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Dáil Éireann debate -
Thursday, 24 Feb 2000

Vol. 515 No. 2

Programme for Prosperity and Fairness: Statements.

I welcome this opportunity to speak about the new partnership agreement, the Programme for Prosperity and Fairness. I am proud to say that I have a particular personal association with the development of the partnership process and I am glad to continue that involvement now as Partnership 2000 draws to an end.

The negotiations on the programme were held against the background of the recent NESC report, Opportunities, Challenges and Capacities for Choice, which maps a vision for Ireland in the early years of the new millennium. The report restated, in our current environment, the basic reality on which the partnership process is based, namely a recognition of the fact that we must compete successfully in a global economy; that our actions and policies must be consistent with that competitive challenge and with each other, and that consistency of approach over time must be underpinned by a consensus based on the fairness of the outcomes.

There is a temptation in times of prosperity to forget these basic facts. We may assume that past economic success is a guarantee of continuing prosperity. We might conclude that maximising wage increases in one company or sector can be achieved without affecting the rest of the economy or the security of jobs. We might believe that policies on taxation and expenditure can be insulated from the labour market or wage increases. We might want to pause or slow down the pace of change on structural reform, thinking that we have done enough already.

Such complacency would be disastrous. We could, all too easily, slip back into old ways of leap-frogging pay claims, irresponsible fiscal policies or undermining our stated goals through inconsistent behaviour. As the NESC pointed out, we now have a capacity to make choices; we are no longer constrained by the external pressures of crisis in the public finances or of unemployment or of qualifying for membership of economic and monetary union.

The challenge we face as a society is to make the right choices, to seize the opportunities to sustain our recent success. More than that, we have the opportunity to transform the quality of life of our people. This is about tackling effectively the consequences of economic success; developing our infrastructure; bringing about real balance between the regions, and between urban and rural communities; and developing real global strengths in R&D and the information society. It is also about ending the exclusion of blackspot neighbourhoods, tackling school drop-out rates and literacy problems and giving a second chance to those who missed out on our recent economic boom.

The Government has recognised this challenge. It brought forward initiatives, such as the national minimum wage, as a radical step towards a fairer Ireland. It conceived and brought to reality a national development plan with unprecedented but realistic ambitions to transform this country over the next seven years, largely based on our own resources and supported by the EU investments which we negotiated. It has also negotiated this ambitious new programme with the social partners.

The Government has faithfully and fully implemented the terms of Partnership 2000, even though it did not negotiate it. It recognises the value of social partnership and of continuity in the strategic direction of policy in the interests of stability and confidence. We have found that this in no way inhibited our ability to implement our programme or to meet the test of democratic accountability. It is, therefore, alarming to hear some suggestions from the Opposition that it might not feel obliged to implement the new programme if it found itself in Government. That must sound odd to the social partners. It must be worrying to all those who recognise the key role which social partnership has played in underpinning our current prosperity.

Notwithstanding the wide-ranging nature of the new programme, the key principles underpinning it may be summarised as follows: first, to underpin Ireland's competitiveness and develop our economic prosperity on a sustainable basis; and, second, to use that increased prosperity to enhance our quality of life in the context of a fairer and more inclusive society. The new programme sets out detailed but flexible operational frameworks by which these over-arching objectives will be pursued. Over the period of the programme, up to and including budget 2003, there will be increases in net take home pay of up to 25% or more when the taxation and pay elements are taken into account.

This will build on the process of tax reform already begun, especially the introduction of the tax credits system, the removal of substantial numbers of people from the top tax rate, the increase in allowances and the widening of tax bands. The new programme gives a sharper focus to the needs of people on low incomes, including the objective, over time, of removing from the tax net all those who earn the minimum wage. Increases in tax credits and the development of the tax credit system are the priority areas for resources over the course of the programme. The programme also supports the policy of establishing a single standard rate income tax band for all individual taxpayers.

In the area of social inclusion, there is provision for a substantial increase in resources, amounting to £1.5 billion by 2003. The new programme, however, goes well beyond resource considerations. Many of the proposals are about getting things done, not only about spending money. Examples in that regard include the development of initiatives to maximise the involvement and participation of local communities in the democratic process; the identification of targeted intervention measures for areas where cumulative disadvantage is pervasive; the encouragement of economic and social development in rural communities; and the promotion and consolidation of the emerging social economy.

Within the social inclusion area, a key component in the new programme centres on the issue of income adequacy. Substantial progress will be made over the lifetime of the programme towards a target of £100 per week for the lowest rates of social welfare. In addition, the level of old age pensions will be improved in line with the commitments in the review of the Government's own programme. Measures such as these will mean real, tangible improvements in people's day to day lives.

The new programme also involves a concerted effort to address issues affecting the quality of people's lives. In the area of housing, for example, a key action is to ensure that the supply of zoned serviced land is sufficient to support the required housing output through increased residential densities and better design where appropriate.

Public transport is another key issue. The programme provides for a public transport partnership forum which will facilitate consultation on the effective delivery of the major investment initiatives set out in the national development plan. Healthcare is also an issue which is central to quality of life concerns and, for that reason, a range of measures are set out in the new programme covering, for example, hospital capacity, health promotion and services to people with disabilities.

Regarding the issue of public service pay, it is accepted in the programme that the traditional approach to pay reviews in the public service, based on analogues and relativities, has given rise to serious difficulties in the past. The parties are committed to making arrangements for an alternative approach which will be grounded in a coherent and broadly-based comparison to jobs and pay rates across the economy. The programme provides for the establishment of a public service benchmarking body to examine pay and jobs in the public service and across the economy and to make recommendations thereon. The benchmarking body will be asked to produce its report and recommendations by the end of 2002 so that the parties will be in a position to discuss the implementation of its recommendations within the context of any successor to this programme, or whatever other arrangements may be in place when it expires. This represents significant progress in dealing with a very complex and long-standing issue and I welcome it as such.

In addition, the programme includes provision for clear links between public service pay and the implementation of the modernisation programme at sectoral and organisational level across the public service, as well as the continuation and development of the partnership process introduced under Partnership 2000. I believe that the programme will significantly enhance the responsiveness of the public service to the challenging demands which it faces, not least the successful implementation of the national development plan and the programme itself.

I want to deal with some of the concerns that have been expressed about the pay terms of the programme. Some have argued that the increases could threaten competitiveness. The social partnership process has produced an impressive range of benefits for the people of this country. That has been possible because of the compromises reached in successive agreements and because of the sacrifices which many people made in pursuit of the common good and the national interest.

Now that the economy is performing strongly, has done so for the past few years and is projected to continue to do so, it would have been unfair and untenable to propose that the benefits of social partnership would involve little reward or sharing. Such an approach would not have yielded an agreement in the first place.

The programme is predicated on achieving an annual average GNP growth rate of about 5.6% over the period 2000 to 2002, provided there are sustained improvements in productivity, that international competitiveness is maintained, that emerging supply side constraints are overcome and that significant budgetary surpluses are recorded in each year of the programme.

Another concern that has been expressed is that inflation might erode the value of the pay increases and provide too little real reward for workers. Recent figures have been unsatisfactory. External factors, including oil price increases and the euro exchange rate with sterling, have impacted on inflation here. The entirely appropriate increase in duty on tobacco has also contributed. However, all reasonable observers are confident that the current inflation numbers will show significant reductions before the end of the current year and that the average inflation rate over the period 2000-2, inclusive, will be of the order of 2%-2.5%. The Minister for Finance will be taking such measures as are appropriate to ensure that low inflation is maintained.

When the taxation changes and pay increases operative over the period of this programme come into effect they will deliver substantial real increases in take home pay. For example, increases of the order of 10% or more in take home pay for the average worker in the current year will produce very substantial real increases. These increases and our overall prosperity require adherence to the pay terms of the new programme. The Government for its part has lived up to and will live up to its commitments. Equally, pay developments in the public service, the private sector and the commercial State companies must be consistent with the terms of Partnership 2000 and with the Programme for Prosperity and Fairness, if ratified.

I am aware that the Association of Secondary Teachers of Ireland withdrew from the Irish Congress of Trade Unions during the recent national pay talks over the PCW "early settlers" issue and I note that according to press reports they have decided to submit a claim for a 30% increase in teachers' pay. This claim has not yet been submitted to the Teachers' Conciliation Council which is the forum at which such claims would be discussed. In the event of such a claim being submitted I wish to make it clear that the Government cannot contemplate any response to such a claim other than the application of the pay and other measures contained within the proposed Programme for Prosperity and Fairness.

The programme provides for direct pay increases of 15% to teachers over the period of the agreement. In addition it has been agreed in the context of the acceptance of the Programme for Prosperity and Fairness to apply a 3% increase to the salaries of PCW "early settlers" with effect from 1 October 2000. As teachers are included in this group they will receive direct pay increases of 18% during the life of the programme. In addition teachers will benefit to a very significant extent from the taxation measures announced in the budget and proposed in the new programme.

The combined effects of the announcement made by the Minister for Education and Science in December 1999 on additional teaching posts in schools and the provisions of the Programme for Prosperity and Fairness will provide 1,400 extra teaching posts in post-primary schools over the period of the programme. These additional posts will improve the working conditions of teachers generally.

If there is one lesson to be learned from the way public service pay developed in recent years it is the impossibility of trying to single out any group as apparently unique and deserving of special treatment. The early settlers provision – which was, crucially, agreed with unions representing both early and late settlers – and the new benchmarking body are designed to restore stability to public service pay and provide a coherent way forward. The Government cannot, and will not, put this at risk by dealing with any group outside the confines of the Programme for Prosperity and Fairness.

As well as providing for major improvements in living standards for all, the Programme for Prosperity and Fairness contains a wide range of measures to enable us to compete successfully in a rapidly changing world. The programme recognises the significant competitiveness challenges facing Ireland arising from the information revolution, globalisation and EU enlargement. As a result of EMU membership, any loss of competitiveness could be punished severely.

The programme addresses these challenges with a particular focus on promoting lifelong learning as a national priority; securing a leading position for Ireland in the global information society; investment in research and development, innovation and upskilling to enable enterprise to move up the value chain of economic activity and a continued focus on reforming our regulatory and competition systems as well as modernising the public service.

The programme also contains a package of measures to develop the key sectors of the economy, including indigenous and foreign owned industry, small business and services, tourism, construction, energy, the food industry, forestry and the marine sector, as well as our agriculture sector.

I am confident that the Programme for Prosperity and Fairness will provide the best possible grounding for further economic and social progress in this country. The next step is for the organisations which agreed the programme to proceed with their different ratification procedures. In that regard, I particularly welcome the recommendations in favour of acceptance by the national executives of three of the country's largest trade unions – SIPTU, IMPACT and MSF. I look forward to a successful outcome and to working with the social partners in implementing the programme in the period ahead. I thank all the many people who worked so hard during the three month period to bring the Programme for Prosperity and Fairness into being.

There is no doubt social partnership has brought Ireland many gains. Looking back over a decade, GDP has doubled and employment has increased by 500,000 – both phenomenal achievements. Undoubtedly the construction of political and social consensus around the key elements of an employment strategy was crucial to that achievement. It allowed us get the basic environment right and to establish sustainable competitive strengths that have underpinned our export-led growth. It also gave us the benefits to reap the opportunities provided by a dramatic demographic change in Ireland. Migration was reversed, female participation grew and our sustained investment in education finally began to pay off. Credible Government commitments to match pay moderation were an invaluable glue in making this policy a success. The question now is not whether we can sustain that economic progress but whether we can use it to secure real improvements in the quality of life in Ireland. It is over three decades since John Kenneth Galbraith berated US policy for creating public squalor amidst private wealth but his words have a great resonance in Ireland today.

Private affluence.

We are running our economic engine at red hot speed. The Minister for Finance is piling on the coal. Individualisation was seen as a clever way to squeeze another few knots out of the vessel. The ship is undoubtedly ploughing through the waters faster than any other, new car sales are humming, property values are soaring. However, in the eagerness to run headlong to the next marker, the Government has failed to notice how many people have fallen overboard and how savage is the undertow in the backwash for those who have lost their grip.

There are in Ireland today huge numbers who are caught in the backwash. They get precious little mention in the Taoiseach's speech. There are 4,000 homeless adults in Dublin, including 1,250 teenagers and dependent children, 400 of whom sleep rough each night. They remain homeless for two years before getting accommodation. Housing lists are up 50% since the Taoiseach took office. Not one house has been built under the affordable housing scheme which the Government announced over a year ago and not one will be built in Dublin for another year. Hospital waiting lists are up 50%. In Dublin 1,100 nurses have been sucked out of the health system, robbing our most vulnerable people of two million man hours of care. Chaos regularly reigns in the casualty departments. The head of the casualty department, where the Taoiseach was employed for many years, had to go on the media to alert us to the scale of the crisis.

Four years ago the national anti-poverty strategy set the target that serious literacy and numeracy problems would be eliminated in early primary education by 2002. It also set the target that early school leaving would be halved by 2000. What has happened? The literacy problem has escalated in our primary schools and early school leaving has not diminished. No progress has been made in either of these targets in deprived areas. Over 20% of pupils in the Taoiseach's constituency have serious literacy problems. To hear the sinner vowing to mend his ways must always be welcome but, having listened to the new Minister for Education and Science speak on literacy, we cannot suspend our critical faculties.

If the Government is to set out credible commitments for a new phase of partnership it must look at how the benchmarks of homelessness, literacy and hospital chaos square up to our leading economy status. These are not the failures of our economy, they are the failure of governance. Ministers cannot plead ignorance or a shortage of revenue for the persistence of these problems. They are a consequence of a failure to put workable structures in place to address these issues as priorities.

Fairness is in the title of the new partnership agreement. It contains many aspirations but has the Government the capacity to deliver them? In the place of well worked out strategic reforms the social partners are being asked to make an act of faith in the big spending plans of Government. This may be enough to ensure the signing of an agreement but the people do not want plans. They want delivery. All Deputies witness the despair of homeless people hoping in vain that we can magically secure something for them. There is no Deputy who does not see the weary exhaustion of carers, overwhelmed by the burden of caring, with no opportunity to complain and with no statutory rights. They face chronic shortages of respite places, have little care assistance and no evening or night time cover. They face the alarming uncertainty of what will happen when they are no longer there to care.

I have searched in vain for time-bounded targets in this plan to resolve these easily identifiable needs of the casualties of our programme.

They are not there.

They are absolutely not there. Homelessness is mentioned once but action is still one report away. I searched in vain for even a mention of hospital waiting lists, the chaos in casualty departments or the shortage of nurses. They do not warrant a single mention. The agreement sleepwalks through the health crisis. It is peppered with reviews, committees, consultative groups and forums but these are no substitute for action on these resolvable problems.

There is little evidence that the new realities of being in the euro zone have, in any way, changed the traditional instruments in the pay settlements worked out in this agreement. We know we are out of kilter with the rest of Europe. We also know that we have no independent interest rate policy, no independent exchange rate policy and little or no control over credit volume. We need to think about flexibility in reward mechanisms that could respond to the changed circumstances that could suddenly come upon us. The agreement contains remarkably little discussion of gainsharing vehicles that would allow public and private sector payments to be made in good economic circumstances which might not be automatically payable should conditions change. Instead, only in the most extreme circumstances, is some form of renegotiation envisaged.

It cannot be forgotten that matters can change quite rapidly in an economy such as ours with fixed exchange and interest rates. The extraordinary strength of sterling in the past year could reverse. A switch in the relationships between supply and demand in the housing market could significantly rock the boat. The growing evidence of overheating in our economy is inescapable. It is reflected in the rapid increases in property prices, unprecedented demand for credit, labour shortages, higher inflation in the services sector and chronic congestion in the physical infrastructure. When the chairman of the Central Bank drew attention to this, the Minister for Finance regarded him as a party pooper. Like the red queen in Alice in Wonderland his has only one answer, “Off with their heads”. This is not good enough. Prudence demands that agreements anticipate potential shoals in the waters as we approach.

Many see the pay terms of this agreement as a starting point and a mere springboard to the real bargaining. The Garda "blue flu" gave the lead and bus workers and teachers have taken the cue. The Government has shown, time and again, that it will bend to pressure from strategic sources, whether in key services or political quarters. The pattern of U-turn is clear.

The new system of developing comparisons with private sector employment through benchmarking is a cause of some concern. It is a welcome departure in many ways but the agreement provides that all the new special increases will be worked out over the next couple of years and will fall due to be paid at the end of the present agreement. This is surely loading up a big bill that will stand like a potential avalanche over the subsequent pay round, perhaps at a time when the absorption capacity of the economy is very different. It is not greed which drives these pressures. It is the collapse of people's hopes of owning a home of their own and the failure to put workable strategies in key areas for the public service. The Government seems incapable of resolving these pressures which have the capacity to derail our progress. The Government is seen to be losing its grip.

The agreement's failure to address the issue of balancing family responsibilities with economic progress is one of its greatest disappointments. It has not proved itself capable of dealing with the issue of child care. The perverse Government thinking which undermined the budget has cast a long shadow over these discussions. In the budget, the Minister did not see the cost of child care as something to be relieved. He regards having children as a consumer good. He does not accept that people should be free to choose whether one of the spouses should stay at home to care for the family. Instead he traps them into making choices which bring them into the workplace. This is no way to tackle the complex issues of balancing family responsibilities with the demands of work. It shows that Government strategy was merely to pile coal onto the economic engine. It is a huge disappointment that this issue has not been properly and honestly addressed.

Recently in my constituency, I carried out a survey of people's attitudes and the problems of child care. On average, in my constituency of Dublin North Central, child care costs £150 of gross income per week for one child. I asked people their view of the adequacy of the Government's support for child care. Only 1% of families responded that they believed the Government's approach to child care is adequate. People's patience is wearing thin. They have heard many promises in Government programmes before the Taoiseach took office and they now find that the question is not being addressed in the partnership agreement. There was a strong belief that the budget would address this issue. This issue will come back to haunt the Government. People's patience is wearing thin.

Equally disappointing is the weakness of the provisions for family friendly policies. They are timid and disappointing and are set against the assumption that improving the efficiency of the business is a necessary condition for such policies. The approach is solely employer driven. The national initiative will only draw up a menu. There is no commitment to adopt any of the measures to make the workplace more family friendly. A committee is established but is confined to employers and unions. Surely the omission of parents and their representatives or of women's groups and their representatives was a great error.

Partnership has served us well. In the recent budget the Government went out of its way to undermine some of the pillars of partnership. The NESC had set out key policy priorities. These were to increase the standard rate of personal allowance in the tax code and to increase child benefit which would be neutral in respect of child care choices and labour market position. In less than an hour on budget day, the Minister for Finance kicked over the traces of social partnership and flushed away many of the foundations of the consensus. The Government has had to restructure those and tax proposals which the Taoiseach described as rubbish when tabled by Fine Gael are now part and parcel of the partnership agreement.

There is real doubt whether the Government has the capacity to sustain the benefits that social partnership has brought us. We are entering a new phase and there is no evidence that the new priorities loom large on the agenda of the Taoiseach and his Ministers.

Few people dispute that the system of social partnership which we have had since 1987 has played a significant part in our economic recovery and in the remarkable level of growth we have experienced in the past few years. During tough times the system provided a considerable degree of industrial peace and ensured at least that those at the bottom of the ladder did not fall further behind, as would almost inevitably have been the case in an industrial relations free-for-all where those with the industrial muscle would have consumed most of the economic cake.

The nature of these agreements has changed during the years. The first agreement in 1987 was basically a pay agreement. As each successive one was negotiated the scope expanded. The Partnership 2000 negotiations which I spearheaded as Minister for Finance included for the first time the community and voluntary sector. This new agreement, the Programme for Prosperity and Fairness, is the most comprehensive ever, running to 132 pages with sections dealing with almost every area of social and economic life ranging from racism to rural regeneration.

Against a background of unprecedented prosperity it is not surprising that there should have been the most vigorous debate within the trade union movement as to whether there should be another agreement and whether the draft agreement merits support. It is a matter for the members of the trade union movement to make their decision through their internal democratic structures but given the importance of the agreement it is also important that the Dáil should have an opportunity to make its voice heard.

Despite its 132 pages, at its core, the Programme for Prosperity and Fairness is a pay and tax agreement with a nod in the direction of social welfare and the community and voluntary sector. As Deputy Bruton said, many of the other sections are aspirational with much work to be done by the plethora of bodies and committees yet to be established. The Labour Party does not regard many of these sections as being in any way adequate or comprehensive but we will certainly act as a watchdog in regard to the commitments entered into by the Government and insist that all are honoured within the required time frame

Under the terms of the agreement most workers stand to benefit from the combined pay and tax commitments to the extent of around 25%. If the tax commitments are fully honoured and if the January inflation figures of 4% plus are not an indication of the future pattern it is hard to disagree with the conclusion of the general secretary of IMPACT, Mr. Peter McLoone, that the pay element of the agreement is probably the best that could have been negotiated with the Government and, to go further, that there is no other process that would deliver something similar.

Following the publication of the Finance Bill which shamelessly ignored the needs of those on low pay the combination of the political pressure exerted in this House and the demands of the trade unions and the Third Pillar extracted a number of concessions from the Government but given the extent of the resources available to it, these fall far short of what could and should have been done for those on social welfare and low pay.

It is regrettable that to avoid further humiliation for the Minister for Finance, Deputy McCreevy, the Government responded to pressure to do something for the low paid by taking additional workers out of the PRSI net. The Labour Party fundamentally disagrees with the principle of raiding the social insurance fund. Relief for the low paid could and should have come through further tax cuts. This was the preferred option of the trade union movement and many trade union leaders share the concerns I have just expressed about the implications for the social insurance fund of the scale of the measures contained in the Social Welfare Bill.

The Programme for Prosperity and Fairness can only be read in conjunction with a number of other documents. Principal among them is the little read Stability Programme published by the Department of Finance on budget day. This is prepared by the Government for submission to the European Commission in accordance with our obligations and commitments under the Stability and Growth Pact in the context of economic and monetary union. It sets out the broad parameters of economic policy to be pursued by the Government, not just in the year ahead but over a three year period. In the programme the Government commits itself to reducing the share of national wealth, GDP, to be consumed by current public spending to 25%. This would make Ireland the lowest public spender in the OECD, even lower than the United States.

What does this figure mean? It means the Government has no intention of creating a society which can be described as fair. It represents a formal and conscious rejection of the European social model in which the State intervenes not just to tackle inequality but to guarantee its citizens a certain level of health care, social protection, education and support at different stages of their lives. As things stand, income inequality here is among the highest in the OECD. The states where it is low are states in which the Government intervenes to ensure it is low. Sadly we are now among them. The Government, as the Taoiseach indicated at a Cairde Fáil dinner just before Christmas, is embracing a social model based on the low tax, low service model synonymous with the United States.

My party profoundly rejects that view of society but Fianna Fáil is now in the grip of an ideological elite, some inside the party, others outside it, intent on propelling the party in that direction and sadly it is led by a Taoiseach who, although he should know better and perhaps believes otherwise, would rather the easy life than confront this cabal within the Government. The sad reality is that he cannot even get one of the leaders of that cabal to meet the credit unions.

I was one of those who feared that the social partners might not agree to another national pro gramme because the actions of the Government suggested that Fianna Fáil and the Progressive Democrats did not want one. For example, in two of his three budgets the Minister for Finance spurned the partnership economic consensus by targeting his tax reductions at the better off. The Minister may point to his mandate from the people to reduce the upper rate of tax and argue that his democratic mandate supersedes partnership agreements and he may be right but the question then is why proceed with partnership at all.

The result is a muddled and incoherent strategy on tax. At the core of the Programme for Prosperity and Fairness is a commitment to take the minimum wage out of the tax net. It is an objective fully supported by the Labour Party and I congratulate the social partners on bringing the Government round on the issue. The question is whether the Government will honour it. It cannot begin to honour it, if it maintains the cabal's obsession with reducing the high rate of income tax. The Labour Party will be pushing hard to ensure the objective of taking the minimum wage out of the tax net is honoured. We will ride shotgun on this objective very strongly.

My party does not believe, as my party colleague, Deputy McDowell, indicated on Tuesday night, that there remains unlimited scope for tax cuts. Prior to the agreement we reaffirmed our commitment to take out of the tax net, the minimum wage which we advocated should be £5 per hour. We also stated categorically that we would not be bound by the Minister's other commitments on taxation such as further reductions in the upper rate which, taken in conjunction with the core commitment of the Programme for Prosperity and Fairness, will cost in excess of £2.5 billion in our calculations over the next two to three years.

Our fear is that in different and perhaps more difficult economic circumstances, should inflationary fear not subside, for instance, the Minister will recoil from his commitments. We have witnessed the reaction of the Central Bank to this year's budget package. Unless the Minister begins in next year's budget to substantially increase the size of the tax credit, including setting aside his other commitments for a time, it may not happen at all. The social partners should be made well aware of this.

We have contracted the entire tax base considerably in recent years and the Minister has done so more than any of his predecessors. I am not certain how much more there is to give. In effect, we have socialised the cost of businesses in recent years and it will soon be time for them to stand on their own two feet. The State has given the economy a considerable leg up in recent years – the proposed corporation tax rate of 12.5% is the prime case in point – but a leg up for Irish businesses cannot become a permanent crutch.

The social partners are aware for instance that my party is not committed to the Minister's individualisation proposals and certainly would not proceed with them were we to enter Government this year. They will also be aware that we would like to see a more expansive programme of house building than that outlined in the programme and we will rarely see eye to eye with the Government on its treatment of refugees.

The reality is that many measures agreed in this programme will be subject to votes in this House over the next few years. They will not be proceeded with without democratic sanction and this has always been the case, but are people seriously suggesting we go back to an age when people were not consulted and the executive power was exercised ruthlessly and often without accountability? My party believes in consultation, discussion and agreement, where necessary, with stakeholders in society. That is why my party, in Government, brought the community and voluntary pillar into the talks on Partnership 2000. Social partnership is not the only model which fulfils this criteria, and it should not be set in stone.

It is understandable that some Members of the House should be concerned at what they see as the marginalisation of the Dáil in this process, but the least we should do is ensure that our own often archaic rules and procedures do not contribute to this perception of marginalisation. Certainly it is absolutely ludicrous that the listing of these short statements on the PPF on the schedule of business should have resulted in a series of parliamentary questions to Ministers on various aspects of the agreement being ruled out of order.

I look forward to a debate about the future of social partnership over the course of this agreement, if it is adopted. The process has its flaws but these should not be allowed to overcome its strengths. Like everything else, people can tire of a process that has lasted for some time. That is as true of social partnership as of anything else, but whatever else succeeds it, wage increases that feed inflation which give rise to further increases are in nobody's interests. Competitiveness is not a neo-liberal conspiracy; it is in all our interests, especially those of the 10% we have taken out of unemployment and enabled get back into the workforce.

The conditions of crisis and poverty which gave rise to the beginnings of social partnership are no longer with us. The search for a new sense of national purpose is not yet under way – sadly new found prosperity seems to have suffocated political debate – but I am confident it will emerge. My party's vision of a fair society is totally at odds with that of the Government. For example, we can now afford to put in place the best health care system in Europe for all citizens. The question is: does the Government really want to do so? The question which really hangs in this Chamber this afternoon is: what do they want to do with our new found wealth, other than merely reduce taxes for the well-off?

There are a number of substantial measures before the House this week: the Finance Bill, the Social Welfare Bill and these statements. Sadly, they all reveal a Government without any strategic approach to economic management. The tax strategy in this year's Finance Bill and that championed in the programme, for example, are fundamentally at odds. There is a clear contradiction in both the direction and the philosophy underpinning them.

My party has always supported the social partnership process and we continue to do so. Partnership has been at the centre of recent economic growth. It set out parameters within which policy was determined. That the section on taxation is sufficiently broad to allow the Minister proceed on a number of fronts gives the lie to the argument that social partnership and democratic government are mutually exclusive. On countless occasions over the next three years, measures agreed and not agreed in this programme will be made subject to decisions in this House. If we as an Opposition or even backbenchers do not get an opportunity to contribute to the consideration of these decisions, it is as much the fault of procedures of this House as it is of the social partners. It is important that this point is not exaggerated. Deputy McCreevy broke with the partnership in two out of three budgets, and with the support of the House, including the so-called four Independents, he was free to do so. The Labour Party will examine his behaviour closely to see that it conforms with the key commitments in this programme, which most commentators believe will go some way to ensuring the economy has a soft landing, not because we are bound by an agreement made over our heads but because the word of the Government, given voluntarily to the social partners, should be kept.

I agree with previous speakers that there are other aspects of this which were addressed recently on the Finance Bill and earlier today on the Social Welfare Bill. Recently the House debated the national development plan also. All of those, taken in context with the Government's programme, An Action Programme for the Millennium, must be seen as a strategic policy-driven approach to economic and social development for the future.

I applaud the model of social partnership which has been fashioned by the Taoiseach and which has been developed by people like Deputy Quinn and Deputy Bruton. If they are given the opportunity of second guessing what is in the plan and the approach, which I hope will not be the case in the near future, I hope they will continue to support it.

I have some reservations about the continuing elitism of the recent discussions, particularly when one finds oneself, as a Member of the House, in the invidious position of approaching people in the voluntary and community pillar suggesting that there are ideas which ought to be incorporated into a plan or the approach, when people in this House ought to be taking the lead in that area. However, I do not wish to cavil too much with that because I am pleased with the model which has evolved and the strategy which has been devised. It will serve the country well.

I spoke on other issues earlier and I want to focus on a couple of ones which are reasonably close to my heart and to those of us who are based in the Dublin area. Transport is an area which has been rightly highlighted in this plan. No doubt there is a need to improve infrastructure. There are bottlenecks evident here. Many of us would think that quality of life measures ought not to be the only criterion to improve transport facilities, but they are an important aspect of it. There is planned, here and through the national development plan, the largest ever investment programme in the national transport system. It aims to provide a well-functioning integrated transport system to reduce travel times to work in places like Dublin, etc. The development of QBCs and the investment in the rail system will significantly enhance people's quality of life.

A new faster approach to the building of national roads and new motorways has been discussed here on several occasions. The Planning and Development Bill, 1999, which is making its way through the House, will facilitate that. Many of us in the Dublin area wait with bated breath to see will the port tunnel begin. I am a little concerned that it seems it is being stalled yet again, even at the stage where trial bores are being made in the Marino area. It is important that we get on with the tunnel as quickly as possible.

Hear, hear.

Luas is taking shape, and many of us have been talking about the eastern bypass. Let us make sure that happens.

I think the Deputy means the eastern subway.

Yes, Deputy. I do not suppose I would be jumping up and down with joy if somebody said the incinerator was planned for my neck of the woods.

The Deputy will get composting.

I think we will get composting instead. We will have to deal with that and other issues like it. The model of public private partnerships should be developed and worked on more energetically than at present. A model along the lines of the West Link toll bridge would be welcome.

Housing has been a source of great concern to those of us on the city council. We are all very aware of the difficulties at present despite the record number of houses being built in the city. We have concerns about the time it is taking to refurbish flats, particularly inner city flats. The quality of people's lives, however, will be improved dramatically. I spoke to one of my colleagues last night who said that there are 30 flat complexes in one of the wards in the Dublin South Central constituency which need to be radically and immediately overhauled. That is a significant social inclusion measure. We talk about social mixing and intervention in the area of education and lifelong learning, all of which are mentioned in this programme which has been agreed with the partners.

The establishment of the housing forum is an important step forward. To be fair, the strategic policy—

Two years after we called for it.

The strategic policy committee on housing, which was set up, met only this week in Dublin Corporation and is bringing together many of the partners whom we would expect to participate in such a forum. I was particularly glad that all parties agreed, without any great difficulty, that the voluntary housing sector would have significant representation on it. I look forward to it as a model to develop policy in that sphere. Sometimes I think the issue of homelessness is being tackled somewhat tentatively. We need to address it.

Many people who might heretofore have shunned local authority housing on grounds of less than adequate estate management are now moving in the direction of supporting voluntary housing association complexes. NABCO developments, for example, are very eagerly sought after as a good half way measure between local authority living and tenant purchase living. I am glad to see it is there. The issue of the private rented sector is being tackled by the Government. A review is being done which will bring forward findings, but the issue of security of tenure is critical and needs to be addressed.

On child care and family friendly policies, I am glad there is an objective in the agreement to promote further child care places in the public and private sectors. We have seen particularly good models. Forgive me for being parochial but in my constituency in Ballymun, we have the Tír na nÓg development which is superb. Deputy Short all, my colleague from the Dublin North-West constituency, has been instrumental in that development. Colaiste Éanna in Cabra, through the VEC and the local area based partnership, has developed a very good model. I was in DCU the other morning and, again through imaginative use of funding, it has developed child care places and cre±che facilities.

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