The European Union's budget for the next seven years has been agreed at Berlin in a whirlwind of late-night negotiations. It is a solid and welcome achievement for the Union and for Ireland. It sets the scene for several important national initiatives. Ireland's interests are clearly changing within the EU, as economic growth and development have outgrown entitlements for structural and cohesion funds. This agreement secures this State's primary interest in the Common Agricultural Policy and should stimulate fresh thinking about the development of social and economic infrastructure over coming years.
The general mood in favour of retrenching and consolidating budgets made this an especially difficult negotiation for the Taoiseach, Mr Ahern, and his team. Ireland's recent relative prosperity has reinforced the sentiment that this State has become less deserving of aid. The overall outcome from Ireland's point of view provides for transfers of an estimated £2.97 billion over the seven-year period under the heading of structural and cohesion funds, to which can be added £400 million in animal headage payments for purposes of comparison with the previous programme. The negotiators are to be commended for securing last-minute improvements that substantially changed the contours of the agreement from Ireland's point of view.
These funds will be divided between the new eastern and western regions of the country set up under the agreement. They are in fact only a small proportion of the investment required to bring the State into line with average EU income levels. A great deal of valuable infrastructural investment was accomplished with previous rounds of EU transfers; but there is still a substantial deficit which will have to be met from national resources, and must include innovative forms of partnership between public and private investors. Administrative but not political power is devolved to these new regional bodies. There is a strong case for developing greater democratic accountability at regional level. As is so often the case with EU policies, they provide a springboard for developing more enlightened policies within the domestic context.
The Common Agricultural Policy reforms agreed two weeks ago by EU farm ministers survive intact and have, in fact, been improved by the last-minute dairy and cereal concessions in Berlin, largely to satisfy French farming interests. This suits Ireland's agricultural industry. It provides that the next budgetary period will be much more certain. But it does not mean that industry is invulnerable to change, whether in forthcoming world trade talks or in terms of domestic policy. The Government must insist that this opportunity is used to develop greater marketing skills and restructuring of the industry. Otherwise its efforts to secure the overall CAP regime may have been in vain.
The Berlin summit opened another new phase in the EU's affairs by nominating Mr Romano Prodi as the next President of the European Commission. He is an excellent choice and commands unprecedented goodwill from the member-State governments. In order to maximise this opportunity the Government must take great care to nominate a person with well-developed political and international experience as the next Irish commissioner. There is ample time to consider this matter in coming weeks as Mr Prodi consults political leaders in the member-States.