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JOINT COMMITTEE ON ENVIRONMENT AND LOCAL GOVERNMENT díospóireacht -
Wednesday, 27 Sep 2006

Scrutiny of EU Proposals.

We will deal with the scrutiny of EU documents COM (2006) 15, a proposal to assess and manage floods, and COM (2006) 94, a proposal to establish a European grouping on territorial co-operation. At our meetings of 7 and 29 March the committee agreed to scrutinise both of these proposals. We will take the management of floods proposal first. This is an area discussed with the Minister for the Environment, Heritage and Local Government, Deputy Roche, at his briefing of this committee before the quarterly EU Council meetings. The Minister has told us that the aim of this proposal is to reduce and manage flood-related risk to human health, the environment, infrastructure and property. It is reported to be broadly in line with the current OPW proposals to implement national policy as set out in a 2004 report of a flood policy review group. The Minister stated that Ireland welcomed the proposal and actively participated in its development.

I welcome officials from the OPW, Mr. Tom Sherlock, principal officer, Mr. Mark Adamson, assistant chief engineer, and Mr. Michael Caden, assistant principal officer. We are grateful to the officials for attending today's meeting. Before the presentation commences, I must draw attention to the fact that members of this committee have absolute privilege. The same privilege does not apply to witnesses appearing before the committee, however. Members are reminded of the long-standing parliamentary practice to the effect that they should not comment on, criticise or make charges against a person outside the House or an official by name or in such a way as to make him or her identifiable. I invite Mr. Sherlock to start his presentation.

Mr. Tom Sherlock

I am grateful to the committee for inviting me to address it on the subject of the draft European directive on the assessment and management of floods. As the Chairman said, the Minister, Deputy Roche has met the committee on a number of occasions. I have been before the committee previously as part of the Minister's delegation. Perhaps I should briefly explain why the OPW is taking the lead in this matter.

In October 2004 the Government assigned lead responsibility for implementing policy on flooding to the OPW. Despite the fact that the directive is being promoted by the Environment Directorate within the Commission, OPW has been leading on the negotiations by agreement with the Department of Environment, Heritage and Local Government.

The current position as regards the directive is that political agreement was reached on the text at the Council meeting on 27 June. It has still to be considered and approved by the European Parliament and that process is in train. The purpose of the directive, as set out in the text is "to establish a framework for the assessment and management of flood risks aiming at the reduction of the adverse consequences on human health, the environment, cultural, heritage and economic activity associated with floods in the Community". Flood risk is defined in the draft directive as the combination of the probability of a flood event and of the adverse consequences associated with the event. It is a combination of those two factors.

The directive requires member states to identify coastal areas or river basins within their territories and assign them to a unit of management. There is a similar provision in the water framework directive and this will ensure co-ordination between the two directives where this is feasible and sensible.

A preliminary flood risk assessment must be undertaken for each river basin or unit of management identified. This preliminary assessment will include a map of the area, a description of the floods that have occurred in the past that had significant adverse impacts on human life, economic activities and the environment and for which the likelihood of similar events occurring in the future exists. Where appropriate it must include an assessment of the potential adverse consequences of future floods. There is a requirement to exchange information on international river basins. This will not have a major impact for Ireland as we have very few trans-boundary river basins, although it is important for other member states. This requirement for co-operation between member states occurs throughout the draft directive and I will not refer to it again. The draft directive requires that preliminary assessments should be completed by December 2012.

Member states are required to identify on the basis of the preliminary assessments those areas where they consider that potential significant flood risks exist or might be likely to occur. There is then a requirement in respect of the areas identified to prepare flood hazard maps and flood risk maps. The flood hazard maps are to be produced for three separate scenarios: floods with a low probability of occurrence or extreme event scenarios; floods with a medium probability — likely to recur, on average once every 100 years, although there could be more frequent or longer intervals; and floods with a high probability where this is appropriate.

The hazard maps are required to show the extent of the flood, water depths or water levels and where appropriate the flow velocity, where that information is available. The flood risk maps will show the potential adverse consequences associated with the different flooding scenarios. These consequences will be expressed in terms of the number of inhabitants potentially affected, installations that might cause accidental pollution, protected areas and any other information that member states might consider useful. There is discretion, therefore, for member states to include additional categories.

There is also a provision that in respect of coastal areas where there is an adequate level of protection in place or where the flooding is from ground water, flood hazard maps need only be prepared for the low probability or extreme events. The draft directive requires that the flood hazard maps and the flood risk maps be completed by December 2013. There is a further requirement for member states to prepare flood risk management plans, based on the hazard and risk maps. These plans will contain appropriate objectives for the management of flood risks, focusing on the reduction of the potential adverse consequences of flooding to human health, the environment and economic activity and, if considered appropriate, on non-structural initiatives and the reduction of the likelihood of flooding. The management plans will also identify the measures proposed to achieve the objectives and describe the way in which implementation of the measures will be monitored.

The management plans are required to take into consideration relevant aspects such as costs and benefits, flood extent, flood conveyance routes, areas with the potential for retention of floods, the environmental objectives of the water framework directive, soil and water management, spatial planning, land use, nature conservation, navigation and port infrastructure. They will address all aspects of flood risk management focusing on prevention, protection, preparedness, including flood forecasts and early warning systems, and will take into account the characteristics of the river basin. They may include controlled flooding of certain areas in the case of a flood event. Active involvement of interested parties will be encouraged in the production, review and updating of the flood risk management plans. The draft directive requires the publication of flood risk management plans by December 2015 at the latest.

The preliminary flood risk assessment, the flood hazard maps, the flood risk maps and the flood risk management plans will all be available to the public. The draft directive provides that all these documents will be reviewed regularly at approximately six yearly intervals, although there is a staggered period for the initial reviews to line up with the water framework directive. The second and subsequent flood risk management plans will include, in addition to the information under the headings in the first plans, any changes or updates since the publication of the previous plan, an assessment of the progress made towards achievement of the plan objectives, a description of and explanation for any measures foreseen in the earlier version and planned to be undertaken but which have not been taken forward, and a description of any additional measures since publication of the previous version.

The draft directive contains provisions covering implementation measures by the Commission which are reasonable and uncontentious. It also contains provision for transitional measures designed to ensure that where member states have already undertaken risk assessments and produced hazard or risk maps or management plans of a standard as required by the draft directive, they will not have to be produced in the first instance and the review provisions will kick in.

The Office of Public Works has participated actively in the negotiation of the directive. We believe that the present draft sets out a logical and attainable series of steps for the identification and management of flood risk and strikes a reasonable balance between prescribing the measures to be undertaken while leaving some flexibility to member states to interpret and apply the provisions in a manner suitable to their circumstances. We are happy that the principle of subsidiarity has been respected so far in the negotiations. The draft directive is also entirely in line with the programme of work planned and already being implemented by OPW in its role as lead agency for the implementation of the Government's policy on flooding in Ireland. The Minister of State will launch a new website in mid-October which will provide maps of historic flooding throughout the State. These will be a very useful source of information to the public and to planners and everyone involved in the planning and development process. These will not be the same as the flood hazard maps required by the draft directive but they will contain much of the information that will be required for the preliminary assessments.

In partnership with Cork City Council and Cork County Council, the OPW has also recently commissioned a catchment flood risk assessment and management study for the River Lee basin. In the next few months, we expect to commence a similar study of the River Dodder basin in partnership with the local authorities in Dublin. We will roll out a programme of these studies in various river basins over the next few years. These studies are the instrument through which we have envisaged the production of the flood hazard and risk maps and the flood risk management plans, and so meet the principal requirements of the proposed directive.

We believe the draft directive will have a positive impact. The assessments, maps and plans produced will be invaluable to the OPW in maintaining a coherent flood management programme for Ireland. The availability of the information will facilitate the planning and development process to take flooding and the avoidance of risk into account, helping to minimise future increases in the national level of flood risk that may otherwise arise through inappropriate development. Since all the information will be in the public domain, it will also help to raise awareness of flood risk and thereby increase preparedness. In that way it will reduce the impact of any floods, which cannot be prevented.

That is a general overview of the situation. My colleagues and I are happy to answer questions if that suits the Chairman.

The draft requirements appear to ask that flooding problems be identified, but nothing is said about curing the flooding problems. As the preliminary assessment does not have to be produced until 2012, there does not seem to be any great urgency about this. Is this information not already in the possession of the OPW because of the history of flooding in various places in Ireland? Following flooding in south Galway in 1995, €1.1 million was spent by the OPW in commissioning a report on flooding in the area with a view to alleviating it, but not a spade has been put into it since.

The report was published in 1997 and cost a great deal of money. I am sure this has occurred in other areas also. Does the OPW not already have information for areas where there was a history of flooding over a number of years that would meet the requirements with regard to human health, infrastructure, the environment and all the factors which would be affected by flooding anywhere? The OPW should have this information rather than having to produce it all again in a preliminary assessment in 2012.

Mr. Sherlock

It is correct that we have much information. I am familiar with the study and the work undertaken in south Galway.

What work was done there? The only work done was an unofficial scheme I organised to alleviate the flooding with which Mr. Sherlock is familiar. The flooding in south Galway has not occurred since then as a result of that scheme.

Mr. Sherlock

I acknowledge that. I do not want to be contentious. We have much information. We have since implemented various flood relief schemes and are in the process of designing other flood relief schemes, from which we are gathering much information. All this information will feed into the catchment flood risk plans. However, we are dealing here with assessing the flooding problem, not on a point-specific basis but on a whole catchment basis. We are trying to identify solutions on a catchment basis and identify areas where there is and is not a flood risk throughout a catchment and which, therefore, may be more appropriate to development.

To answer the question, information that we have already captured will be available so we will not duplicate it, although in many situations it will be necessary to update it. For example, the information from 1995 will have to be updated. This is a different exercise. It is a more holistic, whole catchment approach to the problem of flooding.

I welcome Mr. Sherlock and his colleagues and thank them for the presentation. I have three questions. The first concerns the directive. Why are the time targets so far away? This is a problem that has already happened. The city of Prague, for example, was seriously damaged by flooding in recent times. Six years to prepare maps and nine years to prepare flood risk plans seem very long time periods to respond to something that has already happened.

Second, when the directive is made, will it require legislation to give it effect in this jurisdiction? Is it intended that the flood risk planning will be put on a statutory basis? How is it intended that this will link with the planning process? Will there be a requirement to include it in city and county development plans? How will it tie up?

My third question is more practical. As I understand it, the emphasis here is on river basins or coastal areas and the risk that arises from flooding due to the rising level of water in a river or coastal area. What work, if any, is being done in respect of the risk of flooding arising from existing development? I refer, for example, to the capacity of the surface water drainage system, especially in urban areas. Much attention is given to the capacity of sewerage schemes, water supply capacity and so on, but it seems that surface water drainage is the poor relation in planning.

Is there sufficient capacity in this regard? Does anybody know the capacity of the surface water drainage system to deal with, for example, heavy falls of rain? What attention is given to the maintenance of this system? One of the problems which arises regularly with flooding that arises from heavy falls of rain, especially in urban areas, is simply that the gullies and drains are not maintained by anybody. It is often the case when road sweeping takes place that the machines leave a pool of road sweepings at the edge of a drain. When heavy rain washes the sweepings into the drain, it clogs and ponds and flooding result. Does anybody have control of the surface water drainage system in already developed areas and its capacity to deal with flooding?

Mr. Sherlock

I cannot give Deputy Gilmore an answer to his third question as it is outside my remit. It is an issue for the local authorities. From the OPW's viewpoint, part of our job will be to ensure, where we are involved in the design of schemes, that adequate capacity is provided to ensure the water gets to the river or other water course, and to ensure that the river is capable of handling that water. Equally, a critical part of the design of our schemes will be to ensure that the water does not return from the river through the surface water drainage system. While I cannot give a fuller answer, perhaps Mr. Adamson can do so.

Mr. Mark Adamson

Many local authorities are undertaking main drainage schemes. The greater Dublin strategic drainage study, for example, is tackling exactly that problem in terms of the capacity of the sewerage systems of major urban areas. The local authorities are aware of this problem and have it in hand in many instances.

Mr. Sherlock

To deal with Deputy Gilmore's other questions, the time targets seek to achieve what all member states consider feasible. Ireland had decided to go along this path even before the negotiations began and the directive came into being. We could run with earlier dates but other member states are not at the same stage of preparedness and would fail to meet a target for earlier dates. We have already begun to roll out catchment flood risk management assessment studies, which is essentially what we need to do to comply with the provisions of the directive.

I envisage legislation will be necessary to transpose the provisions in the directive. While I do not imagine this will operate through the Planning and Development Acts, we have not yet made a detailed consideration of the issue. The directive is still at the negotiation stage, which is where our focus has been to date.

I welcome Mr. Sherlock to the meeting. There are two issues. The first is the European directive and its enactment over a fairly protracted timescale. However, there is also the immediate issue of previous and current flooding in Ireland. It is four years since we experienced devastating floods in the Dublin area. I know this only too well as my home was flooded and I had to escape over a back wall with a five-week old child. On the national stage, my concern is that not enough has changed in those four years.

Mr. Sherlock stated that new material will be available over the next weeks and months. What information will be made available to planners in local authorities, whether they be in Bray or Belturbet, to assess flood risk as part of the assessment of a planning application?

I am speaking practically rather than theoretically because a contentious issue has arisen in the town of Bray, in which a developer has secured a planning permission for a massive development on a flood plain. While it is the subject of an oral hearing before An Bord Pleanála in a few weeks' time and I do not wish to go into details, significant potential development on a flood plain is of concern. What obligation is on local authority planners to have regard to flood plains and what information is available to them?

Almost four years have passed since devastating floods caused enormous damage, costing tens of millions of euro, to hundreds of homes in the greater Dublin area. While I accept the European directive is of major importance and will impose significant obligations, that will be in 2013 or 2015, which is a long way off. However, four years ago we had a direct experience and I wonder whether we have learned lessons from it. Obviously, while the Office of Public Works has carried out useful work on the Tolka and Dodder rivers, I am concerned whether those who grant or refuse planning permission can really incorporate the risk of flooding as a material consideration in their decisions. Frequently, such matters constitute the secondary or upstream effects. I refer to the issues touched on by Deputy Gilmore.

For instance, in the case of the Tolka significant urbanisation and suburbanisation has taken place, extending all the way to County Meath. The presence of significantly more tarmacadam and concrete means faster run-offs and a higher risk of flash flooding. This may be taken in combination with some drainage programmes aimed simply at opening up the river basin through the use of JCBs and other equipment. Although this allows the water to move through quickly, if it meets an obstacle it can quickly cause flooding. Hence, I am concerned that the natural amelioration of such waters through wetlands or other mechanisms is being lost and whether the spread of development allowing faster water run-off is being taken into consideration.

Does Mr. Sherlock believe the present planning system can take adequate account of flooding in making decisions? While I appreciate that implementation of the directive is several years hence, how can the planning system deal with this issue?

Mr. Sherlock

That is a big question. At its simplest level, yes, the planning system can, and in some cases has, taken it into account. I am confident the situation is improving. Ultimately, as the planners and local planning authorities are independent in the discharge of their functions, the Office of Public Works has no directive power to make them take on board the information and advice it can provide to them. The flood hazard mapping project to which I have referred has and will give them better information. The information is not absolutely perfect in that it pertains to historic flooding.

If I may explain briefly, while preparing such flood hazard maps we have commissioned a survey of all newspaper reports going back to the late 1800s. In all local authority engineering offices to which we gained access, we have trawled through the records to retrieve any reports in the local authority files on flooding. Moreover, we have gone through all our own records, including all designs for our drainage schemes and the old arterial drainage schemes, going back to 1945 and earlier. All that information has been pooled together and mapped and will be available from the middle of October. While planners already have access to it to some extent, it will be made available to the public.

The Office of Public Works will maintain the information and will continue to update it as new data comes to hand. Hence, planners who use the site while dealing with a planning application will certainly receive an indication to the effect that it is located in an area in which flooding may have occurred in the past or that one may need to consider flooding in this general area. This small pop-up warning system will be available for planners. While they are anxious and willing to use it, we must wait to find out what is the actual experience. However, I am optimistic. Ultimately, they want the flood risk maps that will be produced under the directive requirements and that will be produced under the catchment flood risk management studies we have already begun to undertake. These will provide them with defined lines on maps to the effect that there is a stated defined risk of flooding within a particular area. This will be much more useful to them. However, until this is achieved — we are getting there as fast as we can — the hazard maps will be extremely useful. I am optimistic we will see an improvement in this respect.

I accept this and am sure it will be invaluable. However, my concern is that in a time of extremely rapid urbanisation, enormous amounts of development are taking place and, in the words of the financial advertisements, past performance may not be taken as a guide for future yields. For instance, in my constituency, while there were green fields at Cherrywood ten years ago, it has become office parks, apartments and homes. Consequently, the Shanganagh river now has much higher flash run-off than was then the case. Hence, if one intends to build apartments by the river's edge in Cherrywood or Loughlinstown and wishes to determine the risk of flooding, there is not much point in examining previous high water marks on that river. Although there may not have been floods there previously, there is now an increased risk by the river bank. How can one move on and include the development that has occurred in the equation?

Mr. Sherlock

All such information will feed into the catchment flood risk assessments because assessing conditions on the ground constitutes part of the early stages of such a study. Hence, information will be captured. It will not be simply a case of someone pulling up old maps which may not have recorded all the development. Surveys will be carried out on the ground to interpret that information and to model and estimate what the flows and velocity in the rivers and channels might be.

There is no instant answer. Unfortunately, such studies require the gathering of much information so that one's models may be run and one may be reasonably confident in respect of one's forecasts that the flood line will be at a particular point. Hence, while there is no instant fix, I am quite confident the mapping we will undertake in the future will pick up that sort of information. I should also note that the office is at breaking point in respect of the number of local authorities with which we work to try to produce flood studies. To be location specific, we are doing so for Bray, Portarlington and a clatter of others.

I can imagine that.

Mr. Sherlock

We are at absolute breaking point in terms of what we are being asked to do.

Many people in Bray are old enough to remember Hurricane Charlie. This is why they are scratching their heads at — without discussing individual cases — the prospect of large-scale development to be located literally on the river bank. They are worried and it is important that I convey this concern.

Mr. Sherlock

I am very conscious of this. Like Deputy Cuffe, I will not deal with the actual planning issue because it is with An Bord Pleanála. The OPW was asked by Bray Town Council to join a steering committee to produce a flood risk assessment and, I hope, a flood risk management plan for Bray. We are participating in this committee. Planning is a separate issue that will be dealt with through the appropriate processes. The study is at an advanced stage.

I am pleased to hear that but I worry that we are putting the cart before the horse.

As a committee, we should be concerned about the planning issues raised by Deputy Cuffe. I pass by a field coming to work every day which floods three times a year in the winter but which now has housing development on it, which appears incredible. It is slightly disheartening to hear that information in respect of flooding is possibly not being considered by local authorities and it is something about which the committee should be concerned and should look into.

Local knowledge possessed by householders and particularly farmers is very important. Farmers will often know everything about flooding in their region, information which may not reach the Department or the local authority. It is necessary to have a public consultation that is as wide as possible.

I also welcome Mr. Sherlock and his team to the meeting. Deputies Gilmore and Cuffe touched on some of the issues I also wish to raise. One of these issues relates to the question of why the process is taking up to 2012. Deputy Gilmore touched on what happens when these maps are sent to the local authority. My major concern is that local authorities will not take on board the significance of the flooding of the particular area. I can cite examples from two areas in my constituency, with which Deputy McCormack will be familiar. Planning permission was recently granted on a flood plain in Oranmore which was clearly marked on maps. The matter went to An Bord Pleanála, which upheld the planning permission. Another case involved the granting of planning permission on a flood plain which was marked on maps going back to the 1800s. I remember raising the issue with the local authority. I was informed that its staff members were not experts on flood plains and did not know where the water would go. I was told that the developer had produced a detailed study setting where he felt the water would go. However, both Mr. Sherlock and I know that where money is involved and consultants are brought in, they will produce a scheme that will facilitate the developer. Following rain in recent weeks, I received a telephone call informing me that the development is practically built and the drainage system put in place but that the river has risen and flooded the site.

When maps are produced, they will not be worth the paper they are written on unless they contain something which the planners will be forced to take on board and acknowledge that this flooding occurs. We all know that water has to go somewhere. If it cannot go down, it must be piped into a river. Was the OPW consulted by the local authority regarding these planning applications? I do not wish to go into the details but I am concerned that when these maps are produced, they will lie on some desk, a developer will come in with a detailed report where he will state that the water will go here and there, the planner will take it on board and we will suddenly be faced with a major problem.

Mr. Sherlock

The plans will not just go to the local authorities. They will be in the public domain. If I am planning to buy a house, when these maps are produced I will be able to look up a website or visit a public office and check the maps to see if the house I am about to buy is in a flood risk area. This in itself will be very important, which is why I am so pleased that all this information will be readily accessible in the public domain.

My experience is that the memory of flooding is very short. There is considerable movement of staff in local authorities. Based on my experience of dealing with these matters, once the flood disappears, the memory fades very quickly for the general public, with the exception of those who have been in the middle of it and have, as Deputy Cuffe noted, been forced to escape from it with children or be stranded. These people are completely traumatised. The fact that the memory of the flood fades so quickly for the general public is the reason it is so important to capture the information we are capturing at the moment and will capture in the historical mapping. The plans produced will not simply be in the local authority; they will be in the public domain where everybody will be able to access them. If a person is driving by a field and sees a "For Sale" sign or a housing estate there, he or she will be able to consult a map and say this should not happen.

The Chairman raised the issue of public consultation, which is central to the catchment flood risk assessment and management process. There will be a number of information gathering days and consultation throughout the process. Once we get the hazard mapping site up and running, we will invite the public to submit information to us and we will have a process for validating and recording it if it is valid.

Since its appointment as lead agent, the OPW is now leading a group with the Departments of Communications, Marine and Natural and Resources and the Environment, Heritage and Local Government to produce proper and detailed planning guidance for planners relating to how they should deal with applications for development where flooding is an issue and the kind of assessments they need to take on board. This is another group chaired and lead by the OPW and will, I hope, produce an agreed outcome.

Will the guidelines be made available to the local authorities?

Mr. Adamson

We are at the tender evaluation stage with consultants we have procured to assist us with this. Draft guidelines might be ready towards the latter half of next year. There is a fairly convoluted path to go through and there are many issues to consider. It would then be a question of how that guidance is issued. The question of whether it comes through guidelines from the Department of the Environment, Heritage and Local Government or whether it is an OPW document might determine the release date.

Are there any further questions? I thank Mr. Sherlock, Mr. Caden and Mr. Adamson for coming here today. We have had a useful discussion on the subject. Is it agreed that this proposal has been sufficiently scrutinised at this stage and that we ask departmental officials to keep us briefed if any developments arise at EU level in the future on this issue? Agreed. The clerk will, therefore, prepare the report of the joint committee on the matter for laying before the Houses.

I now invite officials from the Department of Finance to address COM (2006) 94, a regulation dealing with the establishment of a European grouping for territorial co-operation. I welcome Mr. Pat Casey, principal officer at the Department of Finance, and Ms Annette Connolly from the Department of Finance. I call on Mr. Casey to present his submission to the committee.

Mr. Pat Casey

I thank the committee for giving me the opportunity to make this presentation today on the regulation dealing with the European grouping for territorial co-operation, EGTC. I will set out the context for the regulation of the EGTC, the main provisions of the regulation and what the main issues of concern to Ireland were at the time. The draft possessed by the Chairman dates back to last March. I would also like to draw the committee's attention to the fact that all our concerns were resolved at the drafting stage when the regulation was being considered by the structural actions working group, the relevant committee in Brussels. The regulation has since been approved by the Council and agreed by the European Parliament and was published in the Official Journal of the European Union, OJEU, on 31 July. It took effect from 1 August.

I will explain some of the background. The Commission set out its proposals for the next round of programmes from 2007 to 2013 in the third cohesion report published in February 2004. Subsequently, the Commission published five draft regulations on the governance of cohesion policy in July 2004. The structural actions working group debated the draft regulations and a consensus was achieved on the majority of the provisions.

The proposals contained a radical shake-up of existing cohesion policy prompted by enlargement and an attempt to focus investment on a limited number of priorities reflecting the Lisbon and Gothenburg agendas, particularly in non-Objective One status regions. Management will be streamlined and the number of main objectives or priorities in the regulations has been reduced to three. The first is the convergence objective, the second is the regional competitiveness and employment objective and the third is the territorial cohesion objective. The bulk of the European Union's Structural Funds are being provided in respect of the first objective, but Ireland will not benefit from it in the next round. It replaces the existing Objective One and is aimed at EU regions with per capita GDP below 75% of the EU 25 average. Special provisions are proposed for regions that would have GDP per capita of less than 75% of the EU 15 average, but due to enlargement are now above the 75% of the EU 25 average.

Neither of Ireland's NUTS II regions, the southern and eastern region and the Border, midland and western region, will be eligible for support due to their GDP levels. As most committee members know, Ireland is divided into two regions for Structural Funds purposes. Both Irish regions will qualify for support under the second objective, which is aimed at all EU regions not covered by the convergence objective.

The Commission proposed that activities to be funded should concentrate on implementing community policies, that is, the Lisbon and Gothenburg agendas and the European employment strategy, with particular focus on innovation and the knowledge economy, environment and risk prevention, accessibility to services of general interest, such as public transport or broadband, increasing adaptability of workers and enterprises, enhancing access to employment and social inclusion measures. Transitional arrangements and enhanced support were proposed for current Objective One status regions that now have a per capita GDP above 75% of the EU average because of natural growth. The BMW region is eligible for these transitional arrangements and will get more money from Ireland’s allocation.

The Commission proposed a territorial cohesion priority aimed at supporting cross-border and inter-regional activities. This replaces the INTERREG Community initiative programmes of the current round. In this respect, the Commission proposed a package of five regulations. Four regulations concern cohesion policy and one proposes a framework for promoting cross-border co-operation, that is, the regulation on European groupings for territorial co-operation before the committee. The four cohesion regulations establish the objectives, policy orientation, linkages with the Lisbon Agenda, funding for the objectives, general planning, management and implementation arrangements, financial control, the roles of various bodies, partnership, the role of the EIB and the need for consistency with other Community instruments and policies. This is the general framework through which Structural Funds are disbursed.

There are separate regulations for the operation of the three main funds, namely, the European Regional Development Fund, the European Social Fund and the Cohesion Fund. These regulations concern the orientation and programming of the separate funds, the eligibility of activity and specific arrangements linked to the character of each fund. In the next round, the funds relating to Ireland will be the ERDF and the ESF, but we will no longer benefit from the Cohesion Fund.

The European grouping for territorial co-operation regulation is designed to provide for cross-border arrangements between public bodies to overcome differences in administrative arrangements on either side of the relevant borders. The regulation provides a common statutory framework for the conclusion of agreements to co-operation. However, recourse to the EGTC is optional. It is designed to promote co-operation primarily between different local and regional authorities and certain other public bodies in the European Union. Member states may also be members of the groupings. The intention is for all types of territorial co-operation to be covered. These range from cross-border co-operation in the case of bodies or regions that share common borders, transnational co-operation where regions do not share common borders and inter-regional co-operation, which relates to regions with or without common borders. The proposal is essentially a successor to the current INTERREG regional programme instrument for member states' co-operation in Structural Funds expenditure.

An EGTC can be established as a distinct legal entity with the same legal rights afforded to it as other legal persons in member states. However, potential members of the grouping must apply to their respective member states for approval to participate in the first instance. The EGTC must have its own conventions and statutes, be registered in a member state and draw its membership from at least two member states. While the main aim of the establishment of the EGTCs is to facilitate the implementation of the co-operation programmes financed by the funds, they can also carry out actions or programmes that are not Community-funded.

The above is a summary of the main provisions circulated to the committee. A copy of the regulation has also been made available. For convenience, I have set out in appendix 1 the main provisions of the regulation. I do not propose to go through these, but I will happily take members' questions.

Ireland's interest in the drafting process and the matters considered by us revolve around three issues, one of which relates to the establishment of an EGTC. Our main interest in this regulation concerned Article 3.3 as originally drafted, which described the procedure for the establishment of an EGTC and provided that a member state must agree to the participation of an applicant body in the grouping unless such participation essentially contravened the regulation or the member state's national law. We found this measure restrictive. Approximately half of the 25 member states expressed varying degrees of opposition to and dissatisfaction with the proposal, which they saw as limiting their powers to refuse an application. Ireland, the Netherlands, Denmark and the UK were among the more vociferous member states that called for more discretionary powers of refusal to be introduced into the text.

After some time, the Commission responded specifically to suggested Irish textual amendments, which not only allow a member state to veto an application on public interest or public policy grounds, but also extend this discretion to Article 9 of the regulation relating to the activities of an EGTC. The inclusion of this public interest provision was sufficient to address the main element of our concerns.

A second issue related to the nature of the activities an EGTC could undertake. The regulation allowed non-Community finance tasks to be undertaken by the European grouping for territorial co-operation, EGTC, and still does. A number of member states sought to restrict such tasks to Community funded tasks or to give member states discretion in this matter. Others did not have difficulty with a territorial grouping carrying out a wide range of tasks and did not agree. The final version of the regulation provides that a grouping on territorial co-operation will focus primarily on promotion and implementation of territorial co-operation projects co-financed by the EU structural or cohesion funds while allowing some room for activities that facilitate territorial co-operation. That is addressed in the relevant article of the regulation.

The third part relates to the public interest. This article, dealing with how a member state can address a situation where undesirable activities are being carried out by an EGTC, may have caused some concern because of the ex post facto nature of the remedies proposed at the outset. This was amended following the new Commission proposal. The proposal expanded the grounds for prohibiting such activities to include the public interest and allayed our concerns. I thank the committee and hope I have provided an overview of the main provisions of the regulation.

Is Mr. Casey satisfied with this proposal from the Irish point of view?

Mr. Casey

Yes, the main issue is the establishment of a territorial grouping. As originally proposed, the member state had to agree to the grouping unless it contravened the regulation or national law. These were the only exclusions allowed. If, for example, a local authority wished to create a link it could go ahead unless there was a legal prohibition on it. We thought this was too restrictive. Our concern was that this could interfere with existing bodies dealing with cross-border co-operation. The insertion of the public interest and public policy provisions addresses these concerns. Member states may have their concerns reflected before a body is established.

What period does the new Objective One programme cover?

Mr. Casey

Objective One covers the next programme period, 2007-13. The current programme expires at the end of this year.

Ireland is divided into two regions, the southern region and the Border, midlands and western region. If one region is under 75% of GDP and the other is over that amount, is the average calculated or can the latter region qualify for the higher rate of funding?

Mr. Casey

Yes, it could. The criteria for Objective One status are based on statistical information gathered by EUROSTAT. When discussions start on the next round, statistics are based on a particular year. The first calculation was based on average GDP in 2002. In later discussions, it was based on the figure for 2004. Countries whose GDP had increased in the interim were allowed additional phasing in and phasing out moneys as well as the base figure. From a theoretical perspective, the figures were fixed on the basis of statistics from GDP but both of Ireland's two regions do not qualify.

In the current Objective One programme, the Border, midlands and western region was under 75% of the GDP.

Mr. Casey

Of the EU 15.

That was 2001-07.

Mr. Casey

The period is 2000-06.

Is the Government obliged to spend the money in the region that qualified for extra funds or is it free to spend the money anywhere in the country?

Mr. Casey

The agreement on Structural Funds requires that the moneys be spent in the relevant region. It is not allowed to transfer the money to other regions.

Is 2000-06, how much was spent in the Border, midlands and western region compared to the southern and eastern region?

Mr. Casey

I do not have that information.

Could Mr. Casey obtain it?

Mr. Casey

I could.

I thank Mr. Casey for representing the Department of Finance today along with Ms Connolly. Is it agreed that the proposal has been sufficiently scrutinised and that we will ask the Department officials to keep us briefed on any developments? Agreed. The clerk will prepare the report of the joint committee on the matter to be laid before the Houses.

Having seen Longford perform so well in the recycling of household waste report published last week, is it possible to invite staff from the local authority to attend to explain how it was done? The recycling rate there is 57% even though people believe recycling cannot operate in a rural area in the same way as in towns.

We will endeavour to facilitate that as soon as possible in the context of discussions on waste management.

The joint committee adjourned at 3.50 p.m. until 10.30 a.m. on Wednesday, 18 October 2006.
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