Residents of Rosslare Harbour, Co Wexford, have been threatened that a hotel owned by the Department of Justice will be handed over to the Prison Service for use as a halfway house for offenders if they do not agree to its use as a reception centre for asylum-seekers.

Mr Brendan Howlin, Labour's justice spokesman and a Wexford TD, claimed in the Dail that residents who had picketed the Devereux Hotel to prevent its use as a centre for asylum-seekers had been told it would be handed to the Prison Service.

There have been separate negotiations between protesters and the Minister of State and local deputy, Mr Hugh Byrne, and the asylum section of the Department to resolve the row.

The current proposal was that the "hotel would be used for a period of 18 months and would then be sold on the open market as a tourist hotel; that it would be used only as a reception centre and not as permanent accommodation for asylum-seekers; and that it would be used only for short-term stay by those arriving in Rosslare Harbour".

The Minister for Justice, Mr O'Donoghue, made no reference in his reply to the Prison Service suggestion. He said no asylum-seekers were accommodated in Co Wexford.

Discussions with local representatives were continuing "with a view to ensuring that this facility can be used by the directorate [for Asylum Support Services] as part of its overall strategy for meeting the reception needs of asylum-seekers in the south-east region".