THE private sector should become more involved in EU-backed projects in Ireland, the director of the EU's Cohesion Fund, Mr Jean-Francois Vestrynge, has said.

He also warned that full funding for projects, including the Southern Cross motorway and the Port Access Tunnel, may not be available because of delays in starting the schemes.

He called on financial institutions to get involved in road and water schemes which receive EU support.

These projects would have to be paid for through water charges and tolls and people would have to get used to that.

"Ireland will not always be able to depend on cash from Brussels. Adjustments will have to be made."

Although Ireland was good at taking up its allocation of EU funding, planning of projects was not always what it should be.

There had been delays and cost overruns on several schemes. The hold-ups had been caused by several factors, including delays because of environmental issues and land acquisitions.

The blame could not be attributed to any one agency or factor but Ireland was not good at prioritising projects, he said.

Although projects such as the Southern Cross motorway had qualified for funding, there may not be enough cash left to complete the project before the current round of funding ended in 1999.

"They might get funding or they might not," he said.

Mr Verstrynge said it was too early to say whether Ireland would get a similar level of funding from the Cohesion Fund in the next round.

However, it was likely that there would be a reduction in the level of funding Ireland will be allocated. In the 1994-1999 period, Ireland has been allocated a total of £6 billion of EU money under the Cohesion Fund and structural funds.

Talks on who gets what will get under way in 1998, once the issue of which countries will be joining the EMU is resolved.

Mr Verstrynge, who oversees a budget of 2.14 billion ECUs, covering 1,000 projects, said Ireland's good record of using its Cohesion Fund allocation will help its case.

Meanwhile, the Minister of Finance, Mr Quinn, said yesterday that substantial and sudden withdrawal of funds would have serious budgetary and economic consequences for Ireland.

"While we can be grateful that our economic performance in recent years has been such as to create a situation where we are no longer perceived as lagging behind our most prosperous EU partners, we need to firmly convince them of the reality that lies behind that perception: Ireland still has substantial development needs," said Mr Quinn.

He was addressing a conference on financing public investment to 1999 and beyond, which Mr Verstrynge also attended.

It was organised by the Construction Industry Federation (CIF).

"We have made a good start but the job is not done," said Mr Quinn. "Without further EU funding we would not be as far advanced in our roads programme. We need further funding to complete the job."

Mr Liam Kelleher, the CIF's director-general, told the conference that a more positive and aggressive stance towards the utilisation of private finance for public investment purposes will, at least at the margin, reduce the financing requirement of the exchequer.

"The Irish economy is growing strongly, but on borrowed time, we must raise our rate of in vestment substantially to sustain present growth rates," he said.

Mr John FitzGerald, research professor with the Economic and Social Research Institute, said if properly managed the public finances should be able to make good any shortfall in structural funds after 2000.

"With this in mind the Government should aim to eliminate the Exchequer Borrowing Requirement by 1999 to leave room for state funding of projects which may no longer be covered by reduced EU support after 2000," he said.