John Perry (Sligo-North Leitrim, Fine Gael) | Oireachtas source

I thank the Senator for raising this important issue. The Leader initiative was established by the European Commission in 1991. It was designed to aid the development of sustainable rural communities under the reform of the Common Agricultural Policy. Leader II, which commenced in 1994, extended the programme to all rural areas in Ireland and was delivered by 34 groups. While Leader I was a pilot initiative, Leader II was designed to complement the strategy for rural areas in the national development plan for 1994-99. In addition to an increased level of funding and coverage of all rural areas, emphasis was placed on the acquisition of skills and improved capacity building to ensure the delivery of the business plan for the rural areas. Leader continued in the 2000-06 round of EU funding and operated in all rural areas in the country in that programme period. Since 1994, therefore, all rural areas of Ireland, including all Gaeltacht areas, have been included in the Leader elements of the successive rural development programme.

While initially some 36 groups were contracted to deliver the Leader elements of the current programme round from 2007 to 2013, currently there are 35. Meitheal Forbartha na Gaeltachta, the group contracted by the Department to deliver axes 3 and 4 of Leader in the rural development programme in the Gaeltacht areas, went into liquidation on 7 September 2011, leaving Gaeltacht areas temporarily without access to the programme. Progress in the context of the legal winding up of the MFG is ongoing. In this context, the Department has developed an approach that will facilitate the continuation of the programme in Gaeltacht areas and address the existing rural development programme projects with outstanding claims for payment.

This has proved to be a complex legal process which has taken time to resolve. MFG was a private limited company and it is beyond the remit of the Minister or the Department to direct the business of such a company. The group's liquidation process is ongoing. I acknowledge and regret that the current situation has caused delay to the delivery of the Leader elements of the rural development programme in the Gaeltacht areas. However, this delay relates primarily to the need to ensure the continued effective delivery of projects funded under the rural development programme.

The Department is also responsible for ensuring that any solution is fully compliant with and has the capacity to ensure that all projects are fully compliant with all EU national requirements. The process of identifying the promoters whose projects are at an advanced stage of development has been established and a system of co-operation with local development companies contiguous to the Gaeltacht areas is in place to facilitate the final checking and processing of payment claims in respect of these projects. Hopefully the projects raised by the Senator will be included in that. Many of these files have now been sent to the relevant local development companies, which will be in touch directly with the relevant promoter.

In the context of the delivery of the axes 3 and 4 Leader elements in the rural development programme in Gaeltacht areas in the long term, I can confirm that contracts have been issued to groups which will now formally replace MFG as the delivery mechanism of the rural development programme Leader funding for the Gaeltacht areas of counties Galway, Donegal, Kerry, Cork, Waterford and Meath. The Department is formalising arrangements with the relevant local development companies. While there is a system in place to address the current outstanding commitments in County Mayo generally and future delivery for the Gaeltacht areas of south Mayo in particular, some further work is required to finalise a solution for the remaining areas there. However, I expect a solution will be reached shortly.

Local development companies processing Gaeltacht area projects will be provided with adequate and reasonable administration funding, based on the cost of delivering all outputs under the revised contracts, subject to all applicable regulatory limits and conditions under the rural development programme. The local development companies will provide the Department with projections on these costs so that provision may be made for the additional administrative burden of taking on contracts in the respective Gaeltacht areas. The final solution will see the future delivery of Leader elements of the rural development programme allocated to relevant local development companies. This is a significant step forward. I am confident the Gaeltacht areas of Ireland will be restored to full access to rural development funding in the near future.