The fact that more than 40 people from Northern Ireland were named in the honours list has been welcomed by the Northern Secretary, Mr Paul Murphy.
He said: "I am delighted that so many local people have been recognised for their significant contribution to improving our society, here in Northern Ireland.
"I would extend my congratulations in particular to Sir Desmond Rea, who has been chairman of the Northern Ireland Policing Board since its inception. Although Sir Desmond has given service in the wider public sector for some 25 years, it is for his outstanding contribution during a time of immense change for policing in Northern Ireland that he receives this honour today."
In his New Year message yesterday, Mr Murphy said the year ahead posed challenges for the peace process.
Mr Murphy reflected on the progress made in recent political talks, but expressed disappointment that devolved government had not returned to Stormont.
"Yet I am encouraged by the huge steps we have taken towards getting the Assembly and its institutions back up and running.
"I firmly believe that in the New Year we must channel all our efforts into taking those final few steps together to return power to locally elected politicians," he said.
Last month's talks failed to reach agreement after the Democratic Unionist Party demanded photographic evidence of IRA disarmament.
Republicans have refused to take this step, claiming the DUP is calling for an act of humiliation.
"I remain committed to the complex and difficult process of searching for a sensitive and meaningful way of dealing with the past. In the wider context, we still face the challenge of tackling organised criminality in the community. It is vital that we continue in our efforts to frustrate, disrupt and bring to justice those involved."
He condemned the racist attacks that have increasingly become a feature of life in Northern Ireland.
"As a government we are determined to tackle racism, sectarianism, and hostility based on sexual orientation or disability in Northern Ireland. We owe it to everyone to ensure that we continue to build a strong and diverse community for future generations to enjoy."
Mr Murphy praised charity fundraising in the North for those affected by the Asian tsunami. "This season is traditionally a time of hope, thanksgiving and reflection. . . Sadly, this Christmas has also seen a global humanitarian disaster of almost unimaginable proportions.
". . . It is very moving to witness the generosity of the community here as it reaches out to those who are suffering across the world. It is that generosity of spirit, that instinctive ability to reach out and respond to those in need that gives me real cause for hope as we continue to strive to heal the wounds of our own community." - (PA)