Dáil Éireann debate -
Thursday, 11 May 1995

Vol. 452 No. 7

Interim Report of Task Force on Long-Term Unemployment: Statements (Resumed).

Mr. M. Brennan

I am delighted to have the opportunity to contribute to this debate. This excellent report by the task force on long term unemployment is long overdue. We must concentrate on training our people for industry. I am not too happy about the way apprentices are being trained. I know from making representations on behalf of young boys that it is difficult for young people to be sponsored on an apprenticeship, particularly in tool making and carpentry. There are builders in a small way in rural Ireland who would be delighted to take on an apprentice but having to pay them when they are doing their one year off-the-job training in FÁS and for the period of block release deters them from taking them on. The builders find it difficult enough to make ends meet when employing three or four people but they would have even greater difficulty in paying someone for 12 months on a FÁS block release course.

Can something be done for small building contractors. I was an apprentice carpenter but at that time you were taken on by a small builder and served an apprenticeship for four to five years until you were a fully skilled carpenter and then advanced to a joinery shop. At that time you only had to serve an apprenticeship and not attend block release courses. I completely agree with the one year off-the-job training in a FÁS training centre but it is difficult for some employers to pay the apprentice when he is doing this course. The same applies to tool making. Small tool making concerns would prefer to take on a trained person because of the cost of training. I ask the Minister to change that. We need industry in rural Ireland and every town and village needs three phase electricity. If it had been available in a small village near me a factory could have set up there which would have employed five people. Instead it had to locate elsewhere. The Minister with responsibility for the west should ensure that every village has three phase electricity and a sewerage scheme. If those facilities were available more people would settle in rural villages.

I wish to pay tribute to a former Member of the House, the late James Gallagher from Tubbercurry, my predecessor. He, more than anyone else, saw the need for industry in the west. He brought the first tool-making factory to the country in the early 1960s and located it in Tubbercurry. As a result there is much industry in Sligo. Sligo Regional Technical College is now the centre of tool-making in Ireland. He also set up the Basta factory in Tubbercurry. Many years ago if you wanted to get a grant for a house a Basta lock had to be fitted to the doors of the house. The industry thrived during those years. However, today architects design massive offices but do not recommend the use of Basta locks or any Basta equipment. All the locks are imported. How do we expect industry to survive if we do not support it? Look around this House and at most Government buildings. There is not as much as one Irish made lock on the doors. Basta now export to Scandanavia, Africa and the West Indies. It is trying to find markets while we import locks. That is a shame when we have such a fine factory in County Sligo which can provide the product.

Our road infrastructure is not good enough although it has improved greatly. It is expensive to bring an articulated truck from the west to the ports of Dublin or Rosslare. Sligo airport is not going as well as it should and Aer Lingus operate only one flight a day to Sligo. It could operate to Carrickfinn in Donegal, Sligo and Knock airports and bring industrialists to the west. Knock airport was used as a political football for many years and one Member called it a foggy bog. However, many people now use this airport.

Farming is not only a great industry but a way of life in rural Ireland. I listened to farmers protesting yesterday that ferry companies and do-gooders will not allow them export cattle. I hope the matter will be solved in the near future.

The Dublin-Sligo railway line, which was treated as a political football for many years, should be upgraded. It would make it easier for industry and those who wish to travel to the west. I pay tribute to the multinationals such as Abbott Laboratories (Ireland) Ltd., and Saehan Media who employ people in Sligo. They are great employers and are doing very well. The workers are happy.

Everyone would like to have a job. Too many people are unemployed. I was talking to people who are happy to be working on a FÁS schemes. Stone towns and villages have benefited from projects under FÁS schemes. Stone walls were built and villages and graveyards were cleaned up. More money should be made available for FÁS schemes. I know they only offer temporary employment but they give people the dignity of working for a while.

Mr. S. Kenny

On the points made by Deputy Brennan on the Gallagher empire and Basta locks, the house I purchased in 1969 was built by the Gallagher group and it has Basta locks, which I had to replace with stronger locks. The Sligo builders did not only build houses in Sligo, they also built houses in Dublin city.

I welcome the Interim Report of the Task Force on Long Term Unemployment and the acceptance by the Government of the key proposal that a nationwide integrated local employment service should be established to bring together Government Departments, State agencies, the social partners and community interests to meet the needs of the long term unemployed. This service honours the commitment in the programme A Government of Renewal to introduce an intensive guidance and placement service at local level. This decision has been made against the background of the serious problem of long term unemployment. Ten per cent of the workforce or 135,000 people are now long term unemployed. A solution to this crisis is the greatest challenge facing the Government and society. By pooling their resources these separate groups can provide intensive guidance, counselling, training, education, job placement and support for self employment as available options for the long term unemployed. This service can provide a gateway to the world of work for the four main groups identified in the report, namely those who have been out of work for more than six months, dependant spouses of the unemployed, lone parents and the young unemployed. A particular difficulty exists for people who are long term unemployed and over 35 years of age. The new service should focus on this group which is at the core of the long term unemployed. While registration with the local employment service will be voluntary, the service should be proactive in reaching out to those most in need of employment.

The report recommends setting up community-based contact points to bring the employment service to the long term unemployed. The contact point developed in my constituency by the north side partnership and the north side centre for the unemployed at Glen Road in Coolock is the model on which the local employment service is based. The north side partnership was set up under the Programme for Economic and Social Progress to develop strategies to combat long term unemployment. It identified the need for an effective local job placement service and various models and approaches were researched before a Dutch model was discovered. This model was adapted to meet the needs and requirements of the Irish market. There are three key elements to the placement programme used by the north side contact point: first, an intensive personal approach to the unemployed and employers; second, it seeks to develop a relationship of trust with the individuals seeking work and potential employers and, third, information is collected from various agencies and organisations concerning the capabilities of people seeking work.

The Coolock contact point understands the supply and demand side of the labour market and it has gained the confidence of both people seeking work and employers. Qualified guidance counsellors and mediators form the core of the team at the contact point. The mediators who have backgrounds in industry, State placement services and education work with the job seeker in analysing his or her position and developing a realistic plan of action to reach the goal of suitable employment. This may require periods of training or education before the job seeking can begin. Implementing the career path is then undertaken by the team who match the needs and capabilities of the individual job seeker with the requirement of the employer.

The contact point was very encouraged by references in the National Economic and Social Forum's Report on Long-Term Unemployment to its importance as a worthwhile model for local placement services. That report launched in the building which houses the contact point in Coolock indicates that the key ingredient in the progress made by the contact point is the cohesion, commitment and unity of purpose of the three broad groups on the board — the community, businesses and trade unions and the State and local authorities. This year the north side partnership was extended by the Government and it now covers Sutton Cross, Kilbarrack and parts of Raheny and Clontarf.

I will give some figures to illustrate the success of the contact point which will be the model for the employment service. Up to the beginning of this month 2,042 people had registered in the contact point as seeking work. In 1993, its first year of operation, it placed 204 people in employment while in 1994 it placed 607 people in employment. This represents a dramatic threefold increase over the figure for the previous year. That in itself gives hope that new methods of job placement will work. It is important to point out that 78 per cent of those 800 people are still in employment today. The north side partnership area has a population of 88,000, of whom 31,000 or 30 per cent are unemployed. This figure is almost double the national average.

The extension of the north side partnership will require a new office as the service needs to be located and delivered close to the problem. St. Benedict's Resource Centre in Kilbarrack could be used as the second contact point in the north side partnership area. This contact point is at the heart of the north side partnership's links between local unemployed people and employers. Since its formation in 1973 the north side partnership contact point has worked at strengthening the links between employers and the unemployed. Many of these links were formed at breakfast meetings hosted and organised by the employers on the partnership board. The contact point has developed these links and at present more than 100 companies use it to recruit personnel. This service is free to employers whose recruitment needs are thoroughly explored so as to ensure that their requirements are matched with the ability and skills of the clients registered with the contact point. The recruitment needs of large, medium and small companies are dealt with in a professional and thorough way by the staff of the contact point. The area partnerships established under the Programme for Economic and Social Progress have been extended to 33 areas under the local development programme.

The interim report deals with the perceived value of community employment schemes, which are very much in the news at present. Unlike wages, the income received by participants on the scheme is calculated by reference to social welfare benefits. Participants pay the J rate of PRSI as opposed to the normal A rate. This has long term implications for the future social welfare entitlements of the participants on the scheme, and it requires further consideration. The work experience gained by participants on community employment schemes has all the hallmarks of employment but it is not always valued as such by prospective employers. The task force must consider the importance of this experience and carry out research into the attitude of the sponsors and participants.

Some community employment schemes have had to let people go. When he raised this point this morning, Deputy Ahern conveniently overlooked the fact that the money provided in the Fianna Fáil Estimates at the end of last year would have catered for 26,000 participants whereas the money provided by the Government will cater for an average of 38,500 participants each year. However, this does not meet all the requirements and some people will not be able to continue on schemes. I ask the Government to review the community employment schemes. The difference between a community employment scheme and a social welfare benefit is marginal and in some cases all that is happening is finance is being transferred from the Department of Social Welfare to the Department of Enterprise and Employment.

In other areas of the city — I am sure this is true of other cities and towns — these schemes have provided immense benefits. In my own area of Priorswood the Fairfield Development Association and the Priorswood community programme do magnificent work in the community and bring hope to the long term unemployed and to communities suffering through various forms of depravation, drug problems and so on which are a direct follow-on from high unemployment.

I ask the Government to review the community employment schemes and to take into account the marginal difference between social welfare benefit and paying a person who wants to work on a community employment scheme and gain some work experience.

Mr. Boylan

I wish to make a brief contribution on what is a very important subject. I congratulate the Minister on bringing the task force report before the House for discussion and I compliment those Deputies who availed of the opportunity to contribute to the debate. It is important to show the unemployed that there are people who are concerned and trying to do something about their plight. The feeling of despair experienced by the long term unemployed is unimaginable; they feel nobody cares and that nobody is trying to do anything about it. That is wrong but I understand their feeling. It is important that there would be contributions from all parts of the country to show we are concerned and that we are trying to come to grips with the problem. There is only so much the Government can do. I will return to this issue later.

I recall a former Taoiseach, Jack Lynch, who took office in the late 1970s when the unemployment rate was approximately 80,000 saying that if it reached 100,000 he would resign. The employment rate far exceeded 100,000 and the then Taoiseach did not resign. He was a decent man and I am not casting any reflection on him. Since then unemployment has spiralled. In round figures we are talking about 300,000 people unemployed, many of whom have been unemployed all their lives and second generations are unemployed which is terrible. In many households no effort is made to go out to work and the State provides minimal income. Unemployment leads to further problems.

In my constituency of Cavan-Monaghan unemployment is not a major problem but that is not a reason for complacency. I am aware that in the densely populated large cities and towns, including Dublin and Cork there are housing estates where the rate of unemployment is 50 per cent or 60 per cent of the workforce. Such high unemployment leads to trouble. As a consequence of boredom and having nothing to do people go to the pubs, the betting offices or turn to drugs or violence. What can we do about it? As I said, there is only so much the Government can do.

People will have to do more and we will have to educate them on those lines. There is no point in sitting around and saying: "The State owes me a job". The State does not owe anybody anything. That is a wrong attitude. It is surprising what people with initiative can do. It may not be their objective when they start out in life but when they finally get a job and are in the circle of employment, they find that one job leads to another, thus improving their position. Even if people have set their minds on a particular job they should be prepared to accept less. There are several examples of people who have worked their way up the ladder. In areas of large scale unemployment people are not given the chance to work and, therefore, there is no possibility of improving one's position.

Communities and community leaders have a role to play. When young people get into the habit of getting up in the morning and going to a job they take an interest in it. I have in mind the marvellous community employment schemes. Five to ten years ago there was an unfavourable attitude to those schemes and some of the work was vandalised. That has changed dramatically and people are beginning to realise the value of improving their own area by restoring old buildings, monuments and so on, which are part and parcel of our history. The FÁS schemes are marvellous and I ask the Minister to address the cutbacks in those schemes. I am aware of the benefits of those schemes and the skills taught. For example, I thought the old skill of stone masonry had become extinct but there are young people who are well qualified and capable of doing this work. That has come through our education system, particularly the vocational education system, where the skills of carpentry, ironwork and masonry are taught.

This brings me back to the crucial subject of education. I cannot emphasise enough that we should endeavour to keep our children at school to receive the maximum education. When I was at school I thought I would never get out of it. I thought it would be great to see the end of it but that is not good enough. In my day a primary certificate at national school ensured one got a job, if one had the leaving certificate one got a very good job. That is no longer sufficient. Now one must go to third level colleges — not necessarily university — such as to the regional college of further study in Cavan where wide-ranging skills in secretarial work, household management, cookery, pre-nursing and so on are taught. My advice to boys and girls — I go out of my way very often to give them a lift to football matches — is to remain at school. Parents have a role to play here. If the parents are unemployed their attitude towards education is that one is wasting one's time. This is serious.

Career guidance teachers — we have an excellent person in Cavan Vocational School — constantly follow up on children who are not attending school and encourage them to return. A good career guidance teacher can help enormously. A person will not obtain meaningful employment without a good standard of education which is freely available. It may not be on one's doorstep but transport is available and there are good grants available. It is no longer an excuse to say one cannot afford it. There is nothing wrong with students of 20 or 21 years of age continuing in education. Many young people find it difficult to get through the examinations but they should keep at their studies. They will get a qualification which will lead to a job.

Community support work schemes have a role to play. I cannot understand for the life of me why the Department of Social Welfare, FÁS and the other agencies cannot gel together. I do not see the sense of giving money to people for doing nothing. It would be much better to pay a few extra pounds and have them working. I cannot fathom why we cannot resolve that problem and thus get more people to work.

Our road structure is deplorable. There is a problem in my county but we are coming to grips with it. We have the raw material, the gravel, the sand — tar is a by-product of crude oil — and the workforce. Why is it that we cannot put all those together and get a road structure in place which would help develop tourism and the services sectors which have a major role to play? Tourism has a role to play in educating our young girls and boys on how to look after bed and breakfasts, self-catering units, and to do hotel work and so on. The tourist industry has taken off as a result of the peace initiative. I do not want people to feel there are no opportunities, there are many.

The day of the multinational coming here and providing 300 or 500 jobs is over. The computer chip era has reduced employment. Unless we modernise we will not get to the market place. We have some excellent multinational industries here: Intel, in Leixlip is an outstanding example, and in my county we have Boxmore Plastics Limited and others. A number of industries in Dublin are experiencing difficulties.

I firmly believe that it is not all down to management problems. Workers will have to change their attitude because no job is sacrosanct. People will have to redouble their efforts, bad practices will have to be rooted out and that is something the unions will have to come to grips with. No industry can subsidise a lazy approach to work. It is not good enough that people clock in and are there to clock out but do not say where they were in between. If people think they are so smart that bosses and foremen do not miss them, they are only codding themselves. The bottom line is that if there are no profits the industry will not succeed. People should stop cutting their own throats and take pride in the jobs they have. They should not be afraid to put in extra time and be flexible. One industry in my constituency was closed down because the workforce refused to be flexible when the management asked them to do some tidying up at a time when no other work was available. They said that keeping the place tidy was not their job and called in the union. That plant closed down, the former workers would have swept the place out on their hands and knees to get their jobs back, but it was too late.

It is important to try to hold the jobs we have as well as creating more. People must be got into the habit of getting up in the morning and going out to do some work. In this respect communities have a role to play. It is said sometimes that people do not want to work, but that is not true. There are always the unemployable, but the majority of people would take pride in having a job which would enable them to set up a home and build a future for themselves. That is the aspiration of young people. I do not accept that they do not want to work. There is a good work ethic in this country but it can decline because of long term unemployment, second generation unemployment and the ethos in a home that one does not go to work. We need to get rid of that ethos. The Minister should do what she can to bring the various schemes together and, instead of giving people money for doing nothing, give them a little extra to do something. It would not be altogether a net expenditure because if these people have money in their pockets they will spend it and the Government will get a return by way of taxation. Such a policy would allow people have pride in themselves while many of the problems that go along with unemployment and which we are trying to control, such as vandalism, drug abuse, etc. would be solved. I know the Minister is fully aware of the problems and I am confident she will do her best to come to grips with them.

Minister of State at the Department of Enterprise and Employment (Ms E. Fitzgerald)

First I would like to thank all those Deputies who contributed to the debate, the quality of which has been excellent and reflects that on all sides of the House we regard the problem of unemployment, particularly the hard core issue of long-term unemployment, as being the most important economic and social problem facing us.

For many years the main strategy to tackle unemployment was based on the view that the rising tide would lift all boats, that by promoting economic growth the benefit would trickle down to the unemployed. We do need economic growth to build a bigger economy, but economic growth in itself does very little to reduce long term hard core unemployment, a problem that has intensified in the past ten or 15 years in spite of a steady increase in real economic growth.

The establishment of the new local employment service, following on the report of the task force, with £6 million start-up funding in this year's budget, marks an important shift in public policy towards tackling unemployment. It recognises in official thinking for the first time that one needs a different strategy to approaching long-term unemployment from simply creating jobs generally in the economy, that it needs a special approach to tackle the stubborn problem of long-term unemployment, and that policies to create extra jobs are, on their own, unlikely to reach the hard core of long-term unemployed.

We have made significant progress in terms of overall reductions in the numbers out of work although it is still far from enough. The total number of jobless has fallen by 20,000 since the Labour Party went into Government at the start of 1993, but it has not yet made a big difference to those who have been out of work for more than a year. There is now a widespread acceptance that for this group, the long-term unemployed, the strategy has to be different. That is why we are using a two-pronged approach to reducing the numbers out of work.

First, growth in the economy is necessary. There have been many useful contributions on that aspect from all sides of the House. It is a necessary, if far from sufficient, condition to increase the total number of jobs becoming available. Our economic growth at the moment is excellent and is being translated into extra numbers at work.

The second and crucially important aspect of Government policy is to concentrate on policies for and target resources specifically at the long-term unemployed. There are now 135,000 people who have not worked for over a year. Almost 60,000 of those have not worked for the past three years. If we compare that with the European situation, the rate of long-term unemployment in Ireland is greater than the total unemployment rate of most OECD countries. The longer a person is long term unemployed the more difficult it is to find employment. Those who have been unemployed for more than two years have a 74 per cent chance of being unemployed a year later. The long-term unemployed are concentrated in the prime age group of 25 to 44, the stage at which people would be rearing young families. Most of them have relatively low education and skill levels — they lost out at earlier stages of life in terms of their education chances, and their skills have become outdated. Almost half have no formal educational qualifications.

The cost of unemployment in economic terms is enormous, amounting to £2.2 billion or 7 per cent of GDP. The estimate for the EU as a whole is under 4 per cent of GDP. The indirect costs of unemployment have been adverted to again on all sides of the House with references to ill health, poverty and crime. These factors need to be taken into account in assessing the real cost of unemployment.

The longer one is out of work the slimmer the chance of ever getting a job again. Skills become rusty and outdated and people lose confidence in themselves. Most important, employers who have a choice of recruits tend to place the long term unemployed at the back of the queue. That is why I brought representatives of the unemployed to the table in the National and Economic Social Forum, to have them sit down alongside the social partners and an all party group from the Oireachtas and come up with agreed answers as to how to crack this nut of long-term unemployment. The solution we came up with, which is the subject of our debate today, the task force report, is to set up a local employment service to reach out to the long term unemployed and those at high risk of drifting into long-term unemployment, to assess strengths and skills gaps, to rebuild the skills and potential of individuals and to ensure, in partnership with local employers, that they are placed in suitable vacancies.

Deputy Kenny gave an excellent outline of the work being done by the Contact Point Initiative in Coolock. This initiative and the job centre initiative in the Ballymun Partnership are part of models on which the new local employment service is based. A key element of the service is access to dedicated training and education places, to work experience opportunities and contracts of employment in support of the local employment service. What is envisaged is to turn on their head the services we have traditionally offered to the unemployed and instead of trying to match unemployed people to services that are there we will ask what are the needs of unemployed people, make the services match their needs and develop the appropriate mix of services from there.

The Government's response does not end with the launch of the new local employment service due to come into action at the end of June. The task force is currently examining how job options for those long-term unemployed who cannot get a place in the open job market might best be structured and to prepare the detailed basis needed for practical action. Although roughly 30,000 job vacancies are offered to the unemployed every month, we are still finding that the long-term unemployed are at the back of the queue, unless something special is done. Again, the whole area of placement of long-term unemployed people whose skills have been restored through the services in terms of training, education, morale-building and so on that a local employment service has to offer have to be matched with a professional placement service and an involvement of employers who have to play their part in offering job opportunities to the long-term unemployed if people are not to simply fall off the table altogether with no chance of returning to the open job market.

It is critical to ensure that long-term unemployed people get realistic chances of being offered employment. Research done for the National Economic and Social Forum shows that of 50,000 vacancies that became available in 1993 which were suitable to the talents of people who were long-term unemployed, only 6 per cent of those vacancies were actually filled by people who were long term unemployed. That is what this service has to try to crack. There is a need for positive discrimination in favour of the long-term unemployed.

The local employment service will be introduced on a phased basis, initially in the 12 established area partnership areas and two others will be selected. As suggested by the task force, the experience gained during phase one will determine how we progress and how phase two will be implemented. The population of the 12 partnership areas is over 500,000 with unemployment running at 26 per cent. It is clear that the new local employment service has a major task ahead.

Some Deputies mentioned that there is a lack of clarity in terms of the model proposed. It is envisaged that each local community will draw up its own action plan or model rather than employing any one predetermined model. The structure has been deliberately designed to allow options so that what we deliver will match the needs of the area concerned as determined by the local community, local representatives, statutory organisations and local employers.

Deputy Noel Ahern raised the question of funding the service and said that other bodies are already working in this area. It is envisaged that funding will be made available from the sum of £6 million to top up existing resources — the resources of FÁS, social welfare job facilitators or a local unemployment centre — in areas where gaps have been identified.

Deputy O'Rourke argued that the Department of Enterprise and Employment had won the turf war. That is the wrong way to view the service. This is not a question of turf wars or winners or losers but about pooling the resources of Government and public agencies in a focused way to meet the needs of the unemployed rather than meeting the priorities of individual agencies. It is a question of putting the unemployed first, not of who wins the turf wars.

In its report Tackling Long-Term Unemployment which forms the basis for the service, the forum put forward a model designed to meet the needs of the long-term unemployed based on the successful experience of Contact Point in Coolock and the Ballymun jobs service in Dublin. A service is proposed which on the one hand brings together all existing services in the community, statutory and voluntary, and on the other which is tailored to meet the individual needs of the unemployed person. My office chaired the task force to turn the ideas of the forum into practical action. Resources have already been provided to introduce the first phase of the new service in the 14 partnership areas.

It is important to emphasise that we are not looking at one unique solution which is imposed from the centre on local areas; there is a need for a range of options to give as many of the long term unemployed as possible a chance to obtain work. This is based on the premise that we should start by identifying the gaps in the skills, abilities and talents of the unemployed, what needs to be done within local communities and offering a credible job placement service to local employers to ensure that both sides will benefit from what is on offer. It is extremely important that we involve local employers in this task. If we fail to break the psychological barrier to employing the long-term unemployed, in a society where we are producing more school leavers than net job vacancies in the economy, the long term unemployed will continue to remain at the back of the queue unless employers are prepared to believe in their talents, potential and abilities.

An Leas-Cheann Comhairle

That concludes statements on the Interim Report of the Task Force on Long-Term Unemployment.