Programme for Economic and Social Progress: Motion (Resumed).

The following motion was moved by the Taoiseach on Tuesday, 19 February 1991:

That Dáil Éireann approved theProgramme for Economic and Social Progress.”

Debate resumed on amendment No. 1:

To delete all words after "Dáil Éireann" and insert the following:

"Notes that the Government has concluded an agreement with the social partners on theProgramme for Economic and Social Progress.

Notes the Fine Gael proposal of January 1989 for a National Forum for 1992 involving all the Oireachtas political parties together with the social partners in the long term economic and social planning.

Affirms its support for the concept of social partnership as a means of promoting long term economic and social development.

Congratulates the social partners on reaching agreement on pay levels over the next three years.

Regrets that the current Programme was drafted without any involvement of Oireachtas Éireann or of elected representatives generally, apart from some members of the Cabinet, and that many interests in society, notably young people, dependent spouses, the homeless, the unemployed and the non-agricultural self-employed, were not represented in direct discussions on the Programme.

Regrets that the provisions in the Programme in regard to the health service will have the effect of increasing the pressure on hospital beds and of lengthening queues for services.

Regrets the fact that the Government's 1991 Budget is not consistent with the achievement of the fiscal targets set in the Programme, and that the Programme omits essential information as to how the spending and tax commitments contained in it are to be reconciled with the target of broad balance on the current Budget.

Stresses its alarm that the economic projections in the Programme, and the policies of the Government as expressed in the Programme, will not lead to any reduction in the level of unemployment or emigration, and may well increase both, and that the industrial policies in the Programme are not the ones best suited to establishing research-intensive autonomous industry in Ireland.

Regrets that the particular income tax proposals in the Programme make no provision at all to widen the tax bands and thereby to reduce the excessively high marginal tax rates facing low and middle income workers.

Regrets that the Programme contains no commitment to long term structural reform, with a view to creating employment, in areas such as tax policy, food and agricultural policy, the public service, education and social welfare.

and in view of the foregoing, directs the Government to establish an Economic and Social Committee of Oireachtas Éireann, involving members of all recognised groups, which would:

1. review the content of the Programme;

2. put forward remedies for its deficiencies;

3. nominate representatives of Oireachtas Éireann to sit on the National Economic and Social Council;

4. discuss how the Programme ought to be adjusted in the event of the assumptions for growth and tax revenue underlying it not being reached;

5. participate, on behalf of Oireachtas Éireann, in the consultations leading to the drafting of any future programmes for economic and social progress."

—(John Bruton.)

Minister for the Environment (Mr. Flynn)

The last four years have seen a dramatic turnabout in the economic situation of this country. This did not just happen. It was due, for the most part, to the success of the Programme for National Recovery which brought about a unique national consensus on the management of our economic affairs and provided substantial benefits in all areas of the economy.

We are now entering a further stage in the economic and social development of this country. The Programme for Economic and Social Progress, which is set in a ten year framework, will help consolidate the good work begun in 1987 and will continue the national consensus approach to the implementation of economic and social policies. It will gear us to take full advantage of the opportunities of the nineties and leave us with a strong and vibrant economy ready to face into the 21st century with confidence and real hope in the future of our nation.

I cannot over-emphasise the importance of maintaining this consensus approach throughout the decade. We can make progress only if we have a situation in which all interests operate in harmony and work towards common goals. I believe that this is now fully appreciated by the social partners and that they will play their full part in making this programme as successful as its predecessor. It is only with the co-operation of all that we will achieve the growth necessary to sustain the major initiatives envisaged in the social policy area.

For their part, the Government will not be found wanting in implementing their obligations under the programme. The recent budget provides early evidence of this. It underpins the Government's commitment to the economic and social principles charted in the programme by providing additional funds this year for much needed infrastructural facilities and for health, social welfare, housing and education, while at the same time maintaining progress on tax reform.

Time constaints do not allow me to elaborate on these general remarks. Instead, I will concentrate on some major areas covered in the programme which come within my remit as Minister for the Environment.

Only last week I published the "Plan for Social Housing" which contains details of a wide range of new housing measures of benefit to households from the lowest income groups to those on the margins of home ownership. The fundamental principles underlying the plan are to improve access to housing, to widen housing options, to encourage self-help and voluntary and community efforts, to conserve and utilise the existing housing stock and to enhance tenants' rights whether in the private or local authority sector. These new measures represent a shift away from our traditional reliance on local authority housing as the principal means of meeting social housing needs.

The new measures include a new system of shared ownership, with the occupant owning half the equity from the start and with the other half being rented from the local authority until it too can be acquired; a new rental subsidy scheme in respect of the occupants of voluntary housing and substantial improvements to the existing scheme; a scheme for the improvement of existing housing as an alternative to the provision of new local authority housing; a "low start" mortgage allowance for tenants and tenant purchasers leaving local authority dwellings and buying their own by way of a mortgage loan; improved terms for local authority house purchase and improvement loans; provision of sites by local authorities on nominal terms; incentives for the provision of private rented accommodation; and more tenant involvement in the local authority sector and greater tenants' rights in the private sector.

Home ownership — now at 80 per cent — has been the key to the success of housing policy in this country. The new system of shared ownership will build on that by allowing marginal households to acquire full ownership of their homes in stages. It is aimed at households with an income under £12,000, and in order to ensure affordability a rent subsidy will be available to those earning less than £10,000 a year.

The voluntary housing scheme operated by local authorities, with finance from my Department, has been very successful in recent years. Nevertheless, I believe that there is a need to develop alternative approaches to the provision of voluntary housing. For this reason, I am introducing, initially on a pilot basis, a rental subsidy scheme in respect of accommodation provided by approved voluntary housing organisations for low income households. The idea is that the subsidy plus the rental income from the dwellings will allow the organisations to service their borrowings and maintain and manage the dwellings.

The new tenants' mortgage allowance is another important new scheme, but I want to make it clear from the outset that I do not see this scheme as a repeat of the £5,000 "surrender grant", the illeffects of which in certain areas are well known. The proposed allowance is not an "up front" cash grant but is designed to give tenants or tenant purchasers genuinely wishing to move to private housing the advantages of a "low start" type mortgage. I will be keeping its operation under close observation to ensure that it has no unintended effects.

On top of the new measures, not all of which I can deal with today, I am pleased that additional finance has been provided this year for the local authority housing programme. The capital provision for the programme in 1991 is £69 million — an increase of £18 million, or over 35 per cent, on the 1990 outturn. This will enable us to push up the number of starts to 1,500, to maintain good progress on remedial works to substandard local authority estates and, very importantly, to start a new sub-programme costing £2 million this year aimed at ensuring that no tenant of a local authority dwelling is without proper bathroom facilities.

As stated in the plan, I believe that the various new measures combined should, when under full steam, be capable of producing 5,000 units a year. If this is realised, and assuming a continuation of the existing programmes and vacancies at current levels, we should be catering for at least 10,000 households a year. It will, of course, take some time to build up to that.

Most of the measures in the plan involve new legislation and a Housing Bill is, therefore, being prepared as a matter of urgency. However, with the help of the local authorities, I will be striving to get things moving in advance of the legislation.

The fact that there are over 100,000 dwellings in the private rented sector demonstrates the importance of this sector in the overall housing system. Rented dwellings are necessary to cater for those who do not wish to become home owners or those who, for employment or other reasons, need mobility in their housing arrangements. The Government have extended for a year the tax incentives for the provision of private rented accommodation throughout the country, and in the designated areas, these section 23 incentives will be maintained generally for a further two years. Special improvements have been decided on to encourage the refurbishment of private rented accommodation in the designated areas.

In addition, the Government are introducing a whole range of important new safeguards for tenants in the private sector including mandatory rent books, minimum standards applied nationally and improved terms of letting.

All of these measures should help to secure the vital role of the private rented sector in the housing system over the coming years and will greatly improve the lot of tenants, particularly those at the lower end of the market.

It is generally accepted that the well-being or otherwise of our economy is directly relevant to the construction industry. Investment and employment in it derive from economic progress. During much of the eighties the industry was in decline due to the prevailing economic difficulties and employment was down to about 70,000 at the end of 1987. Since then there have been significant changes in the fortunes of the industry — changes which were brought about by the general improvement in the economy and more enlightened and prudent management of the public finances from 1987 onwards. Output in the industry increased by 8 per cent in 1989 and by about 10 per cent in 1990. Direct employment increased in consequence; there was a 10 per cent employment increase or about 7,000 extra jobs between April 1989 and April 1990 and total direct employment should reach 80,000 in 1991.

The total Public Capital Programme provision for construction activity in 1991 is £1,046 million, an increase of over 7 per cent on the original budget provision for 1990. The principal increases occur in the following sectors: roads, sanitary services, are being increased by over £16 million; local authority housing programme — up £18 million; voluntary housing — up more than £2 million; construction investment in the industrial sector is set to increase by £10 million; tourism-related construction activity will increase by £12 million; and energy — an increase of £25 million reflecting increased investment by An Bord Gáis.

The Government appreciate the significant contribution the building industry makes to the economy, especially in relation to employment. Consequently, we deliberately excluded the industry from the increase in VAT from 10 per cent to 12.5 per cent. This exemption, together with the increased capital allocations, will assist in boosting construction output this year with favourable implications for employment.

As to the future, the performance of the industry during the period of the Programme for Economic and Social Progress will mirror general economic progress, which determines the climate for private investment and public expenditure. Having learned the lesson from the eighties, it is important that we get the economic climate correct with low inflation, lower interest rates and reduced public sector borrowing, in order to create the conditions necessary for the industry to operate to maximum capacity.

The Programme for Economic and Social Progress reaffirms the Government's commitment to the environment and recognises the compelling reasons for continued investment in environmental protection and improvement. In short, the Government are committed to implementing policies which will ensure that Ireland's natural environment is fully protected and enhanced for the health, safety and well-being of this and future generations. The environment action programme outlined our strategy for this decade at an estimated cost of £1,000 million. Our approach is based on the concept of sustainable development which seeks to ensure a reasonable balance in all our interests between development and the environment. The principle of precautionary action and the integration of environmental considerations in all policy areas are also vital elements of our strategy.

In line with the commitment in the environment action programme, we have put in place during 1990 amending legislation which significantly strengthens the powers available to local authorities to control and prevent water pollution. Last year, too, we enacted new legislation to clean up derelict sites and to ensure that planning compensation claims — or the fear of such claims — do not force local authorities to back away from their plans to protect amenities and the environment. We will be maintaining the momentum this year, with new legislation on waste.

The Programme for Economic and Social Progress involves the creation of effective and efficient structures within which employment growth and economic development can take place. Similar structural reform will take place in relation to environmental protection over the course of the programme. The new Environmental Protection Agency will be the keystone of a new institutional framework within which cohesive and comprehensive strategies for the protection of the environment can be implemented. The Bill establishing the agency is currently with the Seanad. The requirement in the programme that a balance be struck between environmental protection and economic development is reflected in the duty placed on the agency in the Bill to ensure that a proper balance is achieved between those two vitally important objectives.

Roads are a vital element in any transport system. They are particularly important in our case as a small island nation with a dispersed population pattern on the periphery of Europe. That is why we have committed ourselves to an investment of £616 million over the five year period 1989 to 1993, of which £416 million will be financed by the EC. This is the largest ever single transport investment programme undertaken in the history of the State. It is designed to tackle two fundamental problems in the Irish economy: the high access costs resulting from Ireland's island location on the periphery of mainland Europe; and the poorly developed transport infrastructure hindering development and adding to transport costs.

Let me say categorically at this stage that projected expenditure on the programme is fully on target and all EC moneys will be drawn down. I want also to confirm that we have already secured the maximum moneys available for roads under the Structural Funds for 1990.

I would like to digress for just one moment to refer to some statements made in the recent past by the Managing Director of the Construction Industry Federation when he launched an illinformed tirade on my Department's handling of the roads programme and made suggestions that EC funding approved for the programme might be lost. Despite a statement from me giving the facts of the situation, he appears from recent press reports to be continuing with his unwarranted criticism, so let me state briefly what I have already said. The maximum moneys available for roads under the Structural Funds in 1990 have been secured. The approved roads programme is fully on target and all EC moneys for roads will be drawn down. I sincerely hope this is an end to the matter. The outbursts we have witnessed over the last week or so reflect no credit on anyone, and it is especially sad to find them emanating from a source within an industry which is a major beneficiary of the major roads programme to which this Government are fully committed.

This year we have provided £234 million, £14 million more than 1990 for State road grants, the biggest annual allocation ever made and £201 million is being provided for road improvements, an increase of 7 per cent over 1990. The maintenance grant is £33 million, an increase of almost 6 per cent. These grants, in addition to financing on-going works, will enable work to start this year on eight major improvement projects.

In addition to the increased spending on the national roads, I am pleased to inform the House that the commitment given in the 1989 budget that £150 million would be provided over three years in discretionary grants to county councils for regional and county roads has been more than fulfilled. In fact, total grants over the three years will amount to £173 million. These funds supplement provisions totalling some £170 million made by local authorities, from their own resources, over the same period for works on non-national roads.

Investment of this scale is going to give a major stimulus to the national economy and to the construction industry. The evidence of the enormous strides that the Government have been making in improving and upgrading the country's roads is there for all to see and I am confident that we will have remedied most of the main deficiencies in the network of national roads within this decade.

In conclusion I would like again to pay tribute to the major contribution made by the social partners in the success of the Programme for National Recovery. I believe that the Programme for Economic and Social Progress can build on that success and further strengthen the economy while at the same time caring for the less well off members of our community.

Mr. O'Brien

I suppose we should be grateful that we are offered an opportunity to say something on this Programme for Economic and Social Progress. Certainly this House has had no opportunity to have an input into it and that is serious, though I am glad I am not a party to what is in this document. It is a pretty poor document. If this is our progress for the next three years on the economic and social side it augurs very poorly for the next few years.

The Government talk about tax reform. There is no tax reform. I wish they would stop using the word "reform". They are making some minute adjustments in the tax system and they quickly claw them back whether by additional VAT or an additional health charge. We see again today reports that ESB charges are to be increased. Yet there is nothing about such hidden charges contained in this Programme for Economic and Social Progress.

With regard to tax reform there appears to be a divergance of views on the far side of the House in that the leader of the Progressive Democrats goes along with the budget and the new programme in the House, while externally the chairman of that party appears to be saying something totally different. It makes me wonder who speaks for whom or for what within that party, what is their policy on tax reform, which appears to be their linchpin. It would be interesting to know in what direction that party are moving. Perhaps there is a schism developing within that party. Perhaps they will do the decent thing so that, when a certain Member leaves that side of the House, they will all move over to their former bed when no doubt they will be very happy.

Minister for Industry and Commerce (Mr. O'Malley)

Wishful thinking.

Mr. O'Brien

Not wishful thinking at all.

Mr. O'Malley

I suppose there is no possibility that the Deputy is thinking of going to Dublin South East and that that is why he likes to have a go at our chairman?

Mr. O'Brien

I am not having a go at anybody. I am merely pointing out that their party leader says one thing and their chairman another. I merely wonder who speaks for whom or for what in that area.

On the health aspect of this programme there appears to be a complete turnaround in that it is now proposed that everybody will have access to consultants and public wards. When the Minister was questioned about access to public wards and consultants he replied that basically private patients will not use the public health system. That clearly demonstrates to me that there is no policy on health. Additionally, in the drawing up of this new programme, it appears that it was the trade unionists who wanted a national health service, and that one of the means of achieving that was their putting down a marker for an open-ended national health service we are all aware cannot be afforded.

In the sphere of education there is very little discussion in this document with regard to the eradication of poverty, particularly the poverty traps obtaining. Given the contents of this programme and the people who sat around the table in drafting it it is surprising there was not greater emphasis placed on the elimination of poverty traps. Surely the best method of so doing would be by a proper educational programme, particularly within such poverty-stricken areas now easily targeted within society. There is no reason for there not being a distinct educational policy to tackle such poverty traps within this programme, indeed the composition of the present Government should be affording people an opportunity of sharing in all aspects of education.

The same applies to training and FÁS. People are drifting in and out of courses of 12 months' duration, and emerging in much the same condition as when they began, not trained although they may have gained some little experience. It is time training overall was examined objectively, moved into the area of vocational education which is its proper location. Young people should be trained in some skill even if it entails a two-year course. At least we should ensure that, on completion of such a course, if they must emigrate, they will have a skill or asset to market. We must ensure that they do not drift aimlessly for 12 months merely to keep their names from the live register or some such purpose. That is not what training is all about. I do not see any sign of poverty being tackled within the overall educational sphere.

With regard to housing the only good thing about this latest document is its presentation. It contains no real programme of housebuilding. The Minister for the Environment, who has just spoken, talked about increasing the allocation for house building. In 1986 the allocation for housebuilding was approximately £200 million, which has dropped this year to £86 million. That is a huge cutback in terms of a house building programme. The Minister spoke of joint ownership of houses and so on. I welcome such innovations but, in themselves, they will not solve our housing problem which has been allowed to get totally out of hand in recent years.

Within this Programme for Economic and Social Progress there are two elements, pay and non-pay. In order to get the pay element right or pitched at the right level, a fair price has had to be paid on the non-pay side. As far as I can see, anything would have been agreed in order to arrive at a reasonable pay settlement. I have no doubt that the employers on the social side were not terribly concerned, that their bottom line was what would be the percentage increase agreed.

This Government have been very tardy with regard to Dáil reform. We need a constructive committee system of this House. We need a social and economic committee to cope with all of these issues. Indeed the members of such committees should sit around the table with the social partners ensuring an input from this House into any such policy-making. The absence of such input in the new programme is a reflection on this House and our democratic institutions. We appear to be delegating all of this beyond the House, to be negotiated with various groups of civil servants around tables. This means that, at the end of the day, our contribution is a mere 15 minutes comment on the document as presented. That is not good enough and does not augur well for democracy. We should be very careful because democracy is a delicate animal and we should treat it as such. I contend that the drawing up of such economic and social plans over three years without reference to this House is not a good idea. In future there should be an input on the part of committees of this House into any plans which might bring about such reform.

There does not appear to be much in this programme to improve people's employment prospects over the next three years. For example, there is no reference to the current GATT talks or their effect on this country.

We observed in the budgetary proposals a break in the business expansion scheme provisions. While the Minister has every right to implement changes in such schemes as he sees fit, he should not abolish certain provisions arbitrarily. We must remember that there are many people who will have made plans, invested substantial sums of money, that advisers will have advised people and companies to enter into business commitments on the strength of the then provisions of the business expansion scheme. Such people are now left with egg on their faces having advised individuals and companies to enter into commitments on the basis of the provisions then obtaining but which have been swept away overnight. That is not good enough. It does not encourage investors to get involved in long term projects. The financial institutions selling ideas will be slow in selling because they will not be sure whether the rug will be pulled from beneath them again. This is what worries me.

I agree with the concept of a three year programme because a long term plan brings stability in pay and in labour relations so that companies can plan effectively, knowing where they are going. The programme has not been costed and I hope it has not been bought at too high a price.

I hope that we will have some sort of tax reform as distinct from widening the tax brackets and that sort of thing. The PAYE worker is paying his fair share and he should not continue to carry the burden he has been carrying over the years. I am not happy with this programme. It has been bought at too high a price. If this programme is to be the yardstick for the next three years I do not see any great economic or social progress over the next three years as a result of it.

Minister for Industry and Commerce (Mr. O'Malley)

In my contribution to this debate, due to the fact that I have very little time, I am forced to concentrate on a small number of key issues, namely: the unique partnership between the Government, trade unions and employers which the programme represents; the maturity which, as a country, we have achieved in recent years in conducting our social, economic and political affairs through a partnership rather than a confrontational process; the recognition underlying the programme that no one side has a monopoly of wisdom in dealing with our social and economic affairs; the balance which the programme attains between achieving desirable social and economic objectives and the real constraints posed to their achievement by the huge burden of public debt which still exists and the major economic and geo-political uncertainties facing the world at the present time; the framework for stability which the programme can create in an uncertain world; the importance of developing a social budget hand-in-hand with our economic policies and the importance of ensuring that need and efficiency are the key criteria in developing our social policies; the contribution which changes in company, competition and consumer protection law can make to improving the efficiency of the economy under the programme; and the need for the further reform of our institutions, including the public service, which play a key role in the social and economic development of the country.

I am confident that Dáil Éireann will approve the Programme for Economic and Social Progress. The new programme is a remarkable achievement at a critical juncture in our economic affairs. It represents a unique partnership between the Government, trade unions, employer and farming bodies in achieving realistic and lasting development, on both the economic and social fronts, over the next three years and beyond that to the turn of the century.

The programme is built on strong foundations. Its predecessor, the Programme for National Recovery, achieved a level of success in bringing our public finances under control while, at the same time, underpinning a major expansion of output and employment and an improvement in living standards that few anticipated when it was first agreed. The new programme is based on realistic and sober analyses undertaken by the social partners themselves, by the National Economic and Social Council and by representatives of a number of other institutions and organisations active in analysing social and economic developments.

The new programme coming, as it does, back-to-back with the very successful Programme for National Recovery, is a measure of the maturity we have achieved in recent years in conducting our economic, social and political affairs. We have moved over a short period from sterile confrontation between interest groups to a progressive partnership arrangements on the basis of an objective evaluation of the real issues involved in tackling our social and economic problems. This must be the way forward. The day is long gone when any single source, from the employer, trade union or Government side can claim a monopoly of wisdom in identifying how better living standards can be achieved and sustained for all our people.

While the new programme covers a comprehensive range of issues across the entire field of social and economic development, there are a number of elements, which as leader of the Progressive Democrats and Minister for Industry and Commerce, I consider of particular importance.

Some months ago at the outset of the negotiations for the new programme, I stated publicly that while there was an incontrovertible case for a follow-on agreement to the Programme for National Recovery, such an agreement could not be entertained by Government at any price. I drew attention to a number of fundamental facts that would have to be addressed. I said that within any new programme there would have to be a recognition of the fact that in order to compensate for higher import prices in products, such as oil, the only lasting solution is to increase productivity and competitiveness across all sectors of the economy, and to avoid stimulating further inflationary pressures and higher interest rates through increased public expenditure, sustained by heavy borrowings.

I also drew attention to an international trading environment that will change immeasurably over the next few years under the impact of: the international economic slow-down emerging, especially in two markets of key importance to Ireland — the UK and the United States; the completion of the Single European Market by the end of 1992; the fundamental change likely to arise under a new GATT agreement; the moves towards economic and monetary union in Europe; the political and economic upheaval in Eastern Europe; and the ominous developments then emerging in the Middle East, which have since culminated in today's tragic warfare.

The programme now negotiated has taken these and other factors into consideration. It has, achieved a reasonable balance between the opportunities for, and the real constraints to, development that now exist.

We are now entering unknown territory in many ways, with the major uncertainties surrounding the world economic order to which I have referred. The proposed Programme for Economic and Social Progress provides a structure and a framework for the development of economic and social policies over the next three years and beyond which can provide an important source of stability over that period. This is one of the main reasons that it is to be welcomed and supported. The programme is comprehensive in the range of economic and social policies which it covers.

Some key elements, which are of particular importance are: the overriding principle of firm control of the public finances; the negotiation of which are sufficiently moderate relative to developments in other countries to enable Irish firms which are well managed to achieve, through productivity increases, further competitive gains in internationl markets; the Government's committment to taxation reform. The tax base will be further widened. The standard rate of income tax will be reduced from 30 per cent to 25 per cent by 1993, in accordance with the "Programme for Government" negotiated between the Progressive Democrats and Fianna Fáil in July 1989, and there will also be a single higher rate of tax by that date. A radical restructuring of indirect taxes will be undertaken over the next few years within the context of the harmonisation needed as part of the Single European Market; and the creation of 20,000 jobs gross per year in manufacturing and international services over the period of the programme. The development of indigenous industry will be a priority because of its close integration into the domestic economy, and up to half of all State aids will be in the form of remunerating or repayable forms of funding, including equity.

The programme also provides a context in which developments in the social budget will be framed. As a caring society we must continue to devote a substantial proportion of the resources which are available to us to the social budget in order to reflect a continued concern that the most disadvantaged of our citizens are adequately provided for. In doing so we must, however, ensure that the scarce resources redistributed in this way are concentrated on those whose needs are greatest and that the programmes financed are administered efficiently.

Social welfare, health, housing and education policies are covered comprehensively as part of the programme. For example, through the considerable additional provisions for education set out in the programme, we are investing in our people's future development. I especially welcome the proposed extension of a six year cycle to all secondary schools.

This, together with the commitment to reducing pupil/teacher ratios and allocating additional resources for the educationally disadvantaged, is an opportunity for a major improvement in the quality of the Irish educational system which will contribute to a significant upgrading in the linguistic, commercial and applied science skills available to build strong growth in the industrial and services sectors.

Reforms in company, competition and consumer protection law will make a major contribution to achieving structural reforms needed to support a more efficient and competitive business sector in Ireland. I have already introduced many of the required changes in company law and changes in competition and consumer protection law will be introduced during the coming year.

The new Companies Act will give firms experiencing trading difficulties the opportunity to reorganise and survive, and maintain employment. The new Act will also curb the abuse of limited liability; strengthen the position of creditors both in relation to preserving the assets of companies and giving them greater redress in cases of malpractice; give Irish companies the same flexibility in organising their equity as their foreign competitors enjoy; and provide more effective means for dealing with insider trading.

In the area of consumer protection new measures are planned for the coming year which will, in the case of product liability, impose responsibility on the producers of products and their components for injury or loss caused to persons because of a defect in the product without the consumer having to prove negligence. Measures will also be introduced to curb abuses in moneylending.

In the area of competition policy, the Competition Bill, 1991, which I will shortly be publishing, aims to make competition law in this country consistent with articles 85 and 86 of the Community Treaty. The objective is to prohibit anti-competitive agreements and abuse of a dominant position by enterprises operating in Ireland. Irish firms engaged in trade with other EC countries are already subject to such provisions. The new legislation when it is enacted will extend these provisions to "domestic" activities and ensure that the traded sectors of the economy are not subjected to the costs imposed by anti-competitive practices in more sheltered sectors.

The examination of the institutional aspects of the Irish economy to be undertaken by NESC under the new programme is a significant new initiative. I think there is scope for major reform in this area and this has been a major policy priority of my party.

In the case of the formulation and execution of industrial policy, I have initiated certain institutional reforms in recent months and I am keeping the possibility of further changes under review. I will, therefore, be particularly interested in the conclusions reached by NESC following a comparative examination of institutional developments in other small open economies similar to that of Ireland.

I also welcome the commitment under the programme to consider changes in structures and working practices in the public services as part of the discussions on pay increases above the basic levels set out in the programme and on the approach that will apply to the payment of such increases which involve additional costs beyond 1993. I believe that it is in the interests of both the trade unions representing public sector workers and the Government to develop an agreed approach to the difficulties of an overall public sector pay bill increasing at a faster pace than public expenditure generally. Such an approach must encompass further public service reform which improves the effectiveness and efficiency of the public service, adequately recognises merit and provides greater job satisfaction and motivation for public servants.

Given the grave threats facing our economic future from the events in the Gulf; the possible contraction of many important international economies; the continued difficulties in the agriculture sector and the challenges that 1992 and monetary union may entail, I welcome this programme as providing the basis for protecting the significant progress we have made in recent years in achieving increased employment, improved social welfare payments, taxation reform and control of the public finances. The programme provides an essential framework within which the large scale uncertainties facing the undertaking of development policies at the present time can be dealt with so that a firm launching pad for our next phase of economic expansion can be created.

I could summarise the value of this programme by saying that over a three year period for certain the kind of increases in pay that are being talked about are the equivalent of increases that are taking place in Britain over a one year period and being negotiated and agreed at present. The fact that we are in a position to negotiate pay rises of one-third or less the size of those in Britain is due to the fact that our inflation rate is one third or less that in Britain. It is interesting to note that when leading members of the British Government are asked what particular economic objective they would most like to achieve in the short term, unanimously their reply is a low inflation rate. In this country we underestimate the value of what has been achieved in that regard and the lasting value it will be to our economy and our competitive position.

Not alone as a result of this programme can we maintain the competitive gains that have been made in recent years but we can further increase that competitive advantage. Of the many ways in which that will be to our benefit the most obvious is in the creation and maintenance of employment. Once the present world crisis has passed, as I hope will happen soon, I see a very swift resurgence in employment in the firms who, due to external circumstances, have been forced either temporarily to shed labour in recent weeks, or to put a proportion of their workforce on short time. It is a great disappointment that this is happening but it is because of external factors. However, due to the competitive advantage which Irish industry in general now has compared with many other countries, I am confident that once the external problem has been overcome the employment gains of recent times can be fully consolidated and built upon.

Mr. Deasy

I wish to speak on the agriculture dimension which is referred to in section VI of the Programme for Economic and Social Progress. I cannot understand how the farming organisations signed this agreement. It seems they bought a pig in a poke when they agreed to this measure. On page 67 the programme states:

At EC level, the CAP reform process, which has been emphasising reduced support levels and a greater market orientation, will continue, the outcome of the GATT Uruguay Round negotiations will result in a reduction of overall agricultural support, greater discipline in the application of various subsidies and reduced import barriers.

I fail to see how the objectives of the programme will be achieved nationally if this rhetoric is put into operation. We joined the EC in 1973 primarily to benefit from the advantages which would accrue to agriculture. We joined it for better prices, unlimited opportunities for production and an overall improvment in the economy. We did so in the knowledge that traditional long established industries such as textiles, clothing and footwear, motor car assembly and many others would collapse because of the lack of protection. This area was very sore, politically and economically. Many jobs were lost. However, we were to be compensated by the considerably increased income we would obtain from the agricultural sector.

Now this programme quite clearly states that those improvements and those opportunities are to be seriously curtailed. From an agricultural point of view the programme is an absolute disaster. The proposals mentioned in it, those put forward in the GATT negotiations and by the Commissioner for Agriculture, have not been worked out or priced and their impact on our economy was not taken into consideration when the programme was drawn up. Deputy O'Malley, the Minister for Industry and Commerce, gave the impression that a considerable number of new jobs would be created and that there would be growth. In the agricultural sector we will have nothing but contraction — a reduction in output, a reduction in prices and, consequently, a reduction in the number of jobs at a time when jobs in the agricultural sector are a key element.

Twenty per cent of all full-time jobs here are either in agriculture or in related industries. If one took into account the spinoff effects of employment in agriculture one would probably arrive at a figure of about 40 to 50 per cent of jobs in agriculture either directly or indirectly.

The proposals put forward here must result in a considerable reduction in the number of people in employment in agriculture and related industries. That is not acceptable. We went to Brussels seven years ago and fought the case for milk production on the basis that Ireland had a special position where agriculture was concerned. As a result of that fight we got an exemption which was not granted to any other country in the Community. That created a precedent for all future negotiations involving agriculture and involving Ireland.

I have not heard one word from the Government or the Minister about seeking special treatment where these negotiations are concerned. When we were negotiating a special position for this country in 1983-84 we were repeatedly berated by Members of the then Opposition who told us that under no conditions should we accept any deal in Brussels that would affect Irish agriculture or the Irish economy in any way. There was wholesale criticism because we got an exemption which was not 100 per cent. Now we are expected to accept an agreement that will seriously damage the whole agricultural sector. I am saying that this is just not good enough.

The IFA have priced these proposals if implemented in full at about £500 million. They are being over-cautious in their estimate because I do not think they have considered the knock-on effects of £500 million in direct production. If we lose £500 million in prices we are quite likely to lose a multiple of that in terms of costs to the overall economy. That equation has not been worked out by anybody, particularly by the Government. I do not believe it has been worked out even by the Commission in Brussels. The whole matter must be given serious consideration. We must take a very strident attitude immediately because by our silence we seem to be condoning the proposals which have been made, proposals which will be so disastrous if they are implemented.

The only delegation that mentioned last week in Brussels that they would invoke the veto was the Danish one. Our own Minister, Deputy O'Kennedy, merely stated that he was examining the proposals further. There must be outright opposition if we are to achieve the goals of this programme. We cannot achieve those goals if we have to suffer major cutbacks in prices and production. For instance, the Commission proposals which are referred to at length in this document would cost us something like 10p in the price of a gallon of milk — a 4½ per cent reduction in the quota and a 15p reduction in the price of a pound of beef. They would mean the annihilation of all cereal growers here because if the proposals go through as outlined cereals would fetch something like £60 to £70 a tonne. That would be totally uneconomic in this climate where we have rather moderate or small farms. That price might be obtainable in the plains of Canada or the central United States, in France, or even East Anglia, but certainly not in Ireland.

This, therefore, means the total abolition of grain growing here. In addition, it puts a quota on the number of sheep in the country despite the fact that we are still only 80 per cent self sufficient within the Community where sheep are concerned. The curtailment will mean a reduction in prices for commodities. It will mean a reduction where production is concerned. Overall it is a vast loss of income not only to the farmer but to the economy and will result in a considerable loss of jobs so far as the workforce are concerned.

I have heard no mention whatever of our special position in Europe. The special status we created for ourselves in 1983-84 has been forgotten about in this programme and as I quoted earlier we are expected to bear the worst cutbacks in the Common Agricultural Policy.

I welcome the elements of the programme which refer to the Irish Sugar Company, Siúicre Éireann, which is the subject of a Bill presently going through the House. We agree with the sentiments of the Bill, the privatisation of the sugar company. A private sugar company as outlined in the Bill and as outlined in this programme will be of tremendous benefit to the agricultural community. It will be of tremendous benefit not only to beet growers in the tillage sector but to horticulture generally. When the company are publicly floated they will provide the type of finance which will mean that eventually we will have a flourishing horticultural industry and not be dependent on the importation of products that could be grown at home.

Minister for Health (Dr. O'Hanlon)

I listened to Deputy Deasy denounce the Programme for Economic and Social Progress just as many of his colleagues denounced the Programme for National Recovery in 1988. They now realise that the Programme for National Recovery was a good programme and I am quite satisfied that when the history of this century comes to be written one of the major achievements will be seen to have been that Programme for National Recovery, that programme which helped to bring this country back from the brink of economic and financial disaster.

I am very pleased, as a member of the Government and particularly as Minister for Health, at the manner in which the health services were looked at objectively by the Government and the social partners in the new programme. I am satisfied that we will see major developments in a number of areas in the health service in the coming seven years. On 6 February last year I outlined the principles by which we administer our health services. That is recorded in the Official Report at columns 815-34 so I do not intend to go over that ground again.

I would refer to the debate that was conducted in all developed countries in the eighties as to where money should be spent on health services in future. If money becomes available should it be spent in acute hospitals or in the community? As in other developed countries there is a consensus here that we should channel more money into the community rather than into acute hospitals. The logic is that if you continue to spend all the new money that becomes available in acute hospitals, more and more people will find their way into acute hospitals to be treated for illnesses that can more appropriately be treated in the community. I was particularly glad that the social partners agreed with the Government that the area we must concentrate on in the next seven years is the area of community services. Of course, the community services for the elderly, for those with mental handicap, for those who are mentally ill and for the physically disabled will be strengthened as a result of this programme, as indeed will the dental and childcare services.

Let us look at some of these services. Our services for the elderly benefited last year from the £5 million which was provided in the budget. We increased the number of home helps, the number of public health nurses, the number of care attendants, of day care centres, day hostels, long stay beds and some short term crisis beds. Not alone was the provision of £5 million repeated this year but a further £3 million was allocated for the elderly so that we can continue the developments for the elderly in the community. The same applies to the area of mental handicap and I would be the first to recognise that there are gaps in the service. However, since I became Minister we have continued to increase the allocation for mental handicap well ahead of inflation and indeed as I pointed out last week, the money provided for services for the mentally handicapped has increased by 40 per cent between 1986-91. In addition we provided £2 million, in this respect last year in the budget and a further £1 million has been provided this year. Last year we provided 145 new residential places, 442 day places, respite care for 200 persons suffering from mental handicap and 25 additional support staff for the service. This development will continue as a result of the moneys provided under this programme in the current year.

We also re-established the co-ordinating committees in each health board area, with representatives of the health boards, of my Department and of the voluntary organisations being asked to draw up a list of priorities in each health board area. Again I am very pleased that there will be money available under the new programme to ensure continued development in each health board area.

Under the programme, the same will apply to those who are physically disabled. There will be more support staff put in place, particularly in disciplines that are in short supply at present, for instance, speech therapy, occupational therapy, and physiotherapy. In addition there will be more short term crisis places made available, more day hostels and more residential places for the physically disabled. It is encouraging also that in the section of the programme dealing with the environment more emphasis will be given to the provision of access for the disabled, which is very important.

Those suffering from psychiatric illnesses will continue to be provided for. The report of the working party in 1985, Planning for the Future, has ensured substantial development in community based services for those who are mentally ill and this of course, will continue more rapidly under the new programme.

In this year's budget £1 million was provided for child care services and that of course will ensure substantial improvement in the provision of child care services throughout the eight health board areas. I would envisage also the development, in the next few years, of a child psychiatric service in each health board area as a result of the programme.

We have continued to improve the dental services. In this area £300,000 was provided in 1989, £3 million in 1990 and a further £3 million in 1991. Of course there have been substantial improvements particularly in the area of orthodontistry where there was a difficulty. Improvements will continue as a result of the new programme. It is no harm to look at the moneys that will be provided through the new programme. There will be an increasing amount on the current side each year totalling £90 million net extra in the seventh year of the programme. Over the period of the programme also there will be £100 million spent on capital developments — on the provision of health centres, day hostels, day centres, workshops and all the facilities we need in the community to ensure that we provide the very best level and the best quality of service for all our people.

Other aspects of the programme are very important. For example, the establishment of a performance audit unit in my Department will look at the efficiency and the effectiveness of the service and will compare outputs by different agencies, health boards and voluntary hospitals, to see where we are getting good value for money. If there is some area that is much more costly we will be asking questions as to why that should be. Value for money is, obviously very important because as I have often pointed out in the House, a £1 saved in one area of the health services is available to spend in another priority area. It is very important that we get the maximum benefit for the very substantial amount of money we are spending on our health services. This year the amount of money we will spend on our health services, including capital, will be £1,550 million, a very substantial sum which represents 22 per cent of Exchequer spending on public services as compared with 18.5 per cent spent in 1987.

Improved management is very important and the programme draws attention to this and to the fact that we will be putting in place new organisational structures for the health services. At present we are looking at the Eastern Health Board area which, when all the voluntary agencies in Dublin and the board are included, accounts for one quarter of the total health bill. The Commission on Funding, the Foxe group, drew attention to the need for the development of good management. In a number of hospitals which are spending more than £30 million per year we have put in a general manager because of the sheer size and complexity of managing hospitals of that size.

The programme outlines the change of eligibility status which is a very significant development and one that is very important. At present everybody in the State is entitled to a free bed in a public ward and people with an income in excess of £16,700 are obliged to pay their consultant. After 1 June that will no longer be the case and everybody in the State will be entitled to avail of a free bed — as at present — and will not have to pay their consultant. They will get a comprehensive service in a public ward. That will free up beds for public patients which are taken up at present by patients who avail of their free bed in a public ward but who are private patients of the consultant.

It is important to point out that emergencies will continue to be treated in whatever accommodation is available. The programme recognises the place of private medicine in complementing public medicine here. We have had an integrated system of private-public medicine here since the foundation of the State. It has served the people well and it is important that we should maintain that on the same campus rather than driving consultants out of the public hospitals to private facilities that may be four, five or six miles away and may be one hour's journey away. It is important that the medical staff should be available to patients for as long as possible during the day.

It is fair to say that the medical consultants in Ireland provided a very high standard and quality of service over the years. At present, as the House is aware, we are in negotiation with them on the Gleeson report on higher remuneration. We will be taking into account the change in eligibility status. It is recognised now by everybody — the VHI have stated it and I have stated it in the House — that we do not expect there will be any falloff in the number of private patients. At present there are only 30,000 patients in the VHI who are insured for consultant only; in other words, the other 1.2 million subscribers to VHI are paying a premium for a hospital bed, even though they are entitled to a hospital bed free if they so desire.

Another aspect of the programme which I believe is particularly important is the patient's charter. While we have a very high standard and all our health care staff have a very caring philosophy — something we can be very proud of — nevertheless, I am pleased to see a patient's charter written into the new programme because I have always seen the health service as a pyramid and the patient must be at the top of that pyramid at all times.

The programme recognises the place of health promotion. Health promotion is very important because more and more information is becoming available which frequently indicates that our lifestyle contributes to some of the more critical illnesses from which people suffer, for example, heart disease, cancers of the lung and a number of different forms of cancer. It is very important that we continue to highlight the need for people to look at their way of life, to improve their lifestyle so that they will avoid the more serious illnesses and hazards associated with a poor lifestyle.

Finally, I should like to say that I have no doubt that the previous programme, the Programme for National Recovery, will be seen as one of the major achievements of any Government since the foundation of the State. I am satisfied that the new programme is a very worthy successor. So far as the health services are concerned we will see much more development and will further improve our health service.

Mr. Taylor

In common with other speakers from the Labour Party, I welcome the principles inherent in the development of a programme for economic and social progress. I consider that the Taoiseach has missed a significant opportunity to expand and develop those principles, by enabling the Oireachtas to play a constructive role in the future development of consensus. The Leader of the Opposition has missed an even bigger opportunity, by choosing to take an entirely negative and partisan approach to the exercise.

I am not going to pretend that I like, or agree with, every aspect of the programme, but neither do I want to use this opportunity to score cheap political points. Instead I want to concentrate on the one area of our economic activity where we most urgently need radical reform, and where the Programme for Economic and Social Progress has done little or nothing to effect the changes necessary. That is the issue of unemployment and job creation.

Before I do so, however, I want to say a few words about the decision of the ESB to pass on the VAT increases announced in the budget to their customers. In the constituency I represent, which has one of the highest levels of unemployment and poverty in the country, this decision will cause considerable hardship. It will inevitably lead to many families finding themselves being tipped over the edge when it comes to paying ESB bills, and being faced with being cut off by the ESB. Many families even under the old prices, were cut off by the ESB with ruthless dedication. This additional burden will leave many families, particularly those with young children, without electricity, heating, or facilities to cook. That is in a constituency where, unfortunately, the supply and circulation of natural gas is not available.

When this decision is allied to the local authority rent increases which are now taking place, and the increases in telephone and other heating charges that also flow from the budget, the reality will be that all of the benefits of the budget, such as they are, for families on low incomes will be wiped out. They will be wiped out before low income families even see them. The social welfare increase in the budget, for example, does not take effect until July, while the cost increases are happening now.

The announcement by the ESB will represent for many families the beginning of the unravelling of the budget. It will come to be widely seen for what it is — a timid exercise in economic management accompanied by a great deal of hype and PR polish. The poor remain poor after the budget and indeed for many of them hardship will increase.

The same is true of the unemployed. The budget, and more particularly the Programme for Economic and Social Progress, have done little or nothing for them. In the context of our economic history that may not be surprising, but set against the scale of our problem it is a tragedy.

The experience of the Irish economy since independence has been the failure of job creation. That has been the central fact of our economic and social development. Associated with this, apart from certain brief periods, we have had comparatively high levels of unemployment and unique levels of forced emigration by European standards. Indeed, it has become impossible to consider the unemployment figures released on the first Friday of every month without taking the highest emigration figures in the European Community into account. In this connection perhaps it is worth saying that there has been a great deal of talk and debate — justifiably so — about the legal and judicial extradition of Irish citizens. However, the media are almost completely silent now about the continuing scandal of the economic extradition of thousands of Irish people.

Forced emigration continues at a disastrous pace. There are signs that the total number of people who emigrate this year will not be much lower than last year's record levels. The latest ESRI medium-term review, for instance, forecasts continuing high emigration this year. If there is a slowing down of emigration over the record levels of the last few years it will be because of the recession in Britain and the United States and not because of any huge surge in job prospects in this country.

Forced emigration at any level represents a major failure of our political and economic system. That is a simple fact — our emigration for a number of years has been at, or close to, the levels of some Third World countries. If we cannot do enough to keep our people at home, surely we cannot any longer turn a blind eye to the conditions of young Irish people abroad. How can we read reports, such as the one from the manager of the Conway House Hostel in Kilburn published some time ago, which say that an increasing number of young Irish people in Britain are ending up in prison or in the gutter and not feel compelled to act? The information available about young Irish people in Britain is as follows: a survey of hostel residents in London shows that the average age is 19 years; most of them come from inner city areas in Ireland; and many arrive in England with less than £10 in their pockets. According to some authoritative reports, one in every three people living in hostels in London is Irish and one in every seven people living rough in London is Irish. This is a scandal and our failure to respond to it is equally scandalous; it is nothing less than a legacy of failure by our society. I see it as Labour's task to place back on the agenda the goal of full employment as the fundamental objective of Government. This needs to be demonstrated and expressed as a moral as well as a political commitment.

Side by side with the scandal of emigration — as a statement I issued last week demonstrates — official figures just available now prove that Ireland has the worst unemployment crisis in Europe. The average European unemployment rate was 8.3 per cent for the year 1990, compared to 15.6 per cent in Ireland. In other words, our unemployment rate is still almost twice the European average. If we were developing a league of countries with an unemployment crisis in Europe, Ireland would have the greatest problem in relation to male unemployment and second greatest in relation to female unemployment. Where young people under 25 years are concerned, we have the second highest rate in overall terms, the second highest among males and the fifth highest rate among females, significantly above the European average.

These are official figures prepared under the auspices of the European Commission itself. They clearly reveal the total failure of the Government's inadequate response to our unemployment crisis. Even more, they show the need for the Government to deal with this major crisis by initiating a radical review of the Government's industrial policy. The recent budget has also failed to provide any workable solutions to the everincreasing number of people out of work. The January figures for the live register indicate that unemployment is set to rise by 12,000 in 1991 as compared to last year. If the Government do not immediately implement a progressive industrial policy which will be designed specifically to deal with this crisis our unemployment will shoot out of control to well above the European average.

The European figures do not take the problem of the long term unemployed into account. That is why we in the Labour Party have consistently called for the immediate implementation by the Government and the social partners of an action programme to encourage training and the reserving of a quota of vacancies for the long term unemployed in the public and private sectors.

The European figures to which I have referred show that the only country in Europe with a comparable crisis to ours is Spain. At the rate our unemployment is set to increase this year, we will pass out Spain on the way to the top of this shameful league, unless policies are changed. Our perspective on this issue is this: we believe that growth, competitiveness and job creation can and must be pursued in the context of our vision of a humane, just and democratic economy. However, we recognise that there are a number of critical strategic objectives in ensuring long term economic growth and employment. I should like to spell some of these out as we see them.

First, no small country has achieved self-sustaining industrial growth and expansion in employment based mainly on multi-national investment from abroad. A strong domestic industrial base is of central importance. The objective must be to retain wealth and value-added in Ireland. This is simply not being achieved by current industrial policy. If it were, we would be ensuring that at least some of the £2 billion of repatriated multi-national profits that left Ireland last year was reinvested in this country.

Second, another major factor lies in the fact that here in Ireland we have an inappropriate mix of firm sizes, with too few firms capable of achieving the scale of activity necessary for a sustained long term competitive position in international markets. This is expressed in too low expenditures on research and development, marketing and management development. This problem is greatly added to and is, to a great degree, reflected by our geographic distance from large markets, with high transport costs, small population and domestic market, and a lack of co-ordinated growth and employment strategy by the major EC economies.

Third, I would add to this the irrelevance of privatisation as even a part remedy for our core problems. Privatisation, in Irish terms, is a copycat distraction fostered by the political Right and financial interests who plan to make and share profits from commissions, flotations and the discount pricing of shares. Fortunately, there are examples of public sector, co-operative and private firms which have shown a capability to plan and achieve sustained development. Privatisation in the form of asset sales is simply another form of borrowing whereby future profits are brought forward and used today.

Fourth, the most successful companies in world markets are those with the highest levels of participation by the workforce. This applies equally to companies in Sweden, the USA and Japan. Co-operation rather than confrontation is the central theme in these enterprises.

In addition, the most successful small European economies have been those which achieved a high degree of consensus on economic policy. I am not here only talking of the model which has had some success in helping us to come to grips with our debt problems in the last few years. The kind of consensus I have in mind is only sustainable in the long term if it is based on both equity and the priority of employment in policy formation.

In pursuit of these objectives, the Labour Party have called repeatedly for a radical revamping of industrial policy, which we believe is essential to retain value-added in the economy. Among our proposals are public ownership, part or whole, in the traded sector; public intervention by targeting grants and incentives to overcome the issue of firm size and tax reform through radical changes in the income, company and wealth tax codes with far larger revenues from the company sector. In addition to these measures, we propose to change the orientation of the IDA, getting them to focus entirely on inward investment from abroad, and to fundamentally reorganise the National Development Corporation as the major leader in the development of Irish industry. We cannot hope to win the battle for retaining value-added in Ireland and increasing jobs if we sell our proven winners to foreigners.

Tánaiste and Minister for the Marine (Mr. Wilson)

To begin with I would like to state that despite what Deputy Bruton said about the Programme for Economic and Social Progress I firmly believe that the case in favour of consensus has been proven both here and abroad. Having accepted the merits of this approach some commentators — Deputy Bruton is one — have questioned the creation of what has been termed the fifth estate, a process which operates outside of Parliament and which in some way allegedly circumvents the democratic process. I reject this contention. This programme, agreed as it has been by all the social partners, is an extension of the democratic process. In my view it is the correct way to do business. Having agreed to the programme the House now has the opportunity to debate its contents — we heard the remarks of Deputy Taylor a moment ago — in a mature and responsible manner. Also, as the Taoiseach pointed out, any legislation that arises from the programme will also have to go before this House and be teased out in the various parliamentary stages.

There is a certain arrogance in Deputy Bruton's concept of a restrictive democracy. It is a Celtic kind of thing. If the father was a bard the son would be mac a bhaird. If the father was Ó hIcí, a medical doctor, the son, Mac Uí hIcí, would also be a medical doctor. It is an exclusivity philosophy which I do not believe is appropriate to the running of this country. The Houses of the Oireachtas have an opportunity, in their wisdom, to contribute. The trade unions — as a life-long trade unionist I must pay tribute to the trade unions and their leadership for the part they played in arriving at this consensus — the employers, the farmers and the expertise available in the public service contributed to the formulation of this programme and for that reason I have great pleasure in commending it to the House.

I firmly believe that this debate on the Programme for Economic and Social Progress offers us an opportunity not just to discuss its specific provisions but to critically examine the merits of this approach to developing the economy. This approach, based as it is on co-operation — an important word — and consensus, while well established in much of continental Europe is a relatively new departure here. For some the idea of a consensus approach to economic management is anathema. We do not hear very many cries for the class war as we did some time ago. The whole thrust seems to be in favour of a consensus, co-operative approach.

The opponents of the programme will say there is a price to be paid for consensus and that national agreements are in some way inefficient and an attempt to buck the market. We in Ireland have eschewed co-operation and consensus in the past, as this House well knows. Memories of how poor industrial relations cost us industries are still fresh in our minds. We remember only too well how days lost through labour disputes discouraged foreign investors from setting up here. The "them and us", the class war approach to economic management has never worked here.

We have seen how divisiveness has stunted our development in the past and how other small open economies such as Austria, Denmark, Sweden and Finland have achieved far higher standards of living through the adoption of a consensus approach to economic and social development. I am a student of Spain, and all its aspects, and I know that Felipe Gonzalez, the Prime Minister, has been striving sometimes with difficulty, despite the fact that the UGT and the Comisiones Obreras helped him to power, to get them to agree a consensus for the good of Spain. I know, because I love that country, that they are approaching that consensus now.

The Programme for National Recovery negotiated as it was at a time when the country was on its knees gave us a chance to try a new approach. The parlous state of the economy, while setting us a gargantuan task, was instrumental in, like hanging, concentrating our minds and focusing our efforts on the job in hand. The programme set the agenda for the period 1987 to 1990. Our macro-economic policies were set out clearly for all to see. Employers and unions alike agreed to specified wage rises over the period of the programme and the Government committed themselves to significant sectoral and fiscal measures. The various sectors of the economy were addressed and the consensus achieved showed tangible results.

Non-agricultural private sector employment grew by 70,000 since 1987. Inflation fell to the point where we now enjoy the second lowest rate in the Community at 2.7 per cent. Some people argue that it is the lowest; the contender is Denmark. The ratio of debt to GNP has fallen from 131 per cent to 110 per cent and we are moving towards 100 per cent. The standard rate of income tax has been reduced from 35 per cent to 29 per cent, or £6 in £100, and the top rate has been reduced from 56 per cent to 52 per cent, to £4 in £100. VAT has been reduced from 25 per cent to 21 per cent. This has been achieved while at the same time we have protected the fabric of our social services. The weakest in our society, those on social welfare, have been protected. These achievements would not have been possible without the national consensus achieved under the programme. It is now patently clear that our interests would be best served if we all pulled together within a consistent framework.

Our record on employment, taxation and social welfare is one with which I believe we can be well pleased. We cannot, however, allow for any degree of complacency. We have made a good start and that is all. Now is not the time to rest on our laurels. We must build on our achievements and work towards the creation of a new Ireland of which we can all feel justifiably proud.

We are now entering a new era. In his budget speech the Minister for Finance commented that we were 700 days away from the completion of the single market. By my calculation that is down to 680 or so now. From 1 January 1993 things will never be the same again. Our task is to create an economy which can compete effectively against the best in Europe. We have made much progress in this regard. Costs to industry have been reduced and a substantial programme of investment in our infrastructure is in place.

The Programme for Economic and Social Progress has been formulated with 1992 in mind. It has been influenced by the NESC document, A Strategy for the Nineties. In this document, the council emphasise the continuing need for consistent budgetary, monetary and exchange rate policies. They also stress the importance of consensus on income developments as a means of improving competitiveness and preserving industrial peace. The council furthermore call for a radical policy programme covering the whole range of public sector policies, especially taxation and social issues.

The Programme for Economic and Social Progress develops in detail the policies suggested by NESC. The programme is set in a ten-year framework and provides a comprehensive strategy for national development. It addresses all the main elements of the economy. It sets a coherent agenda which we intend to follow. It addresses in an earnest and honest manner the economic and social issues facing the country.

The programme commits us to reducing the ratio of debt to GNP to 100 per cent in 1993 and to 75 per cent or less by 2000. The achievement of these targets is crucial to the implementation of the other elements of the programme. The continued reduction of the debt overhang will have two main spin-offs. It will increase investor confidence in our capacity to manage the economy and will also free the resources otherwise expended on debt service. In this regard it is instructive to note that debt service absorbed three-quarters of the total income tax take in 1990 and will cost £2.4 billion in 1991.

Living standards should continue to rise over the period of the programme. The Government are committed to ensuring that the fruits of growth are spread evenly. While we have said that expenditure will not be allowed to rise as a proportion of GNP, it is our intention that growth in the economy will finance improvements in public services.

The Programme for Economic and Social Progress commits us to a ten year programme which will transform Irish society. That it goes much further in its provisions than the last programme is a tribute to the success of that programme. It addresses all the key areas of Irish life. Its pay and tax provisions will improve the standards of living of those at work while its commitments on social welfare will protect those most vulnerable in our society.

I will now progress to Marine matters. Our purpose, according to the programme, is to secure higher value-added through improvements in quality and fish processing in Ireland, to increase supply of fish generally through higher take-up of existing fish quotas, additional catches of non-quota species, mainly horse mackerel and tuna, and higher output from the aquaculture sector, to prepare the fish processing industry to compete successfully in the Internal Market and to increase the contribution of the inland fishery resource to the national economy, particularly through increased tourism.

Briefly, our policies for the fishing industry are backed by a programme of investment in ice plants, processing facilities and the construction and modernisation of our fleet. A Community support framework providing for an investment of £30 million in fish processing over the period 1991-93 has been agreed. An EC assisted programme of investment in our facilities at ports has also been agreed. The development of our fishery resource depends on the quality of the infrastructure on which it operates. Fishery harbour development programmes, providing for investment of £20 million, are in place. This includes £7.5 million Structural Fund aid under the operational programme for rural development.

This is an integrated approach to the development of our fisheries. It is geared at developing the upstream and downstream elements of the industry, from landing to final processing. Much progress has already been made. Employment in fishing, fish processing and aquaculture stood at 15,600 at the end of 1990; the comparative figure or 1975 was 8,130, so it has almost doubled since then. The programme to which I just referred will result in the creation of an additional 1,450 full-time and 1,400 part-time jobs in the period 1991-93.

I also have responsibility in connection with commercial harbours. An investment programme amounting to £69 million is in place to develop these ports. I have looked but briefly at my own area of responsibility and I do not think I have much more time to deal with the other parts of the programme. Our economy is programmed to grow although not at the very strong pace of recent years. Nevertheless, progress towards our objective will continue. The budget was the first instalment of the new dawn heralded by the Programme for Economic and Social Progress. Even in this, a relatively difficult year, progress on the correction of the budgetary imbalances will continue. At the same time, tax rates have been reduced further and social welfare payments have been increased significantly. There will be no let-up in our drive to achieve the targets we have set ourselves; our record speaks for itself.

We inherited a country on the verge of bankruptcy, in four short years we managed to arrest the decline and turn the country around. Confidence has been restored and we can now look forward with real hope to the future, confident in the knowledge that we have a programme in place which will ensure that we never again plumb the depths experienced in the mid-eighties. Dá bhrí sin, tá áthas orm an clár seo chun forbartha eacnamaíochta agus soisialta a mholadh don Teach.

Mr. Kenny

The programme under discussion in the House begins with a statement that the Government, the ICTU, FIE, CII, CIF, IFA, ICMSA, ICOS and Macra na Feirme agreed this programme to succeed the Programme for National Recovery.

The debate to date has been nothing short of a complete and total sham. The elected representatives of this House are sent here by people from all walks of life. They arrive on Tuesdays with their bags bursting with medical card claims, queries in relation to hip operations and a broad range of personal problems. The people had no input whatsoever to this agreement or the formulation of this policy which is to take us over the next number of years as we approach the end of this century.

The democratic right of people to elect representatives to this House is paramount and fundamental to our democracy. This charade of Government speeches paraded before us, indicating that everything in the garden is rosy, is a sham as far as proceeding politically is concerned. It is brilliant from the point of view that it ties down all the named organisations to the conditions of the plan and to the programme in general. If things go wrong it allows them very little scope to get out of the situation in which they are now in.

The programme, and the Government, operate in a situation where unemployment is approaching 250,000 despite having the highest levels of emigration in Europe. There is complete and utter frustration among the rising generation in terms of the availability and the ability to create jobs. The recent budget brought in VAT charges for clothes and shoes, medical lists continue to grow despite all the verbiage in relation to hospital waiting lists and we are now faced wih rumours of further increases in telephone and ESB charges. The viability plan for An Post will decimate the heart and soul of rural Ireland; we must compete with a recession in Britain where the Construction Federation expect a further 100,000 redundancies this year, the largest percentage of whom will be Irish. We also have to cope with the effects of the recession in the USA, not to mention the consequences of the Gulf War.

The haemorrhage of the life-blood of this country is a national scandal and every political representative on all sides, all bodies and those who have left this country — or who have been forced to leave the country and who have now climbed the corporate ladder in other countries — are all guilty to an extent. However, the Government stand indicted for their failure to tackle this most serious human problem. There are vast areas of this country which have been cast to the winds. A recent report on peripherality indicates that not one of the Euro routes recommended would even touch the province of Connaught. How then will the children of the nation be treated equally? It is perfectly obvious that the reforms mentioned by the Commissioner for Agriculture — a west of Ireland man — were merely drawn up to appease the United States. These proposals will have devastating implications for the livelihoods of a great many people despite the attempt to put across the emotional argument that 80 per cent of the profits are divided among 20 per cent of farmers and the Commissioner's indication that he will be able to reverse this trend. There is no doubt that price reductions in the beef, dairy and grain sectors will have devastating consequences for those who eke out a living from the land.

The section of the programme entitled "Strategy for the Nineties" is very vulnerable, given that the nature of politics has changed in recent years. Because of this international decisions can immediately affect a broad range of people and activities. The programme envisages the creation of 15,000 new jobs in tourism but I do not believe for one moment that our young people are going to spend the rest of their lives either carrying suitcases as porters or working in B & Bs or other small establishments. The activities of the Provisional IRA in Britain in recent days, and indeed on the Continent in recent times, have heightened fears and will prove devastating in terms of attracting people to this country. This is a national scandal and those who engage in these terrorist and treacherous activities are doing down this economy and every single person in this country.

I would like to see the Minister for Labour initiate an investigation into the relationship between training and productivity and output. Studies carried out in Great Britain and Germany indicate quite clearly that the higher the quality of training the greater the output and productivity. In recent years we have tended to pump money into basic schemes with the trainee receiving at the end of the course a paper certificate or having a qualification which is very low down the skill ladder. The Government's aim should be to increase the production of high quality goods at competitive prices which people abroad will buy, as this will be of help to the economy and provide an incentive to stay to those thinking of leaving.

I listened with interest to the contributions of the Minister for the Marine to this debate and on Question Time. He stated that he has no funds at his disposal to repair those piers and slipways which were wrecked during the recent storms. Because of the damage done some fishermen in the west are unable to land their gear at these piers to prepare their boats before the fishing season commences in a number of weeks.

I also listened with interest to the contribution of the Minister for Health who has condemned people to be prisoners of pain. It is an absolute scandal that people are nearing the end of their lives with pain etched on their faces simply because the Government have been unable to deal with the waiting lists for orthopaedic operations. Furthermore, the vast majority of those waiting for cataract operations are aged between 70 and 90 years of age, but we have condemned them to darkness and pain in the final years of their lives.

Archbishop Cassidy of Tuam indicated quite clearly recently that 7,500 people have emigrated during the past five years from his parish, which is the equivalent of the population of three small towns. Those people are now living in places such as Camden Town in London or in Boston and in many cases their pride will not allow them to come back here to be deemed failures. They have been let down badly and are the invisible minority in Britain. Studies indicate that deaths from cirrhosis of the liver were 63 per cent above average among those who left Ireland and were unfortunate enough to go downhill.

This programme is littered with clichés and bursting with aspirations and represents a desperate attempt to stave off the political realities which this Coalition Government will be unable to contend with. There are black clouds on the horizon and the people of Ireland will shortly be given their opportunity to voice their opinions and to give their perception of the performance of the Government. This programme will do nothing for the many parishes right across the country which have disappeared or where the people are disappointed and full of frustration.

Minister for Agriculture and Food (Mr. O'Kennedy)

I am pleased to contribute to this important debate. The negotiation of the new Programme for Economic and Social Progress represents a considerable achievement on the part of all those involved — Government and social partners. I think that the development of a broad consensus as to the realistic goals we as a country can strive for and the means to achieve these goals is of major importance — in a decade during which we may be faced with unprecedented challenges, with the likelihood that there will be more uncertainty and a more risky external economic environment in the short term future.

A key feature of the programme — and of overall Government policy — is that the macroeconomic environment of growth, inflation and interest rates should be as favourable as possible. It cannot be stressed too often that keeping inflation and interest rates as low as possible is especially important to the welfare of the farming community. Our record on inflation has been exceptional and we now have the lowest inflation rate in the EC. However, interest rates have remained stubbornly high, due mainly to the high level of interest rates internationally and within the European Community.

On the strictly agricultural front, there are also a number of major concerns at international level — for Government and for the farm organisations. Both the GATT negotiations and the CAP reform which will be discussed during the coming months could have serious implications for Irish agriculture. The opening paragraph of the section on agricultural development in the programme provides an opportunity to state clearly what the Government's overall approach to these negotiations is. It is worth quoting in full:

The agriculture and food industry continues to be of central importance to the Irish economy, in terms of its contribution to national income, the balance of payments and employment. The Government are committed, through their domestic policies and their stance on the development of EC and international policies, to maximise the contribution which the sector will make to the future of the economy.

Against this general commitment, there is a further important undertaking in the programme that I would, from the earliest possible date, enter into discussions with the farm organisations which are a party to the programme on the approach to be adopted to the EC's Commission's reorientation proposals and would maintain close contact with them as the Community negotiations on these and as the GATT discussions develop. I am glad to inform the House of some progress on this commitment. Shortly after the programme was agreed and prior to the February meeting of the Council of Ministers at which the CAP reorientation ideas were discussed, I had a very useful meeting with the farm organisations. At that meeting, we arranged that further regular meetings would take place.

There is a further important commitment in the programme that the Government will review all national policies relating to the agriculture and food sector and negotiate with the farm organisations a new development programme for the sector. On this subject of consultation I have accepted a recommendation of the Agricultural Policy Review Group that a forum involving representatives of farmers, food processors, workers, consumers and environmental groups should meet annually to consider aspects of current agricultural policy with a view to obtaining a wider input into the policy formulation area.

These various provisions of the programme should leave nobody in doubt as to the Government's commitment to maintaining the agricultural and food sector as a crucial and vibrant part of this economy.

I would now like to turn to a number of the more specific undertakings in the programme which underline this commitment in the short to medium term.

On structures the programme provides a number of important commitments. The extension and reclassification of the disadvantaged areas is clearly of major importance. I expect a formal proposal will be made by the Commission to the Council of Agriculture Ministers in the near future and I am hopeful that the final decision to be approved by Council will be in line with the Department submission which proposed that two million acres — 72 per cent of the total area of the country — be classified as disadvantaged. I have also agreed that an effective appeals system, including resurveying where necessary, will be put in place as soon as the Commission proposal on extension of the areas is transmitted to the Council. It is my intention that it will be an independent appeals tribunal which will sit at various locations throughout the country.

A further major development agreed in the programme was that the increase and modulation of headage rates originally intended to apply in 1992 will be brought forward to 1991. The full benefit of the revised headage scheme payments in respect of 1991 should, on this basis, be £100 million compared to £67 million previously.

Standard costings used for farm investment aid schemes will be indexed to apply from 1 August each year, starting in 1991, based on appropriate CSO figures. I know that this issue has been a source of concern for a number of years for farm organisations and I am glad that the new programme has finally laid the issue to rest.

On livestock products, the country has, at present, its highest ever level of stocking. This fact is an important commentary on the investment made by farmers in recent years and on their confidence, as well as on the progress made over the years in the production of fodder. I am very conscious that maintaining high stock levels, particularly of beef cows and sheep, is important in sustaining farm output and income. Thus, I was pleased to agree in the programme that policy measures aimed at keeping stock levels up would be kept under review. In line with this, the Minister for Finance, announced in the budget that the existing provisions would be extended for a further two years.

A further matter of considerable concern to farmers was also addressed in the programme. There is a commmitment that the Government will, as appropriate, through national action and, if necessary, seeking to have the relevant community regulation amended, ensure that the tendering system for intervention purchases of beef is properly operated so that cattle prices to farmers fairly reflect the benefits of intervention prices for our beef. All interests in the beef sector have realised that the development of the industry must be market led rather than support driven. This requires a national effort from producer through to processor to exporter to deliver the high value-added products the consumer wants and to adapt to new needs and tastes in supermarkets and other retail outlets.

Our commitment to the implementation of schemes and programmes aimed at improving the marketing and quality of Irish food is also explicitly signalled in the programme. Public funding for CBF was increased by £250,000 in 1990 and by £1.5 million in 1991. CBF have a policy of promoting the sale of quality Irish beef in supermarket outlets. In line with this policy a promising CBF promotion was held in the prestigious El Cortes Ingles hypermarket in Spain in November 1989 and this will be followed up by other special promotions which I myself will launch in Spain next month. The success can be judged by the rapid increase in interest in Irish beef from other premium retail groups. These follow a very successful campaign in premium retail chains in Italy in which I was happy to take part. I saw at first hand the excellent reception for Irish beef and the work and effort which has to go into ensuring top standards of quality, packaging and product development at all times. Irish beef was promoted in six premium retail chains. The reason for the success is largely that Irish beef is seen as being produced under natural conditions. We must guard and enhance this image. In this connection I welcome CBF's work on a quality assurance scheme for beef. This will build on the remarkable success with the pigmeat quality mark.

The Government are committed to maintaining an adequate level of support for CBF in future years in the context of an overall industry programme, including additional industry financing, for greater emphasis on promotion and marketing of Irish meat.

A very unwelcome problem besetting the beef industry has been a tendency to use the illegal growth promoter known as Angel Dust. I have introduced stringent regulations to deal with the situation and I am determined to stamp out this problem. In order to supplement testing at factory level, under an EC approved plan, I established a special team to ensure these regulations are observed at farm level. This intensive campaign will continue on a countrywide basis and offending herdowners will be prosecuted.

The resolution of this problem is clearly within the control of the industry itself. It faces a clear choice whether it wishes to embark down the road of creating an industry dependent on the use of these substances. I am satisfied, and I think most people would agree with me, that it is not the direction in which we should go. The confidence of consumers, the reputation of our beef industry and our access to vital export markets are at stake. They cannot be risked by the irresponsible action of a small group, and I am taking the most stringent action to protect and maintain the quality and reputation of our beef on international markets.

Ireland must be recognised as the European country with the cleanest water and air, which produces fresh food in a wholesome environment. Environmental considerations will impinge more and more on food production, as there are already clear indications that manufacturers and consumers are conscious both of health considerations and of the impact which food production systems have on the world we live in. Ireland's image of a relatively clean, unpolluted country which produces food with low use of chemical inputs is of enormous benefit in the context of this new emphasis on the availability of unadulterated foodstuffs. However, we cannot be content to live on our reputation. There is a need to offer well graded, well presented, quality products to the consumer. Much improvement in quality standards has taken place over the past four years but it is only by constant diligence that we can maintain and improve that market image.

There is also a commitment in the programme that the necessary resources will be provided to enable Teagasc to provide an effective and integrated service covering education and training, advice and research.

The need to eradicate bovine TB in the context of the stricter requirements which will arise from the Single Market is obvious. The programme renews the Government's commitment to the eradication campaign, which will be based on an improved programme to be implemented over the next three years, including adequate research and removal of all sources of infection. It will ensure that this programme is adequately financed until it is brought to a successful conclusion. In the context of overall funding for the scheme, including EC funding, the programme also committed the Government to examining the question of financing an adequate income supplement scheme for herdowners whose herds are restricted because of TB outbreaks to alleviate the hardship incurred.

In this context I particularly welcome the decision taken in Brussels last week to approve the revised TB eradication programme for the next three years. Subject to ratification by the Commission, this will mean a refund of 50 per cent of reactor compensation payments and is estimated to be worth over £30 million over the three years. I am particularly pleased at the initiative I took at the Council during our Presidency to ensure that a veterinary fund would be set up throughout the EC on which we could draw to support our ERAD-TB programme. That has now been finally put in place and it will be of immense benefit to Irish farmers and, of course, to the hard-pressed Irish taxpayer. The funding will make a considerable contribution to the operation and financing of the ERAD Programme. I believe if the various interests work together we are poised to make a significant breakthrough towards the eradication of TB in the national herd. Since ERAD was established the programme has been strengthened considerably and it would be foolish not to capitalise on the progress which has been made.

I am very committed to the promotion of rural development as an integral part of the adjustment which farming and rural areas will have to face during the coming years. I announced the introduction of the operational programme for rural development at the end of last year and this is now in the process of being implemented. I am also pleased about the commitment in the programme to establish a national programme for rural development. This will draw on the experience of the pilot programme which operated over the 1988-90 period and other initiatives of a similar nature.

Another important development is the EC own initiative on rural development known as LEADER. The purpose of this project is to provide funding to encourage local communities to devise and initiate an integrated approach to the development of their own areas. These groups will be selected by the EC Commission in consultation with my Department on the basis of a business plan submitted by these groups for their own areas. It is my intention to ensure that these funds will be available as widely as possible. I expect that the LEADER proposals will be adopted by the EC Commission by the end of this month.

In the section on farm taxation, the programme makes a commitment that discussions will be held between the farm organisations and the Revenue Commissioners on simplifying the farm profile and extending its use to the maximum number of farmers. I am confident that these discussions can be brought to a satisfactory outcome.

A further area in which agreement was reached within the programme was on the continuation until 1993 of the 50 per cent accelerated capital allowances for approved expenditure incurred by farmers within the framework of the existing grants schemes for the control of farmyard pollution.

I have chosen only a number of the key features relating to agriculture and food which are covered in the programme. Time does not permit a more exhaustive treatment of all the important measures. However, I think it is clear from what I have said that the Government's commitment to the sector remains very strong. I am committed to continuing an effective dialogue with the farming organisations and the food industry as we face into very difficult negotiations at EC and GATT level.

The underlying principle of this programme, that of attempting to arrive at a consensus approach to problems, thus sharing responsibility for solutions, is relevant in the agricultural sector also. At political level, I will obviously negotiate to secure the best possible future for the Irish agricultural and food industry. These efforts will have to be matched by changes at both farm and industry level as we face the major challenges of the markets of the nineties. I believe that the overall framework of the new programme and the specific provisions concerning agriculture provide a solid base for facing these challenges.

Mr. Noonan

(Limerick East): I am grateful to have this opportunity to speak briefly on the new Programme for Economic and Social Progress. On the face of it it is a three-year detailed programme and a less detailed ten-year strategy, the former being incorporated in the latter. At face value it seems to me to be a very bad programme indeed. It is certainly not a plan. It is a most inadequate programme which does not deal with the principal issues facing the country. On the other hand, it does contain a pay agreement which, by and large, is a good one negotiated by the social partners and Government which will maintain the competitiveness of Irish industry. If the pay agreement remains on schedule over the next three years it will be of benefit to our economy.

But the negotiating process to arrive at that pay agreement is what gave rise to the difficulty in the programme. The social partners, to ensure the type of pay agreement they considered desirable, decided to sweeten the deal by a whole series of arrangements for which they did not have to pay themselves. Naturally, the employers' side, if they could trade off a low pay agreement against extra expenditure on education, health, social welfare or reduced taxation, were quite willing to agree without examining its details to any great extent because they they were not going to pay for it anyway. It was the same on the trade union side and in the case of the main farming organisations.

The faults of the programme arise immediately from the negotiation process in order to achieve what I would consider to be a good pay agreement. Quite clearly the main negotiators were the representatives of the Irish Congress of Trade Unions. At present the dominant influence there is that of the public service unions and, from their point of view, they made a rather good deal. Because the employers will not have to pay for much of the programme's proposals except the pay side, they made the agreement. What is good in the programme is the pay deal but the very negotiation process of that pay deal has sowed the seeds of what will be a very bad programme for economic and social development through the nineties.

The Government have sold out on the children of this country and on the unemployed in this programme. I shall deal with that at greater length later. First I should like to comment on the issue of public service pay. Much has been said about public service pay recently, a great deal of it adverse. I dealt with it in my reply to the budget, saying that one would think that public servants were some kind of saboteurs undermining our economy. People tend to forget that public servants, in a spirit of self-sacrifice in 1987, deferred pay agreements to which they were entitled. Those chickens are now coming home to roost. The deferral agreements made in good faith in 1987 must now be honoured and the pay bill met in 1991 and 1992, because that is what was agreed at the time. If there was a fault on anyone's side it was on the side of the Government who pretended that their progress in fiscal correction was more rapid than it was because they did not draw public attention to the IOUs to the public service out there which allowed them make progress at the start which has to be paid for now.

There is a problem with the overall public sector pay bill. I tabled a parliamentary question to the Minister for Finance — which he answered on Tuesday — asking him what percentage of public expenditure was accounted for by public service pay; in 1991 what was the Finance Estimate and what was it in the last year of the last Government in 1986. The Estimate for 1991 is that pay and pensions will represent 55 per cent of all public spending whereas in 1986 it was 46.8 per cent. Therefore, as a percentage of public spending, the public pay bill has risen by 8.2 per cent since the present Taoiseach resumed office in 1987 in a minority Government and continued in this Coalition Government.

Everybody will tell you the Minister for Labour is doing a great job. If he is doing a mighty job he is now doing it at a very significant price, because you would have to search a long way through the records of this House to see the proportion of public expenditure dedicated to the pay bill rise by 8.2 per cent against a background of such low inflation over a short period. In itself that would not be remarkable had it not occurred against the most expensive redundancy scheme introduced by the public or private sector. A colossally expensive public service redundancy scheme was introduced. Taxpayers are still paying for approximately 9,500 civil servants shed from the pay bill. What is happening now? This programme, without any evaluation of the merit of those decisions, is hiring extra public servants into the very areas where they were bought out at such expense. When we look at the pay bill now as a proportion of public spending we must also remember that the public spending figures of the last couple of years have been inflated dramatically by the Structural Funds coming from Europe. Therefore, at the very time one would think that the public service pay bill would be reducing as a proportion of total spending, it has risen catastrophically. The Government will have to do something about it.

It is not enough for the Government to constantly trim the non pay element in the voted amounts for the Departments as they come before this House. What will happen is that we will have county council workers who will not have the tarmacadam to fill the potholes, the people in the corporation will be asked to repair houses but they will not have the materials to do so and doctors and nurses in the hospitals will not have the medical and paramedical equipment they need. Already when one visits the hospitals one sees the tatty state of the wards where light switches and lamp shades are broken, plugs will not work and the wards badly need a coat of paint. What is happening in an attempt to hold public expenditure is that the whole non pay side has been cut back to a point that makes it impossible for public servants to deliver their service efficiently. At the same time the pay bill is rising enormously.

That said, it is a good pay agreement that has been put in place, but the Government will now have to bring forward a major redundancy scheme which they will stick to, to reduce the numbers of public servants. The Government will have to do that in a manner which discriminates between the vast majority of public servants who are excellent, and the minority who are not doing their job and who the public knows are not doing their job. There is no point in bringing in redundancy schemes to take out the good teacher while the bad teacher remains in the system. A public redundancy programme, if the Government are to attack this issue, will have to be selective. It will have to encourage the good, the vast majority who want to do their jobs, who want clear career paths through the public service, who want the same kind of reward and incentive schemes one will get in the private sector. All boats cannot rise together. The price of that is that the public service unions will have to take on responsibility for agreeing that all things are not equal in terms of the delivery of service, and that there is a small minority in the public service who do not deliver a service at all. They are the people who should be attracted out by proper redundancy schemes, as it were.

The tax element of this programme seems to be dominated by the ideology of the Progressive Democrats. The intellectual basis for this programme is the NESC report "A Strategy for the Nineties". The report deals with the issue of tax reform but what has been agreed in this programme runs counter to what the NESC put on the table. Curiously enough the main players in Government were in the NESC. The civil servant mainly responsible for this strategy chairs the NESC. The trade union representatives were there as were the farmers' and the employers' representatives. The only people here who were not involved in the NESC report were the Progressive Democrat Ministers. It seems that the change in tax strategy between this document and the NESC can only be explained by the fact that we have ideologically driven Progressive Democrat people now participating in Government who are advocating a tax policy that does not stand up to the extravagant claims made for it, and which is in effect an appeal by the greedy to the greedy. I do not believe the claims that are being made in terms of job creation for the reduction in marginal tax rates. That does not stand up to any serious tax analysis. What we should be doing is ensuring that the vast bulk of income of ordinary workers, especially those on the average industrial wage, is being taxed at the standard rate. There is no point in pulling down the standard rate of tax from 30 per cent to 29 per cent and pretending that that is tax reform when the bands, allowances, PAYE allowances, PRSI allowances and everything else are not being indexed and when one has the fiscal drag of 3 per cent inflation taking away any benefit that could occur from reducing the marginal rates of tax. I am in fundamental disagreement with what the Progressive Democrats have stuffed down the throat of the Government. I will expand on that when I have more time and will bring forward as a witness to what I am saying the report on tax reform in the NESC document which was the genesis of this programme and to which the people who negotiated this programme signed their names. The only difference was that there was not a Progressive Democrat present at the NESC talks.

The major problem with this programme is that it caters for those who are at work and does nothing for the unemployed or the young emigrants. I understand that there is a facility now for having statistical tables included in the record. One day at the end of November when I had little to do I was putting some figures together, before I had any information on Government finances. On the basis of a growth in GNP of 6¼ per cent in 1991 and 6½ per cent after that, I ran certain numbers. Curiously, if the Government were to balance the budget in 1993, which is their commitment, and if they were to borrow 1½ per cent of GNP to the year 2000 to fund the capital programme, on the basis of those calculations the debt GNP ratio would be just over 74 per cent. The commitment in the programme is 75 per cent. The basis of the calculation I used is very close to the basis of the calculation here. The trouble is that when all that is done, one keeps current spending at about the same level, GNP grows, some of it is dedicated to reducing the debt and some of it is dedicated to ongoing programmes but there is nothing left to invest in jobs. This programme is not only committed to removing the current budget deficit by 1993 but to increasing expenditure by about £600 million. The commitments to fiscal rectitude and to expanding public expenditure amount to around £900 million. That is not compatible with a current budget deficit which is to be eliminated by 1993 nor is it compatible with a debt-GNP ratio of 75 per cent by the end of the decade. Even if we were to give the Government the benefit of the doubt and take the most optimistic set of forecasts, we have a situation where the social partners and the Government have committed us to a strategy for the nineties which simply keeps those at work employed, which envisages a live register of almost a quarter of a million persons right through the nineties and ongoing emigration of 20,000. The FÁS consensus should not prevent us in this House from saying that we do not agree with a programme for the nineties that writes off 30 per cent of our population and does not make any provision for them. This Programme for Economic and Social Progress cannot be a cosy arrangement where the haves will continue to have at the expense of the have nots. It is not a programme for all the people. It is a programme for some of the people. I would suggest, as things have begun to fall out at the start of this year, that it will be a programme for fewer and fewer people as time passes.

I would refer the House to an article on page 15 of The Irish Times this morning. This gives a list, although not a full list, of all the redundancies notified in the last three weeks in the key manufacturing sectors around the country. There is a frightening message in it. I hope it is not the pattern for the year. If it is I have no doubt that by Easter we will be looking at a live register of more than a quarter of a million people. This figure is now at 240,000. We are also looking at a situation where annual emigration will continue at about 30,000, provided that there is somewhere for those people to go. The experience in our constituencies has been that our emigrants came home for Christmas but because of recession in the UK and in the US and because of the Gulf War they have not gone back and will not go back. The seeds of an explosive situation have been sown in every community in the country and this document does not take that into account.

Mr. McCreevy

From the contributions made here today, the authors of the programme should feel well pleased. Opposition speakers have said volubly that the programme does not go far enough in regard to tax reform, wages, employment and many other sector headings. Naturally Government speakers have applauded the same programme and listed its many good points.

I could very easily spend my time extolling the virtues of the Programme for Economic and Social Progress. It would not be a difficult task to undertake because it contains many laudable and commendable features. The programme has received much acclaim both inside and outside the House and very deservedly so. I could litanise its merits and I do not wish that the rest of my contribution should be seen as taking unduly from the undoubted merits of the programme. However, I am perturbed by some aspects and I wish to place my concern on the record of the House.

It is said that the difference between an optimist and a pessimist is best illustrated by how each looks at a glass of water. One sees it as half full, the other as half empty. Although I should like to think of myself as an optimist in life, I have some doubts about the Programme for Economic and Social Progress. This would appear to be looking a gift horse in the mouth, given the success of its predecessor, the Programme for National Recovery. Without any shadow of doubt, the latter programme was instrumental in rescuing this country from financial bankruptcy. The period of its operation from 1987 to 1990 marked a turning point in the depressing downward spiral of the previous ten years. The Programme for National Recovery was soundly based, pragmatic and took a realistic approach to our economic difficulties of some years ago. Combined with tough and often politically unpopular Government decisions, the country succeeded in turning away from the abyss of economic and financial chaos.

The financial chaos of 1987 and preceding years did not come about overnight. To arrive at that deplorable and very desperate situation took some doing. Blame can be pretty evenly apportioned across the political spectrum. All political parties here, with the exception of the Green Party, which was then non-existent, can ignobly claim their share of the blame. We all blamed outside influences, world economic conditions and so on but we know that we, the politicians, were the real culprits.

The period of the last programme brought about a fair amount of growing up for political parties, trade unions and other groups. Politicians have more or less realised that the electorate is not as stupid as they, the politicians, always assume. They do not have to spoonfeed the electorate with more and more nonsense or keep throwing taxpayers' or borrowed money back at them just to keep them electorally happy. The electorate will growl at tough decisions but political parties gain their respect if they operate to a better long term strategy.

In principle I am not opposed to national agreements on pay and conditions between employers and employees but I have some doubts about the present programme. The said doubts could be categorised under a number of headings but my overall concern is the effect that this programme will have on State finances. My caveats about the programme can be sub-divided under three main headings: first, the scope of the programme as it relates to non-pay areas and whether this should be a matter only between the Government and the social partners; secondly, the public pay element of the programme; thirdly the long term commitments of the programme and the ultimate cost to the Exchequer.

To be fair, neither the Government nor the trade unions have ever made any secret of their wish that this programme should be an all-embracing, long term strategy for the nineties, not just a pay settlement. I can certainly see the merits in having a coherent, sound partnership approach to running Ireland incorporated, pursuing agreed goals and objectives in harmony with all interests. From the trade union viewpoint I can readily appreciate their desire to be on the inside track.

In the budget debate last week I referred to my doubts about what I termed the anti-democratic nature of having such a broad programme without participation by the elected Members of Dáil Éireann. There is little in the programme that anyone could disagree with regarding objectives under various governmental headings as outlined in the sections. Furthermore, it is difficult for me to visualise a forum in which Dáil Éireann could participate in formulating such a national programme. To me the list of objectives reads like a legitimate programme of goals that any good Government should set themselves or, if one were to be uncharitable, it reads like a party political election manifesto. Surely the elected representatives of the people must have some say. I am already on record as saying that the ultimate logic of this programme is that people should go and join their local employers' organisation, trade union or IFA branch and ignore Dáil elections. Real power will be seen to rest with such organisations. If every area of national activity is to become the subject of negotiation between the social partners, why bother to have any ordinary Oireachtas Members? All we need is a Government to negotiate with the social partners. To some the foregoing points may appear a trifle academic but I believe they must be made.

I turn next to the public sector provisions. The public service unions are very testy with anyone who voices even the mildest criticism regarding any aspect of pay or conditions for public servants. Constructive comment is thrown aside by their spokespersons as being anti-public sector. Undoubtedly some comments are based on personal antagonism towards the public service, but I certainly am not one with any deep-rooted or ideological hang-ups about the public service. Public sector trade union leaders are very much aware of their clout. Perhaps some of them utilise the strategy of vitriolic abuse against anyone who voices comment or criticism on the basis of their collective political muscle. Politicians, being in the front line of susceptibility to public pressure groups and on the understandable basis that public servants make up a large part of the electorate in any constituency, may be somewhat wary of treading this ground.

I believe in the old maxim that the labourer is worthy of his hire. Such logic dictates that persons employed in the public sector are also entitled to be rewarded adequately for their work, skill and endeavour. Notwithstanding the foregoing, it is my personal belief that the State cannot afford the levels of pay rise agreed in the programme as it relates to the public sector. In my view there is a vast difference between negotiating wage rounds between employers and employees in the non-State area and in reaching agreement with the public sector. In the non-State area market forces will dictate and force, if necessary, an employer who concedes excessive wage demands either to reduce his wage costs by layoffs and/or greater productivity and if the long term imbalance is not corrected it will finally put him out of business. In simple terms if an employer's wage costs are out of line with those of his competitors at home or abroad, he is forced to comply with market conditions. This is not true of the protective employment which those in the public sector enjoy. What is the market mechanism which regulates total wage costs in the public sector? Short term there is none. In the long term the ultimate sanction is the State's financial bankruptcy.

The public service conciliation and arbitration scheme is not a market mechanism. It is an outmoded and outdated system to determine special pay awards and relativities. As a bargaining measure I would have expected the Government, if they were so anxious to have a national agreement which incorporated the public sector, to insist at the very minimum on fundamental changes in the conciliation and arbitration scheme. I am aware that the programme includes a memorandum of understanding in annex I to appendix A, but I do not believe that this memorandum represents a fundamental change. The scheme should be scrapped in its entirety.

Earlier I expressed some doubts about broad aspects of the programme, but accepting the reality that national wage agreements are here for some time to come I believe that the public sector wage deal need not necessarily be part of future agreements. It is like trying to mix oil and water. The Programme for Economic and Social Progress and its predecessor have been endeavouring to coincide the interests of mutually exclusive sectors, employers and employees in the open market arena and the State and its employees in the sheltered sector. There is no evidence to suggest that at any given time all these interests will coincide. To try to put an overall package together which will suit all of these mutually exclusive interests is an incorrect strategy.

From 1987 to 1990 stringent controls were effected on the cost of public pay to the Exchequer. Notwithstanding this, the cost has risen as a percentage of current spending. The wage element of the programme may have released a Scud missile on the public financial discipline imposed over the past three years. I wish to deal with the programme's commitments and its overall effect on the public finances.

An Leas-Cheann Comhairle

Deputy McCreevy, the order requires that I call the Minister at 6.30.

Mr. McCreevy

I have more to say about the broad scope of the programme but I will leave it for another day.

In conclusion, I hope the negative aspects of the programme will not be isolated from its many good points. I sincerely hope that all the programme targets will be met with ease. I further hope that the doubts I raised do not materialise and that I will have the pleasure of saying, in three years time, that my criticisms were ill founded.

Minister for Labour (Mr. B. Ahern)

If I had been speaking in a debate such as this five or ten years ago I might have painted a bleak but not unfamiliar scenario of the period. That scenario would include up to one million man-days lost through industrial disputes. The past year would have been notable for several crippling disputes which caused considerable hardship to members of the public. The most difficult and intractable of these disputes would have been in the public service. Inflation would have been in double figures, largely as a result of pay settlements which we could not afford in either the private or public sectors. The debt-GNP ratio would have continued to increase.

I could continue for some time in this vein but I hope I have made my point. This was a scenario which was all too commom in the last few decades and which I could be describing now once again were it not for the good sense of the Government and the social partners to arrive at pragmatic and balanced programmes for economic and social development covering six years in all. While I am realistic enough to accept that there may be difficulties we should, with the new programme, continue on the same path as the last three years.

The Programme for Economic and Social Progress is unprecedented in the depth of its coverage and content and on that basis is more comprehensive than any similar agreements elsewhere in Western Europe, Scandinavia included.

It is of course by reason of its comprehensiveness that it has given rise to a debate about the role of Parliament and motions such as that put forward by the Labour Party in relation to this debate.

The reality about this issue is, however, that the Government of the day have a democratic mandate to enter into agreements of this nature and Parliament has the right to accept or reject. As the Taoiseach said yesterday, legislation on money arising from the programme has to be passed or rejected by the House in due course anyway. In considering the achievements of the Programme for National Recovery it is important to realise that in 1987 this country was in a state of crisis, a crisis of such depth, despair and hopelessness that the very nature of our political institutions was being questioned.

The Programme for National Recovery brought this country back from the edge of financial bankruptcy.

It is worthwhile recalling the success of that programme as we face into the next three years. The Programme for National Recovery had unique benefits for all the main parties — Government, farmers, employers and unions. It provided a period of economic and social stability which allowed businesses to plan ahead on the basis of known costs. The fact that wages were set for a period of three years at low levels provided advantages in terms of competitiveness vis-à-vis our main trading partners. Employers were able to spend more time on activities related to the important task of providing quality products at the right price instead of warding off prospective disputes over pay.

For the record the Programme for National Recovery reduced Government borrowing from 12.8 per cent of GNP to about 2 per cent; brought the debt-GNP ratio down from 131 per cent to 115 per cent; reduced the current budget deficit from 6.5 per cent to 1 per cent; led to growth rates of about 4 per cent per annum; increased fixed investment by about 8 per cent per annum as against a decline per annum of 4 per cent in the preceding five years; helped bring inflation to the lowest level of any European Community country, contrasting starkly with the position in the UK; brought interest rates to two percentage points above those of Germany — in 1987 the difference was almost 8 per cent; increased numbers at work by a net 40,000 while gross job creation in the private sector exceeded 100,000; reduced the numbers on the live register substantially — it stood at 250,000 at the end of 1987 and was rising by the month; delivered over £800 million in tax concessions; increased real take-home pay by between 4 per cent to 9 per cent; reduced working time for those working 40 hours or more.

Man days lost through industrial disputes in 1989 fell to the lowest level since the last world war. Strike levels have fallen dramatically and there are hardly any disputes about pay. All this amounts to a unique achievement in industrial relations in this country, with obvious "spin-offs" in terms of increased production at home and the creation of an extra important incentive for the attraction of further investment.

From the point of view of employees, real wages increased substantially for the first time in many years. The employment losses of the early eighties were replaced by a similar employment gain. Net employment, as I have already stated, in the three years up to April 1990 increased by 40,000.

We have set a new pattern for industrial relations. Our aim now must be not to rest on our laurels but during the next three years to consolidate that position and, if possible, improve on it so that we can attain conflict levels on a par with the lowest in Western Europe. We must challenge the usefulness of our adversarial system of industrial relations and move towards spreading the consensus which exists at national level throughout the economy and down to the level of individual industries and enterprises.

The amazing fact is — and I use the word amazing advisedly — that all this was achieved while at the same time the standard of living of social welfare recipients was protected and substantial income tax reductions granted. Longterm social welfare benefits increased by 27 per cent while all benefits were protected against inflation. On income tax, reliefs totalling more than £800 million were provided and the standard rate was cut from 35 per cent to 30 per cent.

These last two features are also prominent factors of the new programme.

As regards social welfare, the Government are committed in the Programme for Economic and Social Progress to an ongoing reform of the social welfare system, to continue to protect social welfare rates against inflation and to implement the recommendations of the Commission on Social Welfare. During the term of the programme the Government are committed to improving the level of payments to the tune of £400 million in 1990 terms. We are committed to the achievement of the Commission on Social Welfare's priority rate for all by 1993. Thereafter, social welfare rates will be increased in accordance with the commission's recommendations as the resources of the economy grow. The extra cost of achieving the commission's main rates is £327 million in 1990 terms.

The new programme recognises the role that the family income supplement plays in directing resources to lower paid workers while preserving the incentive to work. The £165 million improvement in family income supplement and the child related tax exemptions mean that families on low pay can be better off than if they were claiming social welfare payments.

It is worth noting that while so much was said in the autumn about low pay, in this debate only one or two speakers mentioned the issue. That speaks for itself. School-going children up to 21 can now be included for consideration for FIS and the restriction on the amount of the payment based on family size will no longer apply.

A family with four children and on £160 a week will now be 36 per cent better off working than if they were receiving unemployment benefit with pay-related benefit. The child-related tax measure will benefit some 98,000 workers with 154,000 children. This again addresses an issue that was crying out to be tackled by the Government.

On income tax, the standard rate will be reduced to 25 per cent and there will be further movement towards a single higher rate.

The programme, however, is not just confined to pay, tax and social welfare. Let me take a few further examples of its wide coverage. On fiscal policy, the national debt-GNP ratio will be reduced towards 100 per cent by 1993, with a longer-term target of a level on a par with that in the European Community in general. On health policy, we will shortly be providing free access to hospital consultant services for the whole population. Extra funding is being provided to health boards for community health services to help the elderly and the handicapped to live in their own communities. On education, which is so important in terms of economic development, provision has been made for the lowering of pupilteacher ratios at both primary and secondary levels, the introduction of a six-year cycle at post-primary level and greater resources to remedy disadvantaged in education. Special provision will be made for 60 additional posts for schools in disadvantaged areas. A Green Paper on education will be published this summer, followed by a White Paper in 1992 and an Education Act in due course after that.

These provisions illustrate the fundamental nature of the new PESP which covers all areas of economic and social activity. Other aspects of the programme relate to areas more related to my own responsibilities in the Department of Labour.

The creation of employment must remain our main national priority. The overall objective of this programme — and other programmes that follow it — must be to reduce unemployment to manageable levels by the end of this decade. As I mentioned earlier, a start has been made but we must continue with the work. Unemployment continues to be an enormous drain on our resources. I think a number of people do not understand precisely the amount of money we spend on both unemployment and training in this country; we are surpassed only by Denmark in the OECD area in terms of such expenditure as a percentage of GNP.

Of particular concern are the long term unemployed. For years FÁS have run a number of programmes for the long term unemployed, the best known probably being the social employment scheme. While these have been very successful, they have only been available in a piecemeal way and they cannot therefore form a coherent programme. What we now need is a new integrated programme which will harness the resources of local communities and the State resources of the relevant State agencies. The new reponse under the programme, which will be implemented shortly will be based firmly in local areas, will have local communities as primary movers, will integrate existing initiative and incorporate the principle of "progression" with an eventual goal of gaining real qualifications and thus a greatly improved chance of a real job. It is in all of our interests to do everything we can to ensure this new response really works.

A feature of the programme is its bias in favour of the lower paid and the pay increases coupled with improvements in the family income supplement should ensure welcome improvements in living standards for the categories involved.

I remain of the view that a substantial contribution to the issue of low pay can be made through the system of joint labour committees which can set down legally enforceable minimum rates for specific categories of employees and in that way strike a balance between market forces and the need to protect vulnerable employees. The Labour Court at the moment is completing an investigation into the feasibility of a joint labour committee for the retail trade which could see the number of workers covered by joint labour committees double in a matter of months. A finding by the court is expected shortly, and if that happens it will remove a great number of people from the trap and it will give them cover, which they never had. In this connection, I would draw attention to the powers of the new Labour Relations Commission to examine the question whether new joint labour committees should be established or the terms of reference of existing committees amended.

I would like to draw the attention of the House to the progress which has been made in legislation during the course of the last programme. This has been sought by the trade union movement and workers generally and it is of great benefit and assistance to them. It will work itself through during the course of this programme. There is a new rationalised manpower arrangement in the shape of FÁS delivering assistance to 55,000 unemployed persons per year; a new Health and Safety Act widening the safety coverage from 20 per cent to the whole workforce; an Industrial Relations Act which amounts to the most fundamental review of industrial relations law since the last war; my colleague, the Minister for Social Welfare has a Bill before the House which will cover part-time workers; and I have a Bill before the House to cover part-time workers under the various labour legislation which they have been excluded from for many years.

The pay provisions are obviously a key element of the agreement as a number of speakers said this afternoon. I think the pay increases have been widely accepted as representing a balanced response to protecting living standards while at the same time ensuring we maintain competitiveness in relation to our main trading partners.

What small criticism of the programme there has been has come from predictable sources and have had the same tone as similar criticisms of the Programme for National Recovery in 1987. Much of the criticism has been directed at the level of pay in the public sector. In the time available I want to answer some of that criticism. In my view this criticism is unfairly directed at public service workers whose numbers have been substantially reduced in recent years and who, in spite of this, continue to provide excellent services to the community. It is only fair to point out in this connection that most of the workers concerned are at the lower end of the pay scale.

The world has changed drastically in the past few years. The pillars on which the political organisation of Eastern Europe were based fell with the Berlin Wall. The ideology on which such political organisation was established also foundered. A new consensus on what should be the nature of political organisation based on the Western European democratic tradition has emerged. It is in the light of such changes that developments here at home must be seen. The future lies in achieving the correct balance between the different interests in our society and not allowing any one particular interest to dominate the others. This amounts to the creation of a delicate equation with many variables and the achievement of such a balance is not easy. It is always easier, as in the case of the handful of so-called independent economists and other critics who have criticised the programme, to have only one variable, to have only one point of view which dominates all others. From that standpoint it is easy to adopt what is in effect a one-sided and intemperate position.

In my view, however, we should move towards co-operation and consensus not just on economic and social policy but also in our industries and enterprises throughout the country. This is the way to beat off greater competition and to create the jobs we badly need. It is in this context that I welcome the fact that a joint declaration on employee involvement in the private sector is to be published shortly. This new approach is an indication of where industrial relations are going in this country.

There have been other criticisms of the programme. In the current economic climate the Government felt that a balance has to be struck between the efficient and effective management of the economy and the achievement of increased living standards and greater social equity. In essence that is what the Programme for Economic and Social Progress is about and it is my firm hope that programmes of this nature will shape the future of our economic and social relations in this country.

Before concluding, I should point out that the programme has yet to be voted on and accepted by the trade unions. The relevant vote, in the usual democratic tradition of the trade union movement, is to take place at a special delegate conference tomorrow. It is my fervent hope that it will be accepted but I would not like to let this opportunity pass without paying tribute to the leadership of the Irish trade union movement which has displayed a very enlightened attitude in putting forward the idea of a ten-year strategy and in widening the collective bargaining agenda at national level from pay alone to other issues of an economic and policy nature of concern to us all as a nation. While recognising and paying tribute to the role of the Irish Congress of Trade Unions, I think we should not ignore the constructive contribution by the employers and farming groups, who put in a massive amount of time as well.

The external environment has worsened. We have the Gulf War and recessions in the UK and the US. We have a worsening outlook in respect of agriculture and we have increased competition for investment from Eastern Europe. We are faced with increased competition in what is fast becoming a free global market.

In these current world circumstances does anything but the type of programme we have just negotiated make any sense? I think the answer to that question has to be a resounding no. We have a stable currency, low inflation and a growing economy. Ireland has become a sound location for investment and the way to keep it that way is through programmes such as the Programme for Economic and Social Progress. It is only through creating the right climate for business and investment that we can create the jobs we need to bring unemployment down to tolerable levels. Our objective by the year 2000 must be a social democracy on a par with the best in Western Europe. We must aim to couple a sound economy, a stable currency and low inflation with adequate care for the weakest in our society and tolerable levels of unemployment. The way to such a society is through programmes such as the Programme for Economic and Social Progress. I have heard nothing from the Deputies opposite which could persuade the Government to take any other view.

I recommend the motion and the Programme for Economic and Social Progress to the House.

An Leas-Cheann Comhairle

The Chair notes the understanding of the House in the matter of time. On amendment No. 1 in the name of Deputy Bruton, the question is, "That the words proposed to be deleted stand".

Question put.

The Dáil divided: Tá, 75; Níl, 63.

Tá

Ahern, Bertie.
Ahern, Dermot.
Ahern, Michael.
Andrews, David.
Aylward, Liam.
Barrett, Michael.
Brady, Gerard.
Brennan, Mattie.
Brennan, Séamus.
Briscoe, Ben.
Browne, John (Wexford).
Burke, Raphael P.
Callely, Ivor.
Clohessy, Peadar.
Connolly, Ger.
Coughlan, Mary Theresa.
Cowen, Brian.
Cullimore, Séamus.
Daly, Brendan.
Davern, Noel.
Dempsey, Noel.
Dennehy, John.
de Valera, Síle.
Ellis, John.
Fitzgerald, Liam Joseph.
Fitzpatrick, Dermot.
Flood, Chris.
Flynn, Pádraig.
Gallagher, Pat the Cope.
Geoghegan-Quinn, Máire.
Harney, Mary.
Haughey, Charles J.
Hillery, Brian.
Hilliard, Colm.
Hyland, Liam.
Jacob, Joe.
Kelly, Laurence.
Kenneally, Brendan.
Kirk, Séamus.
Kitt, Michael P.
Kitt, Tom.
Lawlor, Liam.
Lenihan, Brian.
Leonard, Jimmy.
Leyden, Terry.
Martin, Micheál.
McCreevy, Charlie.
McDaid, Jim.
McEllistrim, Tom.
Molloy, Robert.
Morley, P.J.
Nolan, M.J.
Noonan, Michael J. (Limerick West).
O'Connell, John.
O'Donoghue, John.
O'Hanlon, Rory.
O'Keeffe, Ned.
O'Kennedy, Michael.
O'Leary, John.
O'Rourke, Mary.
O'Toole, Martin Joe.
Power, Seán.
Quill, Máirín.
Reynolds, Albert.
Roche, Dick.
Smith, Michael.
Stafford, John.
Treacy, Noel.
Tunney, Jim.
Wallace, Dan.
Wallace, Mary.
Walsh, Joe.
Wilson, John P.
Woods, Michael.
Wyse, Pearse.

Níl

Ahearn, Therese.
Allen, Bernard.
Barnes, Monica.
Bell, Michael.
Belton, Louis J.
Boylan, Andrew.
Bradford, Paul.
Browne, John (Carlow-Kilkenny).
Bruton, John.
Carey, Donal.
Connor, John.
Cosgrave, Michael Joe.
Cotter, Bill.
Creed, Michael.
Crowley, Frank.
Currie, Austin.
D'Arcy, Michael.
Deasy, Austin.
Deenihan, Jimmy.
Lee, Pat.
Lowry, Michael.
McGinley, Dinny.
McGrath, Paul.
Mitchell, Gay.
Moynihan, Michael.
Nealon, Ted.
Noonan, Michael. (Limerick East).
O'Brien, Fergus.
O'Keeffe, Jim.
O'Shea, Brian.
O'Sullivan, Gerry.
Doyle, Joe.
Dukes, Alan.
Durkan, Bernard.
Enright, Thomas W.
Farrelly, John V.
Fennell, Nuala.
Ferris, Michael.
Finucane, Michael.
FitzGerald, Garret.
Flaherty, Mary.
Flanagan, Charles.
Foxe, Tom.
Harte, Paddy.
Higgins, Jim.
Higgins, Michael D.
Howlin, Brendan.
Kavanagh, Liam.
Kemmy, Jim.
Kenny, Enda.
O'Sullivan, Toddy.
Pattison, Séamus.
Quinn, Ruairí.
Reynolds, Gerry.
Ryan, Seán.
Shatter, Alan.
Sheehan, Patrick J.
Spring, Dick.
Stagg, Emmet.
Taylor, Mervyn.
Taylor-Quinn, Madeleine.
Timmins, Godfrey.
Yates, Ivan.

Tellers: Tá, Deputies Gallagher and Clohessy; Níl, Deputies Flanagan and Boylan.

Question declared carried.

Amendment declared lost.

An Ceann Comhairle

Amendment No. 3, in the name of Deputy De Rossa and other Deputies, falls.

Mr. Spring

I move amendment No. 2:

To add to the motion the following:

"and recognising the importance of social partnership and its potential in developing and consolidating agreed economic and social objectives for the nation, and anxious to ensure:

(a) that the areas of economic and social need highlighted by the Programme for Economic and Social Progress are fully addressed;

(b) that specific legislative and administrative commitments given by the Government on behalf of the Oireachtas in the Programme for Economic and Social Progress are fully implemented;

resolves to establish an Economic and Social Affairs Committee of the Oireachtas, so as to provide an informed and effective parliamentary forum that will complement the important work of the social partners with a clear and representative democratic mandate.".

Amendment put.

The Dáil divided: Tá, 63; Níl, 75.

Tá

Ahearn, Therese.
Allen, Bernard.
Barnes, Monica.
Bell, Michael.
Belton, Louis J.
Boylan, Andrew.
Bradford, Paul.
Browne, John (Carlow-Kilkenny).
Bruton, John.
Carey, Donal.
Connor, John.
Cosgrave, Michael Joe.
Cotter, Bill.
Creed, Michael.
Crowley, Frank.
Currie, Austin.
D'Arcy, Michael.
Howlin, Brendan.
Kavanagh, Liam.
Kemmy, Jim.
Kenny, Enda.
Lee, Pat.
Lowry, Michael.
McGinley, Dinny.
McGrath, Paul.
Mitchell, Gay.
Moynihan, Michael.
Nealon, Ted.
Noonan, Michael. (Limerick East).
O'Brien, Fergus.
O'Keeffe, Jim.
Deasy, Austin.
Deenihan, Jimmy.
Doyle, Joe.
Dukes, Alan.
Durkan, Bernard.
Enright, Thomas W.
Farrelly, John V.
Fennell, Nuala.
Ferris, Michael.
Finucane, Michael.
FitzGerald, Garret.
Flaherty, Mary.
Flanagan, Charles.
Foxe, Tom.
Harte, Paddy.
Higgins, Jim.
Higgins, Michael D.
O'Shea, Brian.
O'Sullivan, Gerry.
O'Sullivan, Toddy.
Pattison, Séamus.
Quinn, Ruairí.
Reynolds, Gerry.
Ryan, Seán.
Shatter, Alan.
Sheehan, Patrick J.
Spring, Dick.
Stagg, Emmet.
Taylor, Mervyn.
Taylor-Quinn, Madeleine.
Timmins, Godfrey.
Yates, Ivan.

Níl

Ahern, Bertie.
Ahern, Dermot.
Ahern, Michael.
Andrews, David.
Aylward, Liam.
Barrett, Michael.
Brady, Gerard.
Brennan, Mattie.
Brennan, Séamus.
Briscoe, Ben.
Browne, John (Wexford).
Burke, Raphael P.
Callely, Ivor.
Clohessy, Peadar.
Connolly, Ger.
Coughlan, Mary Theresa.
Cowen, Brian.
Cullimore, Séamus.
Daly, Brendan.
Davern, Noel.
Dempsey, Noel.
Dennehy, John.
de Valera, Síle.
Ellis, John.
Fitzgerald, Liam Joseph.
Fitzpatrick, Dermot.
Flood, Chris.
Flynn, Pádraig.
Gallagher, Pat the Cope.
Geoghegan-Quinn, Máire.
Harney, Mary.
Haughey, Charles J.
Hillery, Brian.
Hilliard, Colm.
Hyland, Liam.
Jacob, Joe.
Kelly, Laurence.
Kenneally, Brendan.
Kirk, Séamus.
Kitt, Michael P.
Kitt, Tom.
Lawlor, Liam.
Lenihan, Brian.
Leonard, Jimmy.
Leyden, Terry.
Martin, Micheál.
McCreevy, Charlie.
McDaid, Jim.
McEllistrim, Tom.
Molloy, Robert.
Morley, P.J.
Nolan, M.J.
Noonan, Michael J. (Limerick West).
O'Connell, John.
O'Donoghue, John.
O'Hanlon, Rory.
O'Keeffe, Ned.
O'Kennedy, Michael.
O'Leary, John.
O'Rourke, Mary.
O'Toole, Martin Joe.
Power, Seán.
Quill, Máirín.
Reynolds, Albert.
Roche, Dick.
Smith, Michael.
Stafford, John.
Treacy, Noel.
Tunney, Jim.
Wallace, Dan.
Wallace, Mary.
Walsh, Joe.
Wilson, John P.
Woods, Michael.
Wyse, Pearse.

Tellers: Tá, Deputies Howlin and Ferris; Níl, Deputies P. Gallagher and Clohessy.

Amendment declared lost.

Amendment No. 3 not moved.

Question put: "That the motion be agreed."

The Dáil divided; Tá, 75; Níl, 54.

Tá

Ahern, Bertie.
Ahern, Dermot.
Ahern, Michael.
Andrews, David.
Aylward, Liam.
Barrett, Michael.
Brady, Gerard.
Brennan, Mattie.
Brennan, Séamus.
Browne, John (Wexford).
Burke, Raphael P.
Callely, Ivor.
Clohessy, Peadar.
Connolly, Ger.
Coughlan, Mary Theresa.
Cowen, Brian.
Cullimore, Séamus.
Daly, Brendan.
Davern, Noel.
Dempsey, Noel.
Dennehy, John.
de Valera, Síle.
Ellis, John.
Fitzgerald, Liam Joseph.
Fitzpatrick, Dermot.
Flood, Chris.
Flynn, Pádraig.
Foxe, Tom.
Gallagher, Pat the Cope.
Geoghegan-Quinn, Máire.
Harney, Mary.
Haughey, Charles J.
Hillery, Brian.
Hilliard, Colm.
Hyland, Liam.
Jacob, Joe.
Kelly, Laurence.
Kenneally, Brendan.
Kirk, Séamus.
Kitt, Michael P.
Kitt, Tom.
Lawlor, Liam.
Lenihan, Brian.
Leonard, Jimmy.
Leyden, Terry.
Martin, Micheál.
McCreevy, Charlie.
McDaid, Jim.
McEllistrim, Tom.
Molloy, Robert.
Morley, P.J.
Nolan, M. J.
Noonan, Michael J. (Limerick West).
O'Connell, John.
O'Donoghue, John.
O'Hanlon, Rory.
O'Keeffe, Ned.
O'Kennedy, Michael.
O'Leary, John.
O'Rourke, Mary.
O'Toole, Martin Joe.
Power, Seán.
Quill, Máirín.
Reynolds, Albert.
Roche, Dick.
Smith, Michael.
Stafford, John.
Treacy, Noel.
Tunney, Jim.
Wallace, Dan.
Wallace, Mary.
Walsh, Joe.
Wilson, John P.
Woods, Michael.
Wyse, Pearse.

Níl

Ahearn, Therese.
Alien, Bernard.
Barnes, Monica.
Belton, Louis J.
Bradford, Paul.
Browne, John (Carlow-Kilkenny).
Bruton, John.
Byrne, Eric.
Carey, Donal.
Connor, John.
Cosgrave, Michael Joe.
Cotter, Bill.
Creed, Michael.
Crowley, Frank.
Currie, Austin.
D'Arcy, Michael.
Deasy, Austin.
Deenihan, Jimmy.
De Rossa, Proinsias.
McGinley, Dinny.
Mac Giolla, Tomás.
McGrath, Paul.
Mitchell, Gay.
Nealon, Ted.
Noonan, Michael. (Limerick East).
O'Brien, Fergus.
Doyle, Joe.
Dukes, Alan.
Durkan, Bernard.
Enright, Thomas W.
Farrelly, John V.
Fennell, Nuala.
Finucane, Michael.
FitzGerald, Garret.
Flaherty, Mary.
Flanagan, Charles.
Garland, Roger.
Gilmore, Eamon.
Gregory, Tony.
Harte, Paddy.
Higgins, Jim.
Kenny, Enda.
Lee, Pat.
Lowry, Michael.
McCartan, Pat.
O'Keeffe, Jim.
Rabbitte, Pat.
Reynolds, Gerry.
Shatter, Alan.
Sheehan, Patrick J.
Sherlock, Joe.
Taylor-Quinn, Madeleine.
Timmins, Godfrey.
Yates, Ivan.

Tellers: Tá, Deputies Gallagher and Clohessy; Níl, Deputies Flanagan and McCartan.

Question declared carried.

Dáil Éireann debate - Wednesday, 20 Feb 1991

Programme for Economic and Social Progress: Motion (Resumed).

Tá

Níl

Tá

Níl

Tá

Níl

Dáil Éireann debate -
Wednesday, 20 Feb 1991