asked the Minister for Economic Planning and Development the estimated percentage wage drift over and above the first phase of the current national wage agreement; if he will outline the Government's attitude to wage drift; and if he will make a statement on the matter.
Ceisteanna—Questions. Oral Answers. - Wage Drift.
3.
It is not possible to give a precise figure for wage drift as official earnings data are not available for the period since the national agreement came into force. Besides, full details of the various individual wage settlements which have been negotiated above the first-phase increase of the agreement are not available. The indications are, however, that the overall increase in average earnings this year could be 16 per cent or more, and that wage drift could make up as much as 3 to 4 per cent of this increase. These estimates are, of course, still very tentative.
The estimated increase in earnings arising from wage drift is unacceptably high, having regard in particular to the substantial standard increases provided for in the 1978 national agreement.
Could the Minister say how much of the estimated 16 per cent is as a result of the carry over effect of the 1977 agreement?
I have not that figure with me, but a substantial proportion of it, perhaps 5 to 6 per cent.
In that case we are talking about a 10 per cent average increase from the current national agreement?
If we are talking about average earnings, yes. In any one year the actual increase in earnings is typically made up of these three components, the carry-over from the previous year's agreement, the contribution from the new agreement in that year plus this third element of wage drift, which is not a new phenomenon. What is new is the extent of it.
Could the Minister estimate at this stage the effect of the carry-over of the first phase of this agreement into next year?
I have an estimate somewhere but it does not relate to this question. I would suggest that the Deputy either table a separate question or that I may come to it later on as there are some questions which touch on that.
Does the Minister accept any responsibility for the massive number of strikes spreading throughout the country at present? Never has the number been so great since the establishment of the State.
That is a separate question.
If the Minister accepts responsibility what action does he or his Government propose to take to bring about peaceful conditions in industrial life?
That is a separate question.
It is related to Question No. 3.
Question No. 4 please.
Can I ask another question? The Minister in reply to Question No. 3 said that wage drift was not a new phenomenon. In roughly what year, or in what decade, was wage drift first recognised by economists as a perceptible phenomenon?
I have seen references to it going back to the early 1960s.
May I take it from that that when the Fianna Fáil election manifesto was compiled the phenomenon was well known and that when the figure of 5 per cent was put down on paper as being a wage settlement which the potential Government would have considered acceptable, they knew in their hearts that it would wind up in practice nearer 10 per cent?
What is the question?
I will repeat it. I asked the Minister if he would acknowledge, in the light of his having admitted that wage drift has been recognised as a distinct phenomenon by economists since about 1960, that a programme which speaks in advance of an election about a 5 per cent national wage agreement must have been compiled by people who knew that if they achieved 5 per cent on paper they would wind up in practice with something nearer 10 per cent.
I am not going to answer the question because I fail to see what the question is and I fail to see its relevance to Question No. 3 on the Order Paper. If Deputy Kelly has a question in that area which can be formulated as a question, I will be delighted to reply.
The Minister did say that the phenomenon which I hear people calling "wage drift" has been recognised for 15 years. May I take it that somebody planning a national wage agreement of 5 per cent in the middle of 1977 must have realised that, if he achieved that on paper, what he was going to get in practice, taking a wage drift into account, which was then known about, would be something nearer 10 per cent?
Yes. Most people would recognise some wage drift.
But the Minister is now blaming that predictable wage drift for redundancies.
I have already said that the unacceptably high level of wage drift this year was a cause for concern. It was not the fact that a wage drift existed; it was the fact that it was so unacceptably high this year. That was not part of any calculations before, during or since the election campaign.
Does the Minister attribute the unacceptable level of wage drift to the Government's decision not to encourage or partake in a new national pay agreement?
I would not, because the problem has been arising from the early months of the period of the present wage agreement.
Does the Minister consider it likely that the carry-over effect of the current national wage agreement into next year could be of such proportions that it would exceed what the Government might set as a desirable wage increase?
I fail to see the purpose of the question. Obviously, if one is making calculations for expected increases in a future year one normally identifies three components: the carry-over effect of any existing agreement, the impact of any new increase and the estimated effect of any wage drift. Therefore, those factors would be recognised.