The Cabinet is next week expected to back proposals from the Department of Finance for the devolution of limited powers from national Government to two new regional authorities whose entire remit will be handling EU structural funds. The proposal is a direct response to concerns expressed by Eurostat, the European Commission's statistical service, about the extent of financial devolution in Ireland and will be established under Section 43 of the Local Government Act.
The minimalist scope of the authorities' powers and the unusual involvement of the Department of Finance in the plans, instead of the Department of the Environment, reflect the extent to which the move can be seen as simply an ad-hoc response to a specific European problem rather than part a strategic review of local government.
Eurostat is expected to rule on Ireland's sub-regionalisation proposals within the next 10 days and there are continuing fears in Dublin about whether it will allow the inclusion of Clare and Kerry in the western Objective 1 region.
Discussions between Eurostat and Irish officials have been going on over the last couple of months, with the Luxembourg service understood to have expressed most concern about the statistical justification for inclusion of the two counties. The Commission itself, however, hinted yesterday at a sympathy for the general principle of regionalisation.
A major report on the effects of structural policies warns that in Ireland's case, a "sign of potential fragility in the economy is the concentration of growth in certain areas, particularly in the east of the country".
The report warns that progress within countries and within regions can vary widely, citing the relative performances of Dublin and Lisbon compared to their rural hinterlands. "This underlines the importance of reviewing the distribution of assistance periodically to ensure that limited resources are concentrated in the regions that need it most," it argues.
The Department of Finance's proposed structure for two new authorities is understood to involve two bodies, the Border, midland and western group regional authority and the Southern and eastern group regional authority, of 32 and 36 members respectively.
The former will consist of the 15 counties' local authorities targeted for EU Objective 1 assistance, and the latter, the 17 others.
The powers of the authorities are defined as drawing up proposals for programmes in the regional operational programme, including proposals for reallocations if projects do not get off the ground, preparing claims to the EU, arranging payments, writing the annual reports on projects and the midterm review, and ensuring budgetary controls. The Government will, however, retain a prerogative on decisions relating to national infrastructure projects such as major roads, although the spending committed by the EU to each area will be ring-fenced.
Representation on the authorities' boards would consist of two representatives from each of the county councils concerned and two from the body which now groups the current eight sub-regional groupings into which the Republic is divided.
Staffing proposed is for a director, reporting to the board, a planner, and a small number of other executive and clerical staff. Whether the structure is sufficiently developed for Eurostat's purposes is unclear, although Brussels sources suggest Dublin is unlikely to have gone ahead with such proposals without some kind of a nod from the statistical service.
Eurostat's responsibility was described by the Regional Affairs Commissioner, Ms Monika Wulf Mathies, last autumn, in her only comment on the Irish decision to regionalise. "It is up to Eurostat to examine the case based on its general principle that changes have to be justified on statistical grounds and reflect a distinct administrative reality."
