Jimmy Deenihan
Ceist:62 Mr. Deenihan asked the Minister for Finance the reasons Counties Kerry and Clare were excluded by the EU Commission from the new Objective One region; and if he will make a statement on the matter. [10109/99]
Priority Questions. - Regionalisation Proposals.
The Government's regionalisation proposal, as originally submitted to EUROSTAT, involved the reclassification of the single NUTS II region of Ireland into two new NUTS II regions, of which one would be based on the existing Border, midlands and west NUTS III regions. The Government's proposals also involved the inclusion of Clare and Kerry in the west NUTS III region. The rationale of the Government's approach was to maximise the area which would qualify for Objective One status.
In the course of intensive correspondence and contacts with EUROSTAT it became clear that EUROSTAT would be willing to contemplate a proposal under which Ireland would be reclassified into two new NUTS II regions but only on the basis which would leave the existing NUTS III region unchanged. While Ireland strongly pressed the case for a revision at NUTS level which would allow Clare and Kerry to be included in the new Border, midlands and west NUTS II region, EUROSTAT would not concede on this point.
In the circumstances, the Government decided that the best interests of the country would be served by agreeing a NUTS II revision based on the existing NUTS III regions. Agreement was reached on this basis guaranteeing that 13 counties would retain Objective One status until 2006. This was reflected in the conclusions to the Berlin European Council.
As regards the overall share for Ireland, it is estimated that about £470 million was secured by regionalisation over and above what would otherwise have been available.
In view of statements made in the House that a strong case would be made for the inclusion of Kerry and Clare, why did the negotiators succumb so easily to the Commission? How much money will Kerry and Clare lose over the five year period as a result of being excluded from Objective One status?
The toughest fight we faced was to get the country reclassified. The Commission's original view was that it did not want Ireland's status changed – it wanted to keep Ireland as one region which would be classified as a region in transition.
In 1998 the Government decided to make an application to subregionalise the country. In so doing we went for what we considered the optimum number of counties. The Commission opposed granting subregionalisation to Ireland so this was not possible. It was possible to have 13 counties reclassified but Clare and Kerry had to be dropped despite the best efforts of the negotiators and the Government. The result has been more than satisfactory. In 1998 everyone in Europe was opposed to subregionalising the country. We succeeded in getting 13 counties included in the new classification.
How much will this cost Clare and Kerry?
One cannot make a calculation on that basis. In one of the final documents submitted by the Commission to the Berlin Council, it estimated that the granting of Ireland's subregionalisation proposal was worth £470 million. When the Government decides on the national development plan in the coming months it will consider the entire country and decide on plans which meet the objectives in all areas. As part of that plan the Government will have to consider the level of EU funding for part of the country and what it will do with those areas which do not qualify for such high levels of EU funding because of the subregionalisation approach.
The Fitzpatrick report will confirm that Kerry's GDP is at 63 per cent. Was the Department of Finance or the Government aware of this figure before agreeing to the 13 counties? There is an infrastructural deficit in Kerry. It has been stated that Clare and Kerry could lose about £500 million over the five year period. Will the Minister give an assurance that this money will be made up from the public capital programme over the next five years?
The national development plan will address all the issues raised by commentators, including the Deputy, expert reports, the ESRI and other studies. If we are to continue to enjoy economic success the Government is aware that the national development plan will have to be broader and more far sighted than previous plans. The needs of Kerry will be looked as will those of other counties.
What about Kerry's GDP percentage?
We had a debate before on extracting GDP figures per county. In putting forward its subregionalisation proposals, the Government included Clare and Kerry as part of a region as it was able to qualify on the basis of being below the 75 per cent of EU GDP. However, Clare and Kerry had to be dropped from that proposal to achieve reclassification for the other 13 counties.