Proposal for a Council Regulation concerning Community financial contributions to the International Fund for Ireland (2005-2006)
Date: 2004-10-13
Institutions: European Commission
Subjects: EU financing, Ireland, Northern Ireland, international aid, peacekeeping

COMMISSION OF THE EUROPEAN COMMUNITIES 

Brussels, 13.10.2004 
COM(2004) 632 final 

2004/0228 (CNS) 

Proposal for a 

COUNCIL REGULATION 

concerning Community financial contributions to the International Fund for Ireland 
(2005-2006) 

(presented by the Commission) 

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EXPLANATORY MEMORANDUM 

The International Fund for Ireland (IFI) was established in 1986 in order to contribute to the 
implementation of Article 10(a) of the Anglo-Irish Agreement of 15 November 1985 which 
provides  that  "the  two  governments  shall  co-operate  to  promote  the  economic  and  social 
development of those areas of both parts of Ireland which have suffered most severely from 
the  consequences  of  the  instability  of  recent  years,  and  shall  consider  the  possibility  of 
securing international support for this work". 

The  objectives  of  the  IFI  are  "to  promote  economic  and  social  advance  and  to  encourage 
contact, dialogue and reconciliation between nationalists and unionists throughout Ireland"*. 

Following  early  contributions  from  the  United  States  and  other  countries,  the  European 
Community, recognising that the objectives of the IFI were a reflection of those pursued by 
itself,  wished  to  give  practical  support  to  the  initiative.  It  began  contributing  to  the  IFI  in 
1989.  EC  funding  now  represents  44 %  of  annual  contributions  to  the  Fund  and  39,5 %  of 
cumulative contributions to date. The Commission has been represented by an observer at all 
IFI Board meetings since the beginning of 1989. 

The  political  background  of  the  region  has  evolved  over  the  years:  in  1994,  the  main 
paramilitary  groups  announced  cease-fires ;  in  April  1998,  the  Belfast  (“Good  Friday”) 
Agreement set a political settlement for a peace process, including the devolution of powers to 
a Northern Ireland (NI) Assembly and Executive Committee, which were set up at the end of 
1999. However, there is still a significant level of violence relating to the conflict and division 
between the main communities remains high. The NI Assembly is currently suspended, which 
illustrates the threats and uncertainties surrounding the peace process in the region.  

In  this  context,  economic  and  social  development  in  support  of  peace  and  reconciliation  at 
grassroots  level  is  a  long  term  process.  As  an  instrument  towards  this  goal,  the  IFI 
complements  the  action  carried  out  by  the  EU Programmes  for  Peace  and  Reconciliation  in 
Northern Ireland and the Border Region of Ireland ("PEACE "I 1995-1999, and" PEACE "II 
2000-2004). 

In June  2004  the  European Council  called on the Commission to  examine the possibility of 
aligning  interventions  under  the  PEACE  Programme  and  the  International  Fund  for  Ireland 
with those of the other programmes under the Structural Funds that come to an end in 2006, 
including the implications in financial terms. 

In  accordance  with  the  current  round  of  contributions**,  the  European  Commission  has  also 
submitted  an  assessment  of  the  IFI’s  activities  to  the  Budgetary  Authority***.  This 
acknowledges the IFI’s very valuable and positive actions for peace and reconciliation in the 
region,  and  thereby  the  fulfilment  of  its  objectives.  The  report  concluded  that  "the 
Commission  believes  that  funding  after  2004  should  be  provided  on  the  basis  of  the 
observations  made  in  this  report,  which  could  be  reflected  either  in  the  future  Council 

* 

** 
*** 

Agreement between the Government of the United Kingdom of Great Britain and Northern Ireland and 
the  Government  of  Ireland  concerning  the  International  Fund  for  Ireland,  18  September  1986  (last 
amended 10 October 2000) ; UK Treaty Series N°58 (1987) Cm 266 / Republic of Ireland N°1 (1986) 
Cmnd 9908. 
Council Regulation (EC) No. 2236/2002 of 10 December 2002; OJ L 341, 17.12.2002, p. 6. 
COM(2004) XXX final, XX .9. 2004. 

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Regulation  on  the  EC  contribution  to  the  IFI,  or  through  other  appropriate  means  of  co-
operation between the Commission and the IFI". 

In  light  of  the  above  assessment,  it  is  proposed  that  the  Commission  adopts  the  following 
proposal for a Council Regulation on the EC contributions to the IFI which will :  

– 

– 

continue the EU contributions of €15 million per year to the IFI, for a further period 
of  2  years.  The  proposed  new  period  will  therefore  end  in  2006,  which  would 
coincide with the end of the extended PEACE Programme. 

take account of the observations made in the Commission report, in particular those 
reinforcing  synergy  of  objectives  and  co-ordination  with  Structural  Funds 
interventions, in particular with an extended PEACE Programme. 

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2004/0228 (CNS) 

Proposal for a 

COUNCIL REGULATION 

concerning Community financial contributions to the International Fund for Ireland 
(2005-2006) 

THE COUNCIL OF THE EUROPEAN UNION, 

Having regard to the Treaty establishing the European Community, and in particular Article 
308 thereof, 

Having regard to the proposal from the Commission1, 

Having regard to the opinion of the European Parliament2, 

Whereas: 

(1) 

(2) 

(3) 

The International Fund for Ireland (hereinafter “the Fund”) was established in 1986 by 
the  Agreement  of  18  September  1986  between  the  Government  of  Ireland  and  the 
Government of the United Kingdom of Great Britain and Northern Ireland concerning 
the  International  Fund  for  Ireland  (hereinafter  “the  Agreement”)  in  order  to  promote 
economic  and  social  advance,  and  to  encourage  contact,  dialogue  and  reconciliation 
between nationalists and unionists throughout Ireland, in implementation of one of the 
objectives specified by the Anglo-Irish Agreement of 15 November 1985. 

The Community has provided financial contributions to the Fund from 1989. For the 
period 2003 to 2004 EUR 15 million was committed from the Community budget for 
each  of  the  years  2003  and  2004  in  accordance  with  Council  Regulation  (EC)  No 
2236/2002  of  10  December  2002  on  Community  financial  contributions  to  the 
International Fund for Ireland3. That Regulation will expire on 31 December 2004. 

The  assessments  carried  out  in  accordance  with  Article  6  of  Regulation  (EC)  No 
2236/2002  have  confirmed  the  need  for  further  support  for  Fund  activities,  while 
continuing reinforcing synergy of objectives and co-ordination with Structural Funds 
interventions, in particular with the Special Programme for Peace and Reconciliation 
in  Northern  Ireland  and  the  Border  Counties  of  Ireland  (hereinafter  “the  PEACE 
Programme”) set up in accordance with Council Regulation (EC) No 1260/1999 of 21 
June 1999 laying down general provisions on the Structural Funds4. 

1 
2 
3 
4 

OJ C , , p. . 
OJ C , , p. . 
OJ L 341, 17.12.2002, p. 6. 
OJ L 161, 26.6.1999, p. 1. Regulation as last amended by Regulation (EC) No 1105/2003 (OJ L 158, 
27.6.2003, p. 3). 

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(4) 

(5) 

(6) 

(7) 

(8) 

(9) 

The peace process in Northern Ireland requires a continuation of Community support 
to the Fund beyond 31 December 2004. 

At its meeting in Brussels on 17 and 18 June 2004, the European Council called on the 
Commission  to  examine  the  possibility  of  aligning  interventions  under  the  PEACE 
Programme and the International Fund for Ireland with those of the other programmes 
under the Structural Funds that come to an end in 2006, including the implications in 
financial terms. 

The  Community  contribution  to  the  Fund  should  take  the  form  of  financial 
contributions  for  the  years  2005  and  2006,  thus  terminating  at  the  same  time  as  an 
extended PEACE programme. 

In allocating the Community contribution, the Fund should give priority to projects of 
a  cross-border  or  cross-community  nature,  in  such  a  way  as  to  complement  the 
activities funded by the PEACE Programme.  

In accordance with the Agreement, all financial contributors to the Fund participate as 
observers at the meetings of the Board of the International Fund for Ireland. 

The Commission shall foster co-ordination at all levels between the Fund’s Board and 
agents,  and  the  managing  bodies  set  up  under  the  Structural  Funds  interventions 
concerned, in particular under the PEACE programme 

(10)  Assistance from the Fund will be regarded as effective only in so far as it brings about 
sustainable economic and social improvement and is not used as a substitute for other 
public or private expenditure. 

(11)  An  assessment  reviewing  the  performance  of  the  Fund  and  the  need  for  further 

Community support should be carried out before 1 April 2006. 

(12)  A financial reference amount, within the meaning of Point 34 of the Interinstitutional 
Agreement  of  6  May  1999  between  the  European  Parliament,  the  Council  and  the 
Commission on budgetary discipline and improvement of the budgetary procedure5 is 
inserted  in  this  Regulation  for  the  entire  duration  of  the  programme,  without  the 
powers of the budgetary authority as defined by the Treaty being affected thereby.  

(13)  The amount of the Community contribution to the Fund should be EUR 15 million for 

each of the years 2005 and 2006, expressed in current values. 

(14)  That support will contribute to reinforcing solidarity between the Member States and 

between their peoples. 

(15)  The Treaty provides no powers other than those in Article 308 for the adoption of this 

Regulation, 

5 

OJ  C  172,  18.6.1999,  p.  1.  Agreement  as  amended  by  Decision  2003/429/EC  of  the  European 
Parliament and of the Council (OJ L 147, 14.6.2003., p.25). 

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HAS ADOPTED THIS REGULATION: 

Article 1 

The financial reference amount for the implementation of the Community contribution to the 
International Fund for Ireland (hereinafter “the Fund”) for the period 2005-2006 shall be EUR 
30 million. 

Annual appropriations shall be authorised by the budgetary  authority  within the limit of the 
financial perspective. 

Article 2 

The  contribution  shall  be  used  by  the  Fund  in  accordance  with  the  Agreement  of  18 
September  1986  between  the  Government  of  Ireland  and  the  Government  of  the  United 
Kingdom of Great Britain and Northern Ireland concerning the International Fund for Ireland 
(hereinafter “the Agreement”).  

In  allocating  the  contribution  the  Fund  shall  give  priority  to  projects  of  a  cross-border  or 
cross-community  nature,  in  such  a  way  as  to  complement  the  activities  financed  by  the 
Structural Funds, and especially those of the Special Programme for Peace and Reconciliation 
in  Northern  Ireland  and  the  Border  Counties  of  Ireland  (hereinafter  “the  PEACE 
Programme”) set up in accordance with Article 7(4) first subparagraph of Regulation (EC) No 
1260/1999. 

The  contribution  shall  be  used  in  such  a  way  as  to  bring  about  sustainable  economic  and 
social improvement in the areas concerned. It shall not be used as a substitute for other public 
and private expenditure. 

Article 3 

The Commission shall represent the Community as an observer at the meetings of the Board 
of the Fund (hereinafter "the Board").  

The  Fund  shall  be  represented  as  an  observer  at  the  Monitoring  Committee  meetings  of  the 
PEACE Programme, and of other Structural Funds interventions as appropriate. 

Article 4 

The  Commission  shall,  in  co-operation  with  the  Fund’s  Board,  determine  appropriate 
publicity  and  information  procedures  in  order  to  publicise  the  Community’s  contribution  to 
the projects financed by the Fund. 

By  31  March  2006  at  the  latest,  the  Commission  shall  submit  a  report  to  the  Budgetary 
Authority,  assessing  the  results  of  the  activities  of  the  Fund  and  the  need  for  continuing 

Article 5 

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contributions  beyond  2006,  taking  into  account  developments  in  the  peace  process  in 
Northern Ireland. That report shall incorporate, inter alia, the following: 

(a) 

(b) 

(c) 

(d) 

(e) 

a survey of the Fund's activities; 

a list of projects which have received aid; 

an assessment of the nature and impact of the Fund’s activities, notably in relation to 
its objectives and the criteria laid down in Articles 2 and 7; 

an assessment of action taken by the Fund to ensure co-operation and co-ordination 
with  Structural  Funds  interventions,  taking  account,  in  particular,  of  obligations 
under Articles 3 and 4;  

an  annex  setting  out  the  results  of  the  verifications  and  controls  carried  out  by  the 
Commission pursuant to the undertaking referred to in Article 6    . 

1. 

The Commission shall administer the contributions.  

Article 6 

Subject to paragraph 2 the annual contribution shall be paid in instalments as follows: 

(a) 

(b) 

(c) 

a first advance payment of 40% shall be made after the Commission has received an 
undertaking, signed by the Chairman of the Fund’s Board, to the effect that the Fund 
will  comply  with  the  conditions  for  the  grant  of  the  contribution  set  out  in  this 
Regulation;  

a second advance payment of 40% shall be made six months later;  

a  final  payment  of  20%  shall  be  made  after  the  Commission  has  received  and 
accepted  the  Fund’s  annual  activity  report  and  audited  accounts  for  the  year  in 
question. 

Before paying out an instalment the Commission shall carry out an assessment of the 
2.  
Fund’s financial needs on the basis of the Fund’s cash balance at the time scheduled for each 
payment.  If  following  that  assessment  the  Fund’s  financial  needs  do  not  justify  payment  of 
one of those instalments, the payment concerned shall be suspended. The Commission shall 
review that decision on the basis of new information provided by the Fund and shall continue 
payments as soon as they are considered justified. 

Article 7 

A  contribution  from  the  Fund  may  be  allocated  to  an  operation  which  receives  or  is  due  to 
receive  financial  assistance  under  a  Structural  Funds  intervention,  only  if  the  sum  of  that 
financial assistance plus 40% of the contribution from the Fund does not exceed 75% of the 
operation’s total eligible costs. 

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Article 8 

This Regulation shall enter into force on 1 January 2005. 

It shall expire on 31 December 2006. 

This Regulation shall be binding in its entirety and directly applicable in all Member States. 

Done at Brussels,  

For the Council 
The President 

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LEGISLATIVE FINANCIAL STATEMENT 

Policy area:   REGIO 

Activity:  

Other regional actions 

TITLE OF ACTION: COMMUNITY CONTRIBUTIONS TO THE INTERNATIONAL FUND FOR IRELAND 

(2005-2006) 

1. 

BUDGET LINE(S) + HEADING(S) 

B2-604 

2. 

OVERALL FIGURES  

2.1. 

Total allocation for action (Part B): 

€ 30 million for commitment 

2.2. 

Period of application: 

2005-2006 

2.3. 

Overall multiannual estimate of expenditure: 

(a) 

Schedule  of  commitment  appropriations/payment  appropriations 
intervention) (see point 6.1.1) 

(financial 

€ million (to three decimal places) 

Year 
[n] 
2005 

[n+1] 

[n+2] 

[n+3] 

[n+4] 

2006 

2007 

Commitments 

Payments 

15 

12 

15 

15 

3 

[n+5 
and 
subs. 
Year] 

Total 

30 

30 

(b) 

Technical and administrative assistance and support expenditure(see point 6.1.2) 

Commitments 

Payments 

Subtotal a+b 

Commitments 

Payments 

15 

12 

15 

15 

3 

30 

30 

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(c) 

Overall  financial  impact  of  human  resources  and  other  administrative  expenditure 
(see points 7.2 and 7.3) 

Commitments/ 
payments 

0,041 

0,041 

TOTAL a+b+c 

Commitments 

15,041  15,041 

Payments 

12,041  15,041  3,000 

30,083 

30,083 

2.4. 

Compatibility with financial programming and financial perspective 

Proposal is compatible with existing financial programming. 

2.5. 

Financial impact on revenue: 

Proposal  has  no  financial  implications  (involves  technical  aspects  regarding 
implementation of a measure) 

3. 

BUDGET CHARACTERISTICS 

Type of expenditure 

New 

EFTA 
contribution 

Contributions 
form applicant 
countries 

Heading in 
financial 
perspective 

Non-comp 

Diff 

NO 

NO 

NO 

No 3 

4. 

LEGAL BASIS  

Article 308 (EC) 

5. 

DESCRIPTION AND GROUNDS 

5.1. 

Need for Community intervention  

5.1.1.  Objectives pursued 

To encourage contact, dialogue and reconciliation between nationalists and unionists 
throughout  Ireland  and  to  promote  the  economic  and  social  advance  of  the  two 
communities. 

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5.1.2.  Grounds for the operation 

The  European  Community,  recognising  that  the  objectives  of  the  Fund  are  a 
reflection  of  those  pursued  by  itself,  has  given  practical  backing  (€ 15  million  p.a. 
since 1989; € 20 million for each of the years 1995, 1996, 1997; € 17 million for the 
years 1998 and 1999; € 15 million for the years 2000, 2001, 2002, 2003 and 2004).  

In  June  2004  the  European  Council  called  on  the  Commission  to  examine  the 
possibility  of  aligning  interventions  under  the  PEACE  II  programme  and  the 
International  Fund  for  Ireland  with  those  of  the  other  programmes  under  the 
Structural Funds that come to an end in 2006, including the implications in financial 
terms. 

Continuation  of  this  contribution  for  another  two  years  illustrates  the  clear  EU 
support for the peace process in Northern Ireland. 

5.2. 

Action envisaged and budget intervention arrangements 

– 

– 

– 

Objectives  :  to  promote  economic  and  social  advance,  and  to  encourage 
contact,  dialogue  and  reconciliation  between  nationalists  and  unionists 
throughout Ireland.  

The  Fund  operates  mainly  in  Northern  Ireland  and  in  the  Border  Region  of 
Ireland; it targets designated disadvantaged areas. 

For a detailed analysis of Fund activities : see Commission report and annexes 
COM(2004) XXX / SEC(2004) of XX September 2004. 

5.3.  Methods of implementation 

Subject to an assessment of the Fund’s financial needs, the annual contribution shall 
normally be paid in instalments as follows: a first advance payment of 40% shall be 
made after the Commission has received an undertaking, signed by the Chairman of 
the Fund’s Board complying with the Council Regulation; a second advance payment 
of  40%  shall  be  made  six  months  later  and  a  final  payment  of  20%  shall  be  made 
after  the  Commission  has  received  and  accepted  the  Fund’s  annual  activity  report 
and audited accounts for the year in question. 

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6. 

FINANCIAL IMPACT 

6.1. 

Total financial impact on Part B - (over the entire programming period) 

6.1.1.  Financial intervention 

Commitments (in € million to three decimal places) 

Breakdown 

[Year 
n] 

2005 

[n+1] 

[n+2] 

[n+3] 

[n+4] 

2006 

Total 

[n+5 
and 
subs. 
Years] 

Action 1 

Action 2 

etc. 

15 

15 

TOTAL  15 

15 

30 

30 

6.1.2.  Technical  and  administrative  assistance,  support  expenditure  and  IT  expenditure 

(commitment appropriations) 

Not applicable. 

6.2. 

Calculation  of  costs  by  measure  envisaged  in  Part  B  (over  the  entire 
programming period) 

Not applicable. 

7. 

IMPACT ON STAFF AND ADMINISTRATIVE EXPENDITURE 

The  needs  for  human  and  administrative  resources  should  be  covered  within  the 
allocation  granted  to  the  managing  DG  in  the  framework  of  the  annual  allocation 
procedure. 

7.1. 

Impact on human resources 

Types of post 

Staff to be assigned to management of the 
action using existing and/or additional 
resources 

Number of 
permanent posts 

Number of 
temporary posts 

Officials 
temporary staff 

or 

A 

B 

C 

Other human resources 

Total 

0,2  

0,1  

0,3 

Description of tasks deriving from the 
action 

If necessary, a fuller description of the 
tasks may be annexed. 

Total 

0,2 

0,1 

0,3 

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7.2. 

Overall financial impact of human resources 

Type of human resources 

Amount (€) 

Method of calculation *  

Officials 

Temporary staff 

Other human resources 

32400 

0,3 * €108000 

(specify budget line) 

Total  32400 

The amounts are total expenditure for twelve months. 

7.3. 

Other administrative expenditure deriving from the action 

Budget line 

(number and heading) 

Overall allocation (Title A7) 

A0701 – Missions 

A07030 – Meetings 

A07031 – Compulsory committees 

A07032 – Non-compulsory committees 

A07040 – Conferences 

A0705 – Studies and consultations 

Amount € 

Method of calculation 

7500 

€750  *  10  p.a.  (5  missions  of  2  days 
each on average) 

Other expenditure (specify) Audit 

1500 

€750 * 2 p.a. 

Information systems (A-5001/A-4300) 

Other expenditure - Part A (specify) 

Total  9000 

The amounts are total expenditure for twelve months. 

I. 

II. 

Annual total (7.2 + 7.3) 

Duration of action 

III. 

Total cost of action (I x II) 

41400€ 

2 years 

82800€ 

8. 

FOLLOW-UP AND EVALUATION 

8.1. 

Follow-up arrangements 

The Commission will  monitor  the  Fund’s activities through its continuing presence 
on  the  Board  as  an  observer.  It  is  informed  of  all  the  Fund’s  proposed  decisions 
before  they  are  put  to  the  Board.  The  Fund  operations  are  moreover  controlled  by 
DG REGIO audit and control services. The result indicators will be the number and 
value of projects approved by the IFI. 

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8.2. 

Arrangements and schedule for the planned evaluation 

The Commission will submit a report to the Budgetary Authority by 31 March 2006. 
The report will include a survey of the Fund's activities, a list of projects which have 
received  aid,  an  assessment  of  the  nature  and  impact  of  the  Fund’s  activities,  an 
assessment of action taken by the Fund to ensure co-operation and co-ordination with 
Structural Funds interventions and an annex setting out the results of the verifications 
and controls carried out by the Commission. 

9. 

ANTI-FRAUD MEASURES 

The  Commission  is  represented  on  the  Board  of  the  Fund  and  the  final  annual 
contribution is only paid over after receipt and acceptance of the Fund's annual report 
and audited accounts. The Fund operations are moreover controlled by DG REGIO 
audit and control services. 

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