Incidences of racially motivated crimes have risen in the province
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The police's clearance rate for racial and homophobic crimes is "disturbingly low", a committee of MPs has warned.
The Northern Ireland Affairs committee said the authorities' strategy to tackle rising hate crimes was sluggish, disjointed and lacking in vision.
The PSNI had no formal definition of sectarian hate crime until recently, an "alarming" fact given troubled recent history, the committee claimed.
It said less than 7% of recorded hate crime resulted in charges or summonses.
If Northern Ireland was to establish a fully normal society, then the "despicable and brutal attacks must cease", they said.
'Collective responsibility'
The all-party committee said it was up to the government, churches, the institutions of civil society and every individual to take collective responsibility.
The report added: "It is high time that the police and criminal justice system in Northern Ireland took with the utmost seriousness crimes against the most vulnerable in our society."
The committee said it was greatly concerned about the very low level of confidence which most ethnic, as well as the lesbian, gay, bisexual and transgender communities had in the police.
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Police will do their utmost to bring perpetrators before the courts but they can only do so with co-operation from communities
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It recommended that the Policing Board should ensure more people were recruited from minority ethnic communities, saying it was crucial that the PSNI was more representative of all communties.
In many respects, Northern Ireland's institutions were "now having to relearn their basic functions as society returned, slowly and painfully to normal", they said.
The committee claimed the Northern Ireland Office and the criminal justice agencies had also shown a lack of firm and effective leadership.
Responding to the report, a PSNI spokesperson said the service was adopting a proactive approach to tackling hate crime.
"Police officers are being trained to understand and deal with diverse communities. A guide to culture and diversity has been produced and distributed to all officers," the spokesperson said.
"Police will do their utmost to bring perpetrators before the courts but they can only do so with co-operation from communities."
Victims groups
Meanwhile, the Northern Ireland Affairs committee also published an interim report on the province's past on Friday.
The MPs called for funding for victims groups to be increased.
The committee contrasted the £28m spent on victims groups between 1998 and 2004 with the £150m spent on the Bloody Sunday inquiry in the same period.
The MPs said the government must ensure extended funding for such groups.
The report said some victims in the early years of the Troubles received very small compensation compared with later payments.
The committee welcomed plans to appoint a Victims Commissioner to represent the needs of survivors or the bereaved, but it felt the government should wait until the political climate was right before setting up any truth recovery process.