Seanad Éireann - Volume 184 - 21 June, 2006

Social Partnership Agreement: Motion.

  An Cathaoirleach: I wish to inform the House that the names of the Labour Party Senators are to be added to the signatories of the amendment to the motion. I call on Senator O’Rourke to move the motion.

  Ms O’Rourke: I move:

That Seanad Éireann welcomes the proposals for the new social partnership agreement.

On behalf of Senators, I welcome the Taoiseach to the debate on this important issue. The motion is simple, that Seanad Éireann welcomes the proposals for the new social partnership agreement. I am pleased the Taoiseach has come to this House first to debate the agreement. I am sure there will be occasions to discuss it in the other House also.

This is the seventh such agreement. We well remember the first agreement in 1987. The Cathaoirleach will remember we had a mini-debate about it on the Order of Business last week. We recalled the perilous and parlous situation in which the country then found itself and the determination by all, especially the trade unions and the Government, that we would devise a strategy to chart a way forward. The Programme for National Recovery emerged from that process.

Things got a bit sparky last week and when we said we “rescued the country”, we also said Alan Dukes had a role to play with the Tallaght strategy. So he did. When talking last week about the achievement of the Taoiseach of the day, Charles Haughey, in putting forward this agreement, speakers did not omit to mention that it was supported by Alan Dukes through the Tallaght strategy. That is on the public record and should be said.

The year 1987 was an extremely difficult period for the country financially and it is not an exaggeration to say we faced certain peril. In addition to other people, the Taoiseach and I were around the table at that time. It was a difficult time to manage, especially in a spending Department. Be that as it may, the agreement was achieved. There is no point in always looking back, we must look to the future. That first agreement was followed by a series of agreements. At each stage, a new agreement was never a given and one never envisaged that they would be easy to achieve. Far from it. As each three-year period came to an end the circumstances changed. The first agreement led to an improvement which coincided with a decrease in interest rates and a general uplift in economic activity, which gave rise to a general amelioration in the situation.

[381]Each agreement brought its own distinct difficulties and challenges. In time, the process broadened to include more than just the trade unions and the Government but they were the only parties to the first agreement because it was a matter of the utmost urgency to address the problems and a rigorous approach was required in order to reach an agreement. The partnership process has been extremely effective. The fact that a better climate of industrial relations was achieved meant firms wishing to locate here, especially from the United States or other areas, were assured that, by and large, the industrial relations climate would be peaceful.

This did not prevent the odd hiccough — in some cases significant hiccoughs from time to time — in the public sector and various other areas but it was possible to overcome them which had not been the case previously. Disputes and work stoppages were no longer as bitter or protracted as in the past. The consensus that emerged did away with the old days of a confrontational, adversarial approach to dealing with industrial relations.

In time, farmers became an important element of the partnership approach. The community and voluntary sector also became involved under the leadership of our friend from Inchydoney, Fr. Seán Healy, who became its main spokesman. Partnership became an all-embracing process that included the trade unions, farmers and the disadvantaged pillar. “Pillar” is the preferred term for each sector involved. In this way the process widened its influence and effect, which has proven to be very much to the good because people in each sector could bring their issues to the talks and hopefully find a resolution. The partnership process has become a way of life.

From time to time doubts set in as to whether we should embark on another agreement but if we were to dispense with them it would result in a free-for-all at local level which would be a disastrous outcome. We have had plenty of that in the past. Wisdom prevailed and those who are in charge of implementing the agreement embarked once again on this process with stout heart. I accept the agreement is not yet concluded. The officials present are well aware of that. I pay tribute to them for their work. We are not allowed to refer to them by name but they know who they are. The Cathaoirleach is indicating that I should behave. The officials concerned have put their hearts into the work and given of the great experience and expertise won by them over the years.

I understand the representatives of the farming community are still engaged in talks. It is expected they will work through their remaining concerns by the weekend. I hope fervently this will happen. In addition, I am aware that, among the teaching community, the TUI has severe difficulties and concerns in regard to a particular aspect of the agreement. Experience shows that TUI members are not unreasonable and I hope [382]wisdom will prevail in regard to their deliberations. TUI members from the institutes of technology, in particular, are very exercised by this issue.

In the past 12 months, there have been significant upheavals regarding the working conditions of immigrants. This has necessitated that particular emphasis be placed in this programme on the obligation of employers to ensure compliance with standards relating to their rights. I welcome plans to establish an office to ensure compliance with legislation on working standards for those who come to work here. It is all very well to say we have opened our doors to welcome the Poles, Lithuanians, Latvians and so on. What should ensue from this welcome is a certainty that they will be treated in an acceptable fashion and will enjoy satisfactory working conditions. Unfortunately, this is not always the case.

We have had many passionate debates on this matter in the House. Everybody is appalled at the prospect that immigrants might not be afforded decent working conditions. The office of employment rights compliance will guarantee the necessary strong protection for employment standards. I also welcome the provisions on a national skills strategy, new employment permit measures and measures to ensure social inclusion.

The substance of the Opposition amendment relates to an issue that is often raised in this House and upon which I hope we can reach agreement. This is the need to ensure there is adequate debate on the issues in question. There has been much comment that the entire negotiations process was secretive. Not everybody can be brought into the closet but I accept there should be a far more open way of conducting these discussions. It is desirable that a debate should take place within the Houses of the Oireachtas, as is happening in this Chamber today. At the request of Senator O’Toole, we had a debate on this matter four or five months ago because there was disquiet among some Independent Senators about it.

It seems there is not a full appreciation among the public of what it means to have successfully secured a national consensus among trade unions, business interests and others. Perhaps the Government needs to conduct some public relations exercises to this effect. Last night, I was invited to a meeting in Athlone Institute of Technology where I met some 50 young people from the United States who are studying there. They had all done significant research on Ireland and several of them asked me to explain social partnership. They were keenly interested in the process and particularly impressed with the minimum wage rate.

We all accept that our current economic success is built on the efforts of preceding years. We also accept that educational provision and social partnership have played a particularly significant role in securing that economic success. We should all take great credit for this. There has been much [383]criticism of the benchmarking process but those who criticise it are never willing to forego the benefits they have received through it. It requires public service workers to satisfy measurable standards of performance efficiency. It was a necessary exercise because public sector workers had fallen behind their counterparts in the private sector. The former have now properly come to the forefront. If we are to have an effective working democracy, we must ensure both the elected heads of Departments and those who work within Departments are rewarded satisfactorily for their work. I often observe that those who needlessly criticise standards and work practices and the consensus that has been reached in this area should come in and experience the system for themselves.

I thank the Taoiseach for coming to the House and I commend those who worked so hard and diligently in bringing forward this programme. I expect the Taoiseach will tell us its name presently. We will run out of names shortly and the Secretary General, Mr. McCarthy, will have difficulties in devising more. I wish the programme every success. I agree with Opposition Members on the need for debate on this matter — that is why we tabled this motion. I see nothing adversarial about the Opposition amendment in its call for ongoing debate on the issue. I welcome such a process, which will allow us to mark and record progress. I have great pleasure in proposing this motion.

  Dr. Mansergh: I second the motion and reserve my right to speak at a later stage.

  The Taoiseach: I welcome the opportunity to speak on the motion welcoming the draft social partnership agreement, Towards 2016. I congratulate the House on its early discussion of the new agreement, following its earlier debate on the negotiations in the context of the National Economic and Social Council, NESC, and National Economic and Social Forum, NESF, reports which preceded them.

Before turning to some of the principal features of the new agreement, which are worthy of support by the House and the public, I will address some of the criticisms of the social partnership process. In doing so, I observe that much of this criticism comes from the same old tired voices, many of whom seem to resent that our social partnership process works so well, is admired so widely on an international level and continues to adapt and develop in the light of changing circumstances. It is a case of some people regretting that what should not work according to their theory works so well in practice. We are invited to believe that social partnership is a dangerous conspiracy, subversive of democracy and empowering vested interests with vast control over public policy, while, at the same time, it is an outdated and empty ritual which [384]makes no practical difference to the world in which we live and work. I can resolve this contradiction by stating that both criticisms are incorrect.

This is not an anti-democratic project. Since the bold initiative of the late Charles Haughey in 1987, social partnership has been based on an invitation by the Government of the day to the social partners to join it in discussions of how, through dialogue, we could together develop policies and behaviour which better serve the needs of our people. As in the past, the Government entered these negotiations on the basis of our programme for Government. We maintained close ministerial oversight of the conduct of the negotiations. The terms of the draft agreement were approved in every respect by the relevant Minister in a process led by the Tánaiste and me. We are satisfied the outcome is entirely consistent with our programme.

In implementing the agreement, we will, as before, be fully accountable to the Oireachtas. The substantive elements of the agreement require the introduction of legislation which, as ever, will be subject to close scrutiny and debate in this House and in the Dáil. The expenditure implications will be dealt with in the budgetary and Estimates process in the usual way, with full accountability, approval and oversight by the Oireachtas. All the implementation arrangements are reported regularly to the Oireachtas. For example, in the course of Sustaining Progress, more than 30 progress reports were laid before the Oireachtas, together with other commissioned reports and studies. Since 1997, I have answered more than 300 parliamentary questions on the social partnership process and the implementation of agreements, while my ministerial colleagues answered questions in respect of their particular responsibilities under these agreements. This will continue. I welcome greater parliamentary engagement and scrutiny of the process. I wish that Oireachtas committees would take a greater interest in the substance, rather than the mythology of social partnership and that the other House would be as constructive as the Seanad in its engagement.

Social partnership is not anti-democratic because it is based on a recognition of the proper and distinct roles of Government, on the one hand, and the legitimate contribution to public life of the social partners who, entirely in their own right, exercise very significant influence over the economic and social life of this country. As employers, trade unions, farm bodies and voluntary organisations, they play an enormous role in civil society. Their independent decision making and behaviour has a profound effect on employment, living standards, productivity, adaptation, the quality of public services and the social cohesion underpinning the quality of life of our community. It is entirely democratic to recognise and respect their independent roles and contribution. At the same time, the social partners [385]recognise that the Government in this process is not simply the first among equals. They appreciate fully that the Government must insist on, and exercise fully, its prerogatives within the framework of political accountability.

I do not need to rehearse here the contribution that social partnership has made over the years since 1987. Apart from the industrial peace and stability it has produced in the labour market, and the confidence this has given to investors, the process has been important in developing a consistency of approach across all the main players in the economy. This reflects a strategic analysis of the opportunities and challenges we face. This consistency of approach has been an important, if not critical, factor in our successful adaptation to change over many years. This adaptation has extended beyond the technical and economic, into the successful response to social change and the imperative of building a more inclusive society.

Fairness has been at the heart of the process since 1987. It is that very quality which has led so many international observers, including the IMF, the OECD and the European Commission, to comment so favourably on its role in the Irish success story. It is also why the European Council urged all member states to develop what it calls national reform partnerships, like Ireland, to underpin the Lisbon strategy for growth and jobs, since governments acting in isolation cannot deliver the change which is required.

There is one final myth which I would like to address, which is that the agreement, in so far as it relates to pay and the workplace, really only affects a minority of the private sector who are trade union members, and is essentially a public service pay agreement. Nothing could be further from the truth. It may be true that a majority of employees in the private sector at any one time are not organised members of trade unions. However, wage determination is never a purely local matter. Wage norms and trends are easily established, especially in small labour markets. We know from our own experience how badly wrong these norms can be in the light of conditions across the economy. Collective bargaining across Europe has a powerful influence on wage levels, even in countries with much lower rates of trade union membership than Ireland.

The key to the success of the Irish model is that it is flexible enough to recognise the wide diversity of situations in employments across the economy, while providing a framework of confidence that is effective in guiding in the right direction not just wage setting, but all aspects of the employment relationship. The concerns which were so widely and publicly voiced last year about the potential for displacement and a race to the bottom in the labour market evoked the genuine and passionate concern of many thousands of workers and citizens. Even though the instances of grave concern about exploitation and unreasonable behaviour affected only a small [386]number of employments, we need mechanisms which provide confidence about decent standards and fairness, without compromising flexibility or adding unreasonably to the burdens of regulation of the labour market. That delicate balance requires the active engagement of all the parties to our employment system.

I am happy to say that the social partnership process provides precisely that opportunity. The outcome of the recent negotiations in respect of employment standards represents, in my view, a very fair balance between the competing legitimate interests and objectives, and will provide confidence for the future in a rapidly-changing labour market.

The level of the pay increases which have been agreed reflects the correct balance between what we know about productivity, inflation and a range of other factors which will impact on the state of the economy, and our ability to be competitive in international markets. The pay terms of the agreement are quite straightforward, with 10% payable over 27 months, in four amounts of 3%, 2%, 2.5% and 2.5%. An additional 0.5% is to be added to the payment, due from 1 July 2006, for those earning €10.25 per hour or less. In addition, the parties have agreed to make a recommendation to the Minister for Enterprise, Trade and Employment to increase the national minimum wage with effect from 1 January 2007. For those whose circumstances require it, there are provisions to plead inability to pay and-or to seek offsetting productivity changes.

The pay terms for the public sector are the same as those for the private sector, albeit that the payment starts later, from 1 December 2006, rather than 1 January 2006. As under Sustaining Progress, these payments will only be made after delivery of verifiable change. Such change includes better opening hours and improved promotion and recruitment practices, particularly the opening up of more senior jobs to competition from people from outside the public service.

A second round of benchmarking is under way and a report will issue in the latter part of next year. This will indicate the differences in pay and conditions, if any, between public workers and their private sector equivalents. If any pay increases are recommended for particular groups we will have to ensure that substantial change and flexibility is delivered in return.

The draft agreement is not just about pay, important though that is. It is also about maintaining a supportive macroeconomic environment in order to enhance productivity, competitiveness and build a stronger society. Put simply, it is about improving the quality of people’s lives.

Chapter 2 sets out the macroeconomic context to the agreement and assumes a certain level of economic growth in the short to medium term. It also endorses the key national strategies such as the national spatial strategy and national development plan that will inform investment and planning, together with details of key actions [387]planned or already in place regarding sectoral strategies in areas such as science, technology and innovation, better regulation, public enterprise, manufacturing, transport, housing, energy, telecommunications, education and training, the environment, rural development and the agrifood sector.

Chapter 3 develops a new framework to address key social challenges which individuals face at each stage of their lives. This means a focus on the needs of children, young adults, people of working age, older people and people with disabilities. In each case, a vision is set out for people in that stage of the life cycle, which the social partners will work towards over a ten-year period. This ambitious approach will pose a major challenge because public services will have to be designed around individuals and their requirements, rather than based on different State agencies. The approach will take time to deliver and the agreement sets out how we propose to measure and review progress over the ten years. In addition, it sets out a number of priority actions in each case over the first phase of the agreement up to 2008. The new approach will also help us to monitor progress more effectively, by focusing on outcomes for people at each different stage of their lives.

The draft agreement will now be subject to ratification over the coming weeks, in line with the internal procedures within each social partner pillar and organisation. I believe that all concerned will recognise the benefits of the new agreement for themselves and the country as a whole, and give it a fair wind in the course of the ratification process.

In the event of a favourable outcome to the ratification process, I would see considerable value in a quarterly discussion with the Seanad on the partnership process. It might be more helpful and effective if the Seanad selected specific themes covered by the agreement for a more extensive debate on such occasions. The quality of Seanad debates confirms my belief that the Seanad is an appropriate place to debate the analysis and conclusions of the more reflective instruments of social partnership. In particular, the reports of the National Economic and Social Council, the National Economic and Social Forum and the National Centre for Partnership and Performance have important contributions to make to informing social partnership and the wider policy process. Direct engagement with the chairmen and directors of these bodies could contribute to the value of appropriate discussions by the Seanad. In addition, I am sure the social partners would be happy to avail of opportunities to share their experiences and their views on the process which has been a critical factor in our overall economic and social development in recent years.

I welcome the House’s engagement with this topic. I would like to see a more active approach [388]by the Seanad to the overall partnership process, along the lines that I have outlined. Social partnership is a European tradition that in no way challenges the democratic process. On the contrary, I believe them to be entirely complementary aspects of modern governance, and I look forward to continued engagement as a means of expressing that complementary relationship.

  Mr. J. Phelan: I move amendment No. 1:

To delete all words after “Seanad Éireann” and substitute the following:

— welcomes the agreement of the Social Partners and the publication of Towards 2016;

— calls for the laying of the full agreement before the Oireachtas for debate and for approval or rejection by its members;

— regrets that ten years of national social and economic policy has been agreed behind closed doors without appropriate democratic scrutiny;

— calls for reform of the social partnership process so that agreements are preceded by the adoption by the Oireachtas of a motion outlining the key challenges;

— calls for the implementation of social partnership agreements to become transparent and to be discussed by the Oireachtas Committee on Finance and the Public Service to be accompanied by on-going engagement between this committee and the social partners;

— concerned at the lack of representation of consumer interests which offers little hope that rip-off Ireland will be tackled in the duration of the agreement; and

— calls for greater emphasis on issues like poverty and disadvantage, environmental protection and long-term economic planning that pose challenges into the future.

I thank the Taoiseach for his remarks and apologise for being rather late for the start. I hope that commuters’ problems will feature large in the social partnership talks, since I had a few this evening on my way to the House. I apologise to the Leader for missing her opening remarks.

It is important that we table this amendment to the motion. There are several issues, problems and difficulties to resolve in the existing social partnership system, as the Taoiseach pointed out in his closing remarks. I welcome many of his final points, when he spoke of the possibility of debating specific issues regarding social partnership in the Seanad. That would be welcome, and the gist of the amendment proposed by the Opposition is certainly in that vein. I hope that the Government will be able to accept it.

I welcome the social partnership proposals and agree with the Taoiseach that the system has [389]served the country well. It is now time to adapt and upgrade the existing process, which has contributed to our development and current status. However, it must be amended, updated and reinvigorated. We clearly require a rebirth of the spirit of the original social partnership agreements. The Taoiseach referred to what I believe is the common myth that social partnership is the only reason for our success. He did not quite put it in those stark terms, but he alluded to it. While it is an integral part, there have been many other reasons for our economic success in recent years. If we are to continue to have social partnership, we must review the system and process.

In his concluding remarks, the Taoiseach spoke of what I and many others would refer to as the obvious democratic deficit in the system. Many Members of the Oireachtas continuously raise the issue, including some from the Government side. We need more involvement by the Oireachtas in the social partnership process. One part of our amendment seeks that the Government come before both Houses with the challenges and issues that it wishes to bring to social partnership discussions before the process begins. That will not happen if this partnership agreement is accepted, but it should happen in future. Members of the Oireachtas should have an opportunity to have some input before the Government gets involved in discussions on behalf of the social partners.

While I welcome the opportunity to have this debate, in one sense it might be a little premature, since the agreement has not yet been signed. We heard a warning shot over the weekend from the TUI, whose executive recommended rejection to its members. I suspect that other groups participating in social partnership will do the same. In that sense, we may be somewhat premature.

That is certainly the case with the agricultural part, which has not yet been concluded. Before I travelled here today, I attended the launch of the Teagasc Options 2006 event in Kildalton Agricultural College in Kilkenny, at which the Minister for Agriculture and Food spoke of her vision for the industry. However, although we need such a vision, she did not express what it was. In that area, the Government lacks a concept. We are somewhat premature and should have a full discussion on social partnership when all the partners have agreed to the proposals as laid out. It is unfortunate and may show the Government’s regard for agriculture, which is still a very important part of the economy. We should have that discussion when the relevant section has been agreed by all parties concerned.

I agreed with one point that the Taoiseach made very well, which is also contained in our amendment, namely, when he spoke of the need for various Oireachtas committees to engage with the partnership process. I am a member of the Joint Committee on Finance and the Public Service and my party’s spokesperson on the area [390]in this House. There is a real role for that committee to be involved in scrutinising the various stages in the process, and I would welcome that in future.

The Taoiseach also touched briefly on several clear gaps in the system as it currently exists. A substantial and ever-growing number of people work in the private sector but are not in a union. They are not represented directly at the talks, which is a difficulty. I do not know how it can be resolved or overcome, but it is a problem, since those people do not feel part of the process. They are detached from it, and it might allay fears and objections on this side of the House regarding the democratic deficit if those people could be engaged in a more meaningful way.

There is also a desperate need to have a consumer representative involved in social partnership. It is a glaring omission as things stand, and if they are talking about evolving and developing the system, consideration must be given to consumers, something not the case at present.

It is not satisfactory that this agreement, Towards 2016, which commits the State for another ten years, has essentially been concluded behind closed doors. As Members of the Oireachtas, we must be more actively involved in the process before it reaches the stage of acceptance or rejection by the partners. Two areas have been neglected. Efforts have been made in the last few agreements, but environmental protection, which seems not to have been treated as it should, is still an area that lags behind. I know that the Government will be talking about an energy policy over the next few weeks. It is a crucial area, and perhaps we should have placed more emphasis on the environment in the discussions.

There have been obvious failings regarding previous agreements in which the Government committed itself to action on social and affordable housing. The situation has deteriorated throughout much of the country, not least in this city. The Government has singularly failed in past commitments in that regard to help those in need of social and affordable housing. I hope that its broken promise will be reversed in any agreement.

  Mr. McDowell: I second the amendment in the name of the Fine Gael and Labour Party Senators. My party supports the social partnership process and much of the content of the current agreement. However, without in any way being smart, if one reads through and considers the agreement, as I have done today, there is very little with which any sane person might reasonably disagree, even the tired old voices to which the Leader referred.

In our amendment we seek to address some of the structural problems becoming increasingly evident in the process. I want to be rather more direct than usual in addressing some of them at the beginning of what I have to say. There is a [391]problem with what some of the parties bring to the table, particularly with the current agreement. There is a problem with the Government parties and some of the individual social partners. The Government comes to it with six months of its mandate left to run. It purports to set out an agreement that runs for ten years, until 2016. In a sense, that is not terribly problematic, since much of its content is general and, frankly, gobbledegook.

However, the Government purports to commit not only itself but several successors to an agreement that encompasses a very wide range of policy areas. This in itself points up a serious democratic problem. I appear to be losing my audience more quickly than I had anticipated. I thought we might fit my contribution in between two World Cup matches but I am not doing too well in this regard.

The fact that the Government seeks to commit not just itself but also several of its successors to certain courses of action presents a genuine difficulty. We have had experience of this in the past. When Charlie McCreevy visited this House after his appointment as Minister for Finance, he stated that he had no intention of adhering to the previous agreement’s provisions regarding tax reductions. However, this Government is seeking to do this in a far more ambitious way than any of its predecessors. It has six months to run but it is looking to bind Governments for the next ten years. I do not think it can realistically seek to do this.

There is also a problem with what the social partners bring to the table. I accept that this is possibly a more sensitive area. When people look to the leaders of the trade unions to which they belong, and I say this as a member of a trade union, they look for leadership and delivery on a range of issues. These issues primarily relate to the workplace. They chiefly concern pay but also encompass issues such as conditions of employment. The new agreement contains many sensible proposals in respect of these issues.

However, a problem arises when one goes beyond these issues. When trade union leaders look to negotiate on a range of issues ranging from early learning to child care to overseas development aid, they venture into areas where their members have not given, and do not feel they should be asked to give, the trade union leadership a mandate to negotiate on their behalf. If I was leader of a trade union, I would consider it perfectly reasonable to state that agreements with the Government of a corporatist nature should not simply be confined to the workplace and that there is far more which defines the standard of living of my members. I would insist on this if I was a trade union leader. However, if we are to be objective, we must state that trade union members do not appoint their leaders to negotiate on their behalf on certain issues.

[392]It is important to remember this because if there is a failure to deliver on these aspects of the agreement, which often happens, it lies beyond the competence of the trade union leadership in many cases to make it stick. We have seen examples of this from previous agreements, including the current one. Trade union leaders cannot realistically return to their members and tell them that the housing conditions of the agreement are not being met and that the union should agitate as a result because most trade union members do not know that they agreed to this in the first place.

A similar problem also arises with employers and the voluntary sector. Much of what they do is good and I disagree with virtually none of it but nobody appointed the leaders of these sectors to agree to these measures which makes their position much more difficult when they are looking to hold the Government to account in terms of making the agreement stick. It is important to be frank about this and put it on the table because it is a fundamental difficulty with this type of corporatist arrangement which is common in Ireland and other countries.

The agreement contains positive elements relating to workplace arrangements. I welcome the proposed new office of employment rights director. I hope the number of labour inspectors will increase. I believe the commitment is to pursue matters incrementally before the end of next year and I hope we will see an aggressive approach to ensure that what the trade union rightly termed the race to the bottom in terms of employment conditions does not come about, partly resulting from increased migration.

The pay increases set out in the agreement are less than generous. They probably average out at between approximately 4% and 4.5% per year. When one takes inflation, which is almost 4% into account, it is very reasonable, if one is sceptical about these agreements, to point out that the agreement does not really provide for any serious improvement in terms of pay conditions over the course of the two and a quarter years of the agreement.

I read between approximately 30 or 40 pages of the part of the agreement which deals with the years leading up to 2016. The material in this section is astonishing. I have been forced to read much of it over the years and I can see where it is coming from and where the cut-and-paste approach has been used. The section contains material from the mission statement of the Department of Finance, mid-term economic reviews and the annual review of the economy which is submitted to the European Commission. One then throws in part of the national spatial strategy and the national development plan and Towards 2016 emerges.

I wonder whether it is worth doing this. It contains much in the way of general principle but very little in the way of specific commitments. I am not sure if I like the general principle that the [393]Government should solicit and obtain the agreement of individual trade unionists and trade union leaders to a range of its programmes. If this happens, and the Taoiseach was quite clear about this earlier today, I am not sure whether this is what many individual trade unionists committed themselves to. I will give examples in case anyone thinks I am being too harsh. I did not seek out these examples; they merely struck me as being potentially interesting.

The section on social welfare pensions states that these pensions will be enhanced over the period in question, having regard to available resources and building on the existing Government commitment for a rate of €200 per week for social welfare pensioners to be achieved by 2007, which does not say much to me. In respect of the health strategy, the agreement talks about the commitment to approximately 3,000 beds. It states that there are 900 beds in place, 400 committed and possibly another 1,000 in the pipeline and states that the Government will merely have another review up to 2010. It makes it fairly clear but does not say that we will not meet the current commitment.

On the topic of public enterprise, a subject of serious interest, not least to the workers in Aer Lingus, all the agreement says is that the Government will consider which form of ownership is suitable, given international experience and Government priorities. The agreement contains a considerable amount of waffle and would be strengthened by its absence. It would be better and more comprehensible if the ten or 12 points of serious agreement between the parties which are new, fresh and easily understood were taken out and put to workers, social partners and the voluntary sector for agreement rather than producing between 70 and 100 pages, much of which no sane person could reasonably disagree with.

In conclusion, I accept virtually everything in this agreement but, as Senator John Paul Phelan noted, the process contains fundamental flaws of which we must be conscious and which we must do our best to reform.

  Mr. Morrissey: I thank the Taoiseach for appearing before the House this evening and I welcome the Minister of State at the Department of the Taoiseach, Deputy Treacy, to the House for this debate. This opportunity to discuss the recent proposals is a timely one and I commend Fianna Fáil for employing their Private Member’s time for this purpose. There has been plenty of commentary in recent days, and indeed almost every time social partnership is assessed, about a democratic deficit and about how the partnership process diminishes the role and input of the Oireachtas and public representatives. This is a concern.

For my part and that of my party, this is an opportunity to set out what social partnership is and what it is not. At the outset, I will state that we are firm supporters of agreement between [394]Government and the social partners. When the Tánaiste addressed the plenary session on social partnership earlier in the year, she said:

The central core around which partnership was built was the belief that a strong, growing, and dynamic economy was the key to providing job opportunities, rising living standards and improved social provision for our people. It recognised that as a small country our prosperity depended on our ability, as a people, to embrace change.

This brings me to the nature of social partnership. Since 1987, social partnership has been a welcome formal interaction between the Government and the social partners. The fundamental objectives of the process, namely, implementing agreed change and providing a process for resolving difficulties have played no small part in bringing Ireland to where it is today. People often speak of partnership as the critical and necessary element in Ireland’s economic transformation in recent decades, but we must remember it is just one element. We must look at other factors such as Ireland’s provision of some of the world’s lowest corporate tax rates and the adoption and meeting of the Maastricht criteria. We must recognise that in 1987, a strong social desire for change existed. The ordinary people of Ireland knew that things had to change. Crippling unemployment and mass immigration persisted and the country was described as an economic basket case.

Simultaneously, there was a strong desire for political change. When the Progressive Democrats was formed in 1985, its purpose was to break the mould of Irish politics and give the Irish voters a new and real alternative. it aimed to give political expression to the desire for change. The political party system at that time, which derived from the Civil War, was failing society. The move toward social partnership and pursuit of its objectives married well with the view espoused by my party and continues to do so.

My party’s view is that the best defence against poverty is a job. The Government must ensure an environment wherein economic progress can be made. People must have the incentive and opportunity to generate their own wealth. With more jobs comes more revenue to improve existing public services and create new ones to help the vulnerable in society. This is the Progressive Democrats’ idea of social justice.

Social partnership is a process to provide the environment wherein that idea of social justice can become a reality. Social partnership is a mechanism to provide the necessary environment, and competitiveness is the motor that keeps everything moving. This is our view of social partnership. It is an alternative to previous ill-defined and badly-structured settings for a sustainable economic and social environment. It made development possible, not automatic.

[395]In the run-up to the most recent proposals, my party colleague, Senator Dardis, stated the following in the House:

The partnership approach has served this country well, as we all know. Much of the basis of this success has been partnership’s ability to adapt flexibly to changing conditions. However, in the same way a one-size-fits-all approach is inappropriate for a group of states facing varying challenges, the same partnership approach that served Ireland well in the past might not be the most appropriate model for other countries. If it were, it would not need to be renegotiated. We must not pursue social partnership at any cost.

Senator Dardis went on to say that the notion of core work as currently defined and outsourcing “could indicate that what went before might not be the right approach in certain sectors now.”

Look at the shocking example of more than 100,000 people, the majority of whom are young, waiting to sit their driving tests. Some have been on the list for more than a year. During a long period, the Minister for Transport tried to implement a scheme that would have involved outsourcing driver testing to reduce the backlog, which would have been a reasonable and necessary action. Earlier this year, the Civil Service arbitrator scuppered those plans on the basis that Sustaining Progress, specifically paragraphs 21.8 and 21.9 thereof, precluded the outsourcing of so-called core work. Those provisions hampered the delivery of these services. Thankfully, talks between IMPACT, representing the driver testers, and Department officials produced a solution earlier this month, but not before a drawn-out and agonising process was inflicted on young people.

Social partnership is not a straitjacket. It is a commitment, but not a defined space, a box within which each and every social actor must limit his or her actions. The Progressive Democrats will continue to pursue our policies and objectives with our consistent vigour and determination before and after the next election.

There are concerns about the democratic deficit arising from the partnership process, but social partnership is not a barrier to policy on, for example, taxation. Notwithstanding the proposals under the next agreement, the Progressive Democrats are committed to using some of the benefits of economic growth to significantly reduce the tax burden on low and middle-income taxpayers. I have outlined what social partnership is and is not. It is not a straitjacket on policy, nor will it be a barrier to our determination, under the next programme for Government, to see 90% of the gains from economic growth dedicated to public spending and the other 10% to tax cuts.

Towards 2016 refers to building an equitable tax system that encourages economic growth to ensure employment growth and continuing [396]improvements in living standards for all. It correctly refers to taxation policy designed to maintain and strengthen the competitive position of the economy and to foster improvements in productive capacity, economic and social development and equity, while maintaining a sound fiscal stance.

6 o’clock

Taking capital and current spending as examples, my party’s plan forecasts approximately an additional €30 billion available for public spending. By 2012, and based on current spending patterns, that amount could provide for additional investment of €7 billion in health services, €8 billion extra for social welfare services, €4 billion extra for education and €1 billion extra for justice matters. These are indicative figures, but Senators will agree they represent a significant financial commitment to these illustrative policy areas.

On reading the social partnership agreement, one might believe policy has been defined for the next ten years and it will not matter for whom one votes. It does matter, as the agreement covers areas in which people must still make up their minds. Should they ensure that the path we are on continues or should we change in mid-stream?

  Mr. Feighan: They could revert to Fine Gael.

  Mr. Morrissey: The Progressive Democrats will call for reforms. While Senator Ryan referred to our public utilities, transport and what system might be in operation, if we are to invest considerable funds, we can no longer have wildcat strikes in public transport services, as recently occurred. Reforms must take place in that area. I welcome the Minister of State’s comments in this regard.

  Mr. Treacy: Hear, hear.

  Mr. O’Toole: I welcome the opportunity to contribute to the debate and that the Taoiseach took the time to address the House. I also welcome the Minister of State, Deputy Treacy, who was furiously nodding in agreement with Senator Morrissey when the latter said that who one votes for matters. I congratulate all parties involved, including senior officials in the Department of the Taoiseach and other Departments.

Notwithstanding comments made in passing, I will try to avoid the main issues within the agreement because they will be well-debated. Instead, I want to look forward and back and place a benchmark on what we have achieved and what we are trying to do. We should approach matters in specific terms that would allow for addressing issues, many of which have been raised by Senator Morrissey.

Whatever people say about what social partnership has achieved, I take a more positive view than others. I will speak on certainties. Since the [397]beginning of social partnership, Irish productivity has been the highest in Europe. In the past 15 or 16 years, only in 2001 was Ireland not ranked among the top two or three countries in this regard. Through the 1990s, we were by far the most productive country. What does this mean? While people see words like “productive” as simply being nice to use, it means that Irish workers worked longer and harder and produced more. No one in Europe can gainsay this fact and no country in Europe can match Ireland’s record in terms of industrial peace, which is directly and solely attributable to the partnership process.

I agree with Senator Morrissey in that there are many other issues, but productivity and industrial peace have been key. We saw their importance to all of the partners when the recent railway wildcat strike took place. The following day, the unions said the strike was unofficial, they did not support it, it needed to stop and their employees should return to work. Some time passed before that was done. That situation would not have occurred in any other European country because people in the Irish trade union movement have the confidence to determine whether something must be done. They have given commitments, signed off on something and, after shaking hands on a deal, they stuck with it. Social partnership has created this situation.

There is no democratic deficit. The Government, which was elected by the people, is engaging with civic society and allowing the pillars thereof to engage with one another. I would like people to see one part of this process, namely, where the four pillars sit down with the Government in plenary session. Therein, the hard men and women of a group must listen to their counterparts in the other groups and are forced to engage with issues such as economic growth and creating the climate for job and wealth creation. It is telling to watch strongly committed trade unionists who have never engaged in that process now doing so and answering questions.

It is very telling to witness a public sector trade union leader having to listen to a representative of small shopkeepers bemoaning the difficulties of regulation, paperwork and reporting, and having to be aware of them. I could give 24 more examples. It is similar for the business community having to listen to the trade unions refusing to accept situations where workers are not treated properly and fairly in the course of their work. They have to listen to bank employees who say they cannot accept a situation where the third largest company in the country, which made a profit of €1.5 billion last year, is now reducing the pension entitlements of its workers. Such matters have to be addressed. The agreement is important because it involves engagement and progress is made in the way it reduces tensions among the different parties.

[398]It is not a conjuring trick but a well-worked economic model. The priority is to create the conditions for growth and wealth creation, because without them there will be no share-out. There is no point in unions arguing about the redistribution of wealth, to use an old phrase, or share-out, to use a modern one, if there is nothing to share. If we only argue about a bit of the cake, rather than the size of the cake, we will not get anywhere. Arguments on such issues took place in the first month of negotiations in Government Buildings because people had to sit and listen to the Department of Finance, the ESRI, Mr. McCarthy from the Department of the Taoiseach and the heads of various other bodies. They put their side of the story and produced their best information. Everybody knows they will return to the negotiating room next year and in following years, so despite what the media think there is no game of bluff being played. If the Department of Finance put forward a proposition that time does not justify or on which it appears to be completely wrong then it will lose credibility and credibility is all that counts in negotiations.

I have left the House with just two certainties about productivity and industrial peace. I could go into many more issues but the picture would get greyer and greyer and would attract argumentation. The workers of Ireland have created, for good or ill, a 24-7 economy. One only has to travel to another European country and try to buy something on a Sunday afternoon to see that. Maybe they are better off, but we have created flexibility and movement.

I do not expect people to agree with me but I can provide chapter and verse on modernisation. For example, it appeared to be a conjuring trick to be able to manage the transition from the health boards to the HSE. Senators will remember the problems politicians had when changes were made to individual health boards but all the workers made the transition to the HSE fluently.

I have been trying to give people simple ideas they can use in discussions. Events in Europe in the past two years convince me of the need for social partnership. France went rigid with fear over job security, workers’ rights and the permanency of employment and effectively closed down. We are trying to avoid that, which is a huge task and took up most of the time during the talks. When one solves a problem before it happens one never receives credit for it, which is one of the problems of social partnership, but we are trying to anticipate problems.

Anticipating problems with pensions closed down Italy for a while, and Germany and France, as did the issue of new workers coming into a society and the problems encountered ensuring they were not exploited so that they could become part of society. I could refer to more issues but they are just some.

[399]This agreement is about vision, strategy and moving forward to create a society that is fairer and in which people feel looked after. I could also talk about the problems social partnership has created and could produce a long list of things with which I am unhappy. All the partners have delivered in the past and are addressing issues for the future that no other European countries are. We are creating a unique mould, which is why others are interested in our progress. I congratulate all the parties, particularly Mr. Dermot McCarthy, the Secretary General of the Department of the Taoiseach. The work he has done and his commitment, like that of the Taoiseach and of all who were involved, are something we should recognise.

  Dr. Mansergh: I welcome the Minister of State and his officials. I warmly welcome this social partnership agreement and it was appropriate that the Taoiseach came to this Chamber to present the agreement to the Oireachtas for the first time. This Chamber has a wisp of a ghost of vocational representation about it.

Social partnership has been essential to the economic success of this country in the past 20 years. I do not say it is the only cause of that success but it has been a major one. Our debt has reduced from 125% of GNP to between 25% and 30% and we have experienced a near doubling of employment. Taxes, both business and income, are far lower and real incomes have increased. As Senator O’Toole pointed out, there have been remarkable increases in productivity and improvements in industrial relations. One important commitment in the programme has already been delivered — before the agreement has been signed, sealed and ratified — namely the research package announced over the weekend.

Apart from the content of the specific agreements and commitments the most important thing about social partnership is that it is a method, based in the first instance on careful study and preparation. Earlier this afternoon we debated the reformation of NESC and NESF. Different subject sectors are carefully studied and prepared as part of the process. I suspect that in many cases the words are carefully weighed, though I accept that in some instances they are simply a résumé of reports and policies from other areas. Senator McDowell, for example, referred to the paragraph on air transport, which is not gobbledygook or fluff — every word is carefully weighed with trade unions.

I welcome the clear statement that the policy will in all cases be based on serving the public interest, to meet the needs of people to best effect without any ideological assumption as to what corporate structure or strategy best meets that objective. That needs to be stated over and over because we heard on the Order of Business this [400]morning suggestions that health policy was based on some rabid ideological drive toward privatisation, of which there is no evidence whatsoever.

The agreement contains a good deal of flexibility, as it must. There is tremendous value in the fact that we have, in principle, a ten-year commitment to continuing social partnership, until 2016. There will have to be adaptability to circumstances and situations will change. Pay will be dealt with in several subsections of the agreement over two or three-year periods and certain aspects of the agreement may have to be reviewed. However, the point was made that fiscal policy allowed sufficient room for manoeuvre in circumstances that may arise in the future, which is very important for avoiding stop-go situations and dealing with emergencies which might give the economy a bumpy ride. We are in a position of considerable strength and we must allow ourselves a bit of room for manoeuvre.

I also welcome the commitment, in principle, to 5% capital investment. We can see the changes taking place in infrastructure throughout the country. Visitors to this country — I had lunch recently with an American professor — are enormously impressed by the sheer number of signs of activity of all kinds. Obviously, construction activity of one kind or another is visible.

As the Taoiseach pointed out, social partnership is attacked by both the hard left and the hard right. For example, the Sunday Independent contained an article last Sunday by somebody who is clearly deeply frustrated that this country is not run on Thatcherite lines where the unions would be put firmly in their place, would not darken the door of Government Buildings and so on. A Member of this House sometimes espouses a view not a million miles from that.

  Ms O’Rourke: He is lurking outside.

  Dr. Mansergh: I have no sympathy for that point of view. I remember talking to Samuel Brittan, a financial journalist, and the one thing he could not understand about the Celtic tiger was the idea of social partnership which was contrary to every principle of management of economic and budgetary policy which people in Britain had learned. It dumped social partnership at the end of the 1960s, or certainly definitively at the end of the 1970s, and has not gone back to it.

Equally, one or two Members of the other House are allied to the point of view of our hard left trade unionists. In the constituency in which I reside, South Tipperary, a Deputy proudly told me on the airwaves that he had never supported an EU treaty or a social partnership agreement. The reality is that such an approach would be very destabilising for the country. I believe we would face quite a difficult situation if it was not possible to agree because people would be a little without bearings as to how they should proceed. [401]Senator O’Toole spoke — he cannot do so often enough — about the way France, for example, has had to conduct matters where edicts are moderated and modified by action on the streets. I do not believe that is a good way to run a country.

The Taoiseach seemed to rather firmly refute the notion of a democratic deficit and I agree entirely with Senator O’Toole’s view on that. The Houses of the Oireachtas are free to spend more time engaging with various aspects of the process. I also agree with the Taoiseach that it probably needs to be broken down into specific subjects rather than being overly generalised.

I hope the missing piece, that is, the agriculture discussions, which are very important, will be successfully concluded. I speak as a part-time farmer and I believe agriculture has far more to gain by being inside the social partnership arrangements than outside them. My only regret is that it has been outside it for such a long time even when it was already clear the nitrates issue was being resolved.

  Mr. Feighan: I welcome the Minister of State, Deputy Treacy, and thank the Taoiseach for taking time out to come to the House. I welcome the motion, although I very much welcome the amendments to it put down by my party.

  Ms O’Rourke: They have been changed.

  Mr. Feighan: When social partnership was launched, this country needed to tackle a number of challenges, including unemployment. A number of years on, the challenges which need to be tackled are much more complex and numerous. While social partnership has the capacity to address many of the issues, it needs the capacity to address many more. I do not wish to harp on about it but there was a slight lack of representation of consumer interests. If we are to deal with rip-off Ireland, more consumer interests should have been involved in the negotiations on the agreement.

Over the years, there has been a stream of job losses in traditional manufacturing. The economy, especially in rural Ireland, relies heavily on the construction industry and consumers are required to maintain it. Employment in companies supported by the IDA and so on has fallen consistently in the past four years — an issue which needs to be addressed. Even in a modern economy where there is strong growth in the professions, we cannot afford to ignore internationally traded goods and services.

Social partnership agreements should be preceded by the adoption by the Oireachtas of a motion outlining the key changes. This is an issue about which we could become upset although I believe that at times, there is too much regulation. I am a businessman and an employer and I am happy to see the rights theory has been used. The process of social partnership is anything but [402]transparent and a little more discussion and consultation is needed.

As an employer, I am delighted an additional 0.5% will be given to the low paid, that is, those on €10.25 per hour or less from 1 July 2006. This country was built on the retail, agriculture and the self-employed sectors. In the race for agreement on social partnership, many of these sectors have not been given the attention they deserve. Last week I said in the House that as a small businessman, I was assured IBEC was fighting my case. I have never been a member of IBEC and it has never approached me. It has no time for small retail businesses.

  Mr. Ross: Hear, hear.

  Mr. Feighan: It only deals with medium-sized industries and so on. My profession was not represented at the talks and I take great umbrage at the fact a body claimed to speak on my behalf when it did not.

I am delighted the public sector is booming but we need to debate the fact that those working in that sector are much better off than those working in the private sector. Small retail businesses do not offer the same returns as they did in the past because Tesco and Dunnes Store have arrived, which is welcome. However, people working for me have been doing so for 20 to 30 years but I cannot give them the same remuneration they would get if they worked in the health board or as a secretary in the public sector nor can I give them the same holidays. That issue must be addressed. I cannot give them the same holidays but thankfully they are very loyal and do not look for sick pay — normally they are not sick — holiday pay or the same pensions. These people are prepared to work twice as hard yet, as an employer, I cannot give them the same attention as if they were working in the public sector. We need a debate on this matter.

Accountants, solicitors and computer company managers are now looking to the public sector because they know the benefits that exist there in terms of productivity. Who is drawing up these agreements? We all have a role. As a politician I will get my increase in pay but those who decide that politicians will get such increases are the people who are giving increases to themselves. Things are going well economically and I do not like to be a spoilsport but when there is a downturn will these people be willing to take a loss in wages or will we get benchmarking? I think not. We may discuss such matters in the context of social partnership, whether in the private or public sectors, but there is a lot of nodding and winking going on. Many people are in there fighting on behalf of their sectors and they have done a good job in taking care of their own areas.

However, I sound a note of caution that there is a serious issue coming down the line. If this [403]country suffers a reaction to markets we will then have huge problems with an over-staffed and privileged public sector with all the trappings that go with it. Those working in the private sector cannot attain the same wages, privileges or pensions as those in the public sector. There is a growing disparity which needs to be addressed sooner rather than later. I call on the social partnership to acknowledge there is a problem by addressing those serious issues.

  Labhrás Ó Murchú: Is mian liom fáilte a chur roimh an Aire, roimh an Taoiseach, a bhí anseo cheana féin, agus go mórmhór roimh an ráiteas a chuir sé os ár gcomhair anseo anocht. It is part of the human condition that when one meets a challenge, overcomes it and ultimately comes out the other side with good news, it is expected that in some way a negative must be provided to balance the weighing scales. That was part of what we have heard in recent weeks. While I do not agree with it, in itself it is not necessarily a bad thing because it creates debate. In this case, it gives us an opportunity of analysing in depth exactly what is involved in social partnership. It is interesting that we are talking about a programme entitled Towards 2016, which will be a significant date in Irish history marking the 100th anniversary of the 1916 Rising. We are all quite good at quoting sections from the 1916 Proclamation, including the one about cherishing all the children of the nation equally. While it might be a tenuous link, there is no doubt that it is inherent in social partnership. That is precisely what it is about.

I will deal first of all with the issue of the negative side of the balance sheet and the democratic deficit which has been mentioned. That is only being advanced in order to have a debate but on examination I do not think one could genuinely say that position is correct. In recent times, I have been watching a television series called “Reeling in the Years”.

  Ms O’Rourke: Yes. There were pictures of the Senator when he was much younger looking.

  Labhrás Ó Murchú: Watching those programmes one can see some of the industrial flashpoints that existed back in that period. It puts in context the situation from which we have come. In other words, once cannot really talk on this subject without looking back to see what it was like in the past when the weaker sections of society suffered most from that position. I often think of what the Welsh miners suffered. It did not matter one iota what leadership they had or how much they protested because at the end of the day they lost the battle. It was as simple as that.

That was also true of Irish workers over the years — they could protest but they suffered dur[404]ing such protests. One need only look at “Strumpet City” to remember exactly what it was like, including the great lockout of 1913. It does not matter what period of history one chooses, prior to the new development of social partnership, inevitably it was mothers at home who suffered when there was no strike pay. It also meant that wealth was not being created in order to provide jobs. In fact, people were in a cul-de-sac where the weak got weaker. The opportunities for helping those who were weaker did not exist at that time.

The more I have come to study our social partnership, the more I realise that it must be unique in the world. Above all else, the two main elements it required initially were leadership and diplomacy — leadership that believed one could bring diverse elements together who, in a way, had established a method of operation over the decades, if not over the centuries. Social partnership tried to change the thinking not just of the leaders of diverse groups but also of the followers who had to be convinced as well. There is no doubt that the necessary leadership qualities had to be there.

Diplomacy was vital as well. I can only imagine what it must have been like in some of those initial talks to get two sides coming from diverse positions to believe that it was in both their interests to participate in the new evolution which was talking place. That diplomacy held very solidly. We will not know most of it but I can imagine how often people packed their bags and went home, only to be recalled to meetings later. That was in the initial stages.

I can also imagine what must have happened during this year’s talks. We should not be disappointed that the negotiations took so long. In a way, I was glad of that because it meant that every single element was being teased out. It also meant that there were bigger issues involved than wages. It was important that social and other issues became part of the discussions. There are many strands to this complex process which was navigating uncharted waters. I am glad that time was taken to work on those issues. It will pay dividends for us at the end of the day.

Other speakers have mentioned productivity and what has been achieved is beyond question. We take it for granted that Ireland is now one of the most developed countries in the world with one of the most vibrant work forces and buoyant economies one could expect to have. How do we think it happened? It certainly would not have happened with the old system. The results are quite evident and everybody seems to be benefiting. It does not mean that some have benefited less or that some outstanding issues do not remain to be examined. However, one of the greatest things that happened is that we had the confidence to plan ten years ahead. We should contemplate for a moment what was happening [405]20 or 30 years ago when one would not even have planned six or 12 months ahead. In recent times, however, we have had the professionalism and competence to plan ten years forward, which would not have been possible in the past. It is clear that we were building on something which was strong in itself.

We are living in such a highly competitive world that if we do not plan into the distant future, we will not be prepared. I often give credit to those working in education who looked after the IT needs of children when it was not centre stage globally. That was one of the reasons we were prepared.

I would pick out two Members in particular in this regard, Senator O’Toole and Senator Mansergh. Through the years, they were the anchor in the debate in the House on social partnership.

  Ms O’Rourke: Hear, hear.

  Labhrás Ó Murchú: In many ways, they came from diverse positions, which was the point I tried to make earlier. That was good because in this Chamber we have had debates which would hopefully have been picked up in the partnership negotiations. Nobody would suggest that in some way the Houses of the Oireachtas are outside what has happened.

I have been informed by the Leader that the Government has indicated it is prepared to accept amendment No. 1 if three amendments to amendment No.1 are accepted.

  Ms O’Rourke: I have been informed by the Clerk to the Seanad that I will deal with the amendments to amendment No. 1 following the debate.

  Mr. Ryan: I am happy that consensus reigns, although I suspect that the next speaker on this side may make some effort to break the consensus. I am a member of the Teachers Union of Ireland, which was prominently reported as having taken exception to the agreement. My colleagues and I take exception to the agreement in the main because it implies certain things were not being done. Paragraph 31.42 of the agreement states, “All staff employed in the [academic sector of the institutes of technology] agree to ongoing co-operation with, and adoption of, new and more flexible work patterns arising from the broadening of roles and responsibilities of third-level educational institutions”. Nobody I know has a clue what that means.

My current contract states I must be available to teach between 9 a.m. and 6 p.m., Monday to Friday, and that night work, between the hours of 6 p.m. and 10 p.m., is a normal part of my duties. My colleagues and I want to know what else is wanted from us in terms of flexibility. The issue arises because academic staff feel there is [406]an attempt to put an end to holidays and related matters without negotiation and proper consultation. If it is intended to end holidays, let us talk about this. What more flexibility is wanted?

One of my friends was involved with the negotiations on one of these issues. He sat with officials of the Department of Education and Science, who were supported by an official from the Department of Finance. When proposals such as this one arose, my colleague made suggestions and asked what the officials wanted. The official from the Department of Finance simply replied: “More.” Looking for more is not the spirit of partnership.

With regard to quality assurance, in the past 12 months the course on which I teach has been subject to two different accreditations, one by Engineers Ireland and the other by the Institution of Chemical Engineers. We did not choose the accreditors; the institutions did so. In both cases, we had to defend the course through our exam papers, through the output of our students, through private debates between the evaluators and our students and through a succession of measures. No civil servant in the Department of Finance was ever subjected to such a vigorous external accreditation of his or her job.

My colleagues in the institutes of technology are fed up with this. Four engineering degrees are available in Cork Institute of Technology, each of which got five-year accreditation from Engineers Ireland. Down the road is another institution, which proclaims itself the university of the year although two of its degrees were refused similar accreditation. However, we are told we are not flexible enough and not responsive enough to new needs, despite this being a sector which thought itself up as it went along and which reinvented itself perhaps four times.

If we could believe there was goodwill behind these proposals, I and my colleagues in the TUI would have no problem with them. However, they only reflect the perception of inadequate management and not the reality on the ground. My institute of technology has approximately 10,000 students and provides a huge suite of courses. In the past three months its staff has restructured, on paper at least, every course to meet a commitment to semesterisation and modularisation. It was an enormous bureaucratic collective task which was completed by the end of May. Then, we find the partnership document states we must commit ourselves to flexible modes of delivery and refers to semesterisation and modularisation.

The Government should not underestimate the depth and intensity of the anger of staff in the institutes of technology at what they believe is a determined effort to leave them with no negotiating position on any issue. Given that somebody told the officials there was inflexibility in some part of the public sector, they included a demand [407]for a carte blanche approach. Whether this is agreed, if an attempt is made to implement what my colleagues believe is behind this approach, there will be large scale industrial unrest. It does not matter how many fine words are in the agreement or what is the position of the Irish Congress of Trade Unions.

Since their foundation, there has been imagination, creativity, flexibility and innovation in the institutes of technology on a scale that the universities did not discover until ten years ago. The suggestion in the document that this is lacking is wrong. In my teaching, I would use modern modes of delivery, such as computers, Powerpoint and so on, expect the Department of Education and Science refuses to fund my institute to provide that equipment in every classroom. If it does provide the equipment, it gets stolen because the Department refuses to allow my institute to employ night security staff. I was trying to use e-mail and the worldwide web before the Departments of Education and Science and Finance knew what they were.

The inhibition with regard to the use of modern technology in the institutes of technology is a resource inhibition. It results from a failure to provide sufficient resources, training and flexibility in the way the systems runs. The academic staff, having read this document and the original Government proposals, which were even worse than this final agreement, are dissatisfied. The TUI in Cork Institute of Technology is and has been extremely flexible. My colleagues range from average lecturers to members of the national executive of the TUI. If this aspect of the agreement is in any way as they have interpreted it, there will be large-scale and vigorous industrial unrest in a sector that has been identified as one of the areas that has contributed enormously to our industrial and economic success. I say that not as a threat, but as a fact.

Every external body says the regional technical colleges, RTCs, were an imaginative creation by a Fianna Fáil Minister for Education, Dr. Patrick Hillary, which have been highly successful. It is implied in the document that the RTCs are no longer fulfilling their purpose. This is profoundly resented and if it is carried through in the spirit I interpreted, it will cause serious industrial unrest.

  Ms Cox: I welcome the opportunity to debate this motion and the amendment. When I read the amendment I felt these words rang true and we needed to study what was happening under social partnership. I am committed to the concept of social partnership and believe it has been an integral part of the development of the economy and the so-called Celtic Tiger. However, social partnership is not without challenges and we must remember that, as every process develops, it must be regularly reviewed and, if necessary, adjusted [408]to deal with changed circumstances. Every process is a circle and has a life-cycle.

The Taoiseach mentioned in his speech that there will be quarterly analysis of social partnership in the Seanad Chamber. It is important to have frank discussions that come from the bottom up so that Senators are briefed by the organisations as they would brief the people who sat in Government Buildings working on this document.

I was greatly concerned by the focus in the document on large employers. I run a small business and it sometimes feel as though such businesses are overlooked and forgotten, as if it is preferable to write grand, sweeping statements of policy with dramatic aspirations relating to what is to be achieved. It is worth remembering that the success of Ireland’s economy is built on our small, indigenous industries and the commitment of the men and women, the mothers and fathers, who have worked in those small businesses. They created employment in hard times.

I read a briefing document supplied by the Irish Business and Employers Confederation which stated that 2 million people will be working in Ireland within a year or two. That is an amazing thought, but it comes with challenges. Some of the challenges that have not been addressed in this phase of social partnership relate to the over regulation of businesses. Running a business involves much filling of forms and discussing issues relating to health and safety, the Revenue Commissioners, the Department of Enterprise, Trade and Employment and so on. There is a regulation covering everything and employing staff has become more difficult, especially the area of recruitment. We are in danger of creating a veneer of equality which renders everyone so equal that nothing can be achieved. This is a dangerous situation because we need an open economy, one based on employers setting up businesses and being able to find workers. Otherwise, employers will relocate to other parts of the world. We must ensure we maintain a proper structure in the working environment and allow businesses to grow and thrive.

We have had discussions in this Chamber on the budget and how the Government has dealt with child care issues. There is agreement in this House on issues such as parental leave. When will we allow parental leave for the first year of each child’s life to be paid through the social welfare system and how will we manage this? We need to focus on social partnership to make working life better for the entire, soon to be 2 million strong, workforce.

I welcome the focus in this document on health, house building and the lower paid but I am worried about the lack of attention paid to the imbalance between the east and west of the country. This applies especially to infrastructure. The Galway City outer by-pass will not receive [409]funding until around 2012. That is not good enough. Social partnership will be of no use in the west when the scales have been skewed so much towards the east, with port tunnels and airports. All of the major roads to the East are toll free, except to those from the west of Ireland. This is a hindrance to the development and maintenance of employment and the success of businesses. We do not want a situation involving longer and longer queues of commuters and people getting up at 6 a.m. and returning home at 8 p.m. We must restore the balance and focus on regional infrastructure if projects such as decentralisation and balanced regional development are to work.

I am concerned by the overdependence on taxing not exports but the building industry, stamp duty on developments and so on. This is dangerous and we can create a false sense of security but if we do not pay attention to the value chain and how high value jobs are created throughout the country. Social partnership will not matter because there will not be enough jobs to protect.

A review mechanism is important as are frank and open discussions in this House. I look forward to participating in such discussions in the coming years.

  Mr. Ross: I hate to break the consensus that seems to exist in this House.

  Dr. Mansergh: The Senator loves breaking the consensus.

  Ms O’Rourke: He loves doing it.

  Mr. Kitt: It would be a very boring place if Senator Ross did not do so.

  Mr. Ross: I am suspicious of the consensus on this issue because so many people, including Charlie McCreevy, John Bruton and others had been sceptical of social partnership until they got into Government. It seems that people change their minds when they get into Government and I suspect it is a convenient tool for Government but not necessarily a good one for the country.

What has been sincerely expressed by many on this issue, including Senator Mansergh, perpetuates the myths on which social partnership is built. These myths, by definition, cannot be proven. One such myth ran through the speeches of almost everyone in this House as, unsupported by evidence, speaker after speaker claimed social partnership is responsible, or partly responsible, for our economic success. There is no evidence whatsoever to prove that is the truth. There are plenty of coincidental economic events which happened at the same time but the connection is impossible to prove. It is completely and utterly foolish to say that because this happened from [410]1987 onwards that it is responsible for our economic success.

  Ms O’Rourke: Partly.

  Mr. Ross: I suggest that in the main it is not true at all.

  Dr. Mansergh: It is an improvement.

  Mr. Ross: The reason people say this is that it is a great way of patting ourselves on the back for the economic success that has taken place. The economic success has got far more to do with two other factors — the great decision taken by Donogh O’Malley more than 40 years ago to have free education, a magnificent decision; and the other, which is less palatable to this House, is the incoming multinationals who provided the jobs and the engine for the economic recovery. The coincidence about that is that they were attracted by——

  Mr. T. Kitt: Corporation tax.

  Mr. Ross: Precisely.

  Ms O’Rourke: And tax concessions.

  Mr. Ross: The extraordinary peculiar and inconvenient fact about that is that the multinationals are not represented at the social partnership talks. They do not have anybody at the talks. The engine of the economy has nobody at the talks. They have contempt for the talks, they do not abide by the wage agreement and do not have anything to do with it. They pay their people in a completely different way. I cannot prove that multinationals are the only cause of economic success any more than anybody else who is perpetuating the myth that it is social partnership. It is not. I do not know whether it was partly to do with it or not but I doubt it. Please do not assert it because there is no evidence for it.

It has been stated here that this is a democratic operation that has been taking place in Government Buildings for six months. That is nonsense. It has bypassed Members of this House and the other House and has been sewn up without any input from this House and most Members of the other House.

  Mr. Finucane: Hear, hear.

  Mr. Ross: The other point about democracy is that we should ask who these people represent. Both IBEC and ICTU are imposters. IBEC does not represent business. Senator Feighan said he was not represented by IBEC, he has a small business. IBEC represents all the big banks and the semi-States. They are their principal paymasters and the people who are pulling the strings. ISME is not represented.

[411]Who do the unions represent? The trade unions represent less than 25% of the workforce. The first trade union to come out has already opposed this agreement. The unions do not represent those working in the multinational sector or for Ryanair and several other important cogs in the economy. What is represented here is old Ireland, not new Ireland or modern Ireland. Please do not tell me that those who work in the IFSC——

  Dr. Mansergh: Social partnership is part of modern Ireland.

  Mr. Ross: ——every day are looking to their unions to see them negotiate their deals in Government Buildings. They do not give two hoots about this deal but these two imposters go to Government Buildings and negotiate much more than a pay deal.

Senator Cox eloquently broadened the agenda enormously to include housing, old age and education. These people are not only negotiating a pay deal, they are writing, without a mandate, the Government programme. They have an input into the budget which nobody in the House ever has and which Fianna Fáil backbenchers never have. They are usurping the democratically elected representatives because it is convenient for successive Governments to give them that type of power.

The third myth is that they have somehow brought industrial peace. Industrial peace has been reasonable in that period but there has not been industrial peace per se. We have had airports closed and threats of strikes from the post office union. Senator Ryan said the consequence will be industrial unrest if certain things happen. He is right. It does not stop people making threats of industrial unrest. If there is an economic downturn the clause on industrial peace will be thrown out the window as fast as any other clause. The reason we have had industrial peace has much more to do prosperity than social partnership.

This is a deal between the public sector and big business. They are hoodwinking other people into the belief that they are somehow represented in this deal. They are now. Within this public service deal there is the big fudge, the utter fiasco, which we were expected to believe on the last occasion was true, that is, that the public sector, for the benchmarking and the added value it gets out of this deal, is supposed to deliver some performance. All kinds of extraordinary committees, called performance verification groups, were set up which are an utter charade to verify that there had been public service performance to merit this. There has been virtually no improvement in public service performance. How can we say as Members of the Seand and the Dáil who got per[412]formance related bonuses pay that our performance has improved? Our performance has not improved, there is no measurement of it and there is nobody to measure it.

  Ms O’Rourke: Did the Senator take it?

  Mr. Ross: That goes through every single area of the public service.

  Ms O’Rourke: Did the Senator accept the benchmarking bonus or did he send it back?

  Mr. Ross: That is a cheap jibe.

  Ms O’Rourke: Not one bit.

  Mr. J. Walsh: I wish to share time with Senator Daly. There is no doubt that over the past 20 years social partnership has played a significant part in economic growth. It is wrong to argue it did not. Equally it is wrong to argue that it be given full credit for where we are because that is not the case. Undoubtedly our EU membership and particularly the overseas industrial development we attracted was a significant factor as was free education and the work ethic of the people.

One of the best aspects of our EU membership was that we began to model ourselves on Germany, which was successful, rather than our slavish approach to following everything that was British, which was a mistake. We did that at the right time. It contributed to a better industrial relations environment particularly in the private sector. The same did not apply in the public sector. That it did not make any contribution to productivity in the work place, as some Members have said, is a fallacy. Many industries are in a position to pay more and do pay more. Market forces dictate the amount employers pay to retain good personnel within their companies. There are traditional industries where employees have been helped.

7 o’clock

In regard to the public service, my fear is that it has become a baseline upon which unions have successfully built through benchmarking and other things. If there is to be further benchmarking the pay scale in the public service, which is outstripping the private sector, is a huge risk factor. Any future benchmarking should deal with similar jobs and positions and responsibilities within the rest of the European Union. There should be complete flexibility in the workplace. There are too many restrictive practices in the public sector in particular. These must be eradicated.

  Mr. Daly: I thank the Taoiseach for his intervention. I wish to put on record the contribution the Taoiseach made as Minister for Labour in the early days of the establishment of the formula for these agreements.

  Dr. Mansergh: Hear, hear.

[413]  Mr. Daly: It is perhaps time to examine the success of the agreement up to now and broaden the horizons of the process. It would not take from social partnership if some Members of the Oireachtas were part of the team involved in negotiations.

I listened carefully to Senator Ross and I value his views on the matter. In the contribution he made, he did not at any time offer any alternative.

  Ms O’Rourke: No, except a free for all.

  Mr. Daly: I recall vividly, when I was in Government in those early days of the process and beforehand in the 1980s, industrial dispute after industrial dispute. People walked up and down outside after marching to Leinster House. People were at the front and back gates. It was almost impossible to get in on numerous occasions. We do not want to go back to the days when there was industrial chaos. It would be disastrous for the country.

  An Leas-Chathaoirleach: The Leader has five minutes to conclude.

  Ms O’Rourke: I did not think I was allowed to speak on the motion.

  An Leas-Chathaoirleach: As the proposer of the motion, the Senator has five minutes to speak.

  Ms O’Rourke: I was told by the Clerk of the Seanad that I may not speak again, having already spoken.

  An Leas-Chathaoirleach: The Senator may reply to the debate but cannot speak to the amendments.

  Ms O’Rourke: Is that a change?

  An Leas-Chathaoirleach: The Senator is entitled to speak as the proposer of the debate.

  Ms O’Rourke: I thought so. The Clerk to the Seanad stated that I could not. I accept the direction of the Leas-Chathaoirleach.

  An Leas-Chathaoirleach: As the proposer, the Senator can speak to the motion.

  Ms O’Rourke: That is what I believed. I often saw people standing up at the end of similar debates to speak. I was under different orders tonight. Being a good person I wished to obey orders. I will obey the direction of the Leas-Chathaoirleach.

I am pleased to wind up the debate. I am sorry that Senator Daly was cut short, but the allocated time was up. I welcome the strong debate we have had. As the Minister of State, Deputy Kitt, has stated, it would be an odd day if there was [414]no disquiet, debate or opposing viewpoints. We would really be worried about ourselves in that case. We were expecting Senator Ross to participate with varied comments.

I did not hear any alternative put forward by Senator Ross. That left me to believe that the Senator wanted a free for all, including mayhem, mishaps, etc. The Senator spoke in glowing terms of the American input, but they got a great deal in their taxation arrangements. Equally, they received a good deal because they were coming into a workforce which would guarantee relative industrial calm. That was a very good arrangement to come into. We are very appreciative of what that section contributes to this country.

Senator Ross did not give his own ideas about how we might conduct ourselves, so we are at a loss to know. The alternative to having agreement is a free for all. Nobody wishes to return to the period when there were such conditions in the country. Senator Mansergh spoke of an article which appeared in Senator Ross’s newspaper last week. The article was not in the Senator’s pages, but the main pages of the newspaper. The article was very critical of what was termed “pussycat” Government and “pussycat” unions, and the potential outcome of partnership.

I accept that Senator Ryan’s disquiet about the arrangements for the TUI in the institutes of technology. I have spoken to people in the institute of technology in Athlone, who brought forward their ideas to me. I hope, whether the problems are textual or related to terminology, that they can be worked through. It is very important that the TUI be brought in. It serves a significant purpose in this country, and it is a fine union both at second and third level. I have always had the most excellent of relationships with the union. I hope the matters can be resolved.

Perhaps the matter is only textual. On reading it myself I believed it so. The words were strong in the arrangement laid out. Perhaps they can be looked at.

I thank everybody who contributed to the debate. It was a full discussion, particularly with the Taoiseach here. Debate came from all around the House and from all parties. I thank the two Ministers of State who attended, Deputies Treacy and Tom Kitt. It was an open and frank debate

The Taoiseach stated he would like this House to be the lead in debating the partnership at regular intervals. He also spoke of having the principals before the House to discuss the arrangements. I thank all for what I regard as a very satisfactory debate with a good bite at the end.

  An Leas-Chathaoirleach: We will now deal with the amendment to the amendment.

[415]  Ms O’Rourke: I move amendment No. 1 to amendment No. 1:

In the third paragraph to delete “behind closed doors”.

Amendment to amendment agreed to.

  Ms O’Rourke: I move amendment No. 2 to amendment No. 1:

In the third paragraph after “scrutiny” to insert “but welcomes the new role for Seanad Éireann in respect of debating the new agreement as outlined by the Taoiseach’s comments”.

Amendment to amendment agreed to.

  Ms O’Rourke: I move amendment No. 3 to amendment No. 1:

[416]To delete paragraph six and substitute “is concerned at the lack of representation of consumer interests; and”.

Amendment to amendment agreed to.

Question, “That amendment No. 1, as amended, be agreed to”, put and declared carried.

Question, “That the motion, as amended, be agreed to”, put and declared carried.

  An Leas-Chathaoirleach: When is it proposed to sit again?

  Ms O’Rourke: Next Tuesday at 2.30 p.m.

  The Seanad adjourned at 7.10 p.m. until 2.30 p.m. on Tuesday, 27 June 2006.