A businessman in Northern Ireland paid a six-figure sum to the Provisional IRA and a five-figure sum to the loyalist Ulster Volunteer Force over the course of a year, a committee of MPs said today.
In its report on organised crime, the Northern Ireland Affairs Committee said it had received disturbing anecdotal accounts of the serious and damaging effect extortion was having on the construction industry in Northern Ireland.
The disclosure prompted Democratic Unionist MP Gregory Campbell to claim it flew in the face of Government claims that paramilitary involvement in criminality was on the wane.
The Committee's report said: "We heard that construction managers were visited on building sites by members of paramilitary organisations, normally at the early stage of a development, and would be asked whether they required 'security services' to protect the site.
"Both republican and loyalist paramilitaries were involved, depending on the location of a building project.
"However all paramilitary groups adopt similar tactics. If the offer of security is refused, a range of savage reprisals will follow, including serious damage to buildings on the site, threats to personal security, and the theft of vital building equipment.
"Many felt that it was much easier to accept the offer of 'security services' from paramilitaries and to make payments to them than to proceed with the constant threat of attack."
Loyalist and republican terror groups have long been suspected during and since Northern Ireland's troubles of extorting money from the construction industry.
The committee's latest claims, however, will add fuel to the flames over continued paramilitary involvement in criminality, especially the Provisional IRA.
Last July the Provisionals declared an end to their armed campaign.
However the Reverend Ian Paisley's Democratic Unionists have refused to go into Government with Sinn Fein despite that declaration, because they are not yet convinced that the PIRA have ended all paramilitary and criminal activity.
The committee today said the amounts of security payments made to paramilitaries varied from £450 to £750 per week and were always paid in cash.
"We were told that at particular 'holiday' periods of the year including the summer months and December, building sites would be targeted for lump sum payments of several thousands of pounds which were dressed up as donations to holiday or Christmas charities," the report said.
"We heard that over the course of a year a number of payments had been made, including a significant six-figure sum to PIRA and a significant five-figure sum to the UVF.
"Although there is a deep fear of reporting such incidents to the police, some builders do report incidents. We were told that although the police are aware of the problem, there had been limited success in arresting those involved.
"Some of the construction managers we met felt that the Assets Recovery Agency could do more to recover the proceeds of organised criminal activity and they should be given greater resources to do so."