Joe Higgins
Question:1 Mr. J. Higgins asked the Taoiseach if he will report on the matters discussed and conclusions reached at his recent meeting with ICTU leaders. [4352/03]
Ceisteanna – Questions. - Social Partnership Agreement.
Enda Kenny
Question:2 Mr. Kenny asked the Taoiseach if the new partnership agreement has been finalised; and if he will make a statement on the matter. [5159/03]
Enda Kenny
Question:3 Mr. Kenny asked the Taoiseach his plans to meet with the social partners in the coming weeks; and if he will make a statement on the matter. [5160/03]
Willie Penrose
Question:4 Mr. Penrose asked the Taoiseach the steps he has taken to encourage the full participation of the social, community and voluntary pillar in the partnership negotiations; and if he will make a statement on the matter. [4825/03]
Enda Kenny
Question:5 Mr. Kenny asked the Taoiseach if he will report on his recent meeting with ICTU; and if he will make a statement on the matter. [5226/03]
Caoimhghín Ó Caoláin
Question:6 Caoimhghín Ó Caoláin asked the Taoiseach if he will report on his role in the discussions between trade unions and employers in the effort to conclude a new agreement on pay and other matters; and if he will make a statement on the matter. [5426/03]
Pat Rabbitte
Question:7 Mr. Rabbitte asked the Taoiseach if he will make a statement on his most recent meeting with representatives of the Irish Congress of Trade Unions. [6183/03]
Pat Rabbitte
Question:8 Mr. Rabbitte asked the Taoiseach if he will make a statement on the finalisation of the new draft national agreement, Sustaining Progress. [6184/03]
Pat Rabbitte
Question:9 Mr. Rabbitte asked the Taoiseach if he will make a statement on his address at the opening of the National Economic and Social Development Office. [6185/03]
Pat Rabbitte
Question:10 Mr. Rabbitte asked the Taoiseach if he has received a response to his speech made at the opening of the National Economic and Social Development Office from any of the social partner organisations which have not signed up to the draft national agreement, Sustaining Progress; and if he will make a statement on the matter. [6186/03]
Trevor Sargent
Question:11 Mr. Sargent asked the Taoiseach if a new partnership agreement has been finalised; if so, the details of the agreement; and if he will make a statement on the matter. [7291/03]
Trevor Sargent
Question:12 Mr. Sargent asked the Taoiseach if the concerns of the social, community and voluntary pillar are being addressed at the partnership negotiations; and if he will make a statement on the matter. [7292/03]
Trevor Sargent
Question:13 Mr. Sargent asked the Taoiseach if he will report on his address to the opening of the National Economic and Social Development Office. [7293/03]
Brendan Howlin
Question:14 Mr. Howlin asked the Taoiseach the specific steps the Government intends to take to meet the commitment in Sustaining Progress to extending and deepening the partnership process in the work place; and if he will make a statement on the matter. [8121/03]
Brendan Howlin
Question:15 Mr. Howlin asked the Taoiseach if he will make a statement on the anti-inflation initiative in Sustaining Progress. [8123/03]
Brendan Howlin
Question:16 Mr. Howlin asked the Taoiseach when the specially convened group to draw up a detailed action plan on inflation, which was promised in Sustaining Progress, will be established; and if he will make a statement on the matter. [8129/03]
Caoimhghín Ó Caoláin
Question:17 Caoimhghín Ó Caoláin asked the Taoiseach if he will make a statement on the outcome of the negotiations resulting in the draft agreement, Sustaining Progress. [8730/03]
Caoimhghín Ó Caoláin
Question:18 Caoimhghín Ó Caoláin asked the Taoiseach if he will report on his address at the opening of the National Economic and Social Development Office. [8812/03]
Joe Higgins
Question:19 Mr. J. Higgins asked the Taoiseach if he plans to meet the social partners over the next few weeks; and if he will make a statement on the matter. [8983/03]
Joe Higgins
Question:20 Mr. J. Higgins asked the Taoiseach if he will report on his role in the finalisation of the new national partnership agreement, Sustaining Progress; and if he will make a statement on the matter. [8984/03]
Joe Higgins
Question:21 Mr. J. Higgins asked the Taoiseach if he will report on the address he gave at the opening of the National Economic and Social Development Office. [8985/03]
Joe Higgins
Question:22 Mr. J. Higgins asked the Taoiseach when the specially convened group directed with drawing up an action plan to combat inflation under the Sustaining Progress agreement will meet; and if he will make a statement on the matter. [8986/03]
I propose to take Questions Nos. 1 to 22, inclusive, together.
As Deputies will be aware, negotiations on the successor agreement to the PPF concluded in February, and the majority of constituent social partner organisations have now formally ratified the new agreement, Sustaining Progress. I wish to take this opportunity to express my deep appreciation of the positive contribution made by all the people who took part in the negotiations and who worked tirelessly to bring about this new agreement.
The Government is in absolutely no doubt that a renewed consensus expressed in this new agreement is in the best interests of all our people and we look forward to working closely with the social partners throughout the implementation of the proposed agreement. I also want to take this opportunity to again emphasise, with my colleagues, the Government's continued strong commitment to pursuing our nation's well-being and prosperity through the process of social dialogue and look forward to the ongoing dialogue on items of mutual interest.
All pillars that were involved in the partnership negotiations – trade unions, business, farming, and the community and voluntary pillar – fully participated in the process. The process itself involved protracted negotiations to reach a position which maximised the area of agreement between the partners in the light of objective constraints. It is an inherent principle of partnership that all parties participate in all aspects of the negotiations, except with regard to the pay element of the agreement in which only the Government, the employers and unions were involved, as has been the case in all previous agreements.
Formal meetings such as the last PPF plenary session in Dublin Castle on 31 October complement the meetings which I hold with representatives of the social partners on a regular basis. I will continue to meet with the social partners regularly, and as required, over the lifetime of the new agreement.
I reported to the House on 5 February on the meeting which the Tánaiste, the Minister for Finance and I had with the employers and trade unions on Monday, 13 January, where we presented the two sides with a set of proposals on some of the key issues under discussion at the time, including pay.
I also met with representatives of the Irish Congress of Trade Unions on Friday, 7 February 2003 to clarify my position on a number of issues covered by the proposed pay agreement in the context of a three-year social partnership programme.
First, with regard to the EU Charter of Fundamental Rights, I stated that, on the basis that the charter is incorporated in a way that does not increase EU competence over national legislation or over socio-economic decisions which are for national governments to make, and would not reduce the standard of protection which Irish citizens enjoy under our Constitution, I would favour incorporation into the treaty.
Second, with regard to the commercial semi-State sector, I confirmed that we are committed to active engagement with the social partners on the basis of the Government's commitment to its role in providing services of world-class quality at a competitive price to the consumer, with a viable long-term future for individual companies based on the most appropriate form of ownership or structure for its particular needs.
Third, with regard to the special housing initiative, I confirmed my personal enthusiastic support for developing this proposal. We must, of course, be pragmatic about the timescale within which objectives can be achieved. However, I stated that I firmly believe that the shared resolve of the Government and the social partners in addressing issues which undoubtedly have to be resolved, will enable us to meet the commitment in the agreement of ensuring that the necessary actions are taken during the programme to achieve the objective, with measurable progress by the mid-term review.
The new agreement indicates that the national centre for partnership and performance, which operates under the aegis of my Department, will play an increasing role in supporting the process of extending and deepening partnership and performance in the workplace. It identifies a number of specific projects which are to be carried forward by the centre with this in mind, namely: the establishment of a forum on the workplace of the future; a joint project with FÁS to promote a learning culture in Irish organisations; the development and dissemination of best practice in the area of partnership and performance; the development of a national training strategy to assist those involved in organisational change through partnership; the preparation of guidelines on the different forms of employee financial involvement; a project aimed at improving practices and procedures in relation to information, consultation and participation rights, in the context of the Information and Consultation Directive; and the promotion of existing joint partnership training materials as developed with IBEC and ICTU. These projects, which have the full support of IBEC and ICTU, will make a significant contribution to organisational change and modernisation in the years ahead.
The Government attaches particular importance to the establishment later this year of the forum on the workplace of the future, which will facilitate in-depth discussion on how workplaces can best adapt to competitive pressures, improve the delivery of services and respond to the changing needs and preferences of employees. This will enable us to take a holistic approach to improving partnership and performance in both the private and public sectors. The Government intends that the work of the forum will be showcased during our EU Presidency as a contribution to the implementation of the Lisbon agenda. On inflation, Sustaining Progress provides that, in the context of the agreement on pay and the maintenance of employment and competitiveness, the Government, with IBEC and ICTU, will work together to help exert downward pressure on inflation, recognising, of course, that some of the underlying problems can only be tackled over the medium term.
The agreement provides in particular for the convening of a group, comprising representatives of my Department, the Department of Enterprise, Trade and Employment and the Department of Finance, together with representatives of IBEC and ICTU, to draw up a detailed action plan and to monitor its progress. Representatives of the Competition Authority and the Office of the Director of Consumer Affairs will also be invited to participate, as appropriate. The group, which will be established shortly, will present regular reports to me, the Tánaiste and the Minister for Finance and will submit a report reviewing progress six months after ratification of the agreement. The report will take account of progress in implementing the range of measures already set out in the Sustaining Progress agreement – for example, in relation to housing and insurance costs – as well as additional measures to be developed by the group.
The group will be chaired by my Department. However, Dáil questions regarding the Government's policies on inflation will continue to be a matter for the individual Ministers concerned, including, in particular, the Minister for Finance and the Minister for Enterprise, Trade and Employment. In my recent address at the launch of the new offices of the National Economic and Social Development office, I stated that it was for each organisation to decide whether it wishes to sustain the social partnership relationship and commitment to work together in advancing a shared agenda in the challenging period ahead. I reiterated that, for our part, we are anxious to continue to work and build on what we have achieved together. I acknowledged that we will regret the absence of those who choose to walk away but will engage with commitment and energy with those who decide to continue with the process, as I sincerely urged all who have been party to recent negotiations to do.
Obviously, I regret that a minority of the social partners have not found it possible to ratify Sustaining Progress. However, I welcome the fact that a majority of the social partners have signed up to the agreement and I am fully committed to working within the social partnership process with these organisations. With regard to the con tinued participation of the farming pillar, my officials are in informal contact with the farming organisations. I still hope that they will find it possible to continue in social partnership. It is my desire and that of the Government that they should. I hope that they can see that their objectives can best be pursued in the context of the partnership process.
Does the Taoiseach accept that the new agreement will see substantial falls in the real living standards of workers, beginning this year? How does the Taoiseach stand over an agreement that provides a pay increase of about 3.5% to private sector workers in the first year when inflation will run close to 6%? The real inflation rate will be much higher than that. How does the Taoiseach expect young workers to be able to buy a home given the abolition of first time buyer's grant and the raft of hidden charges introduced in the budget and other Government measures?
Does the Taoiseach agree that this is a particularly disappointing agreement for public sector workers, particularly those on low pay? How does he stand over a six-month pay pause for public sector workers while inflation is at its current level? Does he agree that to use benchmarking as an excuse for the pay pause would be totally dishonest because benchmarking is supposed to help public sector workers catch up with those in the private sector? Does the Taoiseach agree that this new deal represents nothing more than the same philosophy and mechanism of all such previous deals, which is to restrain wage increases for workers to the maximum extent possible while placing no restraint on profiteering in the housing market, on landlords in the private rented sector or on the services sector, which rips workers off left, right and centre?
A number of the problems the Deputy mentioned are specifically provided for in the programme so that we can try to deal with issues on the pay front. In tougher times, both domestically and internationally, the Government has been mainly criticised for paying increases of this level. The circumstances are difficult and I am glad the social partners accepted this.
As I said last week in reply to a question from Deputy Kenny, the level of inflation in our society is too high. It is higher than the EU average. In the programme, Sustaining Progress, a set of mechanisms has been agreed by the social partners where ICTU and IBEC along with Government agencies, the Competition Authority and the Prices Commission will work together to see if we can, as the Central Bank predicted, force down the levels of inflation. Time will tell whether it is possible to do that but I look forward to working with the agencies in trying to deal with these matters. There are issues in terms of competition and of trying to convince those taking profit margins, particularly in the services sector where these have been identified across a range of personal services and where it has shown that price increases are far higher than in other sectors and are out of line with the international position.
The same applies to housing. The policy is to try to deal with housing by trying to match up supply and demand. That is the only way to try to influence the market to ensure more houses and to bring about a control of prices. There is a range of issues in this programme to deal with this issue on which work has already started and I look forward to pursuing it. I have answered questions on this matter several times in recent weeks.
In relation to some of the other points the Deputy made, as he knows, I disagree with his view on partnership agreements. The reality is that partnership agreements have changed, or at least have played a major part in changing, this country. They are the reason we have 600,000 more people working in our society and the reason we have far more valued added and higher quality jobs. We must be careful we remain competitive and do not out-price ourselves in the market. The Deputy is well aware of the pressures in this area. Pay levels are higher than the average for many international jobs and we must continue to be cautious. However, people are getting a decent wage even if it is, in many cases, higher than that being paid to their counterparts elsewhere in the world, as is increasingly happening here. Pay levels and pay rates are not only higher than those in Britain but are higher than those in Europe and, in many cases, in the United States. That is a risk in terms of competitiveness and that is why the programme is very much centred around competitiveness issues.
Given that this programme is to last for 18 months, will the Taoiseach consider the possibility of a new type of partnership process for the future which would reflect the needs of a modern society, such as real efficiency in the delivery of public services? Does the Taoiseach accept that this agreement is predicated on the Government being able to keep the rate of inflation under control? Given the antics and activities of the Government in recent years, is it not a fact that Government fiscal policy has led directly to an increase in inflation which puts us way ahead in the European league and has caused us to drop in the competitive ratings as a consequence? Does he accept that persistently high inflation will damage that competitiveness and threaten the entire partnership process?
Following on from that, does the Taoiseach accept the findings of the report recently released by CORI which highlights the widening division in Irish society and shows the extensive gaps in social provision where we have growing poverty rates, unequal income distribution, a growing rich-poor gap, under-equipped health and education systems and road, railway and transport systems which compare very badly with those of our European counterparts? Will the Taoiseach comment on those clear indicators, many of which are a direct result of Government inefficiency and inability to manage the public services properly?
I will try to answer those questions in order. The agreement itself is for three years. The pay agreement is to be re-examined after 18 months but the process, work and especially the key items that must be worked on between the social partners and Government agencies are for a three year period.
I agree with the Deputy on the public service. Benchmarking is not just a pay increase but a pay increase in return for efficiencies, enhanced co-operation and modernisation in the public sector. This is the subject matter of the agreement. Mechanisms have been established in the health area, local authorities, Departments and semi-State agencies to ensure that these efficiencies are achieved, are monitored and that it is not a case of automatically receiving the increase. These mechanisms worked well under the Programme for Prosperity and Fairness, and the structures have been enhanced to deal with the new agreement.
On the issue of competitiveness and inflation, part of the inflationary figure, as I have stated previously, relates to Government measures, but it is a small part. The larger part of inflation is directly linked to services. Central Statistics Office figures and other reports have shown this. The Central Bank's report last week showed clearly where increases have occurred and where they are out of line with international trends. The European Union's report a month ago showed this as well. The problem is in the area of services and results from people who provide professional and personal services taking profits and continuing to increase prices rather than lose market share or profitability. That is wrong and I will continue to say that. I know all the predictions are that inflation will work its way downwards, but intervention will be necessary to drive it down and drive more competitive actions and initiatives, not just in the area of competition, to try to force down the rate of inflation which is too high. There is no argument about that.
Inflation obviously affects competitiveness and there are input costs, but our real problem with competitiveness and the reality which costs many jobs is that the level of salaries in this country is increasingly becoming higher than in the United Kingdom, Germany and the United States. Deputy Kenny will know this well, especially as we have moved as a matter of policy over the past decade to try to attract higher value jobs. I have seen the figures for comparative costs, primarily although not exclusively within the multinational systems where the competition for jobs is within the companies, and it is increasingly the case that salaries in this country are higher. That may appear extraordinary, but when I query these figures, it is the case. I am not talking about the lower end of the market. I know there are people on low pay and there are mechanisms through which we are trying to deal with them. However, it is increasingly the case that salaries in Ireland are higher.
The viability and profitability of companies in these cases must be examined. I know it is an issue of concern not only to employers and the Irish managers of these companies but to their employees. It is an issue we must address. It is not all located in the east coast but also in many parts of the country. It is a challenge for us and the reasons for it are clear. In the past two or three years when there has been almost negative growth in Germany, increases have been tiny compared with this country. It is a challenge and a concern, but we are still winning inward investment. This year has been a better year than last year, despite all the international difficulties. We must watch our competitive base.
Can I stay with this anti-inflation chapter? I would have thought what the Taoiseach said in agreeing with Deputy Kenny, that we are no longer competitive in a number of areas, would be very interesting coming from a commentator. Does the Government have a view on it? The Taoiseach is not a commentator, he is the Taoiseach. If he agrees with Deputy Kenny that these factors are making us uncompetitive, will he say what the Government intends to do about it?
Can the Taoiseach draw my attention to any line or paragraph in the anti-inflation initiative, or am I missing something, that says tangibly what the Government will do about it? I note there is a commitment to an explicit and co-ordinated set of policies which could help to slow the present rate of domestically generated inflation. However, I see no such policies or tangibles in the relevant paragraph or chapter. Irrespective of whether we differ on what is domestically induced and what is imported, I presume the Taoiseach is not saying that this anti-inflation package will change what we import from outside. The Government is, therefore, addressing domestically induced inflation.
Has the Minister for Finance not made the main contribution to that inflation since last July and not simply since the budget? The new levy of charges that the various Ministers have thought up are the main contributory factor to domestically induced inflation.
For Members who were not at the talks, will the Taoiseach tell the House what the anti-inflation initiative comprises? In so far as I can read it, I cannot find anything tangible other than that the Government will pull together a committee of the usual suspects. There is nothing in the package to tackle the fact that the Minister for Finance has driven inflation through the roof – it is now about three times the European Union average.
I have already stated that the smaller part of the overall level of inflation is linked to charges brought in by the Government. It is the smaller part of that as shown by the Central Bank analysis of last week, which also showed what accounts for the major part. As far as possible, we do not want to return to high taxes, whether direct or indirect, although I am not against the Government imposing charges where sectors in society that do not contribute to it have a clear advantage. Some of the charges were in those areas and Deputy Rabbitte knows precisely where they are. There are many arguments about those but people should pay something back.
On the particular initiatives, IBEC and ICTU in the talks and publicly put forward a range of measures they wanted implemented by the Government. They put forward their views but I cannot say at this stage whether it is possible to implement all the points which they put into the programme and into the public domain.
The Deputy referred to "the usual suspects" but the social partners do not change. They remain the employers, trade unions, the Government and agencies and we will try to deal with those. A number of issues were highlighted at the time even though the competition report has now been published, which shows that the increases for engineers, architects, dentists, optometrists, veterinary surgeons, medical practitioners, solicitors and barristers are all very high with regard to inflation.
Indecon Economic Consultants put forward a recent report which adds to the significant debate with regard to competition in these sectors. We must challenge these areas. The recommendations in these areas will be addressed by the relevant Ministers and the Competition Authority will take each area in turn, which will help. It is clear in all these areas that the increases are way out of line with international competition in the UK and the EU.
Eight areas have been highlighted by the social partners over the past year or two, although they are not the only eight in Irish society, and it is not impossible for us to challenge those. There are also other areas, including the insurance issue regarding which the Tánaiste will soon bring forward her proposals. The Government is also bringing in proposals and legislation with regard to the rental sector. Control and regulation in all these areas should give us an advantage in trying to reduce inflation and bring increased competition into Irish life. These are not the only areas that need to be addressed.
I call Deputy Sargent.
A Cheann Comhairle, just a quick—
I will come back to Deputy Rabbitte.
It is on this net point, sir. I am not arguing with the Taoiseach that there is excessive profit-taking in the economy and I am not arguing with him that private services have been quite disgracefully increased.
The Deputy should ask a question.
What are the differences between the Competition Authority's report and the report, many years ago, of the old Fair Trade Commission in relation to this matter? Can the Taoiseach outline one new proposal that is contained in the Competition Authority's report? The Law Reform Commission, for example, has said that the legal contracts handed out by successive Attorneys General of this Government in the past six or seven years are absurd. I refer to lawyers' fees, intended for High Court cases of two or three days' duration, but taken by lawyers for cases that have lasted two or three years – some of them have lasted longer than the Second World War. What will the Taoiseach do about this matter? Will he change the traditional system of awarding legal contracts in a manner that looks after his own in the Bar Library? Will he put such contracts out to tender?
I have no problem whatever with putting legal contracts out to tender, or with making changes to the present position, for example by working away from the per diem fee system. I am glad that the Law Reform Commission has made its statements. I know that Deputy Rabbitte agrees with me in relation to this matter, as we debated it in this House about a month ago. The Government can deal with this issue in a number of ways. The Minister for Justice, Equality and Law Reform has produced proposals for dealing with inquiries and investigations in an entirely different way. We must decide whether these matters must always be dealt with on a legal basis – I do not believe they do. Other people in Irish society can investigate many of these issues. Perhaps one can use only the law in many of these areas, but I do not think that the legal profession has to undertake every examination. The Law Reform Commission agrees with this view.
Deputy Rabbitte's first question related to the work of the Competition Authority. The authority's recent report is certainly the first major report to be produced on these sectors in the past 20 years. It is the first report to set out a path for challenging and changing the operation of these professions in Irish society. It is the first report to mention fairly tight protection arrangements, although it may not be fair to refer to them as "cartels". They are not really cartels as many different companies and agencies are involved in them. The report shows that those involved in the sector do not work in a competitive way. There is no competition between them as the industry's sectors and professional services are regulated in a way that ensures that, far from competing with each other, their costs are the same. The only thing that changes is that the fees go up in the better-known firms. The fees are never reduced. There is no real competition of the type found in the retail and other sectors.
Will we address it?
The Deputy should allow the Taoiseach to conclude.
The Taoiseach should answer the question.
Deputy Rabbitte has asked a fair question and the answer to it is "Yes". The inflation group has made a commitment to work on these reports. I hope it does not take too long to deal with individual reports. I have said to the social partners that the Competition Authority's recent report, published in the last few weeks, is enough to proceed with. We should not have to wait for individual reports as we might be waiting for two years.
Does the Taoiseach see anything ironic in the title of the partnership agreement, Sustaining Progress, given that Ireland's greenhouse gas emissions are going off the scale? The suggestion that there is anything sustainable about the agreement is absurd. Does the Taoiseach agree that the endorsement of incineration in the agreement will do nothing to encourage sustainability? If sustainability is not grasped, competitiveness will sink as greenhouse gas emissions will make the country very uncompetitive by comparison with efficient countries that have managed to grasp this nettle. Is the Taoiseach aware that the community platform, which includes the National Women's Council of Ireland, is concerned that its representatives, including those who represent poorer and marginalised people, will not be afforded the space to participate in partnership in the future? I ask this in light of the Taoiseach's remarks that the partnership arrangements will be re-organised. If the arrangement is reorganised, will the Taoiseach include the environmental sector? The Taoiseach says housing proposals must be pragmatic, but what is pragmatic to him may be useless from the perspective of the homeless. The Simon Community newsletter says the proposal for affordable housing will have no direct impact on the crisis faced by the homeless and that it gives no thought to sustainability or social integration. Will the Taoiseach address that matter in the agreement to ensure that progress is made on the issue of homelessness?
The title Sustaining Progress was not used in terms of the environment, although I agree that such issues have to be tackled. The Minister for the Environment and Local Government, Deputy Cullen, is actively involved in addressing them. In this context, the principle of sustaining progress refers to maintaining the economy and the numbers in employment at their current levels. We are attempting to maintain our standard of living while creating a more competitive market which will see further high growth from the future improvement in international economic circumstances.
Some of the organisations in the community and voluntary pillar did not ratify the partnership agreement so they have automatically stated that they wish to withdraw from the process. Most organisations have ratified the agreement and the agencies which have not will continue to engage with Departments in their usual way, but they will not be part of the ongoing pillar. I hope they continue to play a constructive role.
Deputy Sargent will agree that substantial resources have been invested in initiatives to address housing problems. We have put in place many strategies and employed many officers to tackle homelessness. That may not solve every single homelessness problem, but it is having a huge impact.
The problem is getting worse.
That is not the case and, while they will always lobby for more resources, it is not what the people involved are saying. I addressed the annual meeting of the Simon Community last year and pointed out the difference between the provisions made in the past and those that are being made now. I acknowledge that there are difficulties and conflicting arguments and I understand that questions are being asked about mixing the homeless with those who have substance abuse and other problems. The relevant Ministers, agencies and the homelessness officer in this city are addressing the issues and I was privy to a paper a month ago which outlined local authority plans in this regard.
Useful programmes and initiatives are under way whose goals will be costly to achieve. We will continue in the life of the current agreement to invest money and effort to increase the number and range of voluntary housing agencies. Deputy Sargent will acknowledge the excellence of the work of the voluntary housing sector, which is almost 100% funded by the State. The number of houses built was very low in the past, but we have made substantial increases in the grants available and I hope we continue to do that.
More people are at risk of homelessness. Did the Taoiseach not read what the newsletter said?
How can the Taoiseach claim that we are formulating effective integrated competition and social inclusion policies when 75 groups under area development management have had their funding cut substantially this year? They are holding a special meeting to discuss the matter this week. That cutback means, for example, that personal assistants to those in wheelchairs, carers and others in society who have no voice, are being let go. It demonstrates clearly the extent of the gap that has opened up in Irish society. Will the Taoiseach comment on that?
In respect of the agricultural community whose members are now depressed and demoralised and who feel quite rightly that the Minister for Agriculture and Food has let them down seriously, does the Taoiseach expect the agricultural sector to be part of the partnership agreement? If so, can he confirm that the disease levies which were doubled by Government will be dealt with and that the roll-over relief for land acquired for road widening purposes will be restored to the farming community, their two conditions for joining the partnership process? Given the difficulties farmers are now experiencing as a result of the stealth taxes introduced by this Government, the difficulties to come as a result of the Fischler proposals, and those in terms of the World Trade Organisation, can the Taoiseach confirm that these two conditions will be approved by Government this week?
On social inclusion and the negotiations on this programme, not every aspiration of every organisation can be fulfilled. The organisations themselves would acknowledge that during the period of the last programme there was an enormous increase in the resources given to them, as well as to the people they wish to assist. An enormous number of these organisations are now almost fully funded by the State in one way or another, whether through Combat Poverty, ADM, partnership or social welfare grants, or funds given out by various Departments in a range of ways. Most of these organisations are staffed by full-time, part-time and contract staff. There are literally hundreds of people employed in them. In implementing reductions or tightening up on expenditure, all organisations must take some of the hit, but I am sure it is the policy of Ministers, in disbursing their allocations under the Estimates, to endeavour as much as possible to avoid hitting those people most in need. There are particular areas that some of the organisations want examined. Organisations that are in the social partnership negotiations and organisations that are not will continue to raise their various points with Ministers and Departments, and I have no problem with that.
In relation to agriculture, as I have said previously, last year was a difficult year. Production costs increased, it was a bad year for prices and there was a prolonged period of bad weather. There is no doubt that the combination of the three affected agriculture. However, the overall figure for State assistance to the agricultural sector was €2.8 billion, a sizeable proportion of which, €1.7 billion, constituted direct payments. The interests of farmers domestically, in the world trade round and in the mid-term review of agriculture is very much in social partnership. It does not make sense for farmers to remain out side the process. I would prefer them to come in. I have no argument with farmers in these areas.
In relation to costs, tax concessions and so on, farmers have been discussing these issues with Ministers McCreevy and Walsh. Some of the decisions relating to them will not be reversed. Alternative mechanisms and ways of looking at these were put forward. However, in some of these areas, a contribution by farmers is necessary to pay for the provision of services that are quite costly. The State can pay and attempt to engage with these issues as much as it can. The budget of the Department of Agriculture and Food is more than €800 million. It is not possible for the State to simply pay everything and that has been explained to the farming bodies. The wider issues of agriculture, based on the 2010 report which will be reviewed shortly in Mr. Fischler's mid-term review and the World Trade Round are important issues. I would like to see farmers taking part in the negotiations dealing with those issues.
Will the Taoiseach honour the legitimate agreement between the Government and the farming organisations in respect of land acquired for road widening purposes?
Before the Taoiseach answers I will allow brief questions from Deputies Rabbitte, Joe Higgins and Finian McGrath.
What about the people in the community pillar who felt obliged to withdraw from the discussions, and the remarks attributed indirectly to the Taoiseach that they would have to pay a price for this in that they would be excluded from the inner circle in future? Is the Taoiseach aware of my ongoing inability to find these 10,000 houses that are to be built, according to the Minister for the Environment and Local Government, Deputy Cullen, without any impact on Exchequer finances? Has the Taoiseach yet worked out with the trade unions the source of funding for the 10,000 affordable houses that are to be built as a result of the agreement?
Why did the Taoiseach mention the rented sector Bill in the context of controlling inflation in an earlier answer when he knows well that his proposed Bill will have no—
The Deputy is making a speech and he should ask a question.
In fairness, Ceann Comhairle, I was formulating a brief question.
I want to allow your colleague, Deputy Finian McGrath, to ask a question.
My question was, given that the Taoiseach's Bill has no provision to control rents why does he mention it in the context of con trolling inflation? How does he square his enthusiasm for this agreement holding down wages when low-paid workers are at the mercy of landlords who put up rents on a monthly basis?
Deputy McGrath for a brief question.
On the question of the partnership talks on housing, is the Taoiseach really aware of the huge crisis in social housing? What does the Taoiseach say to the thousands of young couples who cannot afford to buy their own homes? Houses on the north side of Dublin which a couple of years ago cost €60,000 or €70,000 are now costing €400,000 or €500,000.
The Taoiseach for a final reply.
Mr. Kenny asked a question about the agreement between the farmers and the Government in respect of the roll-over relief for land acquired for road widening purposes. The agreement was about the level of compensation to be offered for land acquisition and it has been honoured. The farmers were arguing for a tax concession on the money but that was rejected.
It was in place when it was negotiated.
Please allow the Taoiseach to speak without interruption, Deputy Naughten.
The roll-over relief is gone. It was part of the agreement.
The roll-over relief is gone in all cases.
I suggest the Deputy submits a question to the Minister for Agriculture and Food.
The relief is gone for all sectors and not just for agriculture.
On the question from Deputy Rabbitte regarding the community and voluntary pillar, it is not a case of anyone paying a price. Some areas of the community and voluntary pillar rejected the proposals and the whole partnership process so, obviously they are out of the process. In many of these areas there is a long list of organisations awaiting their turn to get into the process. They will continue to be deal with in the normal way in Departments, but they left the process—
It is not like the Taoiseach to exclude people. These are the most vulnerable people.
We have gone over time for Taoiseach's questions.
They voted themselves out of the process. It was their own decision and they knew what they were doing. It was unfortunate that they left because they are being replaced by similar and competing organisations which does not make a great deal of sense, but that is a matter for themselves.
On the housing question, the Minister for the Environment and Local Government, Deputy Cullen, is considering numerous ways of moving forward with the housing initiative. Since Christmas he has been looking at land held in public ownership which could be used for housing. As we all agree, the land value is causing the problem.
Looking at it after the agreement has been put through.
Deputy Higgins must allow the Taoiseach to reply without interruption.
I hope the land will be provided. Deputy Higgins asked about the control of rents legislation. The legislation will be introduced in the House shortly and, I hope, it will help.
How?
The board is already working on an ad hoc basis. It is obvious that there has been a significant fall in private rental charges in the past three months.
The Taoiseach should talk to tenants about that.
One can see what is happening. In reply to Deputy McGrath, approximately 12,000 houses are being built in the local authority and voluntary housing sector. An increase in the supply of housing will reduce prices. Approximately 57,000 units overall will be built this year, including 12,000 local authority houses. However, we need to drive the supply. It is a supply and demand issue here, as is the case in every country. I have addressed on previous occasions the difficulties in regard to the supply of land.