. His group within the European Parliament have said that what distinguishes them from the other groups is that they are committed as socialists and they certainly always parade themselves on high as being very committed people when they use the term "socialist". But they are committed as socialists to correct these regional imbalances. They say that is the difference between themselves and others. I heard this said on radio a few nights ago by the Secretary General, Manfred Michelle of this group. What is the difference between them, for instance, and the CD group in Parliament—that they are committed of their very nature to correcting the regional imbalances. If that is the way the Government see it here, if we allow regional imbalances within our own country, how can we possibly correct regional imbalances within the Community at large?

Mr. Esmonde

We have never argued that.

Mr. O'Kennedy

We want to see— and our party at successive Ard Fheiseanna have, in fact, endorsed this unanimously—that this fund is almost exclusively intended now for the undeveloped regions of the country, for good social reasons, good economic reasons and possibly for good European reasons.

The Fine Gael Party and the Fianna Fáil Party, as Deputy Colley has so rightly argued, made certain commitments and the people understood us to mean what we said, that this fund would be applied to develop the undeveloped parts of the country. I do not mind if the Fine Gael party renege on their own commitments but they have no right to renege on our commitment. If this fund, which is so small in the first instance, is to be applied, as we fear it will, this Dublin-based Government, as Deputy S. Flanagan said, should know that they are entitled, if they wish, to renege on their commitments but not entitled to renege on ours. We will have to tell the people that their expectations have not been realised: we will have to be honest enough to admit that the fund is not being applied as we thought it should.

The Commission have always said that the fund should be applied so as to create maximum impact on public opinion. We know that the way to create maximum impact on public opinion is to apply it through a specific fund for specifically-designated projects here. Otherwise it does not create maximum impact on public opinion especially when the amount available here, over the trial period of three years, is £35 million, far, far less than we required, and the amount actually available for spending in this year will be £4 million, of the £8 million which will be available in the full year. Obviously, to spread that kind of money around would have very little impact on public opinion.

The signs are that even now the Government who have had notice of this for so long do not seem to have selected a project that will benefit from this fund. We have no evidence that they have: perhaps they have. Perhaps the Parliamentary Secretary will tell us.

Mr. Esmonde

Give him time to get in.

Mr. O'Kennedy

I do not think I have gone over my time. We will give him time to get in. The Government have had ample opportunity—we have asked them often enough—to have these projects selected by now. Why have they not been selected? Why have they not been designated? There is a real danger that if they are not designated quickly, that even if we fall short, we could even lose the right to our allocation this year. It could be postponed but that will hardly make for a sense of urgency from this country. I assume that I am wrong, but I am making the assumption more in hope than in confidence, because we are long enough talking about this fund: we have had adequate notice about it and the only thing that was to be determined was the amount of the fund. The fact that it fell far short of our expectations does not in any way justify the inactivity of the Government in determining what projects would qualify.

The amount of the fund would not even build 14 miles of roadway in the west of Ireland. It would only point the way to the west rather than reach the west. At least, let us give evidence of a commitment. We have blamed Europe enough, particularly on the Government benches. In the final analysis, the Taoiseach and others had to recognise that rising prices and inflation were not the fault of Europe, but of our own maladministration here. We have blamed them enough. But let us not blame them for something for which they are entitled to some little credit, namely, the existence of a regional fund. Let us not blame them for the fact that we do not have a regional policy.

I hope this debate will pressurise the Government to have a regional policy with a specific regional fund through which the resources available from the European Community Regional Fund can be applied to give maximum impact on public opinion, and, in the words of the Regulation that the Government "will take all necessary steps to ensure that assistance from the fund be given suitable publicity" and will finally ensure that the commitment that we gave will be honoured. It will mean that we can come back after the trial period as I am sure we will and say: "That is how we applied our moneys in those needy areas. There is the consequence of our application of moneys." That is the strength of our case for our renewed application in three years' time. If the Government adopt that attitude even at this late stage there is some hope that we will have a stronger case next time around. I hope the Parliamentary Secretary can reassure us.

Parliamentary Secretary to the Minister for Finance (Mr. Kenny)

I read the motion proposed by Deputy Colley. In it he says that it is the Government's expressed intention to recoup past expenditure. I do not think that the Government ever expressed such an intention. This image of the Government's intention is due to misinterpretations of the regulations of the EEC. It is also due to reports attributing to the Government an intention to misuse EEC funds which they never had. The operative word is "misuse", and it has appeared on very many newspapers all over the country; it is a word that should never have been used in any newspaper. If the Government misuse the EEC regional fund they thereby contravene the regulations of the EEC and they will not, therefore, get any aid from the EEC.

If this Government do not strictly adhere to the conditions and regulations laid down by the EEC they will forfeit any further aid from the fund. This was the anxiety of the mover of this motion, Deputy Colley, that we are in danger of losing this if we do not adhere strictly to the conditions and the regulations of the EEC. I want to make it quite clear from the outset that it is never, and has never been, the intention of the Government to use Regional Fund assistance for the purpose of recouping past expenditure to the Exchequer. Only time will tell whether the Deputy who moved this motion is right, or whether I am right.

Mr. Colley

Or the Minister is right. What the Minister said contradicts what the Parliamentary Secretary is now saying.

Mr. Kenny

I am telling the Deputy that the Minister is right, and what I am saying is right. The misinterpretation by various Deputies and various people all over the country will not make the truth untrue. Any suggestion to the contrary is simply not true. I can only conclude that such a suggestion is based on an error in interpreting the EEC regulations governing the operation of this fund. What is the correct position? In accepting the fund regulation the Government agreed to observe the principle stated therein that the fund assistance should and I quote:

not lead member States to reduce their own regional development efforts but should complement these efforts.

In other words, the Government undertook that Ireland's receipts from the fund would result in an increase in assistance to regional development. They will add to their own regional expenditure to fund's assistance. The regulation leaves it to each member State to decide whether this increase should occur on a global basis. In other words, whether it should take the form of an increase in the total of assistance to regional development or, in the case of industrial handicraft and service activities it should be used to increase the level of aid to individual projects.

There are very good reasons why it would not be appropriate for us to raise the level of aid to individual projects. If we were to do so we would not be getting full value from the Fund so far as our own development needs are concerned. Assuming, for example, that the IDA succeeded in attracting a project to a particular location with a grant offer of, les us say, £500,000, would it make sound economic sense to use regional fund assistance to increase aid to that project to £750,000, by adding £250,000? Would it not be far more logical and far more intelligent to use that extra quarter of a million pounds to set up a new industry somewhere or to set up some infrastructural project?

Mr. O'Kennedy

Exactly—to service other industries.

Mr. Kenny

Would the extra £250,000 not be better employed, I said, towards financing the establishment of some other industry or an infrastructural project? Many Deputies opposite, I do not know the reason—maybe it is because of the temperament of the Minister for Finance—doubt the veracity of the Minister for Finance——

Mr. Cunningham

And other Ministers.

Mr. Kenny

Maybe, but this Minister in particular, because I have heard of it here and there. What better confirmation of his intentions and his integrity can I give except his words inside and outside this House? After all, we are all supposed to be men and what is a man if he has not got his word? Your word is your bond.

Mr. Colley

Hear, hear.

Mr. Kenny

People find out, the ordinary rural people as against Dublin people, whether your word is your bond or not. You may appear here once, but after that—oblivion. I want to tell Deputies that both inside and outside this House the Minister for Finance has time and time again asserted that this sum will not be misused. I want to quote a few extracts. There is the Minister for Finance's letter of 14th April, 1975, to The Irish Independent and Cork Examiner:

It would make little sense simply to add regional fund moneys to this level of assistance (to individual projects); far better to use these resources to ensure additional industrial development. Under the repayment system, the partial refund of State aids in respect of investments submitted for fund assistance augments the pool of scarce capital resources available to finance future development.

Again on the Adjournment Debate on 23rd April, 1975, he said:

There will be no reduction in the development aid, in the regional development of this country. Rather will we increase the aid given by the Government. We are glad to have it complemented by the regional fund, small and all as this is. The receipt of moneys from the fund will help to increase the overall volume of projects so that Ireland will be able to promote more projects with the fund than we could have done if it were not received.

This is his reply to a Parliamentary Question on the 6th May, 1975:

I wish to make it quite clear that the selection of a particular project for assistance will not increase the level of that aid already being paid to that project. It will simply be the means of obtaining assistance from the fund to increase our total industrial and infra-structural investment efforts, particularly in less developed areas.

In another reply to a Parliamentary Question on 28th May, 1975, he said:

I should again like to stress that the selection of a particular project for assistance will not increase the level of aid already being paid to that project. Rather will it be the means of obtaining assistance from the fund to increase our total industrial and infrastructural investment efforts, particularly in the areas of greatest need.

It is frustrating and disappointing and galling that this tissue of fabrications as to the Government's alleged misuse of the regional fund has been built around selectively quoted extracts from letters which issued from the Department of Finance explaining how the repayment system operated in the case of individual projects. As I have said already, under this system, aid received from the regional fund will not benefit the individual investment but will be recycled by the Government to increase total industrial and infra-structural investment. Far from the regional fund being used to recoup past Exchequer expenditure, I should like to remind the House that we must first spend money on a project ourselves before looking for payment of the fund assistance. In order to get £1 of Community assistance we must spend at least £1 ourselves in the case of industrial projects and at least £2.33p in the case of infrastructural investment.

In the newspapers many conflicting reports emanated from the various reporters in Brussels from their various newspapers. I would like to clear up any lingering doubt as to the attitude of the Council of Ministers and the Commission to the Government's proposal. Newspaper headings, such as "Our misuse of fund dismays Commissioners", The Irish Independent of 14th April, 1975, and “Ryan starts EEC row on Regional Aid”, The Irish Press of 2nd May, 1975, are wide of the mark and have no foundation whatsoever. That can be absolutely proved. These imputations of alleged Commission dissatisfaction have been made without any indication as to the status of persons making them and are completely without foundation. I had to interrupt Deputy O'Kennedy.

Mr. O'Kennedy

Could I return the compliment and just refer the Parliamentary Secretary incidentally to another one when he is quoting?

Mr. Kenny

The Deputy is wasting my time.

Mr. O'Kennedy

Irish Independent of 2nd April, 1975, “Regional Policy —Ryan now admits our report is true”.

Mr. Kenny

That was not the true version that was sent from Brussels. I know that for a fact and I can prove it. The Commission has been very forthcoming in its statements. The following is the text of a statement issued by the spokesman of the Commission on 30th May, 1975:

Reports in certain Irish newspapers today regarding a meeting between representatives of the Associated Chambers of Commerce, Ireland, and officials of the Commission may give the erroneous impression that the Commission is not satisfied with the system which the Irish Government proposes to adopt in applying assistance from the regional fund. The Commission has been informed of the intention of the Irish Government to use fund aid to increase the total level of regional development investment in Ireland. The Commission notes that this intention is in conformity with the principal purposes of the regional fund which is to increase the volume of public expenditure in the regions by the amount represented by the fund.

Nobody can deny that. These are the proofs both from the Minister himself, from the Commission and from Mr. Thomson, but I want to go further. On the 23rd of April, 1975, in the Adjournment Debate on the EEC Regional Fund, the Minister for Finance, Deputy Ryan said:

The counties which will mainly benefit from the regional fund are counties Donegal, Sligo, Leitrim, Roscommon, Longford, Cavan, Monaghan, Galway, Mayo, Clare, Kerry, parts of Limerick and parts of Cork. There are a number of misconceptions circulating as to the nature and scope of the regional fund. They would be laughable if they were not so misleading. While certainly some of them arose originally through a misunderstanding we cannot now ignore the damage that is mischievously spread for base, partisan motives at home, and also done with the malicious intent of doing harm to Ireland's position in Brussels.

Mr. O'Kennedy

That is strong talk about newspaper reporters.

Mr. Kenny

I have no idea of what harm may be done in Brussels but I know all over the country, when they see statements like "West wants full value from the EEC Fund", they think they will not get anything. This emanates from these rumours in various newspapers that have no foundation whatsoever. The Government do not intend to misuse the funds. They cannot do that. Neither do they intend to reimburse the Exchequer for past expenditure paid from this fund. We are all disappointed at the dilatory methods by which this fund is administered. It only started in September, 1974. It is going ahead now and our applications will be sent in by July, 1975. There are certain projects being thought about, which will be selected and sent in time. I do not know the details because I am not a member of the Cabinet and I do not know if the Cabinet have finalised their selection yet. They will be sent on in time and I trust, like all rural Deputies, that the majority of them will embrace, for the most part, those areas that have been mentioned by the Minister for Finance.

Mr. O'Kennedy

The Parliamentary Secretary has said that he does not know if the Cabinet have finalised their selection.

An Ceann Comhairle

The Parliamentary Secretary without interruption.

Mr. Kenny

I said those applications would be sent on in time before July and they would then be considered.

Mr. Cunningham

Have they not gone in yet?

Mr. Kenny

The closing date is July. These must then be considered until October and the payment will be made late in the year, maybe December. We have plenty of time. Anything that is done in haste is not well done.

Mr. O'Kennedy

Like the Government's 14-point plan, for instance.

Mr. Cunningham

Like the Tara mines.

Mr. Kenny

The Minister for Finance is aware of the importance that the receipts from the regional fund should be seen to increase the total resources allocated to industrial and infrastructural investment. In discussions recently with the Commission's director general of regional policy officials of the Department of Finance let it be known that it was intended to show on the resources side of the annual capital budget the total payments expected to be received from the fund during the year. With that there will be then known how these funds will be expended. Deputy Colley asked me for a statement as to the type of project which qualifies for fund assistance. The factual position is as follows: Under Article 4 of the fund regulation assistance may be given for investments which exceed £20,833 and which are of the following types:

(a) industrial, handicraft or service activities which either create ten new jobs at least or maintain existing employment;

(b) investment in infrastructure directly linked with those activities or which is an essential pre-condition of such activity; and

(c) investment in infrastructure covered by the Council directive on mountain and hill farming and farming in less-favoured regions, for example, access roads to farms, electricity and drinking water and, in tourist areas, disposal of sewage.

Mr. Cunningham

That is a disadvantaged area.

Mr. Kenny

The project must be over £20,000. I asked would development concerning fuel, bog roads, minor arterial drainage schemes and things like that be eligible and they are not definite and there is no clear interpretation or no clear definition yet given from the EEC about the particular things we are really interested in.

Mr. Callanan

The Parliamentary Secretary makes enough noise.

Mr. Kenny

I only wish I could make half as much noise as other people in this House.

Mr. Callanan

If the Parliamentary Secretary does not make noise he will not be heard.

Mr. Kenny

Deputy Colley asked that. Suitable projects which meet these criteria have been identified and a final selection will be made shortly by the Government. As I have already said, Commissioner Thomson has indicated that he hopes to receive the first applications from member States by mid-July.

Our applications will be easily in by that date; the Government's application will be there by then. Deputies will appreciate that it would be inappropriate for me to anticipate a final Government decision on the pattern of our applications by giving any indication of the type of project being put forward or of the geographic spread involved. Nor, indeed, as Deputies remarked last night, would it be proper to disclose details of individual applications.

I should like to remind the House that individual projects submitted for regional fund assistance will not, if approved by the Commission, receive fund aid in addition to the amount of State assistance already being paid to them. These projects will, rather be the means of obtaining assistance from the fund to increase our total industrial and infrastructural investment effort particularly in less-developed areas.

We are emphasising, less-developed areas. The Minister has given his word on paper that these areas will, to the greatest extent, benefit. Deputy Colley stated last night that this Government have no regional policy whatever. Deputy Seán Flanagan alleged that the Government were not providing work for the people of the West and denied that there had been any strides made in regional development since the Government took office. There is no difficulty in refuting both these statements.

Deputy Seán Flanagan spoke about County Mayo last night. I know County Mayo as well as Deputy Seán Flanagan although he is in the House longer than I. Since the mid-1930s dole has been paid to the people of Mayo to give them in some places a very bare existence. This has been a consistent and persistent cancer in the lives of the people. That cancer did not start two years ago but from 1973 the people got enough money in dole to give them a fair existence until such time as they are employed. It is not a matter of pride to talk about dole, but dole since the start 40 years ago has shattered the moral fibre of the people who receive it. As quickly as we can give people work instead of dole, work must be provided. Until such time as they get work they must get some assistance. No one knows better than I or Deputy Seán Flanagan of how people live in the barren, remote and secluded areas of County Mayo.

It is true that this Government have not repeated the performance of the previous Government. The previous Government indulged in producing so many programmes and voluminous papers pertaining to employment. Every year or every five years a plan was presented. Once or twice the plan succeeded but then they faded out.

Mr. O'Kennedy

It cannot happen if there is no plan.

Mr. Cunningham

Deputy Richie Ryan would not even attempt a plan.

Mr. Kenny

Deputy Colley mentioned Buchanan last night. I was against Buchanan myself but this Government preferred to act. In the last two years all of the major IDA projects have been allocated to the designated areas. In the final two years of Fianna Fáil's term of office, IDA grant approvals for projects in the Donegal, north-west, west, midwest and south-west regions amounted to £24.7 million. That was for two years. During the 21 months from March, 1973, when this Government took office to December, 1974, grant approvals for these areas amounted to £82.9 million.

Mr. Colley

And when were they negotiated?

Mr. Kenny

It is well known, that, under the present Government the job approval targets of the IDA's Regional Industrial Plans have already been exceeded in the four least developed regions. These plans are now being reviewed in the light of current job creation requirements, and it is hoped that revised plans will be published later this year. I trust I have given a satisfactory explanation and a rebuttal of the arguments put forward by Deputy Colley.

Mr. Colley

Am I allowed to cede some of my time to Deputy Cunningham?

An Ceann Comhairle

That is quite in order.

Mr. Cunningham

I am disappointed at the Parliamentary Secretary's handling of a bad brief. He just said that the projects were identified and are ready for submission before a certain date in July. Our motion seeks to ensure that the Government do not gobble up for budgetary purposes this money. It also seeks to ensure that:

the fund be used to finance a special regional development programme in the less developed parts of the country.

He has given no assurance from the identified and defined projects, before the Government, whether these are in the western areas. I am pleading for the counties in the congested areas, for the Gaeltacht areas for which I am spokesman, and these refer to the counties from Donegal to Cork, and the cross-border regional development bearing in mind Donegal, Derry and Tyrone. I asked a question about this and I got a promise from Deputy Kelly, Parliamentary Secretary to the Taoiseach, of favourable consideration. I sent him some documents on this and he had not the courtesy to send me an ackknowledgment of these documents.

I do not accept the brief the Parliamentary Secretary has handled.

Mr. Kenny

What part of it?

Mr. Cunningham

I do not accept that there is a definite commitment there to the bulk of the EEC regional fund money going to our under-developed regions.

Mr. Kenny

Does the Deputy not take the Minister's word in this House that the counties which will mainly benefit from the regional fund are the counties outlined?

Mr. Cunningham

The Parliamentary Secretary in reply to Deputy Callanan said he did not know whether bog roads or other projects he specified would be included. Yet he said that the projects have been identified. Arising out of this I am accusing him of trying to mislead the House in respect of——

(Interruptions.)

Mr. Cunningham

——western areas because he could have said "No, bog roads are out; the other projects are out." I want to ask the Parliamentary Secretary: is there any provision made whereby the regional fund can be used to make up the vacuum in western areas for grants to farmers? At the moment 90 per cent of the farmers in western areas do not qualify for grants under the farm modernisation scheme. There is no other grant scheme for farmers. Therefore, it is necessary that some of this money would be allocated to help farmers in the areas about which I speak.

Mr. Kenny

That must be decided in Brussels.

Mr. Cunningham

The Parliamentary Secretary has not indicated that there will be any aid for farmers in this region.

Mr. Kenny

That must be decided in Brussels.

Mr. Cunningham

Hotels in this region, these things which I mentioned and which others have mentioned, are they in the projects which have been identified?

Mr. Kenny

I could not tell the Deputy that.

Mr. Cunningham

Well, then keep your mouth shut.

Mr. Kenny

I certainly will not. I am entitled to speak here as much as the Deputy is.

Mr. Cunningham

I did not interrupt the Parliamentary Secretary.

Mr. Kenny

I did not insult the Deputy, either.

Mr. Cunningham

I am advocating and the other speakers from this side of the House are advocating that there are projects in the western counties, in the Gaeltacht areas, in the congested areas and in the north cross-Border areas which should be included in these identifiable lists——

Mr. Kenny

That is a matter for Brussels.

An Ceann Comhairle

Order.

Mr. Cunningham

——which is with the Government and which will be submitted. We do not know even if they are included and the Parliamentary Secretary has not given us any indication that they are. All he can say is that projects have been identified.

Mr. Kenny

Yes.

Mr. Cunningham

We then have to wait and see. In this motion we have asked for an assurance. We have not got that assurance from the Parliamentary Secretary. I should also mention the fact that at the moment there are no grants for hotel development, for tourist development, in the country as a whole.

Mr. Kenny

Are there not hotels?

Mr. Cunningham

There were added grants for hotel development and ancillary development of 20 per cent in Gaeltacht areas. These are not now available. So that we have an interregnum period in the western areas. We have an interregnum in respect of farm grants. There is a full stop in farm grants because of the fact that the percentage are not qualifying. There is lack of industrial progress; there is lack of tourist progress because grants are not being given. There is no provision for the fuel industry in the west of Ireland by either the Minister for Local Government, by the Department of Lands or by the Parliamentary Secretary who is in charge of the Office of Public Works. We want an assurance from the Minister for Finance that these projects, which are desirable and which are more necessary in the west of Ireland than anywhere else and which are doubly necessary in the context of EEC grant already mitigating against schemes. In other words, the introduction of the farm modernisation scheme has done away with all the farm aids to small farmers in Gaeltacht areas. We are not satisfied with the Parliamentary Secretary's statement. We want and we will continue to seek a more definite assurance than that.

Mr. Colley

The Parliamentary Secretary spent a great deal of the time available to him trying to refute a case which we did not make. There has apparently developed a row between the Minister for Finance and some newspapers on this matter and the Parliamentary Secretary devoted a great deal of his time trying to refute the case made by those newspapers against the Minister. But that is not the case that we made in this House. This motion, first of all, deplores the Government's expressed intention of using the EEC Regional Fund to recoup past expenditure to the Exchequer. Secondly, it demands that the fund be used to finance a special regional development programme for the less-developed parts of the country. We got nothing from the Parliamentary Secretary in regard to the first part beyond the quotation of what the Minister has said in the past. In regard to the second part we got nothing at all.

Mr. Kenny

Because I had not the time.

Mr. Colley

It was a very vital matter. If the Parliamentary Secretary had been prepared to give it he would have got it in.

Mr. Kenny

I could not go beyond my specified time.

Mr. Colley

Is the Parliamentary Secretary saying now that the Government intend to set up a special regional development fund for the less developed parts of the country financed from the EEC and from the Government?

Mr. Kenny

You will not catch me out on that one.

Mr. Colley

This is what the Parliamentary Secretary got a brief on. Since his brief apparently did not include anything on that, we can assume that that is not the Government's intention.

Mr. Kenny

Do not assume anything until you are sure.

Mr. Colley

The Government got the chance to indicate what they intended to do and they did not do it. It is also of some significance that the two Deputies from the other side of the House who spoke, apart from the Parliamentary Secretary, went to considerable trouble to try to suggest that we should, and indeed have an obligation to, use the EEC Regional Fund in all parts of the country. That will be noted with considerable interest not only in the less-developed parts of the country but in the other parts of the country where people listened to Fianna Fáil and Fine Gael speakers during the EEC referendum, as Deputy O'Kennedy said, spelling this out very clearly that it was the intention to use this fund for the less-developed parts of the country. Now we find that is being switched too.

Mr. Kenny

Do not assume, Deputy. The Deputy might have to retract that when we find out where this money will be spent.

Mr. Colley

The Parliamentary Secretary seemed to suggest that all of this originated in some peculiar way with newspapers or rumours or something like that but the fact is that it originated in a letter written by or on behalf of the Minister for Finance to a local authority. I quoted it yesterday and gave the source, so I will not waste time on that. The actual wording again is:

Actual payments from the Fund in respect of approved projects will be on the basis of part recoupment on the scale of expenditure already undertaken by the member State.

I know it is a bit complex but nevertheless if it is looked at and analysed all it can be taken to mean is that money received from the fund in respect of expenditure already incurred will be taken by the State into its coffers and not put to the particular project. Let me explain, because I think if I give an example it will be clear precisely what we are afraid of. The Minister, as quoted by the Parliamentary Secretary, did say, when pressed, that it was intended to increase the amount of aid given for regional policy by using the fund. Of course, he is obliged to do that under the fund regulations. But, if we take it that there is, say, an infrastructural project costing £1½ million and the Government say, "We are getting £½ million of this from the regional fund in Brussels and we are putting in £1 million ourselves and if we did not have the regional fund we would only be spending £1 million on it," that is presumably what is envisaged. How are the Irish people going to know, how are Brussels going to know, whether that is true or not? How can anybody know what would have been the level of expenditure unless you treat the fund separately and clearly?

Our obligations under the fund in regard to what Deputy O'Kennedy quoted included giving maximum publicity apart from the requirements of a clear-cut demonstration to the people of what is coming and what is being used from the regional fund of the EEC and the setting up of the kind of the special regional development programme we have called for in this resolution and which we have got no indication is going to be produced by the Government. Despite the fact that the Government have notice, and that this motion was being discussed, we got no indication of it, and we can, therefore, only assume that the Government do not intend either to set up such a special fund or, indeed, that they are capable of snaffling the money and putting it into their general coffers because they are not taking the precautions to ensure that that is seen not to be done. That being so, I can only say, as far as we are concerned, it is not what we promised the people in the EEC referendum; it is not what Fine Gael promised them and it is, in my view, a deception and a fraud of the people who voted in the EEC referendum.

Question put.

The Dáil divided: Tá, 52; Níl, 57.

Tá

• Allen, Lorcan.
• Andrews, David.
• Brady, Philip A.
• Brennan, Joseph.
• Briscoe, Ben.
• Brosnan, Seán.
• Browne, Seán.
• Brugha, Ruairí.
• Cronin, Jerry.
• Crowley, Flor.
• Cunningham, Liam.
• Daly, Brendan.
• Davern, Noel.
• Dowling, Joe.
• Fahey, Jackie.
• Farrell, Joseph.
• Faulkner, Pádraig.
• Fitzgerald, Gene.
• Fitzpatrick, Tom (Dublin Central).
• Flanagan, Seán.
• French, Seán.
• Gallagher, Denis.
• Geoghegan-Quinn, Máire.
• Gogan, Richard P.
• Haughey, Charles.
• Healy, Augustine A.
• Burke, Raphael P.
• Callanan, John.
• Calleary, Seán.
• Carter, Frank.
• Colley, George.
• Collins, Gerard.
• Connolly, Gerard.
• Crinion, Brendan.
• Kenneally, William.
• Lalor, Patrick J.
• Leonard, James.
• Loughnane, William.
• Lynch, Celia.
• McEllistrim, Thomas.
• MacSharry, Ray.
• Meaney, Tom.
• Molloy, Robert.
• Moore, Seán.
• Murphy, Ciarán.
• O'Connor, Timothy.
• O'Leary, John.
• O'Malley, Desmond.
• Smith, Patrick.
• Timmons, Eugene.
• Tunney, Jim.
• Walsh, Seán.

Níl

• Barry, Richard.
• Begley, Michael.
• Belton, Luke.
• Belton, Paddy.
• Bermingham, Joseph.
• Bruton, John.
• Burke, Joan T.
• Burke, Liam.
• Byrne, Hugh.
• Collins, Edward.
• Conlan, John F.
• Cooney, Patrick M.
• Corish, Brendan.
• Cosgrave, Liam.
• Costello, Declan.
• Coughlan, Stephen.
• Crotty, Kieran.
• Cruise-O'Brien, Conor.
• Desmond, Barry.
• Desmond, Eileen.
• Dockrell, Henry P.
• Dockrell, Maurice.
• Donegan, Patrick S.
• Donnellan, John.
• Enright, Thomas.
• Esmonde, John G.
• Finn, Martin.
• Fitzpatrick, Tom (Cavan).
• Flanagan, Oliver J.
• Gilhawley, Eugene.
• Governey, Desmond.
• Harte, Patrick D.
• Hegarty, Patrick.
• Hogan O'Higgins, Brigid.
• Jones, Denis F.
• Keating, Justin.
• Kelly, John.
• Kenny, Henry.
• L'Estrange, Gerald.
• Lynch, Gerard.
• McLaughlin, Joseph.
• McMahon, Larry.
• Malone, Patrick.
• Murphy, Michael P.
• O'Brien, Fergus.
• O'Connell, John.
• O'Donnell, Tom.
• O'Sullivan, John L.
• Pattison, Seamus.
• Reynolds, Patrick J.
• Spring, Dan.
• Staunton, Myles.
• Taylor, Frank.
• Timmins, Godfrey.
• Toal, Brendan.
• Tully, James.
• White, James.

Tellers: Tá, Deputies Lalor and Browne; Níl, Deputies Kelly and B. Desmond.

Question declared lost.