Vol. 479 No. 2
286 Mr. Briscoe asked the Minister for Enterprise and Employment if his attention has been drawn to the fact that voluntary bodies who train persons with disabilities have suffered a loss in income due to the effects of Irish pound and ECU currency variations on human resource fund transfers from the ESF; the measures, if any, he will take to alleviate this problem; and if he will undertake to safeguard such transfers against currency rate variations. [12814/97]
I am aware that ESF draw-downs on behalf of many current Irish ESF beneficiaries, disabled and otherwise, have been impacted negatively by IR£-ECU exchange rate movements over recent months. Irish ESF commitments are made in ECU and the attention of all beneficiaries is drawn at the time of commitment to the fact that the value in IR£ of particular payments made on foot of their programmes or projects will vary in line with the IR£-ECU exchange rate at the time of the relevant draw-downs.
The general principle applicable in ESF-funded projects over the years has been that the exchange risk is carried by the beneficiary and not, for example, by the Exchequer through my Departments' Vote or that of the other Ministers involved.
287 Mr. Cowen asked the Minister for Enterprise and Employment if his attention has been drawn to the fact that voluntary bodies providing training services to people with disabilities have experienced a 10.5 per cent reduction in their income due to current Irish pound and ECU exchange rates and that this has cost them £700,000 so far in 1997; the plans, if any, he has to alleviate the problem; the reason the State passes on the exchange rate losses to the voluntary bodies; the changes, if any, he proposes to make to safeguard this income against exchange rate fluctuations; and if he will make a statement on the matter. [12820/97]
I am aware that many current Irish ESF beneficiaries, disabled and otherwise, have been impacted negatively by IR£-ECU exchange rate movements over recent months. The degree of impact on particular beneficiaries would depend however on the IR£-ECU exchange rate obtaining on the date payments for their programmes or project were received from Brussels in comparison with the rate obtaining at the time the commitment of support was given.
Since all Irish ESF commitments are issued in ECU and the attention of beneficiaries is drawn to the fact that the IR£ value of particular payments made on foot of them will vary depending on the exchange rate at the time of those payments, the IR£-ECU rate mentioned in letters of commitment is quite expressly, an indicative rate only. While I understand the Deputy's concern and acknowledge that the experience of more than a few current ESF beneficiaries obtaining payments over recent months has yielded smaller IR£ sums than the indicative amounts mentioned in commitments letters may have lead beneficiaries to expect, I can assure him that the full ECU amount of all such commitments have been, and continue to be, met.
The State has over the years, issued ESF commitments in ECU as this is the currency in which the funds are received. The implications of doing otherwise would leave the Exchequer open to significant exchange risk exposure in the event of adverse movements in the IR£-ECU exchange rate relative to the date of commitment.
288 Mr. Cowen asked the Minister for Enterprise and Employment if he will make changes to the distribution of EU moneys from the Human Resources Fund of the European Social Fund to give voluntary bodies who provide training to people with disabilities better information as to the amount and date of payment in order to alleviate the losses in income so far encountered due to Irish pound and ECU exchange rates; and if he will make a statement on the matter. [12821/97]
The distribution of funding across the measures in the Human Resources Development Operational Programme was negotiated and agreed between Ireland and the EU Commission in 1993 to apply over the 1994-99 funding period. While this distribution can be changed by the decision of the Operational Programme Monitoring Committee which is representative of the Commission and the range of Irish public and private bodies involved, the Deputy should note that all measures in this Operational Programme are equally affected by exchange rate changes and again that EU Regulations preclude from eligibility for ESF costs associated with offsetting exchange rate movements.
European Social Funds commitments in Ireland are issued in ECU and, at the time of their commitment, the attention of the agencies and beneficiaries involved is drawn to the fact that the IR£ value of payments drawn-down made to them from time to time will vary in line with changes in the IR£ ECU exchange rate. While this has meant that over recent years beneficiaries typically receive either more or less in IR£ than they had expected, it would not be accurate to describe recent outcomes as income losses since the only commitments given were nominated in ECU and are paid in full.
The Deputy will appreciate that it is not possible for me or my Department to forecast future exchange rates such that Irish ESF beneficiaries, whether disabled or otherwise, could be assured of certain IR£ amounts on certain dates.
