A European Union body has withdrawn its offer of funding for the proposed £25 million (€29.5 million) peace-building and conflict resolution centre at the site of the former Maze prison.
Around £18 million (€21.25) had been offered to the lead partner which is the Office of First Minister and Deputy First Minister.
In a statement issued this afternoon the Special EU Programmes Body (SEUPB) said the planned conflict resolution centre, designed by international architect Daniel Libeskind, would not now go ahead as the project was "not viable".
“The SEUPB has been in discussions with the lead partner in relation to the viability of the Peace Building and Conflict Resolution Centre. It has been agreed that the project is no longer viable at this time and the SEUPB has therefore rescinded the letter of offer. The SEUPB will now consider the re-allocation of funding to suitable projects.”
DUP leader Peter Robinson withdrew his support for the controversial centre last summer amid worsening political relations between the two largest parties on the Stormont executive. The conflict resolution centre plan is still strongly supported by Sinn Féin's Martin McGuinness.
He said on Monday that proposed £300 million (€355 million) development of the entire 347-acre Maze/Long Kesh site would be blocked unless the DUP reverted to its earlier agreement to build the peace-building centre and to retain one of the former prison’s notorious H Blocks.
Mr Robinsons described the decision as “sensible and practical” and allowed the SEUPB to ensure the money “doesn’t find itself going down some black hole”.
“It allows them time to look at other projects and spend the money elsewhere,” he added.
Mr McGuinness said he still held out some hope that the peace building centre would yet be constructed n the Maze site.
Repeating his warning to the DUP made earlier this week, the Deputy First Minister added he would authorise no projects other than the move by the Royal Ulster Agricultural Society to the Maze “until people come to their senses”.
“What is at the heart of this is power-sharing. From my perspective I want to share power but I can’t do it on my own. The peace centre is a government commitment which has to be honoured. If it isn’t, then it damages the power-sharing project,” he told the BBC.
Maze Long Kesh Development Corporation chairman Terence Brannigan said the issue now lay with Mr Robinson’s and Mr McGuinness’s office and the EU.
But he added: “As a corporation we continue to be fully committed to securing the regeneration of the Maze Long Kesh site.”
Late last April Mr McGuinness and Mr Robinson jointly and emphatically praised plans for the Maze development, including the peace building centre, which they said would have a transformative effect on Northern Ireland.
Mr Robinson suggested that unionist opponents of the peace building centre should be taken away by men in white coats.
The centre scheme could be reconsidered by the SEUPB as part of a new round of investment funding due to begin in 2014. But the plans would have to be considered afresh and would not simply be a resubmission of the existing application, a spokesman told The Irish Times.
Other unionists welcomed the withdrawal of EU funding.
Traditional Unionist Voice leader Jim Allister simply said: “Hurrah! Should never have been awarded in the first place.”
Ulster Unionist Assembly member Tom Elliott said: “I have always opposed the use of [EU]funding to develop what would become a shrine to terrorism and re-traumatise those who have already suffered most in our society - the many innocent victims of terrorism.”
He said the decision would be welcomed by victims groups and representatives of the former RUC and the British army.
Another of the SEUPB-supported schemes, the proposed cross-Border bridge at Narrow Water linking Co Down and Co Louth, could also be lost unless a shortfall in funding, estimated at between €10-15 million, is met within the next few weeks.