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Dáil Éireann debate -
Wednesday, 31 Mar 1976

Vol. 289 No. 5

Redundancy Contributions (Variation of Rates) Order, 1976: Motion.

I move:

That Dáil Éireann approves the following Order in draft:

Redundancy Contributions (Variation of Rates) Order, 1976,

a copy of which Order in draft was laid before Dáil Éireann on 10th March, 1976.

As and from 5th April, 1976, it is proposed to effect an increase of 20p in the present rates of redundancy contributions and the draft order is for the purpose of effecting this increase. The increase will be apportioned as follows: 12p on the employer and 8p on the employee. The new rates of redundancy contribution will, therefore, be 38p in aggregate for a male worker and 37p in aggregate for a female worker. The employer will carry 25p or two-thirds of this rate and the worker's share will be 13p and 12p respectively for a man and a woman.

The social welfare stamp includes elements in respect of social insurance, health, occupational injuries and redundancy contributions and the ordinary stamp for a male worker will be £6.49 from 5th April next. The redundancy element comprises less than 6 per cent of that face value.

During 1975 an income of approximately £4.5 million was derived by the redundancy fund from redundancy contributions. This income was not sufficient to meet the demands on the fund and it became necessary to rely on Exchequer borrowings to help in financing the fund's statutory operations. Up to the present repayable advances totalling £4.18 million have been made by the Minister for Finance to the fund. The new contribution rates are designed to repay these advances while dealing with continuing redundancies.

The reasons for the large scale borrowings from the Exchequer have to do with the scale of redundancies in 1975 and the increased demand made by unemployed workers for redundancy weekly payments. Notwithstanding a decrease in the rate of notification of redundancies this year to date—they are being notified at a rate of about 13,500 per annum as compared with 19,000 last year, so there is a decrease in the number of redundancies being notified—the present income of the fund is inadequate to deal with the existing levels of redundancy. I ask this House, therefore, to approve of the increases outlined in order to restore solvency to the fund.

On my party's behalf we intend to oppose the increase in redundancy contributions as imposed by this order. We do so for very many good reasons. First, we are concerned about the approach there has been to redundancy as distinct from work creation, productive jobs, retaining of jobs and the efforts to create new jobs. An increase of this magnitude—when I refer to magnitude I refer to the percentage increases involved—brings hardship to everybody. In the case of the employer his contribution now goes from 13p to 25p, an increase of almost 100 per cent. In the case of the male employee it goes from 5p to 13p, an increase of almost 200 per cent, and in the case of the female employee it goes from 4p to 12p, an increase of a full 200 per cent.

Increases of those magnitude reflect the inadequacy of this Minister and the inadequacy of the Government to handle the economic situation facing us. It is the easiest step that one can take to rely forever on continuing payment from one fund or another fund. The time comes when a halt has to be called here. Who is now being asked again to compensate financially for the many mistakes made by the Government and the many failures by the Government to save jobs? It is the working person and the employer. When one listens in the House and elsewhere to the Parliamentary Secretary to the Minister for Social Welfare talking about the privileged classes I have no doubt that as far as he and his colleagues in the Labour Party are concerned the privileged classes are the people who are still in employment. Every increase is a direct charge on them, a direct attack on them for the inability of the Government to tackle the most serious problem facing us, that of unemployment.

We are told that in 1975 19,000 redundancies were notified by employers compared with about 11,000 in 1974. These figures tell their own story. I am sure I do not have to spell out in detail the serious implications here. It is frightening to think that in 1975 19,000 were notified. I feel particularly concerned that in very few cases were positive steps taken to prevent many of those redundancies. It is becoming easier all the time for employers and management to use this fund as a means to an end. We have throughout the country, in almost every area, firms who want to cut back and employers encouraging the older people particularly to avail of this fund and create redundancies. This is fine but by doing this these employers and managers are closing a gap to opportunity and because of the availability of it it helps employers to reduce the numbers at work. While I have no objection to the payment being made, the problem created is that there are no replacements for very many people in many industries in many areas.

One could go on at length in that vein. We are now told that the solvency of the fund is in question. If that is so, one body of people must bear responsibility for it. They are the people who have been handling the fund, and handling it so miserably for the past three years. At times charges are made that there is a certain amount of inefficiency about the handling of the fund, and that certain loopholes are there to be availed of by people if the inspectorate are not on their toes. Recently we have seen carelessness in the Department of Social Welfare with certain documentation. I hope the Minister is absolutely satisfied there are no loopholes within the working of this fund to be availed of by people to abuse the fund at the expense of others who are genuinely and legally entitled to redundancy payments.

When this fund was first set up by a Fianna Fáil Minister, and when the Redundancy Act was first introduced, the intention was to cover jobs which would be lost. At no stage was it ever envisaged that in one year we would have 19,000 redundancies. The Minister said that in 1975 approximately £4.5 million was paid into the fund. He went on to say that up to the present time repayable advances totalling £4.8 million were made by the Minister for Finance to the fund and the new contributions were designed to repay the advances while dealing with ongoing redundancies. The Minister's Department are constantly charged with delays in the payment of redundancy benefits. I have ample evidence of this and I am sure he has also.

This is caused by a number of factors. It is caused by the huge number of people becoming redundant— 19,000 in 1975. It is caused by the dictatorial attitude of the Minister for Finance who will not give the Minister adequate staff to cope with the rising problems. In fact, he cannot afford to give him adequate staff. The reality is that the structures are crumbling because of mismanagement. The people who are asked to pay for this mismanagement are the working people of Ireland. The price of the stamp has now gone to £6.47, between employers and employees. This is an enormous increase.

We have become so used to very big increases that an increase of 8p or 12p is small. Daily and weekly we are having an increase of 8p or 12p. These increases are all aimed at the one body of people. The last straw breaks the camel's back. The people who have been completely neglected over the past few years are the workers who have seen their standard of living continue to drop and their incomes being eroded by increases in prices on Mondays and Tuesdays and more increases on Thursdays. In this way, their standard of living has been whittled away. This has become a fact of life. Increases are absolutely uncontrolled.

What would be the attitude of the National Prices Commission if a request was made for an increase in the cost of a service or commodity of 100 per cent? In the case of a male employee the figure was 18p. Now it goes to 38p. That is an increase of more than 100 per cent. What would be the attitude of the National Prices Commission if an industry or a company asked them to sanction an increase of more than 100 per cent? This brings me back to the inability of people not only to provide for the future but to forecast developments within our industry generally.

We were told by the Minister for Labour on many occasions that we were moving out of the recession period and that we had seen an upturn in some economy far away. First the recession was to end in 1974. Then this date was postponed to 1975 and then to 1976. Now I understand it is 1977. What the Minister is saying, in fact, is that he has not got a clue what the position is or when we will get out of the recession. I am sure he realises that his Government have taken no positive steps to solve this problem.

The 19,000 redundancies reported in 1975 cover many types of industries. The textile industry has been affected on a large scale. We pointed out at length on many occasions the necessity for some type of control on imports of cheap textiles from Third World countries. Our efforts were constantly ignored by the Minister for Industry and Commerce. He pleaded inability to do so because of our EEC entry. I understand that controls have now been introduced which may help to bring it within certain proportions because the value of these imports was getting completely out of hand. It is like closing the stable door after the horse has gone because for many of our textile industries it is too late.

There have been many redundancies in the building industry. The Minister for Local Government has refused to accept the fact that the building industry is in serious difficulty although there are now 23,000 unemployed there—an increase of approximately 10,000 over last year. There are many areas where there were redundancies during the past year. In some cases positive steps could have been taken. The extension of the premium employment programme introduced by the Minister last year, and supported by Fianna Fáil, would have been much cheaper to implement than the continued policy of the Government towards encouraging unemployment.

The increase this morning is another, though smaller, attack on the people who matter most in our society at present. They maintain the structures which help to maintain a reasonable standard of living for the underprivileged people. The people I refer to are the working people who are continuing in employment, and the employers who provide employment opportunities. They are the target. One wonders if this is not the long-planned ideological socialist labour policy of a party who were telling us about the socialist 1970s some years ago. When the people told them this was not on, the attitude was: "We will make you people suffer as soon as we can combine with somebody else to form a Government." It may have been a devious plan by people within that party who have little or no concern for the working people but who are far more concerned about their ideologies.

I accept that the fund has to be financed but we object to it being financed by the people who have contributed so much and who have suffered considerably as a result of the Government's mismanagement. The reasons for the increases are entirely because of the mishandling of the fund, what it is for and what it means. The alternatives with regard to finding the money at this stage are scarce. We were informed recently that there was a substantial balance in the pay-related fund. When the last increase was being sought last year I asked the Minister to consider transferring it, at least temporarily. Rather than impose an additional burden on the people, I asked that the financing be effected by a transfer from the pay-related fund, financed by a similar type of contribution from employer and employee.

We oppose the Minister's proposal simply because the target is the worker and the employer, the two sections who appear to be non-acceptable and whose names are dirty words so far as the Government are concerned. These people are our only hope of survival as a nation. I do not want to go into detail regarding the industries that will be affected. There are very many in my city and county and there are many in Dublin. However, an even greater tragedy are the rural based traditional industries where there are no alternatives.

The Taoiseach on his return from America promised us an additional 3,000 jobs. It was a major propaganda publicity exercise. I should love to see that number of jobs created overnight but we can produce evidence that 850 of these jobs which will be in one particular firm were decided on in October, 1975. In the light of that we can realise how deceitful was the propaganda and publicity attaching to the Taoiseach's trip to America from beginning to end. Those 850 jobs form a part——

I am anxious that Deputies would confine their remarks to the subject matter of this motion which is in respect of the rates of redundancy contributions. The Deputy has ranged widely over the economic sphere and employment generally. I am anxious that we have more regard to the subject-matter of the motion.

I am sure the Chair will agree that it affects the subject-matter we are debating because if the 3,000 jobs were available it would spread the load and it would mean that the unemployment figures would be that much less. The Minister referred to the drop from 19,000 to 13,500 redundancies and I presume he has taken note of the 3,000 jobs referred to. The Minister's forecast is questionable. He has said that redundancy notifications are at the rate of 13,500 per annum as compared with 19,000 last year. I hope the Minister is right but we must express our concern regarding the other industries that are affected by the Government's decisions in other spheres. We must be concerned about brewery and licensed trade workers. We know that workers in the meat processing industry have suffered. It is obvious that redundancy payments are a matter of concern for every employer and employee. What the Minister is proposing is absolutely unfair to the working population and we oppose it vehemently.

I wish to express my opposition to this motion. It is most untimely, coming as it does after the savage increases in the social welfare contributions, the legislation for which we passed in this House last week. It is well known that these increases will affect employment throughout the country. They will have a serious impact on employers, on the take-home pay of employees and they will have an effect on the morale of industry, of business people and of the workers. It will mean an even greater lack of confidence by the people in the Government.

The increases sought are outrageous. They represent an increase of more than 100 per cent for the employer from 13p to 25p and of 200 per cent for the employee. As it is, the increase in the social welfare contributions are having a serious effect on industry and unemployment. I know of one firm where the increases alone will cost in the region of £75,000 per annum; it will cost the employer approximately £50,000 and the employees £25,000. I was speaking to some of the management of the firm and to some of the trade union officials who work in this industry and they are most concerned about the situation that exists directly as a result of the increases. We can visualise the impact of a bill for an additional £50,000 on an industry that is just carrying on in a very competitive world market. The new rates will have an adverse effect on industrialists who were contemplating setting up factories here and those industrialists who intended expanding will also be seriously affected. They are also bound to have a serious effect on businesses and the tendency now will be to restrict rather than expand businesses.

We have had redundancies on a large scale during the past year in the building, textile, footwear and food processing industries and in those industries associated with the spin-off from agricultural produce. This motion will result in further redundancies in those industries. The Government, instead of increasing social welfare contributions to such a high level, should be concerned with injecting more capital into the building industry and avoiding the inevitable further redundancies. Instead of taxing co-operatives the Government should be encouraging them. Many of those co-operatives are in a serious financial position, one which will not be improved by this motion or the Bill which was passed last week. It would be laughable, were it not so serious, to have a Government, in addition to taxing co-operatives, putting this further burden on them.

I fail to see the relevancy of that matter to this motion. The Deputy is straying very far from the subject matter of the motion which deals with an increase in redundancy contributions.

The taxing of co-operatives, and the increase in the contribution for redundancy payments, are due entirely to the mismanagement of the country's financial affairs by the National Coalition and the lack of any plan or policy by the Government. The deficiencies in the redundancy fund should be taken direct from the Exchequer instead of placing a further burden on the employer and employees. In asking the Minister to reconsider this I should like to point out to him that the effect of the motion will be that the employees will suffer another cut in their take home pay. That is a serious matter at a time when delicate negotiations are taking place on workers' pay. It is serious for any Government to bring in legislation which will reduce the take home pay of any worker by up to 65p per week.

The ordinary worker is entitled to ask how he will be compensated for this. Naturally, this will lead to more disquiet and dissatisfaction within industry and employment generally. In introducing this measure the Government are leading the country further into financial ruin and disaster and for those reasons the Minister should reconsider the motion.

In my contribution I intend to show the Minister the serious effect an increase in these contributions will have on workers and employers, particularly the co-operatives. The increase in these contributions, in conjunction with the imposition of a new tax on co-operatives, will mean redundancies there. The Chair has ruled that reference to co-operatives in relation to this motion is not in order but my view is that such a reference is relevant because co-operatives give employment and the effect of this motion will be that employment in co-operatives will be reduced. I am aware of the financial position of co-operatives and I am also aware that any further burden on them will lead to unemployment. We are concerned with keeping people in employment and it should be the aim of any Government to keep people in employment. I know the redundancy fund is necessary but there should be a contribution from some other source rather than piling it on the employer and employee all the time.

Friends of mine who live in this city are fed up with the increases in deductions from their pay packet that take place weekly. They have realised that after all the deductions they would be as well off drawing unemployment benefit. People do not want to be unemployed but it is fair to say that the most dissatisfied man at present is the man who is working. The unemployed man is fed up because he cannot get work but the worker is being scourged daily. There is no doubt but that the increase in these contributions will step up the cost of living. The employer must add something to the price of his goods to compensate him for the increase in the contribution. He cannot be expected to work at a loss. I am opposed to the increase because I know what the reaction will be. The Labour Party are foolish to have anything to do with a motion which will impose an additional burden on the workers. I am closely associated with workers and I know of their discontent. Every week they find that something more is chipped off their wage packet. They do not understand why they should have to contribute so much to help those who are unemployed. They do not know why they should have to carry the baby when they must get up at 7 o'clock every morning to travel to work. The employers feel dissatisfied also. I know that we are in a recession and that we are getting it tight to keep going.

Why should we have to pay? We are daily becoming more non-competitive in world markets because we are pricing ourselves out of these markets, pricing ourselves out because employers and workers have to pay increased contributions. I believe money should be borrowed to get people back to work. I do not want to be misunderstood but there is not enough interest in trying to get people back to work. An all-out effort should be made to put people into employment. Every day I am being asked where is this money for all these increased contributions to come from. This could be the straw that will break the camel's back. I am not making a political football out of this. I am merely explaining how people in the country are thinking.

I am completely in favour of the payment of redundancy money to workers who become unemployed through no fault of their own. That they should be paid this money is both necessary and desirable. The Redundancy Payments Bill was brought in by Fianna Fáil and it is only natural, therefore, that we should be wholly in favour of these payments.

We have heard a good deal about drug pushers. We have had the price pushers in the present Government. Now we have the contribution pushers. One day it is social welfare. The next day it is health. Now it is redundancy. Where will it stop? As previous speakers have said, a variety of problems confront the unfortunate worker at the moment. There appears to be a "screw the worker" campaign. Every day the numbers in employment are growing fewer. It is a tragic situation. The Government should be trying to restore confidence by putting people back into employment. If the people had jobs, there would be no need for redundancy payments.

We have asked questions about industries that are being run down. We know that redundancies have taken place. We know that industries which have not already closed down are on the verge of collapse. The Ministers seem to be absolutely irresponsible in their outlook and in their efforts to cope with the problem. I believe there is a determined effort on the part of the Government to let industry run down, to create this unemployment situation and try to solve the problem in another way. I accuse the Government of this deliberate tactic. There appears to be no logic in approach. In the boot and shoe industry there have been redundancies. A Labour Minister in the Department of Posts and Telegraphs imported shoes for the Naval Service from Britain while Irish workers were drawing redundancy payments. There is no logic in that. Those shoes could have been manufactured here.

There is absolutely no concern whatever for Irish workers. The same Minister purchased 400 pairs of sports boots for the Army. They could have been produced here.

Apparently it is policy to purchase sporting goods abroad while Irish workers are put on the redundancy queue.

Order. The Chair has given some latitude in respect of this motion but the Deputy is now ranging very wide of the mark. The Deputy will have to relate his remarks to the subject matter of the motion. We cannot have an economic debate on the motion.

I am mainly concerned with redundancy payments and those industries in which workers have become redundant.

The subject matter of the motion is limited to an increase in the contribution.

There would be no need for increased contributions if Government Ministers ensured that Irish workers did not become redundant as a result of their efforts. There is industrial sabotage by the Government. They are forcing up the redundancy payments. Deputy Fitzgerald has dealt with that aspect. I am pointing out that most of the redundancies should not have taken place and would not have taken place were it not for sabotage by the Government and by Labour Ministers in that Government.

There have been redundancies in the printing industry. Yet the Labour Minister in the Department of Posts and Telegraphs has got labels and stamps printed in England.

What about the "Buy Irish" campaign posters which were printed in Holland under a Fianna Fáil Government?

Would the Deputy like to produce the evidence to support that statement?

Apparently there is an effort now to justify Irish workers becoming redundant in order to keep the British and what are called the continental Europeans at work. There can be no justification for making any man redundant here while, at the same time, helping to preserve jobs in other countries. I am glad Deputy Byrne has come in to spell out Government policy in regard to redundancy. Some time ago the Department of Defence purchased Italian equipment that could have been manufactured in my constituency. I am glad to hear now that the Government have a policy designed to make people redundant.

Order. Deputy Dowling will have to get back to the subject matter of the motion and that is the increase in contributions.

On a point of order, it is difficult to deal with the motion without referring to the cause for the motion.

The Chair has given some latitude in that regard but the Deputy is ranging too wide of the subject matter altogether.

I do not want to interrupt Deputy Dowling because of the quality of the blue shirt he is wearing.

At least it was made in Ireland.

Tell him the blue shirts were imported.

I understand the blue shirts were imported also. If one wants to discuss redundancy payments and their effect one must be able to discuss the problems that have created the redundancies. I am merely indicating that Government Ministers are directly responsible for the creation of some of the redundancies that have taken place. There are redundancies threatened in the Dublin docks at the moment.

If the Deputy wants to discuss redundancies at large, he will have to find another opportunity. This is not a suitable occasion, an increase in the contribution.

If the affairs of the nation were handled properly, there would be no need for the increases as outlined here. I have not dealt with quarter of the situation, and I feel I am being impeded, that this is an effort to pay people who are put in the position of being redundant through no fault of their own but through the direct fault of the Government who are now asking for an increased contribution.

The Minister indicated in his brief that there were repayable advances by the Minister for Finance of £4.18 million. The Government have handled the situation in such a way they have created redundancies deliberately— and I stress "deliberately"—and the Minister for Finance, in order to cover up or otherwise, has funded this to the extent of £1.8 million. We are told that in 1974 there were 11,000 redundancies and in 1975 19,000 redundancies and these 19,000, as I say, were the result of ministerial action. One does not know now whether it is a Government decision or ministerial decision, because it is altogether too confusing when one reads the papers. I would like to know if this is a Government decision or merely a decision of a Minister. Things are so confused in recent times that we have a John Kelly decision, a Conor Cruise-O'Brien decision, a Justin Keating decision——

The Deputy knows full well that Members of the House must be referred to by their appropriate title.

The Minister for Posts and Telegraphs spoke the other day. I understand it was not a Government decision. When are we to know when a Minister is making a statement in relation to Government policy? I always understood that this veil of collective responsibility fell down over Ministers and when a statement was issued by a Minister each and every Minister of that Government stood solidly behind it. When we ask the Taoiseach about this he will say it is collective responsibility; at a later stage the Ministers concerned are brought in and reprimanded, and we are told something different. I will have a question down to ask how Ministers can be identified as not speaking on behalf of the Government. I am not too sure that Deputy O'Leary is speaking on behalf of all the members of the Government.

The Minister for Labour.

Does the Minister for Labour consider a 200 per cent or a 180 per cent increase a suitable approach to the problem? I wonder what would happen if a worker looked for a 180 per cent or a 200 per cent increase. The Government would be making the sounds with which we are all so familiar in recent times when they admonish the people either inside or outside pubs.

This Government are now falling asunder. It is quite obvious that the price pushers have been found out at last. They are being exposed daily in this House and outside it. The people have lost confidence. The Government should let the people decide in the very near future what the situation will be.

I am sorry I had not the opportunity here this morning of dealing in greater depth with the redundancy problem and the reason why these contributions are necessary. It is all too sad to think that the few people who are working are having further burdens loaded on to them day by day by one Minister or another. If it is not Deputy O'Leary today, it is Deputy Cruise-O'Brien tomorrow.

The Minister for Labour and the Minister for Posts and Telegraphs.

If it is not those Ministers, it is the Minister for Transport and Power and so on. These are the pickpockets of the seventies who are examining the purse of the housewife and the pocket of the worker to find out how much more they can extract to cover up for their incompetence and the disaster into which they have led this nation over the last three years. We hope the country will soon pass into the hands of responsible people who will not adopt the tactics of this Government since they assumed office, that of concealment, until now when they find that the snake has wrapped around them having failed to restore confidence and having put people on the breadline. The Government's job is to put people back to work. Do not blame the Italians or the Japanese. Do not blame the Hungarians, the Germans or anybody else.

Again, I am not sure what Government policy is because we have so many spokesmen on various matters. I am not sure that the Bills that are now coming before this House will ever become law, because I do not think the Government will be there long enough to put them into operation. This House might break up today or maybe next week, judging by the various comments, the run for cover and the individual approaches we now see by Government members who are all endeavouring to save their own skin because they know they are on the way out and that never again will they grace this House.

I am sorry the situation has deteriorated to the extent that it is necessary to seek additional contributions on the basis outlined here. This must be related to something. As Deputy Fitzgerald asked, is it related to pay increases? Not alone had we 11,000 redundancies in 1974 and 19,000 in 1975 but the notifiable rate this year so far is another 13,500. Where will it end? How many will there be next year if the Minister is still in office? This is the serious situation which is facing this nation. Will the Minister rob the worker or the housewife to cover up the blunders made in the past? Let the suggestions made by Deputy Fitzgerald take effect. We can guarantee that when prosperity returns under a Fianna Fáil Government we will rectify this situation. The redundancy fund will be substantial, because we will have no redundancies. We will take the people off the dole queues and put them back to work. We will ensure that it will not be necessary to come to this House day after day to dip further into the pockets of the Irish workers.

When reading the Minister's brief it is sad to realise that not only are so many people unemployed but the terrible tragedy is that redundancies are increasing daily—we are told this year at the rate of 13,500. One can never rely on the figures provided by the Government because they change by the hour, the day or the week. How valid is the figure of 13,500? How has this been cloaked? Is there a veil over this which if lifted would show a much greater number? Is this figure purely for the consumption of the Dáil and the public today? There is a terrible tragedy facing this nation—soon everybody will be out of work or redundant and there will be no money to pay anybody.

How effective will be the think tanks and the policy plans we are told about? As Deputy Fitzgerald pointed out, the Taoiseach came back with 3,000 jobs in his briefcase. I hope they materialise. Three thousand jobs will be of very little use to 19,000 people who are redundant. We should be dealing in hundreds of thousands of jobs. That is what we require to put this nation back on its feet.

It is necessary and desirable that Government Ministers do not sabotage the national effort by importing for Government services items that can be made at home and which are at the moment putting people on redundancies and on the dole lines. Irish workers will never forgive the present Government, especially the Labour Party, for this. If the Minister and the Government are concerned about Irish workers and redundancies and the possibility of putting people back into employment, I can give them an instant solution, that is, send Cosgrave to the Park today so that the people can decide for themselves and put us back into power.

I realise that workers affected by redundancies must be given adequate payment. In my view, we have reached a doomsday situation in this new measure. The Government, facing growing unemployment and redundancies, have taken the easy way out by simply imposing more taxation. I am hoping that we will soon have a radical change here, such as a change of Government. Nothing less will save this nation from continuing on the downward path towards total insolvency. Is there anything worse than that? In my view, the Minister is a prisoner of his own peculiar doctrinaire thinking on economics. He should consult the employers and trade unions and say: "Let us discuss this matter and see what can be done, and how we can put people back to work".

If people were working there would be no redundancies and therefore no need for this measure. The Minister came here this morning with his over simple measure to impose more taxation on a dwindling work force. The economists remind us of what happens when the law of diminishing returns starts to apply. We are on that path here today. The law of diminishing returns will apply because the labour force is shrinking and they will be unable to bear the burden of extra taxation. Sooner or later the Government will have to start thinking and using whatever brain power is at their disposal to find other ways of helping people who are redundant than by taxing those still fortunate enough to be in employment.

According to a newspaper this morning the Minister for Industry and Commerce is setting up what he describes as a think tank to provide 20,000 jobs a year. That reminds me of the call from some of the Minister's colleagues for the new economic task force or the new social order. Last week the European Commissioner, Dr. Hillery, put forward a very sound proposition on how we can absorb our thousands who are unemployed. The people are waiting for a lead from the Government to discuss the matter, to look at the 116,000 unemployed, the men who are losing faith because they are still not employed.

I have no doubt that we will pass this motion which will enable redundant workers to receive payments. Because the coffers are now empty, this will be done at the expense of those who are still working. Not one bit of original thinking has come from the Minister. It is easy to impose extra taxation but the time has come when somebody must shout "Stop", if we are not to stand by and see the country go into bankruptcy. I am not such a hidebound thinker that I would not consider going outside the orthodox thinking of the Government. There are ways to get people back to work; one is by offering them gainful employment. The unemployment benefits now paid help keep a man and his family off the breadline. The majority of the unemployed are only too willing and anxious to get back to work and make some return to society. They are deprived of this right and will continue signing at the labour exchanges in greater numbers.

No action is being taken by the Government that would give these people any reason to be hopeful. We are speaking of people who have had jobs but lost them, not of those who have never had the opportunity of working. Of the 53,000 young people who left the three levels of education last year, only very few were able to obtain employment. Recently I spoke with the father of a young boy who, having studied for his leaving certificate, asked his father where he might obtain employment, but the father had to answer that there was no hope of employment. Britain and ourselves are the sick men of Europe. While other member countries may have their problems, they are making every effort to provide again full employment for their people. There is no light on the horizon so far as we are concerned. It would be a different matter if the Government were in a position to tell us that they had plans for restoring employment to 10,000 or 20,000 people. While the Minister may put forward statistics to disprove what we say, he knows that we are on the slippery slope towards insolvency and that the type of measure proposed here is merely a token social action and not in any way constructive in regard to the provision of employment.

We believe that the vast majority of unemployed are anxious to get back to work. There are those who allege that because the social services are so good they have the effect of discouraging people from seeking employment, but we know that the loss of employment is a tragedy for honest decent people. I have had experience of signing at an employment exchange and I know how demoralising this can be. This Government are not doing enough in the field of creating the conditions in which people could be offered gainful employment. They are prone to taking a lead from the UK Government in regard to fashions in thinking and in general Government policy, but it would be well to consider the danger signs that are apparent in Britain now. For instance the hunger marchers from the north of the country are heading south again. In one area last week it was reported that the police took strong measures against those marchers, but perhaps the police were aggravated.

The Chair would prefer that the Deputy would relate his remarks more closely to the motion before the House.

Unless the Government heed the warning signs, matters will become much worse. I wonder if the Minister read the statement made earlier this week by Deputy O'Malley when he warned of what may happen unless matters are rectified. There was the report, too, of the university dons in England of what may happen if circumstances do not improve.

The Minister may say that this measure is justified because redundant workers must be looked after. They must be looked after, but this House should not be satisfied merely to pass a Financial Resolution for the purpose of increasing taxation. The Minister would get much more thanks from redundant workers if, instead of providing for increased maintenance allowances, he could offer them the prospect of being able to return to work.

Our redundancy legislation was introduced because we foresaw a time when during certain periods people would become redundant, but for the past three years we have continued to increase the contributions. This pattern cannot continue. Either the Government must put forward concrete plans to improve the employment situation or they must hand over the running of the country's affairs to a party who have the ability to bring about improvements. I admit that during Fianna Fáil's terms in office there was unemployment, but we did not try to solve the problem by increasing taxation on those who were working. Rather did we strive continuously to increase the productivity of the nation. Influenced by the teaching of a de Valera, a Lemass or a Lynch, the people had reason to believe that eventually we would create a society that would offer them a living. The parties now in office are adding continuously to the despondency of the people.

It is the duty of each one of us to be here this morning for this very important discussion but it is sad that we are here for the purpose of improving a Bill that is designed to give handouts to the thousands of unemployed men and women. The Minister knows that this motion this morning will bring about further redundancies. It will hit the small industry, the very backbone of the industrial arm of the country. I worked in a small industry and I am fully aware of the impact this increase will have on such people. Last week the Minister received a deputation of workers from a Cork shoe factory who walked from Cork to Dublin to display their willingness and desire to keep their industry going. Surely that must be some indication to the Government of the willingness of the people to build their industries and to ensure employment even with little or no response from the Government.

It is about time the Minister for Labour and the Government came into the House with a policy for creating jobs and restoring confidence in the Irish people. This is of vital importance. Recently we had increases in the social welfare stamp and this morning we are asking for increases in the redundancy stamp. Redundancy was never designed for this. It was only to help workers over a lean period. Now it seems to have become a permanent part of social welfare benefits. I know of the dangerous frustration that is building up among the workers. Many of them just get up in the morning, go along to the Labour Exchange, sign for their payments and return home. I am sure the Minister agrees with me that it is dangerous to have this type of frustration building up among the people.

A fortnight ago I asked the Minister for Labour a question regarding the 50,000 young people who completed their leaving certificate examination last year and asked him to give me some statistics on the number who got work and the number who returned back to education. Unfortunately very few can now return to education because of the very high cost and because of the widespread unemployment in the country at the moment. One cannot say that this side of the House are not playing their part. Last week I pleaded with the Minister for Transport and Power to invest money in areas where there are employment potentials. I pleaded with him to invest £9 million in the Cork Harbour regional development plan where we are guaranteed returns from such an area as far as employment is concerned. The Government must look at areas like this where there is this kind of potential rather than ask the workers to bear further burdens. This morning we are inflicting a further hardship on the industrialist and the worker to try and help pay for the thousands of fellow workers walking the streets.

How long can those who are fortunate to be in employment continue to make this contribution? The Minister must be fully aware of the many protests by the fortunate people who are working against any further burden on their pay packets every week. There is unnecessary delay in finalising the many appeals before the redundancy appeal board. If we are sanctioning money this morning and if there are unnecessary delays in finalising the large number of appeals before the board, the Minister should give this matter very serious consideration in order to avoid further hardship on those who are made redundant.

Every Member of the House should urge the Government to seek out areas where there is employment potential rather than invest millions of pounds, money that has been borrowed and which has to be paid back, in things that the workers do not want and that the nation does not want. This money should be invested in areas where we can give employment to our people so that they can come home every week with something substantial in their pay packets rather than to have to depend on handouts of money that has been borrowed. We cannot even look to Europe to borrow money to pay our unemployed.

Surely the Cabinet should sit down and look at their philosophy at the moment, where there are handouts week after week to unemployed people? The Government should know that there are very definite areas where employment should be given to the people. Let us restore confidence in our people. Let the Government have confidence in our people. Let them be prepared to invest in our people and invest in industry, which is the most important thing in the nation at the moment.

I should say, initially, that I will resist the temptation of allowing my imagination to visualise the position if this morning the situation were reversed and Deputy G. Fitzgerald were sitting on the opposite benches as Minister for Labour and the present holder of that office were sitting here in Opposition. I am visualising what the attitude of the present Minister would be and basing that on my experience of him in Opposition and the ease with which he could solve every problem whether economic or social. I recollect his special presumed expertise in the matter of employment, matters connected with redundancy, and anything which had a kinship with what he would have described as his interest in and his knowledge of the workers.

I recollect, too, the swiftness with which he would dismiss the hand of Fianna Fáil as being incapable of governing and, because of that, he would assert there was no obligation on him to assist them in any predicament which might arise. He would establish as a political principle that there was no question of the Opposition complementing the Government and that the Government alone had the absolute responsibility to solve any problem which arose. I suppose I should admit that, up to that point, he had no experience of being in Government. In all charity one could excuse him and say that perhaps his faith in himself was such that he could solve all the problems of this nation and other nations. I am allowing that charity to him even though I criticise myself for so doing. Accordingly, as far as possible I will make positive comments on the motion we are discussing.

This Government and the Minister for Labour have brought the country into an economic quagmire, a situation which, in fairness to them, they all admit. How can the Minister say he is making any contribution towards solving the appalling unemployment problem by imposing additional taxes on the employers and the workers? That is what this motion represents. The position is bad enough without making it worse. Does the Minister not know that employers are put to the pin of their collar to survive? Daily we have business after business forced to retire from the scene. They are crying out for some form of incentive, or inducement, or encouragement, and here we have a measure from the Minister which he must accept worsens the position of the employer. I will not develop that point.

Let us look now at the case of the employee. This year the Minister for Finance based his budget on the premise that there would be a pay pause. The Minister for Labour should advise the Minister for Finance that you cannot aspire to a pay pause when day by day, and hour by hour, you are increasing the cost of living of employees. The Minister for Labour is asking ladies to pay an increase in the stamp of from 4p to 12p and male workers to pay an increase in the stamp of from 5p to 13p. In certain times that increase might seem rather small but, having regard to the narrow margins operating at the moment, the Minister should realise it will be an element in the case for increases that will be made by trade unions with which he is so familiar and to which he was attached for so long.

I have been presented with the difficulty of assessing where this Government are going, or where they think they are going. This is not a Government in the true fashion. There are no elements of the teamwork which ordinarily would be expected from a Government. Day after day we get ample proof of each one in his own right persuing elements of dictatorship, each one doing his own thing. There are verbal admissions of overall responsibility. They are, unfortunately for the country, articulate and eloquent men, who have the gift of the gab in making any case. When one looks at the totality there is evidence that in perfect disharmony the Left is not prepared to let the Right know what it is doing, and vice versa. Because of that, we have unparalleled unemployment at the moment, and it is developing. It is about the only thing that is developing under this Government.

I do not want to give a sermon on unemployment, but it is no harm to refer to the proverb and adage about what the devil will do with idle hands, or to what the Lord said about how a person should live during his lifetime —the quotation with which we are all familiar about—the sweat of one's brow. That philosophy reminds us of the need, apart from the desirability, for each person to be gainfully employed during his or her lifetime.

Each normal person is searching for that natural satisfaction which derives from being gainfully employed. Each person is searcihing for that sense of fulfilment that comes when he realises he has a contribution to make to society. This Government stand condemned for denying that right to so many people.

At any level unemployment is unwelcome and is socially undesirable but the greatest tragedy is in respect of the young men and women. Tens of thousands of young boys and girls are leaving second-and third-level education full of talent and idealism, having spent long arduous years applying themselves to education. This should normally guarantee them jobs but this does not happen.

What do this Government offer them? They offer idleness, disillusionment and shattered dreams. All of us must fear the reaction that, understandably, will ensue as a result of this frustration and as a result of the ineptitude of the Government to follow up what was prepared for them by their predecessors with regard to developing the economy to the point where it could absorb all of those people.

All of us know that in 1969 and in the early seventies Fianna Fáil had advanced the economic wellbeing of the country to the point where labourers, technicians and professional people were returning from other countries to fill a need that could not be satisfied at home. Having planned the economy, Fianna Fáil looked at the educational system. They saw that at primary level the curricula should be updated and that at secondary level there should be proper employment of the resources that existed to break the traditional competition that had occurred between secondary and vocational education. In pursuit of that aim they established community and comprehensive schools and regional colleges. All this was necessary to satisfy the economic programme which had been planned and which was being executed.

During those years the present Minister for Labour criticised the Government for the manner in which they were operating and for what he claimed was the lack of perfection in our economic structure. He told Fianna Fáil that if they could be removed from the scene he and his colleagues would come into office and lead us on to perfection. Let us consider what has happened.

It is not the first time that a Government like the present one have destroyed the dream of young Ireland. All of us know that the Coalition Governments have a record of double failure and we now have the hat-trick. In the past fate ensured that they were succeeded by Fianna Fáil who had a double success and, hopefully, we will have a hat-trick of successes. My fear is that the country will have reached a point where it will be impossible for any Government, whether party or national, to retrieve this situation and the longer this Government remain in office the greater will be the difficulty of retrieving the situation.

We hear much talk from the Minister for Industry and Commerce about our great wealth. I accept that a person could share what I regard as the "bingo" philosophy, of hoping that wealth will emerge from the ocean and from the land. We understand it is there but it will not be produced without a certain effort and at a price. I believe in looking at what is there. I believe in assessing what I can see and in utilising that resource. If there is any untapped resource in this country about which there is certainty it is labour. Our labour force is the greatest unemployed resource we have at the moment.

It is an extraordinary situation where ostensibly we seem to be concerned about applying ourselves to hidden wealth and hidden resources while at the same time we are neglecting and abusing the resource with the best potential we know of. In respect of that neglect, I accuse the Minister for Labour. I accuse him in particular in respect of the measure which he now introduces. I am sure he is conversant enough with the situation and fully aware of the sensitivity of industry at present to know that the measure he is introducing will not create one new job. On the contrary, he knows as well as I that it must add further to the accumulation of this untapped resource we have.

I am reminded of the days when the boot was on the other foot in this House—shortly there will be no boot on any foot and it will be difficult here, or anywhere else, to recognise any one thing from another. Certain elements in the Government have set about in their prodigal son philosophy to destroy the real wealth accumulated here over the years. That having been done, they are now endeavouring to pick-pocket the wealth of other nations, and, temporarily, they are getting that accommodation. They talk about the distribution of wealth without accepting the counter-balance, that to distribute anything one must first create it. They are not concerned about that; they are not concerned about the creation at all; there is too much hardship involved there and it has not the same ephemeral popularity as the other. They are succeeding very well in reaching a situation where the only true thing in respect of the distribution of wealth is that everyone will have so little that there will be equality. There will not be anything for anybody.

In similar circumstances, when the Minister was in Opposition, he was a great man for the emergency call. He wanted to declare an emergency in housing, an emergency in health and an emergency on the economic scene. He is now in the position of having made his own very substantial contribution to the appalling emergency in which we find ourselves today.

(Dublin Central): Wrecking the economy.

Would the Minister indicate how he proposes salvaging that? I can indicate to him how he can absorb the people I am referring to. Perhaps he will indicate the reasons he thinks he should not do now what he would have done were he in Opposition, declaring an emergency in respect of the appalling unemployment we have.

The measure, as the Chair remarked repeatedly during this wandering debate, concerns the necessity of improving the funds coming into the general redundancy fund to make it solvent because of extra demands made on the funds before they are available. Members of the Opposition are opposing this measure. It is unclear why they are opposing it but I do not wish to wander after the members of the Opposition who spoke down the many roads of their imagination. The last speaker made a speech which was typical of the kind of contribution we had this morning. It strikes me that the only fear of the Opposition is that the present recession will improve. It shows signs of being on the wane and there are signs that the economic position will improve.

(Dublin Central): The Minister is the only person who sees that.

The Opposition appear to be frightened in case the one stick they have to beat the Government—the present economic difficulties—is taken from them because then will be exposed the pretentions of this collection of individuals to try to run the Government of this State. Deprived of the difficulties associated with this recession, the people would see the pretentions of the Opposition for what they are. We have two years to go, at the outside, to a general election and we have not had any policies from a group of individuals who aspire to run the country. We have heard instalments of the kind of baby talk indulged in by them this morning when they spoke of the difficulties before us and ignored the international connection between our recession and that abroad. The Opposition, which consists of individuals who make up an uneasy coalition of ambitions and rivalries, when it comes to election time will discover that the kind of contributions this morning on this and other items is no substitute and can get them nowhere near these benches in the foreseeable future. We need more than that today with the kind of electorate we have.

The Minister should tell us what he is going to do.

Generally, people understand that our recession is part of similar economic problems that afflict every other country. The Opposition do not appear to know their own mind on any particular measure apart from a general simplistic equation that all difficulties would be eliminated if they were in government. Nobody, but the most brain-washed members of their misguided cumainn would credit them with that kind of gift today because the difficulties are worldsize and a little beyond their capacity. Certainly, they have nothing to do with any secrets they may have to impart in government. The Opposition have two years to devise policies which the electorate can assess and decide on if they have any remedies for the many difficulties faced by this and many other economies.

(Dublin Central): The National Coalition have been three years in power and they have not produced a plan yet.

The Opposition have all the way to March, 1978, to declare where they stand. Deputy Dowling argued against the improvement. It is clear that there is an improving position in the employment situation. There has been a constant decline in the unemployment figures over many weeks and the same thing is clear in the trends in redundancy this year. We had 19,000 notified redundancies last year and the rate this year is 13,500. That is a solid reduction. There are many signs on the employment front that even during a term of peak unemployment the position is improving. This tendency will continue to assert itself throughout the year. There is that terrible danger dawning for the Opposition that they have only a short time to make the most of the difficulties that confront us and every other country. I appreciate that it is little consolation to the unemployed person to know that he is one of a number which extends throughout every country in Europe. I readily accept that there is little consolation for the unemployed individual in that situation.

On a point of order——

I do not see that there is a point of order left when I consider the wandering contribution the Deputy made this morning.

Can the Minister assure the House that from figures at his disposal there will be a continuing reduction in the unemployment figures from now on? If that is so, that is good news. Can the Minister back that up with something? That is all I want to know because I honestly do not believe the Minister.

The figures over the last few weeks show a continuous improvement.

Could I ask the Minister——

No, the Deputy could not.

In other words, the Minister knows what I am going to ask him and he is bluffing.

Caught out again.

There was really very little relevance in most of the debate and, because of that, it is difficult to know what the Opposition are for and what they are against. As far as there being a burden on anybody, the fact is that there is an arrangement for a rebate. We know that employers in general are in favour of these redundancy provisions and it is also a fact that employers bear only part of the burden.

The argument was made that the money should be used for job creation. That is a matter of Government policy and Deputies opposite know quite well that, in the capital budget this year, we have provided the largest sum ever to assist industry.

The numbers of those becoming redundant are decreasing but, because of the large numbers over the past two years, it is necessary to correct the insolvency of the fund and restore it to a position of credit. That is why these extra contributions are being sought.

One Opposition Deputy argued that the pay-related fund administered by the Minister for Social Welfare should be made available for redundancy purposes. That would need amending legislation, apart from the fact that the fund is required to continue that particular scheme. It was explained last week that the fund is being continued for a further 13 weeks.

Opposition speakers were so diffuse it is difficult to find exactly what points should be replied to. They seemed to think that, if they were over here, there would be no economic crisis and they believed they would be over here shortly. There was that sort of sub-conscious stream of talk and I am at a slight disadvantage, therefore, in trying to reply. Most of the arguments raised would be proper to a general debate on economic policy. The main emphasis in Government policy from the point of view of economic recovery is on the extension of our industrial bases.

When did the Government have such a policy?

All the arrangements have been made in the capital programme. While the employment situation continues to be serious, it must be admitted that the pattern is the same as the other EEC countries. It is anticipated there will be 1,500,000 people unemployed in Britain next winter. We and others have been going through a very difficult economic period but there are signs of an upturn in our economy as well as in other economies. By comparison with France and Germany, our figures are showing very encouraging signs in the past few weeks.

This motion arises out of the necessity to build up the fund. Heavy payments had to be made out of the fund over the past two years and we now have to correct the position and restore the fund to solvency and, at the same time, reduce its dependancy on the Exchequer. It is an expensive liability and we want to make the fund dependent on employer and employee so that we will not have to meet from the Exchequer the extraordinarily heavy demands made on its resources over the past two years.

Question put.
The Dáil divided: Tá, 64; Níl, 56.

  • Barry, Peter.
  • Barry, Richard.
  • Begley, Michael.
  • Belton, Luke.
  • Belton, Paddy.
  • Bermingham, Joseph.
  • Bruton, John.
  • Burke, Dick.
  • Burke, Liam.
  • Byrne, Hugh.
  • Clinton, Mark A.
  • Cluskey, Frank.
  • Collins, Edward.
  • Conlan, John F.
  • Coogan, Fintan.
  • Cooney, Patrick M.
  • Corish, Brendan.
  • Costello, Declan.
  • Coughlan, Stephen.
  • Creed, Donal.
  • Crotty, Kieran.
  • Cruise-O'Brien, Conor.
  • Desmond, Barry.
  • Desmond, Eileen.
  • Dockrell, Henry P.
  • Dockrell, Maurice.
  • Donegan, Patrick S.
  • Donnellan, John.
  • Enright, Thomas.
  • Esmonde, John G.
  • Finn, Martin.
  • Fitzpatrick, Tom (Cavan).
  • Flanagan, Oliver J.
  • Gilhawley, Eugene.
  • Governey, Desmond.
  • Griffin, Brendan.
  • Harte, Patrick D.
  • Hegarty, Patrick.
  • Jones, Denis F.
  • Keating, Justin.
  • Kelly, John.
  • Kenny, Enda.
  • Kyne, Thomas A.
  • L'Estrange, Gerald.
  • Lynch, Gerard.
  • McDonald, Charles B.
  • McLaughlin, Joseph.
  • McMahon, Larry.
  • Malone, Patrick.
  • Murphy, Michael P.
  • O'Brien, Fergus.
  • O'Leary, Michael.
  • O'Sullivan, John L.
  • Pattison, Seamus.
  • Reynolds, Patrick J.
  • Ryan, John J.
  • Ryan, Richie.
  • Spring, Dan.
  • Staunton, Myles.
  • Taylor, Frank.
  • Timmins, Godfrey.
  • Toal, Brendan.
  • Tully, James.
  • White, James.

Níl

  • Allen, Lorcan.
  • Barrett, Sylvester.
  • Brady, Philip A.
  • Brennan, Joseph.
  • Breslin, Cormac.
  • Briscoe, Ben.
  • Brosnan, Seán.
  • Browne, Seán.
  • Brugha, Ruairí.
  • Burke, Raphael P.
  • Callanan, John.
  • Calleary, Seán.
  • Colley, George.
  • Collins, Gerard.
  • Connolly, Gerard.
  • Crinion, Brendan.
  • Cronin, Jerry.
  • Daly, Brendan.
  • Davern, Noel.
  • Dowling, Joe.
  • Fahey, Jackie.
  • Farrell, Joseph.
  • Faulkner, Pádraig.
  • Fitzgerald, Gene.
  • Fitzpatrick, Tom (Dublin Central).
  • Flanagan, Seán.
  • French, Seán.
  • Gallagher, Denis.
  • Geoghegan-Quinn, Máire.
  • Gibbons, Hugh.
  • Gogan, Richard P.
  • Healy, Augustine A.
  • Hussey, Thomas.
  • Kenneally, William.
  • Kitt, Michael P.
  • Lalor, Patrick J.
  • Leonard, James.
  • Loughnane, William.
  • Lynch, Celia.
  • Lynch, Jack.
  • McEllistrim, Thomas.
  • Meaney, Tom.
  • Molloy, Robert.
  • Moore, Seán.
  • Murphy, Ciarán.
  • Nolan, Thomas.
  • Noonan, Michael.
  • O'Connor, Timothy.
  • O'Leary, John.
  • O'Malley, Desmond.
  • Power, Patrick.
  • Smith, Patrick.
  • Timmons, Eugene.
  • Tunney, Jim.
  • Walsh, Seán.
  • Wyse, Pearse.
Tellers: Tá, Deputies Kelly and B. Desmond; Níl, Deputies Lalor and Browne.
Question declared carried.
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