Seanad Éireann debate -
Thursday, 27 May 1993

Vol. 136 No. 8

Structural Funds: Statements.

Minister of State at the Department of Finance (Ms E. Fitzgerald)

I am very pleased to have the opportunity of speaking to Seanad Éireann about EC Structural Funds at this time when work is well underway on preparing the National Development Plan for the next round of EC Structural and Cohesion Funds.

We are all aware of the importance of EC Structural Funds to Ireland. These funds have already contributed substantially to increasing output and employment levels, through raising our long term capacity, as well as providing a short term injection of substantial spending power.

The objective in the next round of the funds must be to ensure the best long term return to the Irish economy and society after the last ECU has been spent. This is the last time we are likely to receive a funding increase on this scale, and the choice of spending programmes and projects must be wisely made. It is also an important objective to try and reintegrate into the economic mainstream those individuals and communities now on the outside through unemployment, and a targeted programme of local development in unemployment blackspots will be a key feature of the new plan.

Although very large sums of money are involved which are very welcome to Ireland's economic development, it is important to emphasise that they are scarce resources. The demands for funding which have come across my table total £28 billion, many times what we hope to receive from Brussels. Difficult choices have to be made in deciding how these resources are best allocated. Given the high expectations people have, and that many groups now see European money as one of the first ports of call in financing new projects, there will inevitably be disappointments. It is important to bring a sense of realism to the planning of these resources.

It is important to ensure we get genuine value for money from these scarce resources. That means cutting our cloth to fit our measure, and avoiding de luxe proposals which give one project for the price of two. It is important, when designing projects, that the Structural Funds are not regarded as free money from the EC. There are alternative uses to which the funds can be put and we must ensure that we achieve maximum long term value. We will only have one opportunity of doing this. I appeal to local authority engineers and those preparing projects for inclusion under various operational programmes to bear this in mind. To achieve the maximum long term value we must seek optimum benefit from every ECU we receive and choose projects which are realistic, and adequate to achieve their intended objectives, rather than ones which are de luxe and excessive.

Proposals under the plan will have to be evaluated to see whether they generate genuinely additional economic activity or are simply subsidising a new enterprise in one area at the expense of jobs elsewhere. There is no net gain to the Irish economy if we establish a new factory in Dundrum with EC subsidies which knocks out an existing enterprise in Rathfarnham and results in job losses there. The purpose of this money is not to transfer resources from one region to another but to generate additional economic activity in the country as a whole. It is also important to try and avoid what economists call deadweight, subsidising economic activities which would have taken place in any event. For example, if a firm receives £1 million from the Structural Funds but would have used an equivalent amount from its own resources if money from the EC was not forthcoming, it is free to invest this amount abroad. Thus, there is no gain to the Irish economy from these EC transfers. We want to get maximum leverage in generating new economic development from the funds spent.

To set the plan in context, I would like today to look at the broader EC objective of economic and social cohesion within which the Structural Funds are made available, the benefits Ireland is getting from the funds and the work currently underway both at home and at EC level in relation to the next round of the funds.

The EC Structural Funds are designed to assist investments in the less developed regions of the European Community with a view to enabling these regions to build up their productive capacity and ultimately reach the same level of development as the rest of the Community. They are a key instrument in achieving the EC's policy objective of economic and social cohesion. Ultimately, the donor countries are giving us this money to improve our long term economic performance and to help counteract the pull to Europe's centre from the implementation of the Single Market. They are not eligible to be spent on many worthy activities which do not come within this objective, and they are not slush funds to be devoted to pet projects.

Ireland has always attached a very high priority to the goal of economic and social cohesion. In the negotiations on the Single European Act, which laid the basis for the establishment of the Single European Market, the Irish Government ensured the Treaty provisions concerning economic and social cohesion would be strengthened. Subsequently, Ireland was to the forefront in the negotiations on the reform of the EC Structural Funds which provide the means to enable the Community to contribute towards reducing the disparities between the peripheral and less developed areas and the more prosperous regions in the Community. These negotiations resulted in a doubling of Structural Fund resources in favour of the less developed regions covered by Objective One of the funds over the period 1987 to 1992 and facilitated the allocation of over three billion pounds in Structural Fund aid to Ireland in the current Community Support Framework. The progress achieved with the benefit of Structural Fund assistance over the last five years is clear evidence of the importance of the Community's economic and social cohesion policies to Ireland.

In the negotiations leading up to the Treaty on European Union agreed at Maastricht last year, Ireland ensured that economic and social cohesion was placed high on the agenda. The objective was to secure a framework which would provide for the further development of the Community policies and actions in favour of economic and social cohesion and to enable Ireland to respond effectively to the challenges posed by evolution towards closer economic, monetary and political union.

The Treaty on European Union incorporated specific provisions to include the strengthening of economic and social cohesion as one of the key areas of Community policy. Articles 130A to 130E of the Treaty covering economic and social cohesion, which were introduced by the Single European Act, have also been strengthened. The requirements of economic and social cohesion must now be fully considered in the formulation as well as the implementation of Community policies. Furthermore, the commission will be required to report in detail every three years on the progress towards the achievement of economic and social cohesion. The Treaty also provides for the establishment of the new Cohesion Fund which will provide additional aid towards investments in transport infrastructure elements of trans-European networks and the environment in Ireland, Greece, Portugal and Spain. In addition, a special Protocol on Economic and Social Cohesion was annexed to the Treaty to underpin this aspect of Community policy and to ensure that the Structural Funds continue to give highest priority to the less developed regions.

The European Council, held in Edinburgh in December of last year, made several key decisions in relation to Community finances. It was agreed that the Community's next Financial Perspective would cover the period 1993 to 1999. It is important to point out that we are in the first year of this process. It was also agreed that the resources available to the Structural Funds, including the provision for the new Cohesion Fund, would grow significantly faster than the total Community budget and that priority would be given to the regions covered by Objective 1 of the Funds.

Overall a total of about 85 billion ECU is available to be committed to the four cohesion member states of Ireland, Greece, Portugal and Spain over the seven year financial perspective 1993-99. This includes 70 billion ECU Structural Funds and 15 billion ECU in Cohesion Fund assistance. This total available amount of 85 billion ECU will permit a doubling of Objective 1 Structural Funds and Cohesion Fund commitments in the four cohesion states between 1992 and 1999 after allowing for full Objective 1 treatment of what once was East Germany.

The Structural Funds and the new Cohesion Fund are not a panacea for all our ills, nor a limitless source of funding for everyone's pet proposals. We would all agree that the development of the Irish economy and, in particular, the creation of sustainable employment must be tackled on a number of fronts. The creation of sustainable jobs must be the number one priority in the way the Structural Funds are spent.

To date the Structural Funds have played a crucial role in supporting the Government's efforts to develop an environment conducive to increased investment, especially in the internationally competing sector. In the medium to long term the Structural Funds are enabling Ireland to make significant progress in building up necessary infrastructure such as roads, access transport and sanitary services. They are contributing to productive investment in industry, tourism and agriculture and to the development of human resources through training and education. It is not only the visible investments in road improvements, for example, but also the invisible investments in human resources, which increase the productive potential of the workforce and are important in improving our capacity in the long term to increase our economic growth and output. Structural Fund investment has allowed total public expenditure to be brought to a level far higher than would otherwise have been possible.

It is important to point out that some of the agricultural funds come under the main Structural Fund headings, for example, headage payments which are more of an income transfer than a long term economic investment and which will form part of the Structural Funds package. In general, the approach we must take is to try to ensure the best long term economic return to the Irish economy. We must ensure that what we achieve is in terms of long term economic growth. When the last ECU is gone we will have to look at what is left behind and how this money was spent.

The impact of the Structural Funds to date on Ireland's economy is clear. At the macroeconomic level it is estimated that the increased funds provided in the period 1989 to 1993 will have increased the level of GNP by 2.7 per cent by the year 2000. The Structural Funds impact on the level of economic growth in two ways. One of those relates to short term spending. We have spent £3 billion over the last four years and if that money were only spent on digging holes in the ground and filling them up again there would be an employment spin-off in the short term. However, the key task we face is to try to devise a series of investments in human resources, economic investments and infrastructure that will give us the best long term return when the effects of the short term injection have worked their way through the economy.

At sectoral level the benefits of the current programme are also evident. Under the Industry and Services Programme co-financed by the Structural Funds, a target of 20,000 new jobs per year was set. This employment target has been surpassed for the first four years with a total of over 81,000 new jobs created to the end of 1992.

The performance of the tourism sector has been significantly boosted by Structural Funds aided measures. By the end of 1992 the number of overseas visitors had increased by 25 per cent, foreign tourism revenue is up by 32 per cent and an extra 18,000 jobs have been created in the tourism industry.

As Senators are probably aware the system of management of the Structural Funds was reformed in 1988 and the current system of a plan, a community support framework and operational programmes has worked well. The introduction of a programme rather than project based approach and multi-annual planning has allowed for a coherent strategic approach to expenditure aided by the funds.

Implementation of the present Community Support Framework for Ireland is monitored at national and sub-regional level. The overall financial projection is broadly on target to utilise Ireland's full entitlement of EC aid over the five year period. We have been successful both in ensuring that we draw down the maximum of funds available to us from Brussels, and in ensuring that the money is well spent. We have left nothing behind in the kitty and I must pay tribute to the Civil Service for the job they have done.

The current Community Support Framework for EC Structural Funds will expire at the end of 1993 and the preparation of a new National Development Plan which will form the basis of negotiation with the EC Commission of the next Community Support Framework for the post-1993 period has been underway for some time.

As part of the plan's preparation there has been a wide process of consultation. The seven sub-regional review committees, set up to review implementation of the current round of Structural Funds, were invited to make submissions on their views on the content and strategy of the plan insofar as they affect each sub-region. Funding was provided, partly aided by the Structural Funds, to enable the committees to employ consultants to assist in the preparation of their submissions and to hold briefing seminars to which interested groups in the sub-region were invited. These submissions have all been received. Each sub-regional review committee's submission takes into account a wide range of proposals from local authority, agriculture, trade union, community development and business sector interests at local and regional level.

I met with each of the committees to discuss their submission and the priorities they would see in their sub-region and I found these discussions helpful to my work. I have spelled out to the sub-regional review committees that the demands on the table far exceed what we have to spend and I invited them, in that context, to come back to me with what they would consider to be their local and regional priorities. It is appropriate at this stage to acknowledge and pay tribute to the amount of work and effort which the committes put into this task and their commitment to it.

The social partner organisations represented on the Central Review Committee, ICTU, IBEC, IFA, ICMSA, ICOS and CIF, also made submissions, as did the Chambers of Commerce of Ireland, the Council for the Status of Women, An Taisce, the Community Workers Co-op and many other groups. I have met with most of these groups and have plans to meet with others. I am meeting with An Taisce, for example, this afternoon. I found those discussions a useful input in preparing the plan.

A large number of other groups and individuals have made submissions to me, to the various Ministers with sectoral responsibilities relating to the plan, to the Department of Finance or to other relevant Departments. The different views outlined in these submissions and in the various seminars and conferences held on the topic and an important input into the whole planning process. It is important to emphasise that this is not a magic fund which has an answer to everyone's problems. Some of the submissions I received relate to projects which are clearly ineligible for Structural Funds assistance. For example, the Structural Funds are not available to be spent on local community halls or many other worthy projects as the donor countries are giving this money in order to increase our long term output and employment potential.

Many projects which are important and useful are not eligible since they do not fall within the regulations. There are difficult decisions to be made and we cannot afford to do everything we would like to do. We have to select programmes or projects on the basis of criteria which reflect what we feel offers the best long term return. It is easy in hindsight to look back and say that we should have done this or that and it is fair to acknowledge that we are not necessarily going to get everything right. However, there is a genuine effort being made to try to identify those areas where we will get the best long term return from this once-off investment in our future. I received one submission from a woman saying that there had been structural damage to her house and asking if Structural Funds would be available to aid her. Unfortunately, not everything is eligible.

There are, of course, other inputs to the process. The various Government Departments have drawn up detailed proposals in relation to programmes and measures with which they deal.

It was considered desirable to obtain an independent, external view on the plan. Last October, before I was appointed Minister of State, a group of external consultants was engaged. I must declare an interest here as the ESRI, for whom my husband works, was the group employed. Their brief was to carry out an evaluation of the implementation of the present Community Support Framework in terms of its effectiveness in contributing to Ireland's economic development. In the light of this evaluation the consultants were asked to make recommendations for the elements and the balance of these elements in a Community Support Framework for the post-1993 period which would make the greatest contribution to Ireland's growth and employment objectives and to productive investment in Ireland.

In defining the optimal mix of national programmes and measures the consultants were asked to quantify, as far as possible, the benefits in growth and employment to be expected from the various options. This consultancy study has been of benefit in crystallising this plan. It is based on an evaluation of the success of different projects and programmes. It is important to learn from those successes.

Dialogue with the EC Commission provides another input. In addition to the general negotiations at EC level there have been meetings with EC officials about various issues related to the content of the Plan from technical issues such as the development of common statistical indicators to discussions on the strategic priorities as perceived by the Commission.

A final aspect of Plan preparation is the potential of the Plan to assist cross-Border cooperation. The Structural Funds have played a key role in economic development in all of the island of Ireland, North and South. Many of the problems which the two economies face stem from economic characteristics which are common to both.

The two administrations are agreed that a joint cooperative approach should be incorporated in the respective Plans. There have been a number of meetings between the Department of Finance here and the Department of Finance and Personnel, Northern Ireland, and between other relevant Departments North and South to develop this. In addition, it seems certain that there will be a continuation of the INTERREG Border areas initiative.

I have outlined the various inputs into our planning process. The task facing us now is to pull together all these inputs in drafting the Plan.

The central objective of the Plan must be the creation of sustainable employment and growth. It is essential that we use the funds in a way that maximises the permanent benefits to the productive fabric of our economy and permits us to narrow the development gap with our European neighbours.

This may well be the last substantial increase in EC Structural Funds and it is essential that wise choices are made in selecting investments for inclusion in the Plan and Programmes.

In concentrating on employment and growth we must ensure that parts of our society are not left behind. In drawing up the Plan I am anxious that we give particular attention to actions that will tackle long term unemployment and will help integrate those communities where long term unemployment is chronic into the economic mainstream.

It is not sufficient that our Plan assist in creating jobs. It must be targeted so that a share of these jobs are taken up by the long term unemployed and those at high risk of becoming so.

The Programme for Economic and Social Progress area-based partnership are mobilising and resourcing local communities to tackle unemployment in a bottomup approach. I want to build on and extend this process to other deprived areas, building on what we have already learned, and ensuring that there is a targeting of resources from mainstream agencies as well as the local community development initiative to provide real and tangible benefits to the communities worst hit by unemployment. An interdepartmental working group are finalising proposals in this area.

At EC level we are seeking to ensure that the objectives of combating social exclusion is taken on board in framing the relevant regulations to govern the post 1993 Structural Funds. Our own choice of projects and programmes can equally reflect that concern while maintaining the focus on raising our productive potential.

However, it is necessary to sound a note of caution here. The Structural Funds will still need to be focused on improving economic structures with a view to generating economic development. Our EC partners would be unlikely to agree to a fundamental shift of objective. There are, of course, other EC Programmes dealing with objectives in the area of social exclusion such as the AntiPoverty Programme. The project and proposals selected for inclusion in the plan must meet the criteria laid down in the regulations for the funds.

In relation to employment and employment creation, the spending of this money, in the short term, will increase employment. It will limit emigration and people who have emigrated may return home. While we anticipate an increase in employment, a reduction in the level of unemployment will be limited because some of the effect will be felt in reducing emigration. It will not eliminate unemployment.

The issue of evaluation has received a lot of attention at Community level in recent times. The Edinburgh Council conclusions provide that "greater emphasis will be given to ex-ante appraisal, monitoring and ex-post evaluation". The Irish Authorities fully endorse this emphasis on evaluation.

It is essential that we get value for money from the Structural Funds. We are, I hope, past the stage where anybody thinks of EC structural fund aid as in any sense "free money". It is important that we apply the same rigour to assessing proposals to spend EC money as we would if the sources of funding were purely domestic.

However, it would be unwise to underestimate the difficulties of developing evaluation tools which would allow for a fully objective basis for making choices. It might be argued that ideally one would be able to allocate the available Structural Funds resources on a strictly scientific basis. It must be recognised, however, that in reality there are limits to the extent to which one can do so. Generally, criteria for assessing the relative worth of projects can be established within a sector or programme area. The difficulties involved in doing so vary from sector to sector. In other countries, as well as in this country, policy evaluation instruments need further refinement and development.

It becomes much more difficult to assess the relative merits of projects across sectors, for example to compare the return from a roads project with an industrial investment or a training scheme. Similarly, it can be difficult to assess the relative return from a certain level of investment in a variety of sectors. The consultants report looked at the rate of return of individual projects and programmes, under the previous allocation of Structural Funds.

Furthermore, the determination of priorities for a development plan involves important policy considerations that can go beyond the purely quantifiable. Ultimately, it will be a matter for the Government to decide on its priorities for the plan, taking account of all the inputs made, of the evaluations and quantifications carried out and all the other policy considerations arising.

I am under no illusion as to the difficult choices that will need to be made in selecting priorities for inclusion in the plan that will meet our objectives of sustainable employment and growth and of targeting disadvantaged areas and groups. While the amount of European Community Structural funding that will be coming to Ireland in the period up to 1999 will clearly be substantial, the demands currently on my table are even more substantial and exceed any likely allocation.

The preparation of the National Development Plan is proceeding in tandem with negotiations at Community level on the revision of the Regulations to govern the provision of Structural Fund aid in the next round. In these negotiations, the Government's primary objective is to ensure that Ireland's particular needs, for example in the area of employment, are reflected in the regulations so that the Structural Funds can adequately support the priorities identified in the plan.

I particularly welcome the Commission's proposals to reorient Objective 3 of the Fund of focus attention on the needs of marginalised groups such as the long term unemployed who face virtual exclusion from the labour market.

It is essential that the regulations are framed in a way that facilitates a comprehensive set of measures to combat unemployment and to ensure that deprived communities can fully avail of development measures assisted by the funds. In this context, the proposed widening of eligibility of investments in the areas of education and health is significant and the Government will seek to ensure that this provision is incorporated in the final text of the Regulation to be approved by the General Affairs Council later this year.

Ireland supports the proposed reorientation of Objective 4 which concerns the provision of European Social Fund aid towards training and retraining of workers adapting to technological change. While aid is already made available to SMEs in Objective 1 regions for this purpose, we welcome the recognition by the Commission of the importance of facing up to the challenges posed by rapid changes in technology.

Ireland also supports the proposals to include structural action in favour of the fisheries sector within the ambit of the Structural Funds, as this should facilitate a more coordinated approach to support for investment in this sector, within the overall development strategy to be set out in the plan. Likewise, the proposed restructuring of Objective 5A to take account of the reform of the Common Agricultural Policy and to provide for the extension of programming to all agricultural measures, assisted by the Structural Funds, is to be welcomed as this should enable the Government to improve the management of these services.

In the negotiations on the regulations, Ireland will also seek to ensure that the procedures governing the management of the funds are streamlined and simplified and that unnecessary bureaucracy is avoided. This is in the best interests of the very large number of organisations, communities and individuals who benefits from the funds. We must also recognise the importance of ensuring value for money, so that Ireland can obtain the best possible benefit, in terms of sustainable employment and growth, from the funds over the period of the plan. To this end, we are devoting a lot of resources to approval, monitoring and evaluation of the expenditure aided by the funds. We are cooperating with the EC Commission in supporting the development of these aspects of the management of the funds. However, in framing regulations to govern the Funds over the next six years, it is important to strike the right balance between strengthening the monitoring and financial control of the funds and providing for a degree of flexibility to facilitate simplification of procedures and to enable the funds to address the development needs identified in the plan.

While the discussions on the regulations may not be completed before the Summer, we hope to finalise the plan by the end of June or early July and take on board any changes required by the regulations when we are discussing our plan with the EC Commission. The preparation of the Development Plan is just one phase in the process, though a very important one. We will then have detailed negotiations with the EC Commission on the plan. The Community Support Framework will then be drawn up. In parallel, the detailed programmes for the various sectors will need to be agreed. We would hope to have this work completed by the end of the year, in order to ensure a smooth transition from the current programmes to the new ones at the beginning of next year.

I hope this helps to set a framework for discussions here today and I look forward to hearing the views of the Seanad on the funds.

Mrs. Taylor-Quinn

I welcome the opportunity of having this debate here today and also welcome the Minister of State to the House so we can give her our views on this matter. The Minister of State said the objective of the plan must be the creation of sustainable employment and economic growth — that is fundamental and I hope the debate will be constructive. The plan is currently being prepared and the proposals we put to the EC will largely determine how we will develop within the Community for many years to come, so proposals included should be constructive.

I had hoped the Minister of State would outline in more detail some of the Government's proposals in relation to the plan and would have given this House an idea of the direction being taken. The Minister of State referred to the consultancy study done in relation to expenditure over the last number of years and I am curious to know what was in this report. It has not been published yet and is currently not available to the Members of the Oireachtas; I hope it will be made available shortly. There is a view abroad that there could have been greater accountability in many of the ways the Structural Funds were expended in recent years. In her reply, the Minister of State may elaborate in more detail on the findings of that consultancy report. I know they were asked to make specific recommendations, but I also understand that they have found situations, during the course of their examination, where Funds were not used wisely. The Minister of State went into great detail of how the Edinburgh Summit agreed to greater accountability and monitoring of expenditure but could she tell us how her Department intends to carry this out in the future? When there is such a high number of unemployed and a need for financial rectitude, we cannot spend our share of the Structural Funds any more haphazardly than we would spend our national budget, which is more specific and involves greater accountability — Estimates are discussed in both Houses — and detail. This close scrutiny is not given to the spending of the Funds by either House of the Oireachtas and I hope the Minister of State will respond in greater detail on that later. I gather DKM, the ESRI and the Department of Finance — who asked for it to be done — were involved in compiling the report and although it is almost finished, it has not yet been made public.

One of our strongest cases for Structural Funds is our status as a peripheral member state and any submission we make must take this factor into account. Our peripherality is a disadvantage in a number of ways. Employment is affected by the cost factor of producing products and our ability to compete with our European rivals. That is fundamental to our ability to create employment. When making the case for Funds, this should be considered for all areas and not just for agriculture or roads. By ratifying the Maastricht Treaty, we have increased our commitment to cohesion. There is no point in having a single currency without having adequate economic union and that is why the structural input is so important for the outcome of economic union in the future.

I would now like to refer to rural development and its importance in the submission for Structural Funds. The Government has made a commitment towards decentralisation and if that is to be properly honoured, rural development must be carried out. One of the criticisms levelled at the last application of the funds, especially in relation to infrastructure and the expenditure on road networks, was the inordinate amount of money spent on certain areas. Approximately six per cent of the roads — mainly in the Dublin area — got the bulk of the funding, while the rest was allocated towards maintaining certain parts of national routes across the country. Practically nothing was spent on secondary and county roads. If we are serious about decentralisation and job creation, we must first look to our natural assets.

One of this country's greatest assets is the potential for development of tourism and of agriculture by new methods. There is huge potential in tourism for employment but employment will not follow unless there is access to all areas. Unfortunately as a result of Government policy the county road network has dramatically deteriorated in recent years to the point where many roads are impassable and certain places are becoming inaccessible.

The Government must address this issue very seriously and ensure that some of these Structural Funds are allocated to county and secondary roads. Local authorities have received depleted block grants over the years and that money has been reduced dramatically in comparison to former allocations. The result is the current state of the road network. It is important that the gap between urban and rural areas is closed in the 1993-97 proposals.

One could say that Ireland's peripherality has led to discrimination. The Minister mentioned division into seven sub-regions but in reality Ireland is treated as a single disadvantaged unit at European level. Structural Funds are centralised in Government and the regional factor one would hope would apply has not as yet materialised. Maximum benefit from the expenditure of Structural Funds will not be received until more power is given to local communities and organisations to develop their areas and the attitude of dependence on State aid is challenged.

The Minister referred in her speech to agriculture and the fact that headage payments will now be included in the Structural Funds programme. The headage payment subsidy has been viewed as an income subsidy scheme and it was introduced specifically to assist less well off farmers. A survey in 1990 showed that over 80,000 farmers in disadvantaged areas had annual incomes of less than £5,000 each which is an absolute pittance. The survey also showed that an additional 27,000 farmers had an off-farm income but a low one because it was usually derived from seasonal work. As a result the income limit for eligibility for headge was lifted in 1990 on the grounds that it no longer applied.

The headage payment scheme is fundamental to the survival of small farms in Ireland and it is vital that it continues and increases in proportion to the cost of living. I ask the Minister to examine in detail the advantage of it not just to local communities and to farmers but also to central Government because in many cases farmers who receive headage payments are excluded from receiving social welfare benefits. The scheme saves the Government money and although 20 per cent has to be provided by Government, overall, it is to State advantage to increase that rather than to decrease the payment. This proposal should be closely examined. The Minister did not state that there is no plan or Government intention to alter the headage payment scheme and I hope she will undertake to do so at the close of this debate. There are fears of interference which I hope she will allay.

In the last submission for Structural Funds the Government made a grave omission by not including any application for funds to combat coastal erosion. A minimum of one third of Ireland's coastline is being affected by erosion and reports have been submitted to the Department of the Environment by county engineers in all the coastal counties detailing the type of work required to deal with the problem in their local authority area. The county engineer for County Clare coordinated the national submission to the Minister and I hope a substantial case will be put to Europe for Structural Funds to deal with coastal erosion. Serious damage is being caused to the south east coast and parts of the west coast and no corrective action is being taken because responsibility is being passed between the Department of the Environment, the Office of Public Works and the Department of the Marine. The sooner the matter is rectified by one Department being given specific responsibility and funding to deal with coastal erosion the better for the communities concerned.

There have been many contributions in relation to tourism and its potential. The Minister in her speech stated that 18,000 jobs have been created in the tourism sector over the past number of years. There is great potential in that sector but unless structures, such as access roads, are provided to some scenic areas, tourism will not develop to its full potential. It is vitally important that the Minister for the Environment discuss the situation before the application for Structural Funds is submitted. It is pointless if their Departments operate separately in relation to tourism.

Funding was provided in the last programme for agri-tourism and most of the funding has been taken up or been allocated but not yet taken up. Unfortunately in the previous grants scheme the income limit was too high and people did not qualify. I suggest to the Minister in the case of farmers who cannot afford to make the necessary capital investment to develop their agri-tourism product that a minimum 80 per cent grant would be provided. If the Minister were to examine in detail the situation of people currently in receipt of grant aid she would find that affluent people with capital or sources of capital have received money while less well off farmers who were not in a position to compete have not. That situation needs to be addressed so that the numbers in farming can be maintained and the numbers employed in agri-tourism can increase. For many it would mean being able to continue in farming and in agri-tourism at the same time. It is important that the less well off members of the farming community would be considered.

I note in the Minister's speech that money is to be provided for fisheries and the development of various fishing ports. That is very welcome. The State has responsibility for five ports and I hope the Government will take on responsibility for more ports and develop them as the others have been developed. It is very important that we monitor this situation closely because it seems that Irish fishermen are not getting their fair share of the EC fishing quota. This is causing great dissatisfaction and annoyance in the fishing community. I know the Structural Funds cannot be used to address this issue but they can be used to provide proper facilities for the development of the fishing industry, which is extremely important.

Another area which has been given much attention is forestry and reafforestation. Most of the Coillte State forests are reaching maturity and there are many other areas where forests could be developed. An increase amount of grant aid should be made available for reafforestation, particularly for broad-leaved trees. There is a large concentration of coniferous trees across the country and it is important to develop more broad-leaved plantations. It should be realised that the coming to maturity of the existing forests provides potential for job creation. There is a need to establish more processing plants which I hope the Government will consider in the allocation of Structural Funds. Rather than exporting raw timber, we should be in a position to process it before it is exported, thereby providing employment.

Transport is another important area and I have already addressed the issue of road infrastructure. As a peripheral State and the only island EC member state, it could be said that we are discriminated against because we are not receiving Structural Funds for transport facilities such as ferries, cargo ships and aeroplanes. Every other member state is receiving Structural Funds to build major motorways connecting them with other countries. Ireland has an extremely strong case for the provision of Structural Funds for mobile assets, namely aeroplanes, ferries and cargo ships. Unless we can transport our goods to mainland Europe in order to be in a position to compete effectively, it will not be possible to attain the Government's objective of creating more jobs.

There are currently very serious difficulties with Aer Lingus. I hope the issue of Aer Lingus will be addressed by the Government. There are many other areas I would like to address in relation to the Social and Cohesion Funds such as the allocation of moneys for education, especially for remedial education and training for the handicapped. The Government also needs to review the situation in relation to health, where there is discrimination and poor facilities. I could discuss practically every Department with the Minister of State today but we do not have the time. However, I hope when the submission is made — and maybe prior to that — it will be left in the Oireachtas Library so we may browse through it and perhaps contribute to it. Unfortunately, because of the lack of discussion and a closed shop approach, many important issues were omitted from the last submission.

Mr. Mooney

I welcome the Minister of State to the Seanad for this timely debate on how the substantial Structural and Cohesion Funds should be allocated over the next number of years. I will begin by agreeing with Senator Taylor-Quinn that on the last occasion, consultation was more a cosmetic exercise rather than a real one. The Minister of State is perhaps more acutely aware than most that her appointment to her present position is largely due to the criticism which was levelled at the Government during the consultation process prior to the implementation of the last round of Structural Funds.

I compliment the Minister of State on the almost biblical fervour with which she has gone about her job over the last number of months in meeting with the various sub-regional groups around the country. Deputy Fitzgerald comes from a different culture from that of Senator Taylor-Quinn and myself — and I say this with great respect and admiration of her abilities as an economist as well as a politician — and I hope the experience of travelling around the country in the last few months has increased her understanding of the difficulties facing rural communities. It is interesting that while Senator Taylor-Quinn comes from County Clare, which is 100 miles from where I come from in County Leitrim, I would empathise with much of her contribution.

The primary theme of my contribution is the imbalance which has developed in Irish society. It is interesting that the Minister of State, as does every Minister, in talking about EC funds describes Ireland as a peripheral state. I suggest, as did Senator Taylor-Quinn and many other Senators from rural areas, irrespective of party affiliation, that there is a deep social and economic imbalance in this country which I hope the allocation of Structural Funds will address.

I appreciate that there must be a macroeconomic element to discussions about the allocation of Structural Funds whereby Ireland is seen as one unit. The Minister of State and her colleagues in Government will have to make very difficult decisions when considering how best to reduce this £28 billion submission. Obviously, these decisions will have to be made in a national sense, rather than as the Minister of State said, giving undue weight to "pet proposals" from various parts of the country. However, I hope she will not lose sight of some of these "pet proposals" but will give them increased priority.

On the question of rural development, rural communities, particularly in the west and north-west, are in deep crisis, suffering serious population decline, primarily as a result of traditional emigration patterns and absence of industry. The situation is exacerbated by the lack of proper infrastructure such as sewage systems, roads and facilities which people in larger Irish towns and cities have come to accept as a right. A significant percentage of the Structural Funds should be allocated to the development of county and regional roads.

I acknowledge the tremendous work which has been carried out on our national primary road network since 1986 has been of great economic and social benefit. I benefit from it weekly as I travel from County Leitrim to Dublin on a road which was developed with money from the last tranche of Structural Funds. The development of the by-pass at Lucan, the Western Parkway, the proposed by-pass for the villages of Leixlip, Maynooth and Kilcock, the by-pass at Mullingar which will open later this year, the widening of the stretch of road between Mullingar and Longford, the by-pass at Longford and the by-pass at what are known as the Shannonside villages of Roosky, Drumsna, Dromod and Jamestown will reduce the journey, which currently takes me two hours, by about 15 minutes. That is real progress. There has been similar progress throughout the country as a result of the development of our national road network.

In a political context, votes cannot be garnered from the development of national primary roads whereas politicians can benefit from the development of regional and county roads. That should not be the criterion for road development but people vote according to their concerns and interests. Senators who are also members of rural local authorities will acknowledge that apart from the creation of employment, the major issue for people in rural areas is the condition of county roads. That issue must be seriously addressed.

I acknowledge the Government's argument that the Commission's proposals and regulations — arrived at in its consultation process with national governments — must be taken into consideration. However, I understood the future development of Europe would be based on subsidiarity, a concept that was once much discussed in this House but it seems to have been forgotten. I am disappointed the Minister did not mention the word once in her speech. Subsidiarity, as defined by the Commission, encouraged decision making at local level where appropriate rather than at Commission level. The concept of subsidiarity, having been developed as an academic concept, does not appear to have filtered down to a practical level. Fortunately the people who voted in the French and Danish referenda brought it home to Commission officials that the concept of subsidiarity was not redundant; that people were aware they needed control over their lives; that there was an urgent need for more consultation at local level and that decisions that affected the daily lives of people being made by the Commission was not in Europe's best interest.

I hope the Irish Government will emphasise that point to the Commission should the Commission advise that money be spent only on high density roads due to the macroeconomic benefits that can accure to Ireland. Indeed, I must chide the Minister for the extensive use of economist's jargon in her speech although, given her academic background and training, I suppose it was inevitable. However we are discussing the quality of people's lives in addition to economic benefits. If people believe their living conditions are inadequate and are envious of better-off neighbours, society will not be happy or productive. We must impress upon the authorities in Brussels that, although funds should be spent on national primary roads, the infrastructure at local level must be developed. We must have, in a word, access. If we have access to all areas of the country we can concentrate on generating viable employment.

Without a good road network and adequate services we will not attract entrepreneurs or, indeed returning emigrants. I applaud the Minister's aspiration to bring our emigrants home. However, in present circumstances an emigrant with entrepreneurial spirit, no matter how strong the emotional ties with this country, will not be persuaded to return. I am familiar with the problem of emigration as I live in a county with a rapidly declining population — some 25,000 at the last census — due to emigration. Many of our emigrants are in England and America where they enjoy a good standard of living. When one meets them at emigrant reunions they talk of their desire to return to Ireland and acknowledge the incentives to encourage them to do so but they also point to the obstacles: the remoteness of many areas, the condition of the roads, the small population and, hence, the small market. Thus in the present circumstances they are not encouraged to return. That is why I emphasise the importance of access.

The Minister, in her reference to the benefits of cross-Border development, mentioned that areas on both sides of the Border have similar problems. I would argue that is not so. The British Government, with its bigger and more prosperous economy, has invested considerable sums of money into the Northern economy since its foundation especially in peripheral regions such as Fermanagh, Armagh and other Border areas. Thus a comparison between Border counties in the South and those in the North is unfair and inaccurate; those in the North have a distinct advantage.

For a long time we have argued for the concept of "additionality". Under Government policies over the last ten to 15 years European funding has been used as a substitute for normal Exchequer allocations to Border regions rather than as an additional allocation. The Interreg fund, for example, has been used in this way. I am sure the Minister will find figures to dispute my argument but that is the public perception. People who travel the Border roads — that is, those that are open — can see the difference between roads North and South. The International Fund for Ireland has pumped considerable funds into the area north of the Border — the funds are allocated on a 60:40 basis, North and South — and I have often argued that a town like Enniskillen, which was traditionally a business town for the region, has less need of such funding than smaller towns south of the Border. That applies also to Cavan and Monaghan relative to Armagh. The Border region is a peripheral region within a peripheral region. Although the Minister has met the sub-regional group from that area and heard this argument, it would be remiss if I did not take the opportunity of alluding to it here.

On the question of rural development, I support the view of the Irish Farmers' Association that 18 per cent of Structural Funds should be allocated for agricultural development. The Minister may believe that the association's submission is unrealistic, with only £8 billion to distribute, but the merit of their argument should at least be debated.

Tourism is a perfect example of how the proper allocation of Structural Funds has been of benefit over recent years. The Minister referred to the number of jobs that have been created in that sector and I hope the same success can be achieved in other parts of the economy. The Minister used the example of the community hall when discussing the eligibility of projects. Although such facilities are commonplace in large cities and towns they are still necessary developments in parts of rural Ireland.

Peripherality was mentioned by Senator Taylor-Quinn. There has been a noticeable lack of consideration given to the economic implications for Ireland of the opening of the Channel Tunnel in 1994. Senator Taylor-Quinn said that when the Channel Tunnel is opened we will be the only island nation in the European Community. For this reason I support the call to have Ireland treated as a special case, especially in the area of Cohesion Funds. We are grouped with Spain, Portugal, and Greece as the poorer countries, but Spain, Portugal and Greece are part of the land mass of Europe. We are not, and this geographical fact makes us a special case. I have no doubt the Minister, who has already shown herself to be adept at highlighting important expenditure areas has raised that matter with her European colleagues.

I cannot overstate the importance of the opening of the Channel tunnel for us and we seem to be sliding into it as if it were just another technological innovation. The Channel tunnel will have a very serious economic and social impact on this country. The Commission requests Ireland to prioritise the allocation of money in a European context. There is therefore a case to be made for a joint effort between Britain and Ireland, since each State has an obligation to ensure the development of their peripheral regions and our main area of access to European markets is through a peripheral region in Britain. The European Commission should encourage this kind of development. Although it cannot insist on action being taken, it has an important role to play. Ireland should also encourage this effort.

Senator Taylor-Quinn touched on the question of access and ferries and aeroplanes in regard to grants, but I will go further. Those who have travelled across on the ferry to England or Wales or Scotland, know the trains there, for example, are not electrified and that they are of a poorer quality than those operating on main routes. The British road network, although it is improving in parts of North Wales, leaves a certain amount to be desired. There has been no suggestion from British Rail in its most recent investment plan that the route from London to the North West be upgraded or electrified. It is vital to Irish trade to get goods as quickly as possible into Europe. Perhaps the Minister could see a role for opening discussions with her British counterparts, if they have not already been opened, with regard to the allocation of infrastructural funding to the peripheral regions of Britain, for optimum cohesion between Britain and Ireland.

I welcome the fact that Interreg funding will continue. It has proven to be a very important lifeline in the economic well-being of my region. For those Members who do not come from the interregional area, this money is used for the development of tourism infrastructure, etc. There have been rumours that Interreg funding is to be extended to the whole country. While I would welcome that extension I would not welcome any dilution of current funding. Interreg funding has always been concentrated in the border regions and I hope that it will remain so. An extension of Interreg would require additional funds.

We need a Government decision followed through at European level, to set aside a significant amount of money for county and regional roads. We also need to look at the decline of rural populations and its effect on our economy rather than crying out "Save the West" or saying that it is of national economic benefit that such population decline be arrested.

Our Government should resolve the question of ease of access to trade routes out of Ireland in the context of British Irish relations and in the context of the application of cohesion and other European funding. The British Government cannot be allowed to ignore our economic development requirements. I welcome the opportunity to make these points to the Minister and I wish her continued success in her difficult brief. I hope at the end of the consultation process we will be presenting her with bouquets rather than brickbats. Given the nature of her job it will not always be that way.

Dr. Henry

I welcome the Minister's statement on the Structural Funds, and I hope she will not make any apology for employing the ESRI as consultants in this project. I have dealt with them for years and found them to be most satisfactory. No apology should be made for careful examination and monitoring of plans and constant reporting back because £8 billion is an enormous amount of money. I know the Minister is asked for ten times that amount every day, but the Funds allocation is a large amount of money which represents a rare opportunity for us, and she must do all in her power to ensure none of it is wasted.

I welcome the Minister's emphasis that this money is to be used to increase employment, and that we must be careful not to see it as a way of reducing unemployment. The Minister is quite right in saying that we may encourage people who have been abroad to return, if they see the opportunity of coming back to do something for the country and for themselves. This is to be welcomed, because many of our high achievers who emigrate could be of great benefit to the rest of us who have stayed in Ireland. It is important to stress the fact that we are going to increase employment.

A great deal has been said regarding the use of Structural Funds for industry. However, it is important to remember that in the western world over the last 20 years employment in industry has increased only slightly due to improvements in automation and the large increase in productivity. We must be careful to ensure the industries set up are those which will provide the maximum amount of employment. It is not enough to set them up merely in the hope that they will increase employment levels.

The Minister mentioned that we must be very careful about setting up a new industry which would be in direct competition with an existing industry. This aspect of the operation of county development partnership boards gives me cause for concern. I hope those boards do not go into competition with each other so that for example a mushroom factory is shut down in Roscommon and one is set up in Sligo. This would benefit no one.

The necessity for economic co-operation between North and South cannot be over-stressed. While I take Senator Mooney's point that there has been a greater injection of funds into peripheral areas of the North than of the South we must do whatever we can to increase our domestic market. We forget that in the entire Irish Republic we have a domestic market half of the size of Paris and one third the size of London. When a firm is set up it needs a good domestic base to try to sell to such a small market.

When these industries are being set up, I hope the Minister will give preference to research and development in the agribusiness, because this is our forte. I was delighted to hear the Minister for Agriculture, Food and Forestry, Deputy Walsh, supported by Lord Arran speaking in the North about the importance of an all green island marketing approach. The lack of patriotism of some of those involved in our major industries — examples include contaminated stomachs going down the wrong chutes and quasi-wholesome meat — is appaling. We have to be sure that what we export is of the highest quality. Our image should be that we sell quality goods only. There is little else we can do, because there will be tremendous competition from Eastern Europe. The standards in our agri-business — and I am sure the Minister will ensure this — must be incredibly high.

I hope I will never see licences given to establish irradiation plants which prolong the shelf life of food. If we are to sell our food on flavour and nutrition value, then anything that only prolongs its shelf life is of little value. I will return to this later. Our attitude towards this industry is most important.

I am disappointed that, so far, our discussion on transport has focused mainly on roads. Although roads are important so is our rail network and I hope it will not be neglected. Apart from the Cork-Dublin route and the line to Belfast, travelling by train to Sligo, Westport, Galway and many other routes can be an undertaking. I was on the train from Sligo a few weeks ago. As the train was running late I asked the inspector if he thought we would make it to Portarlington in time for the connection to Cork. He said "Indeed, we will; we have a good stiff breeze behind us." I hope the railway will get increased infrastructure and not have to rely on a good stiff western breeze. The West of Ireland is extremely badly served in terms of the rail network. The Sligo, Westport and Galway trains are badly in need of investment. That is why I would not like to see all of the Structural Funds for transport spent on roads.

I recognise that we are an island people and that we have to get our produce off this island. It has been suggested that the ferry links with Britain and the Continent should be improved. We rely a lot on private enterprise for these links. I am also interested, especially when we consider the present difficulties of Shannon, in the possibility of an air-bridge to take cargo to the Continent; I know this is not an original suggestion. In this day and age it is far from impossible to transport fresh food from Shannon where we have a splendid airport. The presence of Aer Rianta at Shannon means there is a good infrastructure. Such a bridge would avoid the need for irradiation to increase the shelf life of our produce. It takes a long time to get food from here to the Paris market or to Italy. Yet, these are places to which we must sell.

I said already that industry is an difficulty because of the increase in productivity and automation. We must, therefore, look seriously at the tourism and service industries. As the Minister of State said, there has been a 32 per cent increase in foreign tourists and this has led to an increase of 18,000 jobs. However, we will have to do better and I believe an enormous amount of money has to be put into training.

There are few people in any of our tourist locations or hotels who speak another language. We are the people who want to sell our tourism industry and it is up to us to learn German, French, Italian, Japanese, etc. It is not up to our visitors to learn English. Hotels and other facilities — interpretative centres — should always have people on site who speak foreign languages. We have done well improving food and services in hotels. These are few complaints, apart from the usual one about price, but everyone who goes abroad expects things to be much cheaper than they are at home.

Could some of the Structural Funds be spent preserving some of our ancient structures? This has been very well done in various areas through projects supervised by FAS. The cultural revolution in China knocked down half of the ancient Chinese structures; at least we seem to have got over most of our cultural revolution without that — although, in the light of what has happened on the quays in the last few days, others might not agree with me.

We should put a tremendous effort into preserving the structure of our cities. If one looks at the skyline of Waterford now, coming down the Dublin Road, one will see what a major improvement has been made. The centre of Wexford, St. John's Castle on the way to Cork, are further examples. Ireland should use the Structural Funds in such a way as to revolutionise our appearance.

I want to discuss the Social Fund. I am delighted the Commission has decided to broaden the spending of funds to include health and education. This is particularly important. We are geographically on the periphery of Europe, but we have an enormous number of socially isolated people who are peripheral within our country — and I do not mean only the long term unemployed who suffer tremendous social isolation economically because they do not have money and cannot avail of the same opportunities as the rest of us.

I want to talk about groups within the community who are socially isolated because of their handicaps. I hope more money could be provided for them. For example, I met a group of deaf women at lunchtime today who were visiting the Minister of State at the Department of Social Welfare, Deputy Burton, and they were stressing their peripherality. While they can try to get on FAS courses, they have to pay their own interpreters. It costs between £13 and £15 per hour to pay an interpreter who can do sign language. These people are being judged by the same standard as those who have been educated through English or Irish, even though their first language is sign language. We should look carefully at the marginalised in our society to see if the Cohesion Fund can be used for them as well.

I naturally welcome any extra funds for the health service. I can envisage numerous projects which the Minister will be asked to fund, and I am sure she will assess them carefully.

I know little about headage payments save what a man told me recently. He was offered so much a kilogramme for beef. He decided to keep it for the headage payment. The cattle got fatter, the price went down and he got less eventually per kilogramme for the beef than if he had sold the cattle and had not pursued the headage payments. I would like the Minister to know that I also have a knowledge of headage payments.

Ms Kelly

With approximately 300,000 people unemployed, the EC Structural Funds is perhaps Ireland's last opportunity to come into line with the rest of the EC. Our first priority must be to tackle the unemployment problem and we must then improve the standard of living for all who live on this island.

Our lack of knowledge about the nature of the unemployment problem is a cause of worry. There is a structural unemployment problem especially in large urban centres, where unemployment is almost endemic. In these centres 75 to 80 per cent of the workforce is unemployed and perhaps unemployable. In such areas a large number of people in the 24 to 44 year age group are unable to find work. Many of their children will find themselves in a similar situation and three generations of people will be chronically unemployed. They may also be unemployable as the work habit may be acquired or lost.

Statistics provide information on the numbers unemployed in terms of sex, age grouping and location. However there has been very little tabulation of the skills, or lack of skills of the unemployed. For example, there is no information on the number of unemployed carpenters or computer programmers and often people are offered places on SES schemes which are inappropriate to their skills.

It is ineffectual to attempt to tackle the unemployment problem with such an inadequate statistical base. It is important to establish the kind of work people would like if given the opportunity. This kind of knowledge is essential to the creation of training programmes; bus driving may not be the work an unemployed bus driver would choose given a choice.

Allied to unemployment is the problem of emigration. There has been significant loss of educated and skilled people through emigration. Again, there are no statistics on the profile of emigrants or on their skills or on the numbers that wish to return and to use such skills to create work for themselves and perhaps others. Currently there are few schemes that will attract those abroad in their thirties, who emigrated in their twenties, to return and apply the skills they have acquired abroad to generating employment here. It is to these areas that some of the EC Structural Funds should be applied, especially if these are the last of such funds we are to receive.

Every year approximately 7,500 people leave rural Ireland because farming is no longer a viable occupation for them. They add to the congestion in our cities and towns, to the unemployment statistics and to numbers emigrating. Therefore the application of structural funding to rural areas should ensure that all those working and living on Irish farms should benefit through increased income.

Problems which have their root in poverty must be tackled at the outset in areas of chronic unemployment. This includes ensuring that the educational system provides pre-school training to overcome the disadvantages of poverty. If all children begin their education at the age of six in a primary school, those whose home resources are limited will soon be left behind. Resources must be diverted into these areas to overcome disadvantage. Unemployment tends to run in families and an intervention must be made at an early stage in a person's life to ensure that hope is maintained. It is a shame if children of nine or ten years of age already feel at a disadvantage, or feel there is no place in society for them and that the education system is only for the benefit of privileged children.

It is important to ensure that the standard of housing throughout the country is maintained and we need to invest some structural funding in this area. Every house in the country should be able to avail of running water. It is a deplorable fact that in 1993 there are thousands of houses in this country, some in towns but most of them in rural areas, without bathrooms or running water. There may be water pipes running by the roadside, but the connection can cost £300 to £500, sometimes more. An unemployed person or a person on social welfare assistance does not have the resources to pay for such a connection. There is little point talking about improving the quality of life if we are unable to provide everyone with an amenity as fundamental as running water.

At present there is no national co-ordinated approach to safe waste disposal. We are fortunate to have a high number of waste disposal bays per head of population. However at the rate we are filling up landfill sites we will soon run out of space to store our waste; yet we have no national policy on waste disposal or to encourage waste minimisation or recycling. Industrial waste is treated on an ad hoc basis. Industries often rely on private contractors to remove their waste. This waste is disposed of in private dumps, often beyond the control of local authorities. There is a danger that we are storing up a hazard for the future with unsupervised disposal of industrial waste. Whether we like it or not, industry generates waste and we must have a means of disposing of it safely so that we do not build up a time bomb. If the food processing industry were developed further there would be much biological waste. We need to look at this question as such waste presents a problem unlike that of industrial waste.

There are many areas where funding is required and I would like to see an overall national plan, taking as it were a bird's eye view of how we can best utilise the funds to solve our waste problems. Many problems cannot be solved locally; some need national co-ordination.

I would like to share my time with Senator O'Sullivan.

An Cathaoirleach

Is that agreed? Agreed.

Ms O'Sullivan

I welcome this debate at this crucial time in the planning of the future spending of Structural Funds. The Minister will soon be submitting this plan so it is important for us to have an input at this stage. I welcome the emphasis in this plan which is different in many ways from the last plan for Structural Funds. The main emphasis in the last plan was on infrastructures such as roads and so on, which undoubtedly were necessary and will continue to be necessary. In some ways that aspect of structural funding requirement is easy to sell to Europe as it is fairly obvious that a peripheral nation will need to improve road and transport structures. I welcome the emphasis this time on the long term unemployed and the targeting of black spot areas which will require political commitment and a fair amount of selling to the EC. We must back the Minister in her attempts to maximise funding for Ireland in those areas.

We have failed many sections of the community and the speakers who came before me concentrated on rural problems more than urban problems although Senator Kelly brought the two together. If I could quote from a song which my colleague, Senator Mooney probably knows, being an expert in that area: "The farmer and the cowman should be friends". I think the farmer and the townman and townwoman should be friends as well. There are equally strong cases to be made for problems in urban areas and I am glad urban problems are being taken on board this time.

Parts of Limerick city have up to 80 per cent unemployment and, as Senator Kelly said, this has been passed on from one generation to the next. It is essential that we target these areas if the problem is to be alleviated. An educationalist wrote a book entitled How Children Learn and another entitled How Children Fail. On that basis, I am glad we are looking at why we have failed these communities instead of just saying that we must allocate money to them. We need to evaluate what has been done already and the Minister mentioned that.

There is a high level of unemployment in many urban areas. It is important, as the Minister suggests, we listen to organisations like the Community Workers Co-operative and to community organisations. In Moyross, in Limerick, there is an organisation called the Moyross Employment Co-operative Organisation which has attempted, in that area, to see what skills and possibilities are available and to evaluate where people can be given work. In other words the work is being done in relation to subsidiarity. It is important that these communities be among those evaluating and deciding how best the Structural Funds can be allocated.

We have a very small market in this country and the opening up of the European market is designed to make that market available to all EC countries. There is good reason to look for Structural Funds to help our industries to market themselves within the EC. They inevitably have greater difficulties than businesses based on mainland continental Europe or in Britain which now has its tunnel. In our reaction to the Culliton report there has been a great deal of discussion about the clustering of small industries, particularly for assistance with research and development, management training and marketing. It is within the ambit of the Structural Funds to give assistance to clusters of small firms. A small firm in France, Germany or Belgium, unlike in Ireland, is close to the centres of distribution. I ask the Minister to take that suggestion on board when she is finalising the plan. There is great scope in this country for job creation if we can extend our market. As Senator Henry said, our home market is very small.

There is scope for developing food and fish processing, as mentioned by the Minister and also tourism. Those industries depend on our image as a green and healthy country which produces good food and to which tourists are attracted. That potential should be exploited in areas of high unemployment. I think it was Senator McGowan who said yesterday, in a different debate, that for every fisherman in Ireland there are about one and a half jobs on the mainland in fish processing whereas in other EC countries the figure is more like six fish processing jobs for every one fisherman's job — or fisherperson's job. There is scope for job creation in food processing and that is the central point of our debate on these Structural Funds. We want to produce more jobs. Senator Henry spoke about not putting a mushroom grower out of business in one part of the country by setting one up in business in another part of the country. I support that idea.

I also support the point made by the Minister that the EC Commission will report in detail every three years on progress towards economic and social cohesion. This is something I also supported in relation to the Government's response to the Culliton report. If we do not report back, and if we do not have a point in time from which a look at the situation to see if we are achieving targets, then there is a fair chance we will not achieve them. There is nothing like a target to get one working. It is important that this should be built into the spending of Structural Funds. There should be an aim, and it will not be a case of hoping to achieve the target but of having to achieve it by a certain time or else we will be evaluated and maybe have our heads knocked together. It is important to have a timescale.

It is important that the Minister does not listen only to the loudest voices when introducing this plan, because the loudest voices do not necessarily have the strongest case. Often the weakest sectors have the greatest needs but not the loudest voices. We should listen to the case rather than the strength of the voice.

Mr. Cotter

This is my first opportunity to welcome the Minister to a debate in this House. I listened to her speech with interest and while I agree with many of the aspirations she so forcefully put forward I disagree with others.

Not many Senators have referred to the background to this debate within Europe which could be described as hopeful on the one hand yet depressing on the other. The European Community appears confused and disturbed by the continuing, deplorably high unemployment rates across the Community — the EC figure is approximately 12 per cent and it is 25 per cent here. Another disturbing factor is the recognition that the EC only expects a zero rate in GDP this year. A growth rate of 2.5 per cent is being projected here, but I wonder how much of that is real and how much is imaginary. How much of that projected figure could be put down to, for example, a transfer of resources from Europe in the form of Structural and Cohesion Funds? I would say most of it could be ascribed to those factors, if one also includes the devaluation of the IR£. The Government, who is crowing about a 2.5 per cent plus growth rate this year, would do well to clinically examine from where that growth is coming. The Minister clearly said that the present funding will not last forever; it is finite, and come the end of the century, we will have to stand on our own feet. Building castles in the air and talking about growth rates that do not exist is hardly the basis for realistic future economic projections. We must look in the long term. Immigration to Germany, particularly from eastern and south eastern countries, is causing problems for the EC and I have seen the situation at first hand. How will the EC ensure that the population remains stable on the eastern and south-eastern fronts? The EC is currently committing funds to those areas but for many reasons, social and otherwise, we cannot have people from Poland, Afghanistan, Romania and elsewhere pouring into the EC because the Community cannot cope. The EC is assisting them to develop their economies, and Irish people and others in the EC are jealous of that aid. When times are bad protectionism and nationalism take over, and those indications are there at present. We are jealous of any expenditure going to third countries; we would also be jealous of extending the size of the Community. All in all, Europe is managing those matters.

I wonder how the European elections will go next year? I would say they will be about bread and butter issues rather than the great vision of a European Community. I hope they do not encourage us to be introspective because most of us would agree with the development of the EC in the future, with no more war and no more large scale loss of life. That is what should motivate us, and I hope we continue down that road.

It is interesting to note, when attending meetings in Europe, that Europeans are committed to European Union and a single currency despite the current difficulties. It is wonderful to see that there is no diminution in the drive towards that goal. We are great beneficiaries of this European ideal in the context of our size and economy. It is, therefore incumbent on us to use EC funding to our own best advantage. This funding is not a gift from the EC. We are full members of the Community, part of the European process, and we receive the funds because we need them. The money is being given to us because our economy is not properly developed and our population is unstable. The one thing we are missing more than anything else in Ireland is people. There are not enough people, the local market is far too small. It is difficult for industry to develop on a scale to be able to compete with and export to other economies. One would hope the result of all this would be population growth with people coming back to sparsely populated communities. This would allow the economy to take off in real terms.

With regard to the national development plan, I find the way it is put together unsatisfactory. The consultative process is weak and the people are not properly involved. What you have is a couple of people from each county on a regional board who put together the bones of this plan without consultation of any kind. This is a bottom-up approach which is not being given an opportunity to develop. We are asking local development groups and chambers of commerce to help to develop the country while, at the same time, when it comes down to the bit, we refuse to consult properly with them. There was no consultation at local level when these programmes were being prepared. I would like to see that changed. We should institutionalise a process where there would be annual consultation basis at local authority level with the various voluntary organisations which are working hard to contribute to the development of this country. Such institutionalism can only happen through a ministerial directive.

Local authorities are carrying out their functions as best they can but their horizons need to be broadened. Our democratic deficit is appalling and the consultative process must be made meaningful. I ask the Minister to look at this situation and to ensure that, in future, the consultative process will be meaningful and when a national development plan is produced, the people can say that is theirs.

An Cathaoirleach

It is now 4 p.m. On the Order of Business it was agreed we would adjourn this debate now. Can I ask you to move the Adjourment?

Mr. Cotter

Will we have another opportunity to debate this?

An Cathaoirleach

Yes.

Mr. Cotter

I so move.

Mr. Wright

We welcome the Minister here today. Because of the interest shown, she has agreed to resume the debate within ten days.

Debate adjourned.

An Cathaoirleach

When is it proposed to sit again?

Mr. Wright

On Wednesday, 2 June, at 2.30 p.m.