EU finance ministers are to finally reject Commission President Mr Jacques Santer's attempt to secure 800 million extra for trans European transport, energy and communications networks (TENS). Some of the funding was also to be targeted at small business and research.
The TENS cash, requiring a significant increase in the Union's budget, had been seen as a central element of Mr Santer's flagship "Confidence Pact for Jobs". The ministers' refusal, after six months of deadlock on the issue, is likely to prove politically embarrassing for him.
The Irish Times has learned that a special finance ministers' committee has advised, in a report to be submitted to ministers at this weekend's informal meeting of Ecofin in Dublin, that no agreement would be forthcoming.
The committee's recommendation would also be seen as a blow to what the Minister for Finance, Mr Quinn, hopes will otherwise be a very successful weekend. But in setting up the committee in July under the former senior Irish Commission official, Mr Eamonn Gallagher, he had warned against undue expectations of a deal, pointing to the difficulty involved in loosening the EU's purse strings while national governments pursue severe financial stringency at home.
That reality is reflected, diplomatic sources say, in the resolute refusal of five member states - France, Germany, Luxembourg, the Netherlands and Britain - to contemplate extra EU spending. They represent a clear majority of votes in the Council.
Mr Quinn is understood to be likely to urge ministers to put the issue behind them once and for all by accepting the report this weekend unless there is a demand from colleagues for a substantial discussion on the issue, in which case he will probably refer it back to the next formal meeting of Ecofin in October.
The report is understood to acknowledge that extra funding could help to speed up some of the projects but to point to the fact that currently some £24 billion in European Investment Bank loans have already been approved for projects involving a cost of over £80 billion. Some £3.2 billion in direct EU spending is already planned for the 1993-1999 period.
The committee is also understood to have drawn attention to the potential of a committee set up by the Transport Commissioner, Mr Neil Kinnock, due to report next year on public private partnerships as vehicles for raising cash.
The story is unlikely to end this weekend, however, as MEPs, who share budgetary authority with the Council of Ministers, may well threaten to get in their own form of retaliation if the TENS money is not forthcoming. Sources in the parliament say they could take the view that, as the Council does not see the need to prioritise TENS, its current allocation should be redistributed.
