Dáil Éireann debate -
Tuesday, 29 Jun 1976

Vol. 291 No. 13

Employment Premium Bill, 1976: Second Stage.

Minister for Labour (Mr. M. O'Leary)

I move: "That the Bill be now read a Second Time."

Deputies will recall that under the Premium Employment Act, 1975, which was passed in July last year, the premium employment programme was launched to provide financial incentives to employers to take on workers who had lost their jobs. Under the programme, two separate schemes were inaugurated, one for certain manufacturing industries and the other for agriculture. The currency of both schemes expired on 26th June, 1976.

As already announced in the course of my speech on 26th May, 1976, on the Estimate for my Department, I propose to extend the duration of both schemes for roughly a further six months. The purpose of the amending legislation, as indicated in section 1 of the Bill now before the House, is to obtain statutory authority for the proposed extension. The proposed new termination date referred to in the Bill—8th January, 1977—was adopted so as to coincide with the fourweek payment cycle up to the end of December, 1976. The reason for prescribing the commencement date— 26th June, 1976—in section 2 of the Bill is to preserve the continuity of the schemes from the previous termination date, as prescribed in the 1975 Act, up to the new termination date on 8th January next.

During the past year certain modifications were made in the original programme. For instance, the scope of the scheme for manufacturing industries was extended to include food processing, which had been omitted initially, with effect from 5th December, 1975, after the seasonal peak in that industry had passed.

In addition, the premium rates were improved. Initially, the premium rate per eligible worker was fixed at £12 per week up to 3rd April, 1976, after which it was to be reduced to £6 per week for the period 4th April, 1976, to 26th June, 1976. However, as I already announced in this House, the amount of the premium has been raised to £15 per week with effect from 4th April, 1976, instead of being reduced to £6 as originally envisaged. The second-phase rate, which has been increased from £6 per week to £7.50, will now apply from 19th September, 1976.

The basic objective of the premium employment programme is to get as many as possible unemployed workers restored to employment as quickly as possible. The State pays a subsidy of £15 per week to an employer for additional unemployed workers taken on over and above the number employed as at 20th June, 1975. It is a condition of the programme that the unemployed worker must have received unemployment benefit at least once since June, 1974, and was signing-on at an Employment Exchange or attending an AnCO training centre for at least four weeks prior to being re-employed.

The total number of workers who have been re-employed to date under the programme is over 5,000. The vast majority of these workers were re-employed in manufacturing industry. I am encouraged by the fact that these workers might otherwise be still without a job but for the operation of the scheme.

I must say, however, that I am far from satisfied about the extent to which the scheme has been used up to now. However, with growing evidence that there is now a prospect of a recovery in the economy, there should be a greater incentive for employers to take on additional workers in the expectation that the level of demand both in the domestic and export markets will increase. The latest CII/ESRI business survey, which was taken in the first three weeks in May, showed that the recovery in economic activity had in the main continued, though at a slightly reduced rate. The level of exports has continued to improve and over the next few months the forecast was that production would continue to increase as would exports. Home sales were also expected to remain stable.

As far as unemployment is concerned, the latest live register figures are those for the week ending 18th June, 1976, which showed that the number of persons on the register on that date was 109,700. This represents a decline of over 500 on the previous week. Apart from slight increases in two successive weeks in early April this year, the number on the live register has fallen steadily from its peak of 118,427 on 13th February. At the same time the difference in the level of unemployment between the two years is also narrowing. For instance, on 9th January, 1976, the level of unemployment was over 21,000 above the corresponding level for last year. On 18th June this year the difference, compared with the corresponding week last year, had dropped to slightly over 7,500.

It is imperative that we should capitalise to the greatest extent possible on any opportunities to take up the slack in our productive capacity and thereby reduce unemployment. The Government, as an example of their determination to take positive action to help those who are without jobs, have decided to seek the approval of the Oireachtas to extend the duration of the premium employment programme schemes until the end of the year.

While the increase in the amount of the weekly premium to £15 should help to make the scheme more attractive, I have also arranged, in addition a publicity campaign in the newspapers, for the National Manpower Service of my Department and for AnCO, through their training advisers, to undertake an intensive canvass of employers to again bring to their notice details of the scheme and to encourage them to take advantage of it over the next six months or so. I also arranged to have eligible employers in manufacturing industry circularised, by post, about the improvements and extension of the scheme.

Because of the higher rate of premium now applicable and in anticipation of an increase in the volume of payments, the present provision of £1.25 million in my Department's Vote for the current year may be inadequate. If it is I shall be very glad to introduce a Supplementary Estimate before the end of the present year to meet the extra financial commitments involved, because it will be sure evidence of a speedy pick-up in the economy.

The Government's strategy for 1976 is to give priority to expenditure that would promote growth and sustain or increase employment. The premium employment programme is one component of that strategy. One of the scheme's attractions is that its effects are immediate inasmuch as people are immediately restored to gainful employment.

Deputies will have noted that the Bill provides for retrospection of the scheme to 26th June, 1976 on which date the original scheme expired. I am anxious to avoid any interruption of payments to employers which might be occasioned by possible delay in enacting the new legislation. For that reason, I would urge the House to give this measure a speedy passage.

I commend the Bill to the House.

Mr. G. Fitzgerald

When the forerunner of this Bill was introduced in this House about a year ago I, on behalf of my party, expressed support for it and went a bit further to say that it had about it an imagination that up to then had been non-existent with this Minister for Labour and, indeed, with his Government regarding the helping of people to be re-employed. Of course, my party and I support the meagre, miserable extension offered by this current Bill.

I cannot commend anybody for any imagination on this occasion. When the Bill was introduced a year ago we went to extremes and made pleas to the Minister to extend the scope of the Bill to cover industries not covered by that Bill. He ignored completely or almost completely the pleas we made to him and left out those areas where the highest unemployment was suffered in the intervening period. We asked him to have agriculture included. He did, I think, when it went to the Seanad. We asked him to have food processing entirely included. He did, at the tail end of last year, six months later. We asked him to include the building industry. He has made no move on that yet. We asked him to include the service industry, nor has he made any move there either.

To support what I am saying with regard to lack of imagination shown by the Minister on this occasion, I would say at this stage that it is tantamount to criminal negligence the way the Minister for Labour and his Government have neglected the unemployed and have continued to do so. He has given us the usual sort of propaganda in his Second Stage speech here that we know now it is just like beating empty drums and empty vessels. I will in the course of my remarks here set out to disprove some of the points and claims he is making, and compare them with what he said a year ago. The fundamental difficulty we are experiencing is that we have a Minister for Labour who not only is incompetent but, in addition, is showing a complete lack of interest, as, indeed, are his Government, in the field of employment generally.

To elaborate on the points I have made regarding the narrow format of the scheme, I take an answer which I got today to a query of mine on the total number of people employed under the premium employment programme, 1975. When that programme was introduced in this House the Minister said that the target of that programme was 10,000 jobs. I said to him that we needed no top limit, that we hope that 10,000 would be the minimum number of jobs created. To help to create them we suggested that the scope of the scheme be broadened to include industries where reasonable numbers may well be employed. The Minister, of course, in a typical manner despite utterances he may make otherwise, buried his head in the sand and said, of course, that £1.25 million had been provided in the Estimates and more would be provided if necessary. What did we spend? What has been spent after a year of that scheme? £656,000, approximately half, 50 per cent of what was provided in the Estimates last year. Worse than that, that is the gross expenditure of 50 per cent, but the net cost to the State is probably somewhere in the neighbourhood of 20 to 25 per cent, because when one breaks down the £656,000 one will find that those people who were re-employed, both themselves and their employers, contributed to a social welfare stamp in the first instance. Many of them, I have no doubt, paid income tax. Therefore, you will find that the net cost to the State was an awful lot less, certainly less than half of the £656,000 spent on that scheme to date.

In addition to those gains and advantages for the State there was, of course, a very important aspect, a very important human factor, where the social or morale-restoring job provided for the person came into play or into consideration. We have been listening to the Minister earlier this evening, to the pleas of this Government and their reference to social welfare. If they can claim credit—and I put a very big "if" there—or if, as the Parliamentary Secretary said, they were heroes in that regard, they are the damned opposite with regard to their efforts on behalf of the unemployed. If we analyse, we have 5,185 jobs created out of the target of 10,000 jobs after a year, 12 whole months elapsing. That is half the target.

I want to come back to the points I made earlier, to the two extensions of the scheme. The Minister extended the food processing in December and he created by that extension 33 extra jobs. He extended agriculture around the time the Bill was introduced last year. He created 32 extra jobs. Those 65 jobs were very welcome. They were an extension to the scheme, but we should look at the other areas where he might have extended the scope of it and the other industries he might have included. We can examine the increase there has been in unemployment in what one could say is the intervening period, while not exactly, because the figures from the Central Statistics Office, although dated June, would, of course, refer to the period between mid-March last year and mid-March this year. During that period if we take the building industry—and remember the building industry is our second largest—not only does it react quickly to promptings and assistance but the many allied industries, the many industries closely connected with it also react if money is expended in the building industry.

I know the Minister in typical fashion will come back here to me this evening and he will say: "But we have provided money here by way of capital expenditure". This is necessary and has always been necessary but at a time of high unemployment we must use our imagination a little bit.

If this Minister has failed the country it is a heavy responsibility on his shoulders and posterity will not easily forget that to him. This Government's approach to all areas of employment has been a negative one. Until a positive, aggressive attitude is adopted by them there will be no worth-while improvement. There is no point in the Minister claiming in his speech credit for reductions that are far lower than should be the case at this time of seasonal improvement. We are talking about the best months of the year for employment. At this time of the year we must think of the prospects between now and next December and January.

In the course of his statement the Minister said:

However, with growing evidence that there is now a prospect of a recovery in the economy, there should be a greater incentive for employers to take on additional workers in the expectation that the level of demand both in the domestic and export markets will increase.

I should like to give further quotations from a speech made by the Minister when introducing this Bill last year and they will be ample evidence of how little we can depend on him for forecasting what is likely to happen. I should now like to quote from Volume 284, column 1062, of the Official Report where the Minister said:

This is an endeavour to bring us up to the period of general recovery which, it is generally anticipated, will occur in the spring or early summer of next year.

We have not seen that recovery in the spring or early summer; I wish to goodness we had. At column 503 of the same Volume of the Official Report the Minister said:

The real purpose of it——

"It" is the premium employment programme.

——is to aid the areas worst hit which are in manufacturing industry. It is our idea that it should be a programme that would be easy to administer and effective. It is only a temporary programme to take us through these months ahead to the summer of regrowth.

Just 12 months later we are introducing an extension to the premium employment programme, an extension that is absolutely inadequate in the unemployment climate we have.

The increase in the number of people unemployed in the building industry between March, 1975, and March of this year was 5,243. That industry was not included in the programme. Surely, if it was included we could have reduced that figure in some way with obvious benefits. We would have had a saving in the amount of money paid out in unemployment benefit to people involved in that industry. The service industries were not included.

I should like to refer to a few of the service industries. The increase in unemployment in the distributive trades was 1,101, but the Minister did not think it worth his while to include it. In "personal services" which includes hotels, clubs, restaurants and public houses the increase in the number unemployed was 1,017 but the Minister did not think it worth his while to try and reduce that figure. In transport and communication the figure was 1,013 and that was not included. The number unemployed in those industries is very high and this has meant that the Exchequer has had to pay out a huge amount under social welfare. The alternative would have meant that while we would have had a pay out by the Department of Labour we would have had a big saving in the Department of Social Welfare. That would have been in excess of any amount paid out under the premium employment programme by the Department of Labour. That is simple mathematics and it is hard to understand why the Minister has restricted the scheme so much, particularly in view of the fact that he provided £1¼ million last year and had a gross expenditure of half of it. There was an obvious overall saving for the Exchequer.

The size of the premium has been increased to £15 but it will only remain at that figure until 19th September. From September to January the gross pay out will only be in the region of £7.50. Where is the initiative being shown here? Where is the Minister showing any imagination, even though he is responsible for employment? There is no initiative or imagination being shown by him. We were told recently that up to the end of March £38½ million was paid out in unemployment benefit and £6¼ million was paid out in pay related benefit while unemployment assistance amounted to £42½ million. That makes a total of £87¼ million but that does not include redundancy payments or the morale shattering aspect suffered by people during periods of unemployment. The Minister has the audacity to tell us that his Department had spent a miserable £600 on this scheme to date. The Exchequer, therefore, saved substantially.

I would ask the Minister why he will not sensibly extend the scope of this scheme to cover industries where new jobs might be created. I fully realise the necessity for regulations to prevent abuses of the scheme. I raised questions a year ago regarding the four-week qualifying limit on the live register. Our real unemployment figures are not those as expressed by the Minister or the live register: the real figures for those seeking employment at present must be in the region of 180,000 people. This figure includes the 110,0000 unemployed, the 1975 school leavers who have failed to find employment and who are not as yet included in the live register, and this year's school leavers who are also on the employment market. There is no point in discussing hypothetical figures. A large number of school leavers have to be added to the live register.

I remember the Parliamentary Secretary to the Taoiseach trying to defend the live register. He said that it did not vary from the way it was prepared over the years. That may be so, but it is no defence for a situation that has caused frustration for many parents, particularly for parents whose 1975 school leavers failed to find employment and whose brothers and sisters will be joining the queue in 1976. There is no imagination or worth-while effort in this document. There is a small extension to a scheme that has already proved inadequate, that has not realised the target set for it by this Minister. Is it laziness, inexperience or lack of concern that is inspiring him to allow these things to happen? There must be some explanation. Unless this Minister realises that he has to grasp the evil of unemployment in a positive way there can be no future for our people.

The Parliamentary Secretary, the Minister and some other Government speakers have said that we have not put any positive proposals before the House for improving the unemployment situation. I have spelt them out on a number of occasions. I am not entitled to spell them out under this Bill but there are, even within the limitations of this Bill, areas for improving it. Two areas that come quickly to mind are the building industry and the service industry. I have given figures to substantiate the big increase in unemployment in those industries between March, 1975, and March, 1976.

This Bill reminds me of a leaking roof. The Minister is plugging the pinholes and leaving the large holes open. Surely the 65 jobs that were created in the two extensions made by the Minister could have been augmented by many hundreds if he had included the building and service industries a year ago. Why are we confining it to manufacturing industry? I realise the necessity to support manufacturing industry, but this Minister has made no effort to sustain or support ailing manufacturing industry. In his reply today the Minister said that, of the 5,185 jobs recreated under the premium employment programme, 2,022 of them belong to the textile industry. When we appealed for assistance for the textile industry the Government allowed many factories to close in my constituency and in many others. I am glad that 2,022 jobs have been recreated but I would venture to say that, had the Government and the Minister moved in time, many more jobs would have been saved in the textile industry. There is still an area of the textile industry—the blanket industry—that is suffering severely. Two Ministers have been appealed to for assistance but they have refused to budge. The blanket industry is going through tough times and is not in a position to avail of this scheme.

The Minister for Labour has been a total failure. His Government have criminally neglected the workers. We will support this small effort but it is inadequate. Are we trying to save another £600,000 on the Estimate in order to divert it somewhere else? Is the Minister genuine in saying that he would be very happy to look for extra money to increase the £1.25 million voted for his Department's Estimate for the current year if it is found to be inadequate? Can we be expected to have confidence in his prediction? The increase to £15 was announced with a fanfare of trumpets but there was little ballyhoo about the reduction to £7.50 which is to be affected in September, less than three months from now. One can only hope that more than the £1.25 million will be needed but I find it difficult to believe that this will be the case.

In a few months' time, too, we will be faced with the seasonal decline in employment. We are now almost at the peak of the season in respect of employment but the decline usually begins sometime after the August holidays. Therefore, a more extensive employment premium programme would be desirable at that time. Any criticism offered from this side of the House is intended to be constructive. We support any vehicle which the Minister may use in an effort to recreate jobs, but we have not heard yet from him either in this House or elsewhere a worth-while reason for excluding from this legislation the building industry and the service industry.

Last year he told us that this employment premium was serving two purposes: the creation of jobs and the assisting of manufacturing industry so as to tide them over a difficult period. There is no argument for excluding any industry in which jobs may be created because every job created as a result of this scheme represents a saving to the economy. It was suggested last year from speakers on this side of the House that the scheme could be extended to local government employees. If that point was valid last year it is more valid this year when most local councils are struggling to maintain their present volume of employment until the end of the year. Another reason for including local authorities would be that the scheme might create further jobs especially since there is so much necessary and productive work to be done. More important, though, is the wish of most Irish people to be at work rather than to be depending on the soul-destroying but so necessary social welfare payments.

I shall not delay the House further as there are other Deputies who wish to contribute. There is an urgency about this legislation. While supporting any measure that will help to put people back at work we deplore the incompetence of the Minister and his lack of interest in doing anything worth while in relation to employment. Indeed, he has not even continued the decent bit of imagination that I credited him with displaying a year ago.

Mr. Moore

I have never seen a poorer attempt than this to cope with the employment problem. The Minister places much emphasis on the live register as if that was the main consideration in dealing with the unemployment situation. Unless he rids himself of his cavalier attitude to this problem and comes before us with some imaginative legislation we shall have to examine seriously his role as Minister and the manner in which he is mishandling the Department of Labour. However, it may not be totally fair to blame him solely for the situation. One could say that there is collective Government responsibility but that concept, like many other tenets of our democracy, is fast disappearing.

The Minister has told us that the previous legislation in this sphere has resulted in 5,000 people obtaining jobs but, despite pleas from this side of the House, he has not agreed to extend the legislation to the construction industry in which there are 25,000 operatives unemployed. In addition, there is the factor that in this city alone we need at least 12,000 new dwellings. The extension of the scheme to the construction industry would give a much-needed impetus to that industry. Apart from adopting the role of criticising the Opposition for allegedly not suggesting suitable ways of coping with the unemployment problem, the Government would appear to have lulled themselves into believing that there is nothing they can do to help. There has been no imaginative thinking from them in this area. We get little contribution from the think-tanks of the Government towards any reduction in the frightful unemployment figures.

As Deputy Fitzgerald pointed out, if we examine the unemployment figures and take into account people who cannot get jobs—those who never appeared on the live register because they could never get a job—this year yet again, in a few weeks or so, there will be another 50,000 people, those leaving third level education. Luckily some of them will get jobs but the great majority will not. Even if 10,000 people are employed under this new chapter in employment, we will be thankful but it must be judged against the total number without jobs. I am no expert on agriculture but I do see many facets of it that could benefit enormously from a real effort to support it, from a Government attempt to attract more people into it. We could point to a dozen different industries which could benefit. But I do not think the Government or the Minister have the will to come and say: "Look, here we have a radical programme for tackling unemployment" because nobody could call this the radical thinking of a semi-socialist Government. Right-wing conservatives in some of the most Right-wing countries in the world would reject this legislation as a serious attempt by the Minister to do the job he suggests he is here to do. Could the Minister not have included a proposal that where a firm takes on young people to train them they be given some bonus. Such would encourage employers to take on young people who may want to be bricklayers, carpenters, plumbers, printers and so on. Surely the Minister could have worked out some type of scheme with the trade unions which would have made it attractive for employers to take on young people in industry.

I want to praise AnCO on their efforts. Certainly they do try to train more and more people. But as imaginative or constructive thinking is not forthcoming from the Government, it is very difficult to get people to be enthusiastic about a great economic recovery, for which we hope, and which the Government promise all the time is just around the corner.

I have often thought it ironic that this is called the premium employment programme. Somebody advertising it used capitals for the initial letters, so that we had something called PEP. PEP is an in word nowadays. Whatever this Bill may have, certainly it is not pep. I feel the Minister realises that himself and knows it will not succeed to any great extent. It may give the impression or fool the weak-minded into thinking that something is being done but we know it is too little and probably too late to curb the growing unemployment. The Minister will have to look to broader horizons when reviewing the situation of the live register.

With regard to a radical programme —and here I may be straying somewhat from the Bill—sometime ago in the House the Minister and his colleagues told us that the banks were simply bursting with money, that they wanted to give it away in order to generate greater economic activity. While the banks' money may not be available this week or next, the trouble there will have to end some time. Could the Minister not approach the banks again and say: "If you have got so much money in your coffers, if you want to play an effective role in regenerating our economy, we will put before the country a plan under which the money lying idle will be used to take people off the unemployment exchanges, give them work, so that we can build a better society." But we will not build a new Jerusalem through the efforts of this Government. We are facing a situation in which there may well be grave social unrest because we have got so many people unemployed and so many young people who cannot obtain employment. It is much later than the Minister thinks. I would suggest that, in the interests of all of us, he try to do a lot better next time he introduces a Bill such as this.

Mr. Callanan

As Deputy Fitzgerald said, nobody on this side of the House wants to hold up the passage of this Bill. The amount of money being provided is totally inadequate. We on this side of the House have been complaining about borrowed moneys for various purposes but none of us would complain to the Minister at money borrowed in order to get people back to work. I spell out here this evening— and I hope the Minister understands it—the very serious situation of young, educated people who cannot get a job. It is the most serious situation we have had to face for years. Furthermore, they cannot go abroad to obtain employment. Therefore, we must try to provide it. I would be prepared to do this across the board for everybody who would employ a person at present unemployed, particularly younger people leaving school who cannot get jobs. Deputy Moore mentioned a few moments ago the dangers of these people who are educated, with minds that want to be working on something. If they cannot get work, I do not know what will be the thinking of those young minds. They feel the State owes them that, that it should provide them with a job.

I am not at all happy with this small amount of money being made available in an effort to get people back to work. I will support and vote for it but it is a miserable sum. I would do it right across the board for everybody who would take a person off the unemployment register or from the dole queues. The reason I say so is that a certain businessman came to me and said he would be prepared to add a couple of young people to his staff provided he got this premium. For example, local authorities could employ a lot of people. I would borrow—and make no excuse to anybody —for this purpose and I believe the State would gain.

In fairness, I should say to the Minister that I have not, offhand, the answer to the unemployment situation but I do believe that this is an emergency measure only. The State will have to play a bigger part—by all means it should assist private enterprise and anybody who employs people—and act quickly to try to get people, particularly the younger people, off the dole queues. If we do not, they will react violently. I do not want to prophesy but I know young people, looking at this House, are asking what we have to offer. They want jobs. They are educated and they cannot get work. This sum of money provided here is utterly ridiculous. Not alone that but it should be given across the board. I agree that no young person and, for that matter, no not so young person wants to be on the dole queue. The majority want work and there is an obligation on the State to provide work for them.

There is no longer any outlet for our young people. The emigrant ship is no longer there. It should be a top priority for all parties here to see that the unemployed are put back to work. Last year a large number of school leavers could find no employment. This year that number will be increased by those leaving school this year. What have we to offer them? Has democracy failed? That is what the young people are asking. We must put our heads together to solve the problem and I would like to see an all-party committee of this House getting together to solve the problem.

Mr. Enright

I welcome the Bill. An incentive is necessary in order to provide employment for young men and women and for the not so young also who, through no fault of their own, have lost employment. Even if the employment situation improves, this scheme will still be an incentive because it will be a bonus. On an earlier measure I pressed for the inclusion of agriculture in this scheme. I welcome its extension now to agriculture and so will many farmers. There is widespread scope for the development of employment in agriculture and there is a growing need in that industry for young active men and women. I would go further now and suggest that local authorities might become involved in this scheme.

The Minister is to be congratulated. Many doubting Thomases said the Bill, when first introduced, would not have the effects it did have. I believe good progress has been made. I represent a rural constituency and certainly Laois-Offaly have reaped the benefits of this scheme. Were it not for the scheme many of the industries giving employment there today might never have got off the ground. This scheme helps to meet overheads and costs. It goes some way towards paying the price of the social welfare stamp. The cost to the Exchequer is not prohibitive when one considers the return from productive employment and there is a saving, too, from the point of view of social welfare benefits.

I see the date here is 8th January, 1977. I do not think it is wise to have any curtailment and I would have left it open. I certainly believe the Minister was right in his approach originally. The scheme has proved beneficial.

Minister for Labour (Mr. M. O'Leary)

I would like to avail of this opportunity to ask once more for the co-operation of employers. Thousands of young people have been brought back into gainful employment by means of this scheme. I ask all personnel management and production planners now to consider seriously the advantages. I have asked all our manpower offices to contact local employers to examine afresh the steps by which this scheme at the new rates may, with co-operation from employers, succeed in reducing local unemployment. Traders councils and chambers of commerce can assist by informing affiliated members of the advantages of the scheme. I am especially anxious that the scheme should be availed of by those industries most seriously affected by the recession. I refer to the textile, footwear and engineering industries. That is not to say that the scheme cannot assist new industries. It can assist such industries as pharmaceuticals, electronics and the petro-chemical industry which are still in their growth stages. The premium by providing an incentive to employers to increase their workforce ahead of requirements puts them in a better position to expand production ultimately. There is some evidence that the level of recession in some of our industries has now been reduced to a level consistent with a slowing down in overall demand. We should not allow that situation to persist for so long that we are unable to meet the initial surge of demand that is sure to come. The PEP will make it easier for employees to get a job and for employers to offer employment. I would appeal to the employer who is delaying taking on workers until he sees more positive signs of an upturn; the programme gives him a substantial inducement to take on new workers.

In previous recessions one could say that unemployment lasted longer than necessary because employers traditionally met improvements in demand after a recession by increasing the overtime rather than the number of workers on the payroll. This programme will enable employers to take on workers now in anticipation of the improvement that is already evident in other economies and the signs of which are appearing in our economy.

The international economic position is brighter than it was, the growth rates of the major economies are improving and there are signs of a new level of international co-operation in the management of world economies. The agreements reached on planned growth in the OECD and in the EEC suggests that recovery can be sustained without a recurrence of extreme inflationary pressures. We were unable to attend the tripartite meeting in Luxembourg last week because of the lack of agreement on pairing arrangements. This country played a large part in bringing about that meeting; we put emphasis on the social policy of the Community, we considered there should be this meeting regarding the social and economic policy of the EEC and we maintained that the Community should answer up to the jobs crisis.

At the meeting in Luxembourg last week it was agreed that a growth rate of 5 per cent per annum should be targeted for with the objective of reaching a satisfactory level of employment by 1980. It is not to claim too much, rather it is to be accurate, to say that in Ireland unemployment, seasonally adjusted, stabilised during the second quarter of this year. In absolute terms, the numbers on the live register dropped by about 9,000 people. It is not to claim too much but it is a point of hope that must be noted since it is accurate and based on scientific evidence that the pattern observable in the employment situation here is in contrast to that prevailing in Northern Ireland and Great Britain where unemployment continues to rise. This would seem to confirm that the pattern of unemployment here is now more closely approximating to that in the rest of the EEC rather than Britain, as was traditionally the case. Before our entry into the EEC, our unemployment position went hand-in-hand with what happened in Britain. We are now seeing increasing evidence that because of the growing dependence of our economy on the EEC our employment pattern and the structure of our economy is becoming more closely aligned with that of the more modern economies in the rest of the EEC.

Unemployment is unacceptably high and nobody will deny that, but it is a fact that it is coming down in Ireland. That is a matter of cold statistics. There are still too many people unemployed but we should note the encouraging signs and see what they confirm, namely, that our unemployment pattern is becoming more aligned with the rest of the Community. Of course, the position in the rest of the Community leaves little room for complacency. There are still too many people unemployed in the EEC. We have been seeking a response at Community level to these problems.

There is one great reservation that must be applied when talking about the unemployment situation here. If we are to maintain this more hopeful tendency, of our economy being aligned with the position in the other mainland economies of the Community, it is essential that our economic industrial costs be held at levels that will facilitate a significant and early reduction of present unemployment. It is essential that those costs be kept down if we are to have an early and significant reduction in the present unemployment figure.

I would not claim that the programme we are discussing is the answer to our unemployment crisis. It is not, but it is a component in the overall answer. It is an element that we thought would be helpful in inducing employers to take on workers during the recession. It is true that I set an objective of 10,000 people to be re-employed under this programme and it is true that has not been realised. The programme needs the co-operation of employers if it is to be successful. If the employers do not consider it is in their interests to bring new employees into the work force, the programme will remain underutilised and, obviously, that happened during most of last year. Despite the most energetic attempts of officers of my Department, of the National Manpower Service and of the training authority, the total of our efforts were 5,000 people back at work. However, we need not be ashamed of that figure. Some 5,000 Irish people have got jobs because of the programme and for this alone the programme has been worth while. Certainly it vindicates those who believed that an extension of the programme was called for and who argued for improving the financial inducements.

The vast majority of the re-employed workers came back into manufacturing industry. The scheme was drawn up to help industries that were in a serious situation and there is no doubt that those 5,000 workers would still be out of work were it not for the existence of this programme. Deputies on all sides who have spoken on this measure in the House and who have supported it should feel some satisfaction that the fruit of our legislative endeavour had this practical good effect for so many Irish people. There is a great deal of rhetoric spoken on the subject of unemployment but in this instance many Irish people have been brought back into employment. We should not think the measure was not worth while. It has been of great value.

I am far from satisfied regarding the extent to which the scheme has been used. There is evidence that as the economy improves the new incentives will be utilised even more by employers. The increase to £15 per week should encourage those employers who up to now have been reluctant to avail of the scheme. We heard from Members opposite some of the criticisms that were mentioned previously. Probably the one heard most often is the reference to the construction industry. The explanation has been given before. The officers of my Department and I would like to see the programme applied to the building industry but, after the most careful consideration, reluctantly we came to the conclusion that the pattern of employment in the industry and the constant job-changing between firms make it unsuitable for the programme. We held many meetings to see whether there was any way of getting over these difficulties but none could be found.

The programme is intended to help those industries which have suffered because of the recession. It is not intended to assist industries or services with an improvement in their employment position as a result of seasonal factors. The thrust of the programme has been to assist those industries worst hit by the recession. Having examined the matter pretty exhaustively, we came to the conclusion that the building industry could not be assisted by this programme and that it is better assisted, as it is assisted, by capital grants paid to it. I will not detain the House by detailing once more the assistance which has been provided to the industry by the Exchequer.

To sum up, the factors which lead to the exclusion of the building industry from this programme are the subcontracting features of the industry which would lead to the possibility of very widespread abuse of the scheme, the diversification of a firm's business between different sites which would make it difficult to administer, the high degree of inter-firm mobility, the seasonal nature of the industry, the difficulty in establishing a base figure, and the most conclusive reason of all, that the industry is most suited to other types of incentives such as financial stimuli under the capital programme and budgetary measures. The industry has had ample help from these sources. The same arguments apply to assistance to local authorities. This in an area better assisted by the Exchequer. This programme is not appropriate for assistance in that area. I do not mean it in any derogatory way when I say most of the criticisms voiced about the working of the programme were heard here before, and I have no doubt they will be heard again. In their heart of hearts Deputies will accept that this is a very constructive programme. It has proved its worth in practice. Its extension at enhanced rates at an extended level is fully justified. People concerned with manpower planning in industries such as bacon factories, flour confectionery, cocoa, chocolate and sugar confectionery, margarine, distilling, malting, brewing, tobacco, the full range of our manufacturing industries to which the programme is applicable, now know that in the extended scheme they have a means whereby they can bring back extra workers at a time when it is in their own best interests to bring back workers. There are signs of a recovery in our own economy, and more definite signs in the neighbouring economies with which we trade.

Mr. Enright

In his introductory speech the Minister referred specifically to unemployment benefit. Somebody could be on unemployment assistance as distinct from unemployment benefit. What is the position of a person on unemployment assistance?

Mr. M. O'Leary

Is the question whether people on unemployed assistance are covered by the programme?

Mr. Enright

What is the position of a person who has been drawing employment assistance as distinct from unemployment benefit?

Mr. M. O'Leary

They must be drawing unemployment benefit. We date it back to 1974.

Mr. Enright

The point is——

An Ceann Comhairle

We cannot have a resumption of the debate. I allowed the Deputy a question but he may not proceed to debate the matter.

Mr. Enright

If a person qualifies for unemployment assistance, why not allow him into the scheme?

Mr. M. O'Leary

He is long-term unemployed. The programme is intended to help those industries affected by the recent recession. There is a limitation on the programme. It is not regarded as the answer to all aspects of unemployment because the main thrust of the Government in this area is through the budget and bodies like the IDA who deal with job creation. This is a limited measure to assist certain of our industries hit by the recession and to bring workers who lost jobs in those industries back to work. The programme is geared in that direction.

Question put and agreed to.

Agreed to take remaining Stages today.