The Department of Enterprise, Trade and Employment is considering the implications of the European Court judgment on the reduction of European Social Fund (ESF) aid to Ireland, and how this will affect departmental budgets, it said in a brief statement.
It said the reduction, by €15.6 million, of ESF funding relating to three programmes in the 1994-1998 period represents less than 1 per cent of the amount allocated to these programmes for this period.
Ireland received a large transfer of funds from the EU during this period for a variety of programmes aimed at improving access to employment and training, especially for people living in marginalised areas or suffering from social exclusion.
The European Social Fund is one of four EU structural funds whose purpose is to reduce differences in living standards across the EU. Its budget for the period 2000-2006 is €60 billion, of which Ireland will receive €1.1 billion. €3.8 billion will go to the 10 new member states between last year and the end of the funding period.
In Ireland the bulk of funding will go to employment and human-resource development, with childcare, peace and community initiatives also benefiting. Retraining of workers made redundant and adult literacy programmes are being aided, and bodies such as the Department of Education, Fás, the Department of Justice, Equality and Law Reform and the Equality Authority all receive ESF support.
In the statement, the department said the reduction in the 1994-1998 funding was made because the commission was unhappy with the methodology employed by the department and one of the implementing bodies in preparing ESF claims. This resulted in an "overclaim" by Ireland, according to the commission.
The statement also pointed out the commission accepted the expenditure was eligible and no allegation of fraud was made.
Ireland took the case to the Court of Justice, with Government approval. The Advocate General recommended the court dismiss Ireland's application to overturn the commission's decision, and this recommendation was upheld yesterday.