The issue is one of three key sticking points remaining following talks between London and Dublin last week. Throughout the negotiations Ireland has been pushing for a European aspect to co-operation and the Government has been reluctant for fear that Europe and Ulster - the two most controversial topics in British politics for three decades - could become intertwined.
The proposal being considered for the new cross-border body would be directly modelled on the European Union and a central authority with executive powers would be modelled on the European Commission. Like the Commission, it would have powers to initiatepolicy, consult and harmonise but would not make decisions. That would be left to ministers from Dublin and any devolved government in the North.
This is directly parallel to the EU Council of Ministers. The authority would be responsible to the Irish Parliament and to an elected regional assembly in Northern Ireland as with the European Parliament. The Authority would contain elements from all the different communities in the North.
The authority would cover areas such as agriculture, the environment, tourism and transport where the island of Ireland as a whole is affected. In particular, it would develop a joint approach to the European Union. In certain policy areas the authority would represent both North and South at meetings in Brussels of the EU Council of Ministers instead of ministers from London and Dublin as now.
This would only affect cross-border issues where both sides have an obvious interest in the same outcome. For instance, if Brussels was deciding on cash for a new cross-border road or rail link, the authority would pool the British and Irish votes. In areas that were not affected - farming in Devon or cash for urban projects in Dublin, for example, national ministers, as now, would attend.
The concept of radically increasing the European input in Northern Ireland is likely to be instinctively opposed by Unionists, who have traditionally regarded the whole European concept with suspicion.
Most Unionist politicians are close to the the Tory anti-European right in maintaining that British sovereignty should be jealously guarded rather than diluted by Europe. Irish nationalists, by contrast, are almost universally pro-European.
The issue is one of three main sticking points coming from last week's discussions. The others are the scope and scale of the authority's remit, and the idea of reversion. This would ensure that if the Unionists refuse to cooperate, instead of allowing aSunningdale-type situation to evolve and the gradual collapse of an Ulster assembly, powers would revert to the Anglo-Irish Agreement.
The EU already gives large amounts of cash to Northern Ireland and plans to give hundreds of millions more. Britain and Ireland co-operate on cross-border EU funds and last year for the first time they put together a joint statement on their plans for spending EU cash.
Experiments have already begun in EU countries with federal constitutions where regional authorities vote in Brussels instead of national ministers - for example, ministers from Flanders can vote at meetings of ministers. None of these, however, has a cross-border element.Reuse content