COMMITTEE FOR FINANCE AND PERSONNEL

Peace Funding

25 June 2008

Members present for all or part of the proceedings:
Mr Mitchel McLaughlin (Chairperson)
Mr Roy Beggs
Mr Simon Hamilton
Ms Jennifer McCann
Mr Adrian McQuillan
Mr Declan O’Loan
Mr Peter Weir

Witnesses:
Mr Martin Tyrell Department of Finance and Personnel
Mr Pat Colgan Special EU Programmes Body

The Chairperson (Mr McLaughlin):
We will be addressed by Martin Tyrell, head of European division, North/South programmes branch in the Department of Finance and Personnel, and by the chief executive of the Special EU Programmes Body, our longstanding friend Pat Colgan. [Laughter.]

We have to be nice to you, Pat. You have a lot of money to get rid of, so we will all be very polite and deferential.

Mr Pat Colgan (Special EU Programmes Body):
I really appreciate that introduction, Chairperson.

Mr Martin Tyrell (Department of Finance and Personnel):
I should like to begin by briefly going through the paper that we presented a few days ago. It is an update of where we are with Peace III. The implementation section is possibly the most interesting part of that paper, outlining as it does where we are with regards to the approval of projects. We received all eight local action plans in March, and in mid-May —

Mr Beggs:
Chairman, it is appropriate that I declare an interest as a member of Carrickfergus Borough Council, which is a partner to one of the cluster groups.

The Chairperson:
You are always very interesting.

Mr Weir:
I should declare that I am a member of North Down Borough Council, which is a member of one of those overall cluster groups.

Mr Hamilton:
At a recent council annual general meeting I was appointed to the local strategy partnership; I am in the process of amending the Register of Members’ Interests.

Mr Weir:
I should also declare my membership of a local strategy partnership — I try to block it out of my mind, but, unfortunately, it keeps coming back.

The Chairperson:
We are all in a very confessional mode.

Mr Tyrell:
In mid-May we had the assessment of those eight plans, all of which were submitted on time; they were assessed over two days and three of them were approved by the steering committee with some conditional comments. Those three projects were Belfast, the north-west and the north-east. All of those projects should be in a position to begin implementation by September or October, and they have been informed that they can begin the recruitment of staff as a prelude to the implementation of their plans.

The remaining five groups were asked to resubmit by the end of this month; those resubmitted plans will be considered again in August. We hope that, at that stage, all of the matters raised by the steering committee will have been fully addressed and that the plans can then proceed to full implementation. In the interim, and in anticipation of the plans being approved in August, all five clusters have been informed that they can begin to recruit the necessary staff to carry out the implementation.

Other aspects of the programme are open, and project assessments are being considered. Steering committees have met to carry out work on initial assessments across all the themes, but principally theme 2.1, which deals with shared space, and theme 1.1, the regional dimension of building positive relations.

Victims’ groups have submitted 69 applications, which will be considered in September. The steering committee will look at all of the victims’ aspects of Peace III, which is good progress in terms of programme implementation. Peace II runs until the end of September, when all projects that are currently open will have to close. The two programmes will, therefore, run in parallel until the end of September.

Peace II must meet its expenditure targets and clear its entire budget. In Northern Ireland, we are confident that it will achieve its EU spending targets and expend its full budget. Around €2 million of the Peace II budget for the Republic of Ireland, in the border counties, may be in jeopardy, which is causing some slight concern. However, every action is being taken to ensure that that money is spent and the full budget of the programme is expended.

Peace II is complicated because of the mix of funding that it receives. A significant part of the Peace II budget comes from UK member state sources, and, unlike EU money, it is not bound by spending targets. That allows for a bit of flexibility as to when the funding can be spent, but it still has to be spent before the end of the year, within the time frame of the programme.

There is still €71 million to be spent across 1,500 or so Peace II projects. That works out at about €50,000 per project or €12,000 per month. That is a challenging level of expenditure, which we hope will be achieved. However, the Special EU Programmes Body (SEUPB) has identified some €14 million as being at risk of not being spent within the programme. That is nothing to do with N+2 targets; it will not be lost to the Northern Ireland economy. However, it will be lost to the programme if it is not spent.

At the last DFP Committee meeting, the issue of reconfiguration of Peace III local authority clusters was proposed. However, all advice has been that that is not the best way forward. Significant progress has been made on local action plans, and that would be negated if we were to reopen the clusters and begin again. At the best estimate, it would be early 2009 before that part of the programme could be up and running again. That would be a significant delay, which would adversely impact on all present Peace II beneficiaries who are seeking a share of the Peace III programme. Therefore, it would not be an appropriate strategy. That is the advice that we have received.

Mr Colgan:
I want to update some of that information; quite a lot has happened in the last week. On 23 June and 24 June, two meetings of the steering committee were held, and some issues have moved on.

Of the €100 million allocated, in principle, to priority 1 theme 1 — building positive relations at a local level — we want to allocate €60 million in the current phase and hold over €40 million for phase 2, which will be in 2010, at the end of the current planning period. A steering committee meeting will be held on 7 August, at which time the remaining five applications, which must be submitted before the end of June, will be considered. We need that time to reconsider the economic appraisals and to reconsider the suitability statement by the Community Relations Council (CRC) and Border Action. That leaves a narrow window of opportunity within which to turn that around. Another reason for the time gap is that members of the steering committee must have the papers at least two weeks in advance. We are very confident that letters of offer will be with the cluster groups in August.

All eight groups — the seven clusters and Belfast — have started the recruitment process. The jobs have yet to be advertised in newspapers, but they should appear in July and August. Internal human resources issues are being examined and job descriptions put in place. The information that I have is that, by early September, people will be in those posts within the clusters to implement that work.

Under the priority 1 theme 1 regional strand, there has been an allocation of between €40 million and €50 million. To date, six projects have been approved, not two. Therefore, the total amount of commitment from steering committee approvals is not €12·6 million, but is now €23 million. Two interesting and significant projects have been deferred for further approval and consideration at the steering committee meeting in August. We are quite confident that those projects will be approved as well.

If I may, I will update the Committee on the latest information on priority 1, theme 2. Paragraph 7 of our paper mentions strand 3 — securing the future. The total allocation for that strand will be around €25 million. As Mr Tyrell reported, 64 applications have been received under that strand. The original thinking was that they would be considered at a steering committee meeting in September. We have had quite a number of meetings with CRC, Border Action and the Commission for Victims and Survivors. It has now been agreed that we will push those applications through much more quickly. A steering committee meeting has been arranged for 24 July, at which 33 of those 65 applications will be considered. Hopefully, money and letters of offer will issue immediately afterwards. That will help significantly toward working with some of the smaller groups on the ground.

A first call for applications under strand two was issued on 20 June. CRC and Border Action intend to deal with applications as they come in. Rather than wait for everybody to lodge their applications, steering committee meetings will be held fairly quickly. Thus, the call for applications will remain open and project applications will be dealt with as they come in. Basically, it is a case of first come, first served. A certain amount of management of the funds will be required to ensure that we are not creating disadvantage for others.

The Chairperson:
Has it been made clear that the applications will be dealt with on a first-come, first-served basis?

Mr Colgan:
The final letters of offer will not be issued until all applications have been received, but the full assessments will be carried out. For example, projects could be scored, assessments could be completed and everything could be ready to go. We will then close the competition at a certain date, look at the overall picture, and proceed with the applications that have scored highly, making provisions based on the scores. Every attempt is being made to ensure that there is no delay in the process.

The Chairperson:
If a group misses the closing date, that is their responsibility, but there is no inherent advantage in being the first to lodge an application.

Mr Colgan:
That is right.

I want to make one minor correction under the heading of priority 2 theme 1. Seven projects have been approved to date, and the total funding is €53 million. I also want to give a final update on the closure of the Peace II programme. Our paper states that €71 million remains to be spent. As of this morning, it is €63·8 million. Thus, a great deal has been happening on a daily basis.

Those are the main updates on what is a very dynamic process.

The Chairperson:
We can see that; it is necessarily so.

Mr Weir:
It is very useful to get this kind of regular update, as it means that we can keep on top of things.

We have received a letter from the Society of Local Authority Chief Executives (SOLACE) expressing concern about what it believes to be a misrepresentation of its position by you. I assume that you are aware of the letter, because it was copied to you. How do you think that situation arose?

Mr Colgan:
I have here a minute of a meeting that was held on 7 April. Howard Keery, Brenda Hegarty and I were there. Also present were Danny McSorley from Omagh; Liam Flanagan from Limavady; Trevor Polley from North Down; and Liam Hannaway from Banbridge. Liam’s office was kind enough to produce a very simple, one-page minute of the meeting. I will read out what was agreed there:

“There was general agreement that the hiatus over RPA arrangements makes it difficult for councils and SEUPB to implement PEACE III. The very robust position of DARD further complicated the issue.”

I cannot possibly comment on that. It goes on:
“There was a general view that PEACE III would be a good vehicle to get Councils in the new RPA groups to start working together and could help form the basis for Good Relations Units in the new Councils.

There was agreement that SOLACE should be asked to contact DOE and NILGA to suggest that this position be reviewed by September 2009 to enable the reformation of clusters. SOLACE should write to Pat Colgan to make this suggestion.”

Mr Weir:
With your permission, I suggest that it would be helpful to circulate a copy of that minute.

I appreciate the point that you made about the examination of re-clustering — you said that it would not be practical to re-cluster at this stage because you have gone sufficiently down the line. However, is it still the intention to have a review of clustering? At what stage is that practical — September 2009?

Mr Colgan:
That review should take place in September 2009. We need to get money on the ground, and we must ensure that we help some of the groups on the ground to engage with local authorities. A fair amount of development work is required. Once that sort of activity begins, we should sit down and review it at the end of 2009.

If, at that stage, there is an appetite for clusters to be reconfigured in accordance with the review of public administration, we will be very happy to facilitate that. We will discuss the implications of that with the Department of the Environment and other Government colleagues.

Mr Beggs:
About the €14 million of Peace II funding that is at risk of not being spent — you seemed to say that that was not EU money and was not, therefore, in danger of being lost. Does that money simply go back into the monitoring round?

Mr Tyrell:
Absolutely. Of the total Peace II budget of €995 million, €182 million is member-state money. The complex history of Peace II funding is such that €182 million of member-state money, from UK member-state sources, went into the programme. That is not bound by N+2, and the €14 million that is at risk of not being spent in the programme comes from that €182 million. As you said, that money would go straight into the monitoring round — probably into the September or December monitoring this year — and be reallocated.

Mr Beggs:
I appreciate that much progress has been made over the last couple of months. You indicated that Peace II funding has to be spent by the end of September, and you hope to have new funding — particularly for victims, which you will assess at an earlier stage — flowing in tandem with that.

That may work if those groups have not already spent their money. Have some of them already closed their expenditure programmes? Are groups that meet the criteria for Peace III funding, such as the successful victims’ groups, at risk of experiencing a period in which they have no funding?

Mr Colgan:
That is something that we have been monitoring very closely. We also discussed that issue the last time I was here. The principal mechanism that we have used to try and ensure that that does not happen is getting the Peace III moneys out on the ground as quickly as possible. We are also trying to facilitate groups to extend their contracts up to August or September. We made that offer, and quite a number of groups took it up. We did that through the implementing bodies, which — in this case — are the Community Foundation for Northern Ireland, CRC and Border Action.

Mr Beggs:
Does that involve diverting other moneys that may not have been spent?

Mr Colgan:
Part of our strategy for maximising spend on Peace II is to get some of that €14 million, and some of the money from the other areas, provided that the aims of the projects fall within the various priorities. That money has been made available — several groups have taken it up, some have not.

We are monitoring the situation closely with our colleagues in CRC and Border Action, to try to pinpoint individual groups that may face difficulties. We have not had a huge clamour of difficulties and problems at the moment, but we are monitoring it closely and have said that if any difficulties emerge, we will consider innovative measures to deal with them. That may involve, for example, innovative ways of getting interim funding to groups from the Peace III moneys. We are happy to explore ways of avoiding big problems.

Mr Beggs:
Are you liaising closely with the Department of Finance and Personnel in case there is a need for other Departments to fill gaps that might occur?

Mr Tyrell:
The money does not sit in one place — it is with the currently accountable Departments. It would be returned to us through the Departments identifying the underspend and delivering that to us.

Mr Beggs:
It would be wasteful for experienced, cohesive groups — particularly some victims’ groups that may be successful in Peace III — to make people redundant, only to re-emerge weeks or months later. I am conscious that there will be increased funding for victims’ groups, for instance, which is a potential source of funding.

Mr Colgan:
That is precisely why we have said that. We are trying to identify individual groups where that might be the case. At the moment, through working with the victims’ commissioners and CRC, I have identified one such group. If members are aware of any other such groups, I would be happy for you to let me know of them, because we would like to work with them and see what needs to be done.

Mr O’Loan:
I take it that, in relation to Peace III, what is not local is considered to be regional. Is the theme for creating shared public spaces only open to applications from bodies that can confer a regional impact? What opportunities are provided for the local creation of shared public space?

Mr Colgan:
That theme is very local in focus; it is about creating shared public spaces in local areas. The capital-build or regeneration projects are local in that they are attached to a geographic location.

Mr O’Loan:
Is it open to application from bodies that could only have an impact in a local area?

Mr Colgan:
Yes, it is.

Mr O’Loan:
I have been told otherwise.

Mr Colgan:
They are capital-build projects, so by their very nature they are focused on physically reclaiming spaces that either have been lost, were no-go areas or needed regeneration, or where it is possible to connect communities in a way that was not possible in the past. So, in that sense, the projects could not really be regional, although their impact could be.

Mr O’Loan:
Is it still open to applications?

Mr Colgan:
Yes, although we are running out of money fairly quickly. We have committed €53 million to it; we have €82 million in the pot altogether. That is not to say that money could not be reallocated within the programme, but that is the situation at the moment.

Mr McQuillan:
You say that the advice that you got about the reconfiguration of the clusters in relation to the review of public administration was to let them remain as they are currently — I believe that that is totally wrong. A review is due in 2009, which is just around the corner, and some of the groups might decide to change then. It is better to do it now and have the structures in place, because the clusters will only be getting used to working together in 2009 anyway, and they may decide to change then. So what was the rationale there — was it just the time issue?

Mr Tyrell:
It is imperative that we meet our N+2 spending targets, and the local action plans are an important element in achieving that. If we do not meet our spending target, which is €28 million in 2009, that resource is lost to the Northern Ireland economy. Therefore, if we delay the implementation of local action plans, we risk losing at least some of that €28 million.

Reconfiguring would mean starting the entire process again. It would be early 2009 before local action plans came back for steering committee assessment, and even longer before they could be implemented. That would be a major delay, which would jeopardise the achievement of our N+2 target.

All factors will be considered in the proposed review. The N+2 implications of the review will be imperative. Any risks to the achievement of the N+2 targets in, for example, 2010 in a review of the current clusters would be a major factor in holding that review back — we could not reconfigure on the basis of a review that indicated that there was a further N+2 risk in 2010.

Mr McQuillan:
You said that there was €53 million left from the Peace II budget. Is all that money committed to the 1,474 projects?

Mr Colgan:
Yes; that €63 million must be spent by those projects.

Ms J McCann:
There is much concern in the voluntary and community sector about the closure of the Peace II programme. Some of the groups will not be eligible for Peace III funding. Over 7,000 projects were funded in the last tranche of Peace II money — 5,000 of those projects have closed, and the rest will close soon. Peace III will be delivered according to the local strategic peace plans by the clusters. Those groups from the voluntary and community sector that are not eligible for Peace III funding will be seeking money elsewhere. Has there been any evaluation or review of the essential front-line services, particularly in disadvantaged communities, that will be lost? If so, has that review been passed to the Departments so that, when those groups and organisations ask for core funding, the Departments can see the effect of ending the services they provide?

Mr Colgan:
The community and voluntary groups can access the Peace III programme in several ways. They can access money from the programme under the umbrella of a lead partner which represents several groups. There are several such proposals, such as one from the Training for Women Network, which is on behalf of several womens’ groups. The second way for community and voluntary groups to access funding is by taking advantage of money available in the local-authority action plans by their local cluster.

There may still be gaps in the programme. Our focus is to get the programme structures in place, get the money committed and provide anyone who is eligible for funding with the opportunity to apply. Once that has been done, which will be soon, we must ensure that the letters of offer hit the ground, because they are the contracts that enable groups to begin spending. We must also examine the strategic gaps that may exist — are there any areas that have fallen through? We will need more research, and we are committed to doing more in the near future. There are groups in the community and voluntary sector, such as those that represent former members of the security forces, that will probably require assistance from us in gaining access to the type of funding that can be made available to them through the local authority action plans or the regional lead-partner groups, or there may be something else that we must do in the programme for them. That analysis will be done.

Ms J McCann:
Paragraph 5 states:

“Seventeen full applications have been received. Eight have been presented to the Steering Committee and two projects, worth €12·6 million have, to date, been recommended for approval. Two applications have been rejected”.

Paragraph 10 refers to the rejection of a further nine applications. Will you provide some detail on which projects have been rejected? A major concern is that the remaining clusters will not be in a position to deliver the funding. That would result in essential front-line services delivered by the community and voluntary sector going nowhere. Until a review or evaluation demonstrates to the relevant Department that those essential services must be maintained, I cannot see where those groups can go for funding.

Mr Tyrell:
I appreciate the issues for groups that are currently funded under Peace II, but the Peace III programme is substantially different: for example, its focus is more strategic and it has an emphasis on larger strategic targets, rather than on smaller and more localised, projects. Also, Peace III focuses on activities that more directly promote peace and reconciliation. Therefore, some Peace II projects will not meet the selection criteria for Peace III. Also, as Peace III has a smaller budget, even were its selection criteria identical to those for Peace II, it could not support every current Peace II project — for example, better projects that came along would take precedence.

Every project that is currently funded under Peace II sits in a measure of the Peace II programme for which a particular Department is accountable. Over the next six months, the Departments must decide whether activities currently funded under Peace II are appropriate for mainstreaming as part of their regular, ongoing budgets.

At the same time, projects that are funded under the Peace II programme can apply for Peace III funding and take their chances on satisfying the new selection criteria. I suspect that some, particularly those based in the victims’ sector, will have no difficulty in succeeding. Organisations that are currently supported by Peace II funding will also apply for Peace III funding; indeed some of those that have already done have been successful. Therefore, the crossover between Peace II and Peace III is more likely to be at the level of organisation rather than at the level of individual project.

The difficulties for individual projects that are being funded under Peace II and are now seeking to continue under Peace III funding should not be undersold; they will face challenges. All Peace II projects were, as part of the selection criteria, asked to state an end date or to specify how they could continue when Peace II funding ended. Peace II funding was introduced as a finite programme, and it was reckoned to be the last Peace funding that we would receive. We have been fortunate to receive Peace III.

Ms J McCann:
May the Committee have a detailed breakdown of the projects whose funding under Peace II has ended, or is due to end in September, and a detailed breakdown of the applicants for Peace III funding?

Mr Tyrell:
Absolutely; that information is easily available.

The Chairperson:
Is it possible for that breakdown to include references to the relevant Department? We could then share that information with the other Committees?

Mr Tyrell:
Of course.

Mr Colgan:
We are happy to provide that information, although it may not be directly comparable.

Mr Hamilton:
All the questions have now been asked, but I want to make a comment for the record. To echo what colleagues said, I have talked to groups that are being funded by Peace II and the delay is causing them concern, particularly in areas where clusters have not had their action plans agreed. Pat mentioned the extension of existing contracts through the Community Foundation for Northern Ireland (CFNI). However, in the most part, the additional money was a small amount and merely covered housekeeping to keep the lights on, and so forth.

It is imperative that those action plans are agreed, or else there is a real risk that, in certain areas, the capability to deliver on the ground some of the projects that might be delivered through Peace III may have unfortunately disappeared.

Mr Tyrell:
Three clusters have already been approved, and should be up and running, and the action plans rolling out, by September/October 2008. The other five clusters are recruiting staff to enable them to do that, and we are very hopeful that all of the weaknesses that were identified in mid-May will be addressed and that when they come before the steering committee on 7 August, they too will be approved, and will be able to commence very quickly. They will be coming into operation just as all Peace II projects are ending, on 30 September.

However, that again raises the issue of reconfiguration, because local action plans are, for many projects currently receiving Peace II funding, the best hope of securing funding under Peace III. If we were to reconfigure, then there would definitely be a gap between the Peace II and Peace III programmes. That is a further reason why we should not be reconfiguring at this stage.

The Chairperson:
Thank you both very much; your presentation was very helpful. Thank you also for your patience — it took a while for the Committee to get to you. It is quite valuable to get those regular updates, because the Committee is having to field enquiries about quite a range of projects. The people involved in those are either anxious about the future or just trying to establish what is the best point of contact and the best way forward.

Mr Tyrell:
Thank you very much.