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Dáil Éireann debate -
Tuesday, 18 Nov 1997

Vol. 482 No. 8

European Summit on Employment: Statements.

It may be unusual to have a debate of this nature in the House in advance of a European Council, but I was, however, very happy to accede to the request of Deputy De Rossa that we have such a debate. It is entirely appropriate that the House should have such a special debate on the occasion of what is a unique European Council. It is unique because this European Council will be solely devoted to the issue of employment and to the role of the European Union in tackling what is the primary concern of its citizens, namely, the creation of jobs.

Employment is the primary challenge facing the European Union. The need for firm and sustained action on this front has never been greater. European unemployment affects close to 18 million people. The average unemployment rate among young people in the Union is over 20 per cent. In 1996 more than 5 per cent of the European Union's labour force had been out of work for at least one year.

These statistics of themselves cannot portray the corrosive effect which unemployment has on society and individuals. Unemployment wastes the valuable contribution people can make to society. It leads to poverty and social exclusion with its attendant misery and places social protection systems under financial strain. It is an issue which goes to the heart of the concerns of citizens. The response of the European Union must, therefore, be clear and effective. It must support to the fullest extent possible the efforts of member states to promote employment and minimise unemployment.

It is my hope that this special European Council will send a strong signal that the EU is embarking on a more co-operative and co-ordinated approach to tackling unemployment. The inclusion of a new chapter on employment in the Treaty of Amsterdam provides a legal basis for European-wide action in this area which must be built upon.

The convergence criteria in the Maastricht Treaty for economic and monetary union have in many respects been the catalyst for the pursuit of sound macro-economic policies across all member states of the Union. This co-ordinated approach to economic policy has delivered low inflation and macro-economic stability to the European Union, thereby creating the conditions essential for employment growth. Member states should now resolve to harness the potential for a co-ordinated approach to employment policy.

The European Council will consider the adoption of EU-wide employment guidelines and the establishment of annual surveillance of member states' employment action plans as the method to facilitate closer co-ordination of employment policy. Ireland supports this approach. It is sufficiently flexible to allow for different approaches by member states according to their particular circumstances while facilitating better co-ordination in employment policy.

The European Commission has prepared draft employment guidelines which have been considered both by the ECOFIN and the Social Affairs Council. The Tánaiste and Minister for Enterprise, Trade and Employment will deal with the Commission guidelines in more detail in her address. I welcome the fact that the draft guidelines commit member states to focus their efforts under four key pillars of employment policy, namely, improving the employability of the unemployed; developing entrepreneurship; encouraging adaptability in businesses and in their employees; and strengthening equal opportunities for employment between men and women.

To improve the employability of the unemployed we need, in particular, to tackle early school leaving and to improve the targeting of training schemes so as to ensure that the unemployed have an opportunity to acquire the skills that the market place demands. The recent announcement by the Government of a £250 million information technology investment fund which will be used to develop technology education at all levels is a practical example of improving employability in the modern economy.

Entrepreneurship is the lifeblood of employment creation in a market economy. Therefore we must do all we can to make it easier to establish and develop a business, particularly through easing the administrative burden on small businesses. Action to reduce non-wage labour costs is also required under this heading.

We can encourage adaptability by taking advantage of the opportunities for new types of jobs which modern society offers. This requires considering developments such as flexible working hours and part-time working in consultation with the social partners. Equality of opportunity must also be fostered with the aim of increasing the employment participation of women.

The guidelines also set out specific objectives in a number of areas, notably, interventions to help the young unemployed and the long-term unemployed, increasing the level of training for the unemployed, fostering social partnership and tackling the unemployment gender gap.

There are differing views among member states as to how specific the objectives in the guidelines should be. This issue will no doubt be the subject of discussion at the special Council. Ireland is generally positively disposed to the suggested approach. I believe that conclusions which merely restate a general concern about European unemployment will not send a sufficiently strong message from the summit.

The Council will also have before it a funding package to assist job creation involving funds from both the EU budget and the European Investment Bank. Ireland welcomes this package which is particularly designed to stimulate employment creation in the small and medium sized enterprise sector, SME. No one is suggesting that this special European Council will, of itself, be a panacea for Europe's employment ills. In accordance with the consensus among member states, employment policy will remain primarily a domestic competence. The hope is, however, that the Council will see agreement on a structure to co-ordinate better member states' employment policies and on policy guidelines which will have sufficient flexibility to allow them to be tailored to individual member states' needs.

Ireland will approach this special Council in a positive and constructive frame of mind. We have achieved much on the employment front over the last decade but we continue to suffer from an unacceptably high level of unemployment. I believe that Ireland's employment policy experience can be of assistance to our European partners. I am, therefore, circulating to my colleagues on the European Council, in advance of the special Council, a short paper setting out the Irish perspective on the issue. I have arranged for copies of this paper to be placed in the Library of the House.

This paper sets out the successful Irish experience with regard to economic management and employment creation over the last decade. This has been exemplified by the increase of approximately a quarter of a million people in employment, average economic growth of approximately 5 per cent and a reduction of more than 5 percentage points in the rate of unemployment, all achieved against a background of firm fiscal discipline and low inflation.

The main employment gains have been achieved on foot of the consolidation of consistently sound economic fundamentals during the current economic boom, which began in 1993/4. There is no doubt that we are succeeding in creating jobs, and that we are even beginning to make inroads into long-term unemployment.

This performance has been underpinned by the social partnership agreements put in place over the last decade. These agreements are based on a fundamental shared commitment by all social partners and Government to the pursuit of sound macro-economic policies.

Orthodox macro-economic policies are not, however, sufficient on their own especially in the light of the unemployment challenge facing Ireland due to our demographic and labour market trends. We have introduced many innovative measures designed to contain unemployment. I have referred in the paper to be circulated to some of the more notable of these, especially the community employment scheme and the back to work allowance scheme. These two schemes have a current take-up of more than 60,000.

The paper also sets out the major continuing employment challenge facing the country. There has been much recent international coverage of the economic progress which Ireland has made.

We welcome the plaudits but we must also assert that, notwithstanding our recent strides, there is a considerable way to go. Unemployment, especially long-term unemployment, remains unacceptably high. The progress we have made must be built upon and put on a long-term sustainable footing.

The persistence of high long-term unemployment, particularly in concentrated pockets of social deprivation, is a major manifestation of Ireland's relative underdevelopment vis-a-vis its more advanced EU partners. The economic and social costs of high long-term unemployment in Ireland are set to remain a significant burden on the economy. The re-integration of the long-term unemployed into the labour market will remain a priority concern of economic policy.

In addition, Ireland's island location, low population density, dispersed pattern of settlement and small domestic market emphasise our high degree of dependence on both internal and external transportation and communication networks. Poor infrastructural quality in Ireland imposes high competitiveness penalties, reflecting the economy's uniquely heavy dependence on international trade. Considerable further investment will continue to be required in order to attain standards of physical infrastructure comparable to those of advanced EU economies. This Government has also recognised the need to invest heavily in our higher education system over the next few years to have the skills needed by the marketplace.

In some places we have labour shortages and in others there is high unemployment. Since this Government took office we have been encouraging a more even spread of new jobs throughout the country although more must yet be done in that regard.

With regard to the international environment, enlargement of the European Union will benefit the centre comparatively more than peripheral economies such as Ireland. Our lack of historic trading links with the countries of central and eastern Europe will leave us at a comparative disadvantage vis-a -vis our continental partners in the European Union.

These continuing special needs regarding employment creation in Ireland must be clearly recognised. Important negotiations are under way at European level on issues such as taxation, regional state aids and the next round of structural and cohesion funding. The outcome of the negotiations will have the most profound implications for employment creation in Ireland over the medium to long term.

Ireland is a successful example of the cohesion policy which has been so correctly adopted by the European Union. I have no doubt that both the European Commission and other member states will wish to ensure that the cohesion policy is successful on a sustainable basis. The Commission's recognition that there must be no abrupt withdrawal of Objective 1 status from those countries which have exceeded the 75 per cent GDP per capita ratio is a positive indicator in this regard. I am confident a similar constructive attitude prevails in the European Commission with regard to the issues of corporation tax and the regional state aids regime. I therefore look forward to a mutually satisfactory conclusion to the negotiations on these issues and one which will be consistent with the EU's overriding objective of maximising employment in all parts of the Union.

Deputies will be aware that I have expressed concern regarding the employment effect throughout Europe of the decision to abolish duty free facilities from 1999. The Treaty of Amsterdam states that the objective of a high level of employment shall be taken into consideration in the formulation and implementation of community policies and activities. It is accepted that duty free facilities will eventually be phased out. What is at issue is the timing and the impact of implementation. At a time when the European Union considers it important to present a citizen friendly image of the community to its people, it is difficult to see how the total and immediate abolition of duty free can be presented in a positive light. I intend to use the opportunity offered by the employment summit to raise the issue.

No doubt there will be those who will view the outcome of the special European Council as an insufficient response to Europe's employment problem. It is true that no dramatically resourced EU initiative will be launched at the summit, nor should such be expected. Preparations for economic and monetary union dictate tight fiscal regimes.

Nonetheless, if the Council can agree on the employment guidelines, the follow up surveillance procedure and the financial package, solid progress will have been made. A foundation will have been laid to facilitate better co-operation and co-ordination of national employment policies which should, over time, yield significant benefits for employment in the EU as a whole.

This summit is designed to set targets for job creation on a par with the targets for budgetary policy set in the Maastricht Treaty. As such it is making good on Europe's social and human dimension. No doubt the setting of these targets will have significant moral and political force. The existence of benchmarks for performance on the creation of jobs will bring the debate back to the unemployment issue, an issue which might be ignored during times of prosperity when the concerns of those who are already employed tend to dominate public debate.

In a market economy job creation is the result of free individual decisions, not of Governments setting targets. While there might be a consensus about objectives for employment in Europe, is there a consensus in Europe on how to achieve these objectives? Not only is the overall level of unemployment in Europe too high, the burden is carried disproportionately by four groups: the long-term unemployed, the young, the unskilled and those living in depressed areas. In practice, at the heart of the present European labour market lies the idea that it is acceptable to sacrifice the opportunities of the worst off to help those who are already in work. What type of justice is that?

The problem in most continental countries is that labour costs are too high. Why can a consensus not be reached to reduce labour costs and so create jobs? The answer lies in a profound political and intellectual failure. While unemployment has risen in Germany it has fallen in the Netherlands, in part because Dutch social partnership agreements since 1982 have kept labour costs well below the German level. This was a deliberate choice involving the trade unions then led by the present Netherlands Prime Minister, Wim Kok.

Faced with the highest unemployment for decades, Germany and France have retreated down blind alleys which raise rather than lower costs of employment. These Governments believe unemployment can be dealt with by job sharing, limits on the working week and even by reducing overtime. This approach is simply not viable in a global open market. Europe's competitiveness cannot carry this type of burden on global markets. This will become obvious when we enter the proposed single currency area within which there are wide divergences in labour costs and which will cause real tensions when the single currency starts in earnest. There will be a tendency for firms to move investments out of some countries and into others in the euro area on competitive grounds.

According to Price Waterhouse, compensation per hour in manufacturing ranges from $30 per hour in Germany to $25 per hour in Belgium to $18 per hour in France to $13 per hour in Britain and Ireland to $5.20 per hour in Portugal. While labour costs may represent no more than 20 per cent of total costs — productivity varies — variations of this size between Germany and Portugal or Germany and Ireland create a big difference which will be hard to hide when we begin to use the same money in all transactions. There will be no exchange risk involved in moving a business from Germany to Ireland or from Ireland to Portugal.

Increasing technology dissemination enables latecomers to catch up quickly with the technological front-runners with high earning capacity — in other words, German technology can be very quickly transferred to Portuguese workers. That means the difference between $30 per hour in Germany and $5.20 per hour in Portugal is not viable in the long run.

When monetary union comes into effect, local economic slowdowns will no longer be dealt with by local monetary policies and only in a limited way by local fiscal measures in national budgets. The brunt will be borne by the labour market which will mean more unemployment if it is not flexible enough. If European Governments are to avoid the potentially disastrous consequences of that, they will need to start reforms now well in advance of the introduction of the euro and while the European social model stands a chance of being preserved.

In the immediate aftermath of the introduction of the euro, the main problem to be faced in Europe will be on the jobs market in Germany. Far from looking for strict criteria, Germany will be looking for lax criteria on unemployment grounds because of the competitive transfer of employment to other countries in the euro area, including Ireland, with lower employment costs and people who are as skilled as German workers. We should bear in mind that the use of a single currency will make a huge difference in the transferability of business from one jurisdiction to another. There will be an inevitable alignment on labour costs.

It is important that the Ministers and Prime Ministers gathered around the table in Luxembourg realise that this summit is not a matter of making fine sounding declarations and being able to say to their local media that they had yet another meeting on employment. Hard decisions will have to be taken on employment policy if employment levels in some of the high cost countries are to survive in the euro area, let alone the global market. We must face the fact that lower taxation on labour, which everyone agrees should occur, means either higher taxes on something else or lower public spending. A consensus on lower labour taxes means nothing unless one or other of those two inevitable consequences is faced up to.

The European Union has a very poor record of agreeing to alternatives to labour taxes as seen in its inability to agree to a carbon tax which would have provided a useful alternative to labour taxation. Everyone, including interests in this country, opposed such a tax yet it is one of the few ideas on offer for reducing labour costs. When I hear of another European declaration about the need for reductions in labour costs, I recall the failure of the same institution to agree to the one viable alternative to taxing labour of which I know, taxing energy.

It should also be recognised that a rigid labour market penalises women more than men because women tend to take less regulated part-time job opportunities more readily. Let us compare France and Britain. The male unemployment rate in both countries is more or less the same, but the female unemployment rate in Britain is one-third that of France. In Britain, women have taken up part-time jobs whereas in France with its more regulated labour market these part-time jobs have not been created and women have remained unemployed. Unemployment is a gender issue.

Ireland has been a spectacular economic success in contrast to continental Europe. This is because since 1987 we have kept income increases below the rate of increase in productivity unlike our continental partners. Ireland's economic growth, as conventionally measured, has been three times the European average for most of the 1990s. Irish growth exceeded the European average by a smaller margin in the 1980s and 1970s but was well below European rates of economic growth in the 15 years after World War II. US foreign investment in Ireland is 50 per cent higher per capita than in the UK and six times higher per capita than in France and Germany. If that is to continue, we must understand how we should measure success in economics — a matter upon which there is not complete consensus — why we have been successful and what long-term steps we must take to ensure we are successful in the future.

How should we measure economic growth? Changes in output per person per year are not the best way to measure increases in either human welfare or creativity. GNP and GDP take no account of the number of hours which must be worked to create a given amount of output, take no account of any work done outside the paid economy and take no account of the damage done by particular forms of economic growth to the environment. The British national institute for economic and social research showed recently that, when the number of hours worked was taken account of in place of the usual simple annual output per person per year, the United States dropped from first to tenth place in the world in terms of GDP per person and Belgium emerged the most productive country in terms of output per person per hour. We all know that because in America most people must have two jobs to make a decent income whereas in Europe one job will usually suffice.

Important work is done which is not paid for and is therefore ignored as if it did not occur. When we talk about jobs, employment and welfare we should not forget that work is done for which no one is paid and without which we would not be able to lead a decent life. For example, unpaid child care by parents, parents-in-law or grandparents is not measured in GDP whereas paid child care by non-family members is measured, even though parental or family care may be of a higher value to the child. In such a case, a growth in GDP by substituting one form of care for another may result in a reduction in human welfare. Is the task of looking after one's children a job or not? I believe it is but it does not count as far as the measures of job creation used at the summit are concerned.

The unpaid work of voluntary organisations does not count either as far as the summit is concerned. Some of the work created as a result of the policy measures announced at the summit may result in a reduction in unpaid work by voluntary organisations or one's immediate family. This could involve a reduction in welfare which is not going to be measured in any of the discussions.

GDP growth which permanently depletes natural resources may not be an addition to human welfare. Natural resources used up will not be available to future generations. We do not measure this properly. Jobs created destroying the environment do not add to human welfare.

These issues of measurement; unpaid work, environmental damage and hours worked to obtain a given amount of income, are not mere philosophical whimsies. In a world where facts exercise tyranny over reflection we could easily slip into the belief that the only thing worthwhile is that which can be measured in money and transmitted in figures through an Internet site. That is not the case.

What lessons can we and Europe learn from Ireland's success? The comparative youth of our population has been crucial to our recent success in job creation. Younger people are less averse to risk and less prone to form pressure groups to defend vested interests because they do not have so many vested interests to defend. Younger people are more likely to be at ease with computers, more willing to move house to get a better job, less conscious of their limitations and less likely to defend their job property rights by forming pressure groups. When the Taoiseach explains why Ireland has been a success, he should explain that one of the reasons is that Ireland is young whereas many continental countries are comparatively old.

It is important that Ireland recommends to Europe that measures be taken to ensure that the European workforce stays young in mentality if not, at least, in outlook. This requires a conscious investment in retraining, not just in new skills but in mental attitudes. The concept of early retirement as an objective may be desirable in terms of giving people a chance to reorient themselves but psychologically it is a bad idea. The idea that one's working life is over at age 55 is inappropriate to a continent like Europe or country like Ireland which has a huge bank of talent which needs to be rejuvenated at a certain point in life rather than put on the scrap heap. I hope we will not see solutions to the jobs problem which involve putting those over a certain age on the scrap heap. That is not a solution. It is reducing our wealth creating capacity in a very arbitrary way and adding to our pensions liabilities which we may not easily be able to meet in the long-term. Once people have retired for a year or two it is too late to bring them back to work. It would be too late to discover that we should have had a different policy two or three years after people have retired. There must be continuity.

Educational institutions in this and other EU countries are not catering adequately to the need for people in mid-life to reorientate their careers to new forms of work. The nine-to-five approach of higher education institutions is inappropriate to a workforce that needs to reorientate itself.

The Deputy has one minute remaining.

I will put the remainder of my speech on the Fine Gael Party site on the Internet.

The decision to hold the special summit on employment was made at the EU Council of Ministers meeting at Amsterdam at which I participated. It was made against the background of the conclusions of the negotiations for the single currency. I share the scepticism and views expressed by Prime Minister Juncker that we should not hold our breath with regard to what will emerge from the special summit by way of proposals and that it is not the end of the road with regard to thinking on the issue.

Since July I have been a member of the Party for European Socialists' working group on employment policy. The group, which represents the Socialist, Social Democratic and Labour parties within the PES, has met on a number of occasions and has developed ideas which I propose to put to the Taoiseach for further consideration. In this regard, I welcome the holding of this debate in advance of the summit.

The European labour market is no longer working either efficiently or effectively. In addition, the European model of social cohesion and solidarity, built substantially by the European Socialist movement over many years, is now under serious new pressures. Liberal market forces by themselves have not and cannot resolve these problems. New approaches must be developed by us all within the context of the application of the basic values regarding the European social model which are shared across the political spectrum in Europe, certainly by the Christian Democrats and the Social Democrats.

The completion of the internal market of the union is an essential component to our approach. The impact of globalisation upon the world's economy requires Europe to rationalise its domestic economy so as to provide new economies of scale and production and either become or remain effective. However, the internalised debate within Europe and the introspective focus of so many political leaders, certainly within the PES, has ignored the process of competition that has resulted from globalisation. It is a process we ignore at our peril.

The internal market cannot be completed without the introduction of the single currency, the euro. It is essential that the euro commences on time and that the maximum number of member states participate at the earliest stage. The logic of economic and monetary union is that all 15 member states should be participants as soon as possible and certainly in the early part of the next century.

The completed internal market and single currency will enable new Keynesian type macro economic policies to be adopted without the distortions and difficulties of the past, an example of which was the French experience of 1980-81. In particular, the EU Commission and the European Investment Bank must find new ways at community level of raising new capital for investment in infrastructural projects, such as research and development, TENS and venture capital funds for small and medium sized enterprises. The issue of Euro bonds to finance this investment must be addressed. I hope the Taoiseach will be able to have this issue raised as an item for further exploration at the summit.

While preparations for EMU are now well advanced, there is an imbalance with regard to the detail and the clarity of the monetary side of EMU in contrast to the economic side. The role of the European Central Bank and the operation of the stability and growth pact have been debated and clarified, yet the aspect of economic governance has not received the same degree of attention. It is now necessary under Article 103 to set out clear structures for the operation of economic policy at community level for all member states. In this regard, I look forward to the Taoiseach and the Minister for Finance clarifying the Government's attitude to its participation in the stability council.

The relationship between the Commission, ECOFIN and the European Parliament must be developed and agreed in a formal manner, similar to the stability and growth pact. In addition, the relationship of the European Central Bank to the rest of the Union's institutions must be clarified within the context of the treaty, while maintaining full respect for the independence of the European Central Bank and its areas of competence. There is a serious imbalance between the clarity with which the monetary side of EMU will proceed and the relative lack of clarity with which the economic side will be pursued.

I will now turn to the stability programmes, which are under the agreed structures for EMU. The final structure of the stability programmes must contain explicit targets and sections on the operation of the labour market in member states and the overall levels of employment and unemployment. The inclusion of the employment chapter in the Amsterdam Treaty and the new employment committee will further strengthen the role of the Union in the area of employment, while leaving the implementation of employment policy a matter for member states themselves to pursue. I do not see any conflict here with what Deputy John Bruton said in relation to the various ways in which employment can be generated. However, the measures and benchmarks should be common to all member states. The stability programmes should include specific standards and benchmarks for the national labour market, just as they propose to do for other aspects of national economies.

The Social Affairs Council should renew the initiative open to it to redefine the relationship between the operation of the labour markets in member states and the role of the Commission in setting standards. Such new standards, either in the form of directives or resolutions, should not necessarily impose additional costs. In some respects, the adoption of directives will assist the governments of member states in reforming the labour market part of the welfare state by setting common standards across the Union.

There is clearly a need to move from passive income support payments to active income support payments, particularly among the long-term unemployed and young people entering the labour market. Given the growing integration of the internal market, in particular, the labour market of the Union, it is very important that the emerging changes in welfare states across Europe are properly co-ordinated and, where desirable, standardised.

The relationship between national parliaments and the European Parliament in all areas is weak. Having regard to the central importance of the functioning of the labour market and the credibility of the Union in the eyes of European citizens, there must be a more structured and productive relationship between the parliaments of the Union.

Having regard to the significance of local development and regional government, the involvement of the Committee of the Regions should be incorporated into this new set of structures. The objective must be clear. People are directly concerned about employment. Democratic institutions, particularly democratic assemblies at European, national and regional level, should be seen by our citizens to be directly involved in resolving the problems of employment and unemployment. For example, the operation of the area partnerships should have a more structured link with local authorities, unlike the present situation.

The European Parliament must have specific hearings with each member state to review the operation of the stability programmes. The employment committee must have a formal relationship with the Parliament to ensure the maximum amount of co-ordination.

Continued integration and economic rationalisation combine to drive the internal market of the Union. These pressures have also brought about standardisation in relation to many aspects of economic activity. The same overall process should, in principle, be applied to the European labour market. This is particularly relevant to the reform of the welfare state and its relationship to the labour market.

As the world moves towards increased globalisation, it is clear the European social model will require its workforce to be better educated and trained in order to compete internationally and enhance its levels of productivity. Europe should commit itself to basic standards for all workers.

I will turn now to youth employment and how the labour market/social welfare interface could be reformed. No young worker between the ages of 18 and 25 years should be able to register as unemployed after a period of six months and receive income support from their national welfare system. Instead, they should be offered a range of labour market options with the appropriate level of income support: first, a return to full-time education; second, specific vocational training; third, work experience and placement in a commercial enterprise; and, fourth, community work in the third sector area of their choice — environmental protection, leisure, sport, education or health care. Participation would not be compulsory. The principle of freedom should prevail. However, there would be no automatic entitlement to income support for single people under the age of 25 who refuse to participate. This proposal featured in the Labour Party election manifesto under the social guarantee. It did not receive much publicity, which is probably a reflection on us. If it is to be successful, the quality of training involved will have be sufficiently high to hold out the prospect of a quick transition to employment.

It is essential for that kind of initiative to be co-ordinated at European level. The Taoiseach will find a certain consensus among my colleagues in the PES to get directives or resolutions from the Social Affairs Council which would set guidelines and standards within which national Governments could move to reform simultaneously, or within an agreed timeframe, the directive or resolution embodying those standards. Otherwise, we will have a situation with which the Taoiseach will be familiar in his own constituency and many others: young single people automatically going on the live register because of a poor level of training or family background. They get full entitlements as a consequence and that cycle must be broken in the manner I have suggested.

The reduction of working time within the confines of a competitive European economy facing global competition must be addressed. Overtime work, which is persistent in some sectors and industries, should be regulated to ensure a more equitable distribution of the available work among willing and qualified workers. The curtailment of monetary payment for excessive overtime and its replacement with time-off vouchers could be a way forward. The Minister of State, Deputy Kitt, should examine this practice which will be familiar to us from sectors of our own economy, not least the public service. Systematic overtime is being availed of because of the level of payment; there could be greater employment created if work was more equitably shared. The practice of time-off vouchers is availed off in many private companies. Time off can be allocated in lieu of time worked rather than continuous overtime payments.

I have no illusions about how complex and difficult the introduction of such changes would be. From the Irish perspective, the use of social dialogue and the social partnership is the forum within which such ideas could be explored and the details of implementation agreed. We must build upon an emerging consensus within the PES, and, I suspect, the Christian Democrats, on common attitudes to aspects of the non-functioning of the European labour market. We must then go back to the Social Affairs Council, which effectively had a veto on this as a result of the former United Kingdom Government's attitude to such measures. We can then see if it is possible to get directives such as I have mentioned. These would provide co-ordination and harmonisation in the approach to the reform of the interface between the labour market and the social welfare systems in our different countries. There is an opportunity now that did not exist while the previous administrations in France and the UK were in office to use the virtual unanimity across the 15 member states on these issues, notwithstanding the present position of the German Government. I presume the Minister of State, Deputy Kitt, will attend the employment summit in Luxembourg or be involved in its consequences. These issues must be explored.

Focusing on long-term unemployment, particularly youth unemployment, means examining ways of changing the operation of the European social model. That means co-ordinated change at Social Affairs Council level where the initiative can commence. I wish the Government every success in the Luxembourg summit.

I congratulate Deputy Quinn on his elevation to party leader. I was away at a number of meetings dealing with this issue at the time of his election. I will not be at the summit as the treaty decided that Prime Ministers and Foreign Affairs Ministers should attend. Like Deputy Quinn and others, I am interested in this area and we did much of the preparatory work. On the proposals made by Deputy Quinn and Deputy John Bruton, no one has a monopoly on ideas on how to resolve the scourge of unemployment. I acknowledge the work done by successive Governments and as Minister for Labour, Trade and Consumer Affairs, I am prepared to look at any suggestions and work with other Members of both Houses to address the issue, particularly in relation to youth and long-term unemployment.

I greatly welcome this unique debate which was requested some weeks ago and to which the Taoiseach was responsive. The imminent employment summit is an important opportunity and challenge for the Union. It is an opportunity to address in a concrete and practical way the unemployment problem that exists in the Union where currently there are 18 million people unemployed, almost nine million of whom are long-term unemployed and of whom five million are young unemployed people.

The challenge for us is to come up with effective policies to address the unemployment problem —to come up with responses that go beyond general recommendations and orientations that have tended to characterise the output of previous European summits in the employment area. We need concrete measures. I believe the preparatory work that has been done for this summit is such as to ensure that we will have a successful and constructive outcome. I have had the privilege of being at the heart of that preparatory work through my participation on the Labour and Social Affairs Council. This council, together with ECOFIN, has been charged with responsibility for paving the way for the summit decisions.

The Taoiseach has already outlined the perspective which Finance Ministers have brought to the project, including the new lines of finance that are to be opened up to promote employment — the 150 million ECUs agreed in the budget and the financial line of credit to an amount of some 1 billion ECUs being made through the European Investment Bank. The importance of getting the macro-economic condition right has also been emphasised.

The main aspect with which the Labour and Social Affairs Council has been concerned is that of labour market policy. There is a clear recognition that economic growth, although essential to jobs growth, will not on its own produce the rate of expansion of jobs which is needed to provide employment for the majority of the unemployed. There is a structural component to our unemployment problem which requires us to undertake reforms of our labour market policies and seeks to ensure that the labour market functions more effectively.

Within the Union we now have a new instrument through which we can both encourage and co-ordinate such reforms. I refer to the new employment chapter in the treaty, the implementation of which was mandated at the Amsterdam Council. The relevant provisions of that chapter allow for the development each year of employment guidelines to be adopted by the council and to be implemented by the member states. They also provide for a surveillance procedure which will monitor the performance of the member states in implementing the guidelines. We will, in other words, be called upon to develop an action plan which will outline how we intend to give effect to the guidelines and we will be called to account each year as to our progress in implementing them. This, I believe, is good, not least in terms of the moral pressure it creates to make us perform.

Much of the focus of our work at the Labour and Social Affairs Council in recent weeks in preparation for the summit has been on the employment guidelines developed recently by the commission. These will be a critical input to the summit later this week. Deputies will be aware that these proposed guidelines are built on a four pillar framework comprising entrepreneurship, aimed in particular at promoting small and medium sized enterprises; employability, aimed at reintegrating the unemployed, particularly the young unemployed, into the labour market and preventing drift into long-term unemployment; adaptability, aimed at promoting social partnership down to the level of the firm and ensuring that employees can be responsive to the changing nature of work and work organisation though ongoing training and upskilling; and equal opportunities, aimed at maximising the opportunities for women to re-enter the labour market.

Our objective within the framework of these guidelines is to come up with proposals and commitments which on the one hand are concrete, measurable and challenging, and at the same time are realistic and avoid creating false expectations. They must recognise the principle of subsidiarity, the fact that responsibility for employment policy rests primarily with the member states. They must also be sufficiently responsive to the differing labour market conditions prevailing in the different member states. Much positive work has been done towards meeting these objectives at the three council meetings which I have attended and which have been substantially devoted to consideration of the guidelines.

We have been positively disposed to the overall thrust and direction of the proposed guidelines. They will serve to reinforce many of the policies we have already put in place at national level. Thus, for example, the objective under the entrepreneurship pillar is on promoting the development of small and medium-sized enterprises. The means advocated to do that include improving access to finance, reducing administrative burdens and reducing indirect labour costs — areas to which we have been giving attention for a number of years.

The area of particular interest to me is the employability pillar. Here our focus is very much on the long-term and young unemployed and on the efforts we must make to provide them with employment opportunities, or with progression pathways, which will get them back into the labour market.

Notwithstanding the encouraging results from the recently published Labour Force Survey, which showed a drop of some 17,000 over the previous year in long-term unemployment, the number in that category, at 86,000, still remains unacceptably high. Likewise, while our level of youth unemployment has shown a significant drop in the past number of years, from a rate of 25 per cent in 1993 to 16 per cent at present, the absolute number involved — 47,000 below the age of 25 — is equally unacceptable.

Apart from the waste of economic potential which these figures represent, we know the social costs which arise from such unemployment in terms of poverty generally, the potential it creates for social exclusion, the drift into crime and substance abuse.

The proposed guidelines under this heading are a real challenge for us to redouble our efforts to get unemployed people back into work. The guidelines, as initially drafted, concentrated very much on a preventative strategy aimed at preventing drift into long-term unemployment by calling on us to move towards a position where we will make a job offer or other employment enhancing intervention to all adult unemployed before they hit a 12 month unemployment threshold and, in the case of young people, before they hit a six month threshold.

We recognise and accept the importance of the preventative strategy and this is a challenge which we will gladly take on. We were, however, concerned that the guidelines did not give an explicit recognition to the position of those who are already long-term unemployed and of the need to ensure that they must also continue to receive priority. I am glad to say that, as a consequence of our interventions at the Council, it is my belief that this dimension will be given recognition within the guidelines.

The guidelines, under the employability pillar, also place strong emphasis on the need for investment in human resources so as to provide the skills necessary to meet the needs of the labour market. We are all conscious of the relative success we have had in attracting high-tech enterprises and the acknowledgement that part of our attraction is the quality of the work force and, in particular, the young graduates we are producing to meet the needs of these enterprises. Our intention to keep our comparative advantage in this area is manifested, for example, in the new £250 million technology fund announced in the past couple of weeks. However, not all future jobs will be in those high-tech areas. There remain many other skills-needs at different levels which can provide job opportunities for those, including the unemployed, who, perhaps, have not been fortunate enough to receive formal third level education or who have, for whatever reason, fallen out of the education system. Thus, I welcome in the guidelines the focus on increasing the number of unemployed people who are to be given access to training opportunities. The objective is to move to the level of best practice in the three best performing countries in the Union.

Likewise there is an emphasis on reducing early school leaving as well as developing and expanding the opportunities for apprenticeships and traineeships. These are directions towards which we are already committed as, for example, outlined in the previous Government's White Paper on Human Resource Development and as committed to in Partnership 2000.

Thus, one can see that many of the policies being advocated under the European process are already in place. That is not to say that we can either be smug or complacent. There are new challenges created by the European process. In the context of developing our action plan, we will have to define new targets which will demonstrate that we are increasing our efforts in these areas and we will be subject to scrutiny, including recommendations, from Europe.

As I said at the outset, this employment summit is both a challenge and an opportunity. It presents a real opportunity for the Union to demonstrate its relevance in a tangible way to the concerns of people and their families. Deputies will recall that I previously served as Minister for European Affairs when I initiated and developed the concept of "Communicating Europe", seeking ways and means of communicating to our public the relevance of the Union to people's daily lives. Many of the areas to which the European Union has been giving attention over recent years, including monetary union, convergence policies, enlargement and institutional reform, are all extremely important in their own right but they have a certain remoteness for the ordinary man in the street.

On the other hand, employment and a fear of unemployment, even in the good times, is a real concern to many of our citizens. If we as politicians cannot demonstrate that the Union has a real role to play and contribution to make in this area, then our citizens may well increasingly call into question the relevance of the whole European project. I am, however, optimistic about the likely outcome of the employment summit. I am convinced it will bring real added value in regard to addressing the employment and unemployment problems that exist at European level. From my own point of view it has been a privilege to have been intimately involved in the preparatory process and I believe our work will have paved the way for a successful outcome.

What is required from this summit is a European action programme, not merely a political aspirational statement concerning the Europe-wide unemployment problem. Unemployment in the EU has risen sharply in recent years and is now at a very high level. Both national and regional rates vary widely around that mean. European unemployment is, in the arithmetic sense, the aggregation of national unemployment rates, and national circumstances are highly important in explaining national levels of unemployment. In addition, in Ireland endemic long-term unemployment is geographically clustered in a small number of urban unemployment black spots. Any action programme must contain specific measures to tackle this phenomenon of generational unemployment.

For much of the EU there is at least one common factor at work, that is the business cycle. Most EU states — Ireland and Britain are marked exceptions — are at roughly a similar point in the business cycle, more or less at the bottom of it. Ireland and Britain, on the other hand, are well advanced on the recovery phase and, in all probability, there are also deep structural growth factors at work in Ireland. One important point about the business cycle is that as recovery strengthens and growth accelerates over the next few years, new jobs will be created and probably in large numbers, if history and the recent Irish experience are anything to judge by.

EMU will also strengthen recovery. A successful monetary union and single currency project will likely create a positive double whammy — cyclical recovery magnified by the positive effects of monetary union. These positive effects are likely to include large capital inflows from the rest of the world, stable and low interest rates and low inflation. The collapse of the project would, of course, spell serious trouble. Furthermore, many existing jobs will be lost. EMU will be a real force and factor in this regard also.

The likelihood is that EMU will have an enormous impact on corporate Europe, much bigger than the Single Market programme. Takeovers, mergers and acquisitions, restructuring and reorganisation will be of huge significance over the coming years. Feeding into EMU in this respect and magnifying it, will be continuing globalisation, growth in competition and the progress of the second industrial revolution we are now living through. Again, in recent weeks, we have seen indications of this including a huge wave of merger proposals — Guinness and Grand Met, BAT and Zurich Insurance, Redland and Lafarge in building materials, the manoeuvres of BT, and the saga of MCI. We have also seen announcements from Pilkington and Kodak of huge job shedding plans. All of this is probably a foretaste of things to come.

At a conference last Thursday on this issue organised by Democratic Left, special emphasis was attached to campaigning for the following objectives: the development of an effective educational and training system in order to guarantee the right to education and training for all; the harmonisation and co-ordination of fiscal policies in order to avoid fiscal dumping — what is needed is a better regulation of financial flows, a more effective struggle against fiscal fraud and evasion, and the creation of new forms of taxation; the defence and reactivation of the public sector as a source of public goods and employment as well as a necessary instrument for the defence of inhabitants' rights, especially to protect the most vulnerable categories of the population; the rejection of compulsory "workfare" and unequal treatment for unemployed people and people on "into work" schemes; adequate equal protection and guaranteed minimum wage rates, including measures to protect self-employed — freelance or own account — workers. Minimum wages is a current issue in Ireland — mention of freelance and self-employed workers in this context is important and tends to be forgotten. The tax regime for this growing group of workers needs to be thought about. In a wider context, notwithstanding what Deputy Bruton said, the length of the working week needs to be addressed.

I lay great emphasis, from a long-term viewpoint, on education and training reform in Ireland and elsewhere in the Union in the context of pursuing the realisable objective of full employment. In the context of structural change, corporate reorganisation, globalization and the second industrial revolution, substantial recasting of the education and training systems is a major demand to be vigorously pursued.

Our education system is little connected with training. This is in marked contrast with best practice in the EU, particularly in Germany and the Nordic countries. The Irish education system emphasises attainment rather than aptitude. In turn, attainment is defined and measured from the standpoint of the academic requirements and orientation of higher education — HE, the universities. Aptitude, on the other hand, is critical to technical education — it is still ignored in Ireland to too large a degree — and training, which is hugely under developed here within the national sphere and at company level. Aptitude testing is also critical to a tier of education that we do not have in Ireland, further education or FE. In short, we have a skewed system with too much emphasis on HE and too little on FE.

Further education, including technical education and training, second chance education, retraining and lifelong learning, is critical to building a system and society that can cope with large-scale and ongoing structural and technical change in the economy. Such change will be a marked feature of European and national economies over the coming years. Irish universities play a central and critical role. However, there is more to a proper, balanced and economically effective education and training system than putting everything into the university system and creating a climate in which the Regional Technical Colleges, for example, believe they must become universities.

The European Union and Commission have a significant role to play in this. Some additional own resources for the Union may be necessary. However, a switch in emphasis in the EU budget towards human capital and education and training policies as opposed to sustaining milk and wine lakes and meat mountains or even building motorways and bridges is far more critical. I should not criticise the building of bridges. The Community channels funds into education and training. However, much of it is ineffective. In addition, much EU funding goes into pilot projects, which is correct, but there are problems in having the results of successful pilot projects mainstreamed. The difficulty in having good pilot projects, successful experiments, developed into being applied more widely is particularly acute in Ireland. It may well be the same elsewhere in the EU.

I quote one example from my own constituency — the Clondalkin Information Technology Initiative or CITI. It is a small project that set out to show it was possible to turn young people with low formal educational attainment but who were proven to have an aptitude for computer programming, into qualified programmers obtaining well paid jobs in commercial electronics companies. CITI is working. It turns out programmers who obtain jobs and the life chances of the young people going through the project and graduating are vastly improved. They move from unemployment to work, from no qualifications to being skilled and qualified, and are set on career paths that will, if they pursue them, change their lives vastly for the better. They have access to the growth dividend and to the fruits of technological change and economic development. The problem is that EU funding runs out shortly. I accept it cannot go on forever but the issue now is for the national authorities to pick up CITI, apply it more widely and mainstream it. The world of work is changing rapidly. Investment in human capital, people, through education and training is critical to the pursuit of full employment and the reduction of large scale unemployment in the EU.

Tax dumping is a bone of contention between the Union, Commission and some member states, on the one hand, and Ireland, in particular, on the other. The focus of the present discussions is the corporate tax regime to be put in place by Ireland beyond 2005 and 2010. The Government is formally committed to a 10 per cent headline rate. That could amount to tax dumping and it would appear that the proposal has been quietly dropped. The rainbow Government's approach was different and had much to be said for it. A rate of 12.5 per cent was agreed on.

If a country engages in tax dumping it is attacking the capacity of other states to tax and maintain public services and pursue equitable tax policies. Tax dumping also induces competitive and protective responses. I instanced the recently renegotiated double taxation treaty between this country and the United States. All things being equal, tax dumping has to be paid for in some way in the state in which it is practised. In other words, some taxpayers have to pay for the low rates of tax paid by others. This is very much the case in Ireland and it is a real factor in the inequitable tax regime and the high burden of tax faced by workers, particularly low paid workers.

The European Summit on Employment runs the risk of becoming a damp squib. There has been much hype and expectation and many press conferences but no real work seems to have been done by individual countries to prepare for the summit. There will be a high profile meeting of the leaders of EU countries who will repledge themselves to reduce unemployment. Mr. Jacques Santer wants to reduce unemployment from an EU average of 10.7 per cent to 5 per cent and to create 12 million new jobs over the next five years. That may not seem a large figure when spread across 15 countries but it is a huge ambition. Raising expectations in this way when individual countries have not faced up to the decisions which will have to be taken to create this number of jobs runs the risk of people becoming bored and disenchanted with the opportunities provided by the EU.

The expectation of getting a job is at the heart of all human endeavour. Even ten year old school children expect to get a job when they leave school, whether as a fireman, ballet dancer, engineer or McDonald's employee. The challenge facing Governments throughout Europe is to ensure that these expectations are fulfilled. We should spell out at the summit on Thursday the measures we have taken to create our very high growth rates which are above the average achieved by our trading partners. Our success in the 1990s gives us a greater hope of fulfilling the expectations of the ten year old school children to whom I referred. In some areas of employment we are at the wall in terms of providing a sufficient number of people. In order to ensure continued growth, we must analyse and understand the factors that brought us to this position. That would assist us in considering future policies.

The ESRI medium-term review 1997 to 2003 contains an assessment of what happened in Ireland since the deep recession of the mid-1980s and we should take cognisance of that. The report states that the factors that led to the growth rates include the tightening of fiscal policy in the 1980s, the successive national pay agreements from 1987 onward, the devaluations of 1986 and 1993, the adherence to a strong currency policy from 1987, improvements in competitiveness, the increasing level of average educational qualifications and the inflow of Structural Funds. Another factor was our capacity to attract multinational industries which, without the issues highlighted in the ESRI report, we would not have been in a position to do.

The recession of the 1980s, when many of our young people left the country to find work elsewhere, many of them, fortunately, with a good education, was exacerbated by the profligacy of the 1977-81 spending policies of the then Government. At that time we were overcoming the oil crisis of the early 1970s and, far from spending, we should have been consolidating, tightening our belts and recognising that we needed to put money aside for the rainy day.

There was at least a silver lining to the recession of the 1980s in that everybody, industrialists, trade unions and consumers, became frightened by the spectre of the World Bank coming into Ireland, a real possibility at the time, and people woke up to the high spending policies that were destroying the possibility of growth rates. The events of the 1980s led to a more enlightened era in politics, in the trade union movement and in industrial policy because, to quote the President, people saw the edge and decided they wanted to pull back from it. The enlightened Tallaght strategy in 1987 also brought people to their senses because for the first time an Opposition party put the national interest at heart and adopted policies that allowed the country to turn the corner and create the growth rates of more than 5 per cent which our people have been enjoying.

There must be continued emphasis on some of the issues highlighted in the ESRI report. For example, many young graduates have returned to work in their own country, but we must be careful that, as we encourage a greater number of people into second and third level education, we provide appropriate education and training, without which there will be a reduction in the number of multinationals and other investors setting up here. It is important a sufficient number of staff is available to those companies. If they do not get the staff they require they may have to move elsewhere. That is the challenge facing our education and training systems. The millions of pounds being spent on FÁS training programmes must be targeted at the needs of the country. If an industrialist requires a person to run a machine, to work on computers and to be able to speak a foreign language, we should not be training people to carry out door to door surveys. Training must be targeted at the needs of industry and that will require a great deal of discussion between entrepreneurs, business people and educators.

It is also important that we continue to increase the quality of Irish products. Some 66 per cent of our trade is with EU countries other than Great Britain, with which we trade 22 per cent of our tradable products. We must continue to attract sales for our products.

Will the Minister outline Government policy on corporation tax and the future of IDA grants? How does it propose to deal with the changes in Objective 1 and 2 status? Until we know its policy in those areas and what it is saying to our European partners and the Commission, we will not be able to continue to attract inward investment and create employment.

I wish to share time with Deputy Gormley.

I am sure that is agreed.

The employment question will be on top of the agenda in all European countries in the years ahead. High levels of unemployment in all member states are a cause for major concern for governments. We must pay continuing attention not only to the creation of more jobs but also to the geographic spread of new employment opportunities. We must make a major drive to reduce unemployment levels and this is even more urgent in light of the recent census figure which shows an increase of 100,000 in the overall population since the last census. In the year prior to the last census more than 40,000 people came to live here, almost half of whom came from the United Kingdom. The Central Statistics Office projects that our population could increase by 10 per cent in the next ten years. This poses a major challenge to Government and development agencies, if we are not to return to the former high levels of emigration.

The IDA's success in attracting massive overseas investment and employment is very welcome. There is increasing evidence, however, of skill shortages in some of the high technology sectors, despite the contribution of universities, Regional Technical Colleges and the institutes of technology to meet industry needs in recent years.

It is vitally important that more resources are allocated to education and training to provide young people with the relevant skills to avail of good employment opportunities in the future. This should be viewed in the long-term and primary and secondary schools should be properly equipped and staffed to provide an appropriate introduction to computers and languages. Breaking the cycle of poverty and missed opportunities, which affect many young people from deprived areas who leave school early, requires the provision of the best educational facilities and maximum resources to help children with special learning difficulties. Skill shortages should not be considered only in the sphere of high technology and languages. There are equally important job opportunities which require proper training skills, particularly in traditional crafts and trades, such as plastering, carpentry, bricklaying and the tourism and agriculture sectors.

While employment creation is a national question, with overall future employment depending on a high standard of education and skills, there is also an important regional dimension. Recent employment growth has not benefited all regions equally. Media comment on the very few new job announcements north of the line from Galway to Dublin points to the serious employment needs in that area.

The Fitzpatrick report on Structural Funds was recently quoted by the chairperson of the council for the west. It showed that once more the west and Border regions performed worst during that period. They started off from a relatively poor position and remained there in 1996. It stated that 50,000 jobs were created in the Munster and Leinster regions compared to only 2,000 in Connacht and Ulster. It is vital that regional imbalance is fully recognised when considering unemployment policies.

I thank Deputy Perry for sharing his time with me.

The Green Party regrets that the employment topics of the November summit on employment will not be discussed in an integrated way with those of the December summit, which will be centred on the co-ordination of economic, foreign exchange and tax policies in the EU. EMU, without a parallel process of social and institutional legislation, is a seriously flawed concept.

The Green Party criticises the stability pact in its present form which seeks to preclude any change in economic policy by aiming for massive deficit reduction in a period of mass unemployment. We demand a European pact on employment, solidarity and ecology with equally binding commitments to counterbalance the stability pact concluded in Amsterdam. This European pact on employment, solidarity and ecology should combine employment targets with ecological sustainability. Full employment of a new type guaranteeing equal access for women and men to dignified, voluntary and decently paid work must become an aim in its own right for EU policy as well as a guaranteed right for all. The social value of unpaid activity, voluntarily undertaken, should be recognised and supported. Adequate legal frameworks to meet this end should be created.

The Green Party demands an EU programme to support local economies against market centralisation with the aim of guaranteeing a greater diversity of economic activity, enhancing social and environmental responsibility and creating more jobs in each local area. Co-ordinated steps, which involve the equitable redistribution of paid and unpaid work, must be taken to achieve radically shorter working hours. Legal frameworks and fiscal incentives should facilitate the transition to a 30 hour week as a mid-term objective.

One aspect of the introduction of European ECU taxes will be to boost social and ecological innovation, while conversion programmes, including retraining for workers in unsustainable industries, will have to create sustainable employment throughout Europe. We must expand EU funds for ecological conversion and urban regeneration with a strong employment dimension by shifting savings into investment through the issue of Union bonds by the European Investment Bank. We must take action to strengthen the third sector in the social welfare economy as a source of new, appropriate and socially protected jobs — for example, in the areas of social, ecological and cultural services. We must mobilise the vast savings of the European Investment Bank and the European steel and coal community to encourage investments in ecological innovation, education, health and urban environments, especially in regions of high unemployment.

We must link the training of long-term unemployed people to a guarantee that they will be given paid employment for at least a year following retraining. We must give every person the right to receive two years' paid training after leaving full-time education. Member states should translate their commitment to equality of opportunity into expanding the rate of women's participation in professional training and employment in all sectors and at all levels of seniority where it is less than 50 per cent.

We must also introduce a European framework of national incentive systems for the reduction of working time through collective agreements. Companies which create new employment after reducing working time could be subsidised from the subsequent savings in public expenditure. At the same time this would reduce the pressure to accept imposed part-time work. We must implement a European legal framework to guarantee access to employment for people with disabilities. We must implement also a social and environmental audit of all EU budgets, greening the EU budget, especially by reforming the Common Agricultural Policy but also by fundamentally revising the ecologically devastating Structural Funds. The EU should cease to promote the trans-European networks and stimulate and support environmentally friendly transport modes. Conversion from nuclear energy and coal to energy saving, energy efficiency and renewable energies is long overdue.

We must co-ordinate efforts to prevent poverty and social exclusion by combining strategies for basic social security or income support with minimum wages or removing the tax burden for lower income groups as well as promoting social, cultural and political participation. Regular social audits should monitor poverty and wealth. For the Greens struggling to overcome unemployment in the EU is one element in a more comprehensive strategy for ecology, solidarity and democracy which does not stop at any frontiers. Therefore, we link these demands to the EU Commission with the demand for an adequate development of the social and employment dimension of the EU's accession strategy for central and Eastern European countries. The European Green Parties are committed to creating a European space of economic regulation and common development for the whole of Europe, including Russia and the CIS area.

I thank Deputies who contributed to the debate. Unfortunately time did not allow more Members to participate. Unemployment in the European Union but particularly in Ireland concerns every public representative. Although our economy is the Celtic Tiger and there is a great success story to tell, our unemployment level at 10.3 per cent is not something about which we can be complacent. The challenge for all of us, and particularly for one with responsibility for employment, trade and enterprise, is to ensure we translate that high growth which the economy is experiencing into more job opportunities for the unemployed, particularly the long-term unemployed. That is the reason the Government has placed strong emphasis in the Estimates for 1998 on training of the employed and the unemployed. Training of the unemployed will increase by 21 per cent next year and of the employed by 95 per cent. To sustain the jobs we have in Ireland our workers must be trained and retrained and must be flexible and adaptable to the changing circumstances in the global economy.

The level of unemployment in the EU, at somewhere between 18 million and 20 million people, depending on how it is measured, is the greatest single disaster of the economic union. The coming together of so many member states has brought huge social and economic benefits to all our citizens. That we have had peace in Europe since the foundation of the European Economic Community is one of its greatest achievements and it has resulted in enormous benefits. Where it has failed is in the area of employment. That is why I am pleased that the heads of Government will meet later this week to discuss realistic options for tackling that high level of unemployment, at over 10 per cent of the workforce. It is the equivalent of the population of three or four member states, depending on which member states we take.

The guidelines which have been refined by the Luxembourg Presidency are realistic and are based on four main pillars: the development of the whole concept of entrepreneurship, adaptability, flexibility — which is extremely important if the European economy is to get a greater market share in the global economy — and employability. This is where the issues of training and education come to the fore. Recently the Government announced a £250 million package for education and investment in education for the emerging jobs of the future. We want to ensure our workers and our young people are equipped with the necessary skills for the fast changing world in which we have to operate.

Recently a multinational company located close to here told me that within the next 15 months it will change not only its product range but its whole process. To respond to that rapid change workers have to adapt, to be retrained and flexible. The whole issue of training is extremely important.

We have to look also at the issue of equality of opportunity, not just as between men and women but as between young, unskilled and experienced workers and as between the unemployed and those already in the world of work. The four pillars which form the guidelines of the decision to be made by the heads of Government form the basis for something worthwhile in the area of employment. That is extremely important. Next year we will spend £750 million on schemes to encourage people to move from the world of welfare to the world of work. We need to look realistically at how we can make it easy for people to make that transition. I am having discussions with the Minister for Social, Community and Family Affairs about this matter. As a society, we must provide job opportunities for everybody who wishes to work. As we all know, from unemployment comes marginalisation and isolation; a sense of a loss of dignity, self-value and self-worth; a greater dependency on drugs and alcohol; in the case of some young people, a greater tendency to drift into a life of crime; and the breakdown of family relationships. It is important for social and many other reasons, not just economic, to place the unemployment issue at the top of the agenda. It is appropriate that next weekend the heads of Government should seek to address in a realistic way how member states can deal with this serious economic and social issue.

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