COMMISSION OF THE EUROPEAN COMMUNITIES 
COM(94) 607 final 
Brussels, 07.12.1994 
COMMUNICATION FROM THE COMMISSION TO THE COUNCIL 
AND THE EUROPEAN PARLIAMENT 
A SPECIAL SUPPORT PROGRAMME FOR PEACE AND RECONCILIATION IN 
NORTHERN IRELAND 
2 
A SPECIAL SUPPORT PROGRAMME FOR PEACE AND RECONCILIATION IN 
NORTIIERN IREL...\ND 
I Introduction 
The Joint Declaration of the United Kingdom and Irish Prime Ministers on 15 December 
1993, which launched the present peace process, recognised the need to lay down a 
framework for peace based on a number of key principles articulated by both governments. 
The European- Union welcomed the signing of this Joint Declaration and the European context 
of the statement, highlighting in its response the European Union's commitment to promote 
social and economic progress in the region, especially through the application of the Structural 
Funds. 
The next significan-t stage of this peace process was the announcement by the IRA and the 
Loyalist paramilitary organisations of a complete cessation of violence. In a public statement 
following these announcements President Delors on behalf of the Commission declared its full 
commitment to the peace and reconciliation process. In addition, it restated the Commission's 
view that the achievement of peace in Northern Ireland would bring many social and 
economic benefits, not only to the region and the Member States concerned, but also to the 
European Union as a whole. 
As a first response to the new situation, the Council adopted Regulation N° 2687/94 of 31 
October 19941, providing a continuing basis for three years of funding by the European Union 
to the International Fund for Ireland while endorsing the increase of the annual contribution 
from 15 to 20 mecu. · 
At the same time, the Council and the European Parliament emphasised the importance of the 
peace process for the European Union. On 14 September 1994, the President of the European 
Parliament exceptionally opened a pl'enary session with a statement about the events in 
Northern Ireland. A resolution on this matter was adopted by the European Parliamene. 
Equally, members of the European Parliament from Northern Ireland and the border counties 
of the Republic have played an active role in the continued promotion of peace. 
Shortly after the cessation of violence in Northern Ireland, a special Commission Task Force 
was created. Its remit was to look into further ways of giving practical assistance to Northern 
Ireland and the border counties of the Republic in consultation with the two Member States 
most directly concerned. In particular the Task Force was requested to consider ways to 
develop and refocus the policies of the European Union to help those people who have been 
1 OJ L 286, 5/11/94, p. 5 
2 EP 182021, p.4 
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most affected by the conflict to live together in mutual respect and economic prosperity. The 
Task Force adopted a broad and open consultative approach. The MEPs for Northern Ireland 
and the border counties of the Republic were in close touch with the Task Force. Extensive 
consultations took place and valuable submissions were received from many different quarters 
including local authorities, business, trade unions, voluntary, and other groups. The input from 
this consultative process was of great interest and indispensable for the work of the Task 
Force. 
11 Priorities for Action 
On the basis of the Task Force's work, the Commission has focused its attention on the new 
opportunities and additional needs brought about by the cessation of violence in Northern 
Ireland, and on the possible measures to address these new priorities. 
The need to promote growth and expand job opportunities is paramount. This is a general 
requirement, but it is most acute for those who are marginalised from the economy, 
particularly the young and long-term unemployed. Unemployment as a whole, and within that 
long-term unemployment, is particularly acute in Northern Ireland, as well as in the border 
counties .of the Republic. In Northern Ireland there are currently about 101 000 people 
unemployed, of whom 54 000 have been unemployed for more than one year, and 18 000 for 
more than 5 years. Over 3 7 000 are unemployed in the border counties of the Republic, 
representing 18 % of the work force as against the national average of 15.6 %. Of these, 3 1 % 
have been unemployed for more than two years. Northern Ireland has a very high number of 
school leavers without formal educational qualifications, and more than 50 % of the 
unemployed have no formal qualifications. It is imperative to act quickly to prevent people 
from joining the ranks of the long-term unemployed and thus becoming disaffected with the 
peace process. Due to the new situation forecasts suggest that in the short-term 20 000 jobs 
may be lost in the security and other sectors. This means a need to redirect redundant skills 
arising from the peace process. However, in the longer-term there should be a significant net 
increase in jobs, especially in service industries. 
Acceleration of urban and rural regeneration would have an immediate and visible impact 
within Northern Ireland and the border counties of the Republic. Improvement of the physical 
environment, of the inadequate outdoor facilities and community services would provide an 
important boost to the region. The commercial life and heart of not only the towns, but also 
of the villages have been restricted by the violence and many have the scars of destruction 
from bombings. Improvements to the physical environment of towns and villages, including 
local development, would contribute to overcoming existing constraints to their successful 
regeneration. 
Analysis has shown that the potential for cross-border cooperation across a wide range of 
domains is far from fully exploited. The new situation offers scope to realise this potential, 
for example by reinstating closed cross-border roads and the establishment of new business 
links. 
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The new circumstances provide a challenge to all to promote social inclusion, to put behind 
them the alienation and marginalisation caused by the violence. In particular, those who have 
been victims, whether individuals or whole communities, and those who have not benefitted 
from life in a normal society; expect the new developments to bring about a clear change. A 
basic ingredient will be the promotion of understanding, communication and partnership by 
developing a reconciliation process, in particular in tho~e areas most damaged by the conflict, 
which~ develops and builds on the existing solidarity within communities. 
The current process of peace and reconciliation enhances the opportunities for business and 
investment in the region. To take advantage of these opportunities, a significant and sustained 
level of productive investment is required to upgrade the competitiveness of the local business 
sector, mostly consisting of small and medium sized enterprises (SMEs), and gradually to 
reduce unemployment levels over the coming years.· Moreover, certain companies will have 
to undertake major restructuring ·and transformation efforts to safeguard their future 
development. 
The Commission has therefore come to the conclusion that, as a result of the cessation of 
violence, the following priorities should be addressed: 
(i) Employment 
This would include measures to boost economic growth and employment, 
including mechanisms to anticipate labour market trends and skill and 
qualification needs, to strengthen innovation and R&D (especially in SMEs) 
and to support and ·enhance the expected growth in sectors such as tourism 
(including agri-tourism). It should also reinforce efforts for the long-term 
unemployed, and the young, provide for the greater participation by women in 
the labour force, and support the redirection of redundant skills, especially in 
the security sector. More concrete examples could include innovative schemes 
designed to place the long-term unemployed in work; support for expanded 
training courses and facilities; community-based guidance services; and the 
coordinated pooling of training facilities betw~en various training institutions. 
(ii) Urban and rural regeneration 
This would involve the promotion of wide-ranging local development and of 
social and economic regeneration, in particular through the improvement of the 
social and physical environment in urban areas, towns and villages, including 
village renewal, landscaping, the clearing and development of derelict sites, 
and measures to meet the needs of rural dwellers. It would also include 
community development and the provision of facilities for small businesses, 
small rural infrastructures and social and cultural activities to be established 
and developed. More concrete examples could include development, training 
and capacity building related to urban and rural regeneration; investments to 
remedy the physical problems of the 15 peace lines; the pedestrianisation of 
selected areas; and the provision of parks and children's playgrounds. 
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(iii) Cross-border development 
This would involve a wide range of measures to exploit the opportunities for 
increased cross-border development arising from the new situation through, for 
example, enhanced trade, economic and agricultural cooperation as well as the 
upgrading of infrastructures. Assistance could be given to companies to 
establish joint ventures, and to undertake joint marketing and R&D on a cross­
border basis. More concrete examples could include establishing energy links; 
reinstating closed cross-border roads and bridges; and joint animal health, food 
and forestry actions. 
(iv) Social inclusion 
This would aim to promote pathways to reconciliation by encouraging grass 
roots cross-community cooperation especially in the most deprived areas in 
Northern Ireland and the border counties as well as action to address the 
specific difficulties faced by vulnerable groups. It would combine economic 
and social measures to help tackle the problems experienced by victims, 
children, young people, and those previously caught up with violence. 
Examples of activities which offer particular scope for bringing communities 
and individuals together include culture and the arts, sports and leisure, the 
environment, education and care services. This would also include the 
encouragement of cross-community contacts and exchanges in Northern Ireland 
and the border counties of the Republic following models which have been 
successful in other Community programmes. More concrete examples could 
include actions to provide integrated nursery places and assistance for children 
in the most disadvantaged areas; schemes to improve pupil performance in 
basic skills; social advice and information; and cross-community art and 
cultural facilities. 
(v) Investment and Industrial Development 
This would aim to enhance existing facilities to promote productive 
investment, industrial development and services, particularly the development 
of SMEs 
In order to address these new priorities, the Commission examined extsttng Community 
policies with a view to their possible refocusing and considered new initiatives and 
-instruments as supplementary means of supporting the process of peace and reconciliation. 
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Ill Exisdng Policies 
Northern Ireland is at present a significant beneficiary of the Union's policy of economic and 
social cohesion, principally through the Structural Funds. Northern Ireland received over one 
billion ECU from the European Structur~l Funds between 1989 and 1993, and the 
Commission agreed a six year programme at· the end of July 1994, the Single Programming 
Document (SPD), with European funding of over 1.2 billion ECU. Further assistance is 
foreseen under a number of Community Initiatives such as INTERREG, LEADER, URBAN 
and EMPLOYMENT. 
The structural funding for the Republic is set out in the Community Support Framework 
(CSF). In this context Ireland will receive a total of 5 620 mecu over the period of 1994-
1999. Further assistance is foreseen under the Community Initiatives and the Cohesion Fund. 
Moreover, both areas will receive assistance under several other Community policies. The 
Cork-Dublin-Belfast-Larne-Stranraer link is on the first. priority list for the Trans European 
Network programme (TEN). 
A number of facilities and programmes exist to promote investment and industrial 
development (Seed and Venture Capital and the SME Initiative under the Structural Funds, 
EIB loans, SME Facility and ElF loan guarantees). 
However, it has become clear that these existing policies in their present form are not 
sufficient in themselves to address the new opportunities and additional needs occasioned by 
the changing situation. New approaches are needed, both within existing policies and through 
new measures, to ensure that the full potential of the region is now realised. 
IV The New Package 
The Commission considers that a new overall support package is required if Community 
assistance is to contribute successfully to this unique opportunity for reconciliation, and social 
and economic recovery. The new priorities of the area can best be met by the introduction of 
a special distinct support programme with an immediate and lasting impact on the ground. 
This programme should be multi-annual, comprehensive and complementary to existing 
policies under the Structural Funds. 
Moreover such a programme should be additional in its funding both as to the Community's 
contribution and as to the matching parts from both governments. Its central objective should 
be reconciliation; the programme should benefit all communities in an equitable and balanced 
way while focusing more particularly on those areas and sections of the populati'on suffering 
most acute deprivation. 
Finally, the Commission considers that at the local level, local authorities, business, trade 
unions and voluntary organisations should be involved in shaping and implementing the 
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proposed package of measures. 
On the basis of these considerations the Commission proposes that a specific support 
programme for Northern Ireland be established based on the following elements : 
(i) The commitment of the t~o governments to use the existing adjustment 
mechanisms to refocus existing Structural Fund programmes (the SPD in 
Northern Ireland and the CSF in Ireland) in order to accommodate the new 
demands and challenges which have arisen from the cessation of violence and 
thereby optimalise support for the sustained social and economic development 
of the region. 
(ii) The commitment of the two governments to take the best advantage of the new 
situation in finalising and implementing their operational programmes under 
the existing Community Initiatives. 
(iii) The introduction by the Commission of a new integrated and distinct 
Community Initiative for Northern Ireland and the ·border counties of the 
Republic aimed at supporting fresh actions particularly in deprived and 
marginalised areas and at promoting reconciliation through : 
urban and rural regeneration 
promoting employment 
cross-border development 
social inclusion. 
(iv) Moreover, it would be advisable to maintain an interest subsidy on EIB loans 
to SMEs both in Northern Ireland and the border counties of the Republic for 
a further period after the expiry on 1/7/95 of the existing SME Facility. Such 
a specific facility, which could be integrated into the new Community Initiative 
outlined above, would provide investors with a reasonable time horizon to 
prepare and implement investment plans. This would promote the development 
of SMEs which are the backbone of sustainable growth and job creation in the 
region. However, a small increase of the existing interest rate subsidy and 
more flexible conditions have to be considered. 
(v) The examination of programmes and actions in other policy areas in the light 
of the new situation such as TENs (e.g. Newry-border motorway). 
(vi) The integrated management of existing and new policy instruments in order to 
ensure full coherence and complementarity, with special attention to the scope 
for eo-financing programmes or parts thereof with such organisations as the 
International Fund for Ireland. 
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V Further Arrangements 
The appropriate involvement of local and grass roots organisations in shaping and 
. implementing the programmes is strongly recommended. Appropriate consultative platforms 
for the whole package should also be considered. Monitoring and management arrangements 
should build on the experience with cross-border programmes under INTERREG. 
Information on how to access the funding should be readily available. 
The Commission is of the opinion that the new Community Initiative should be established 
for a five year period coinciding with the remaining period covered by the Structural Fund 
programmes. Additional funding should be allocated for the first three years. ~ total of 300 
mecu is proposed as additional EC aid. Further financing for the last two years will be subject 
to a review on the basis of a Commission report. However, the costs of the suggested interest 
subsidies on EIB loans to SMEs should be spread over five years. 
As far as the eo-financing rate is concerned, it is suggested that, as a rule, the Community 
should finance 75 % of the cost of the measures under the new single Community Initiative. 
VI Conclusion 
The Commission recognises that both the society and economy of Northern Ireland and the 
border counties of the Republic have suffered as a direct consequence of the violence of the 
last 25 years. To strengthen the present fragile peace, the problems, in particular of the most 
deprived areas, need to be addressed further to demonstrate to the ordinary people that there 
is a real benefit to be gained from continuing this process. 
The Commission is of the opinion that current developments offer many new opportunities 
to bolster reco.nciliation and economic and social regeneration in the area. These opportunities 
and the additional needs must be addressed, for example, the redirection of redundant skills. 
Concrete results must be obtained as quickly as possible. 
The European Union has a clear interest and a vital role to play in maintaining the momentum 
of the peace process. It therefore proposes a special support programme for peace and 
reconciliation for Northern Ireland and the border counties of the Republic consisting of the 
elements outlined in this Communication. 
The Commission will prepare the necessary steps in early 1995 to establish a new integrated 
and distinct Community Initiative to promote reconciliation through the support of fresh 
actions in the area of urban and rural regeneration, employment, cross-border development, 
social inclusion and investment promotion. 
FINANCIAL STATEMENT 
1.. Title of Operation 
A Special Support Programme for Peace and Reconciliation in Northern Ireland 
2. Budget Heading Involved 
Category 2 (Structural Funds): Budgetary chapter B2-14 (Community Initiatives) 
3. Legal Basis 
Category 2 (Community Initiative): Commission decision to be taken under 
Article 11 of Council Regulation 4253/88 as last 
amended by Council Regulation 2082/93 
4. Description of Operation 
4.1 General Objective 
The proposed Programme is a new and distinct support package of Community 
assistance to Northern Ireland and the border counties of the Republic aiming 
to contribute to the reconciliation, and social and economic recovery of the 
area. This proposal seeks to build upon and encourage the peace process in the 
region. It will be multi-annual, comprehensive and complementary to existing 
policies under the Structural Funds, benefitting all communities in an equitable 
and balanced way while focusing more particularly on those areas and sections 
of the population suffering most acute deprivation. 
The Programme includes a number of new measures under a new Community 
Initiative aimed at supporting fresh actions to promote reconciliation through 
urban and rural regeneration, employment, cross-border development and social 
inclusion. It is also proposes that interest rate subsidies be maintained for a 
further period on the expiry of the SME Facility in mid-1995. A small increase 
of the existing rebate rate and more flexible conditions will have to be 
considered. 
• 
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4.2 Period covered and arrangements for renewal or extension 
The Programme is due to run for five years from 1995 to 1999. Funding will 
be allocated for the first three years, further additional funding for the last two 
years being subject to a review on the basis of a Commission report . 
The costs of the suggested interest subsidies on EIB loans to SMEs will be 
spread over five years, some additional funding being required for the last two 
years. 
5. Classification of Expenditure or Revenue 
5.1 Non-compulsory expenditure 
5.2 Non-differentiated appropriations 
6. Type of Expenditure or Revenue 
Grant-financing measures are envisaged with variable aid rates for the different 
elements of the new Initiative. 
Under the new Community Initiative, as a rule, the aid rate will be 75 %. 
A small increase in the rebate rate for interest subsidy on EIB loans to SMEs will be 
considered, along with more flexible conditions than currently exist under the SME 
Facility. 
The eo-financing of measures may also be possible with other organisations, such as 
the International Fund for Ireland (IFI). 
7. Estimated Financial Impact 
The total financial envelope for the period 1995-97 will be 300 MECU .