Steel row hits Ulster talks

COLIN BROWN

Chief Political Correspondent

A pre-Christmas meeting between John Major and John Bruton in Dublin to boost the peace process is in the balance today over a row between Ireland and Britain over European Union subsidies for the Irish steel industry.

The Irish Prime Minister was described as "incandescent" with anger over a threat by the British to veto the EU subsidies at a meeting today in Brussels of trade and industry ministers.

Mr Bruton privately accused the British of being driven by ideology, and made it clear that he would not meet Mr Major if the British government refused to let the subsidies go ahead. British ministers have privately complained about the Irish using the peace process as a lever for the subsidies.

The issue threatens to sour the meeting in Dublin which was intended as an informal goodwill trip by Mr Major at Mr Bruton's invitation to show unity after the differences over IRA decommissioning.

Downing Street was refusing to speculate on whether the visit planned for tomorrow would go ahead. Officials on both sides were engaged in hard last-minute bargaining to reach a compromise.

British ministers have objected to the subsidy because it would hit British Steel's Shelton plant in Stoke with alleged unfair competition. The Irish have denied that charge, insisting that the EU aid is needed to allow a steel plant near Cork to be privatised.

Meanwhile, Sir Patrick Mayhew, the Northern Ireland secretary, is backing the idea of holding elections to a new body in Ulster next year to appoint negotiating teams for all-party peace talks, including Sinn Fein.

Sir Patrick believes it could be a way out of the impasse if the international body under Senator George Mitchell fails to find a way to begin the decommissioning of IRA and loyalist paramilitary weapons. He is seeking the support of the SDLP who have resisted the idea, which has been promoted by the Ulster Unionists.