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Dáil Éireann debate -
Thursday, 15 May 2003

Vol. 566 No. 5

Redundancy Payments Bill 2003 [ Seanad ] : Second Stage.

I move: "That the Bill be now read a Second Time."

I am very pleased to be here to move this important legislation. I thank both Deputy Hogan and Deputy Howlin for their co-operation in ensuring that this Bill has a speedy passage through the Oireachtas. The Bill provides for the implementation of the enhancements to redundancy payment levels and other improvements to the operation of the redundancy scheme that are provided for in the partnership agreement, Sustaining Progress, and the report of the redundancy review group. The Bill will also amend the insolvency payments legislation to allow employees of insolvent companies to claim their minimum notice entitlements under the insolvency payments scheme through a liquidator or receiver without first having to obtain an award from the employment appeals tribunal.

In April 2002, the Government established a review group, in the context of social partnership, to examine the operation of the statutory redundancy payments scheme so as to ensure the scheme best met the requirements of employers and employees. The review group, which reported back to me and the Government in July 2002, agreed a range of changes to the scheme, including a simpler method for calculating service, changes in the treatment of absences from work, treatment of service abroad, simplification of application forms and a new IT system, including an e-government aspect. The group did not reach consensus on issues such as an increase in the level of statutory redundancy payments and size of rebate to employers. The partnership agreement, Sustaining Progress, endorsed the changes agreed by the redundancy review group and provided in addition that the distinction between service under and over 41 years would be removed, there would be two weeks pay for every year of service, the bonus week would be retained, and the rebate of 60% to the employer would also be retained.

On 18 February 2003 the Government approved the drafting of a Bill on a priority basis to give effect to the new enhanced redundancy payments scheme. The Government decision also approved the provision of a sum of €1 million to cover the cost of supporting IT, the funding of administration costs and operational overheads, including the enhancement of supporting IT, to be made from the social insurance fund, with arrangements to be put in place with the Departments of Finance and Social and Family Affairs. The Government also agreed to amend the Protection of Employees (Employers' Insolvency) Acts 1984 to 2001 to enable employees of insolvent companies to make claims for minimum notice entitlements under the scheme without having to obtain an award from the employment appeals tribunal.

On 30 April 2003 the Government approved the text of a Bill to give effect to the new enhanced redundancy payments scheme and the amendment to the insolvency payments scheme. The Government decision of 30 April also approved the presentation of the Bill to Seanad Éireann and circulation to Senators. The Bill was published on 7 May 2003.

When the improved statutory redundancy payments come into operation, it is estimated that a full year's cost of payments from the social insurance fund, based on the 2002 level of redundancies at around 24,000, will be in the region of €149 million. This is an increase of €96 million in the annual cost to bring the new enhanced rates into effect. An amendment of the redundancy IT system will be required to implement the full range of changes set out in the new Bill, at a cost in the region of €1 million. It is anticipated that the new system, when it is fully operational, will simplify administration, especially for employers. It will also bring improved efficiencies in administration by the Department.

Section 3 of the Bill provides that the administrative costs of redundancy and insolvency be met from the social insurance fund by means of an appropriation in aid to the Vote of the Department of Enterprise, Trade and Employment. This will provide greater accounting transparency, in that all costs – payments as well as administration – will be funded by the SIF. Detailed arrangements have been agreed between the Departments of Enterprise, Trade and Employment, Finance and Social and Family Affairs to implement these changes.

There are two pieces of legal advice from the Office of the Attorney General. Firstly, as the payment of a statutory redundancy lump sum is a legal requirement on employers, it could not be imposed on them with retrospective effect. In fact, employers are entitled to due notice of the intention to legally require them to pay enhanced rates. The Nokia case of 1984 was related to this: the then Minister for Labour sought to impose increases on employers and that was successfully challenged in the courts. Secondly, the new Redundancy Act has to be brought into effect by ministerial order after enactment by the Oireachtas. This cannot be made retrospective.

I hereby give advance notice to all employers that it is my intention to try to ensure that the new redundancy payment levels will come into effect on Sunday, 25 May 2003 or as soon as possible thereafter. This will require swift passage of the Bill through the Oireachtas. The Government has also approved an early signature motion which will be going to the Seanad later this afternoon on the assumption that the Bill passes this House by the appointed 3.30 p.m. deadline. Employees who are issued with notice of redundancy on 25 May or later will be entitled to two weeks pay per for each year of service, plus a bonus week.

It is proposed that when this Bill has passed through both Houses of the Oireachtas and is enacted, a commencement order will be made so that most sections of the Bill will become effective, including the increased payment amounts. However, section 9 will be brought into effect on 30 January 2004, while sections 7, 11 and 12, will not come into effect until well into 2004 when the new IT system becomes fully operational. A commencement order giving effect to these three sections will be made at that time.

Section 1 provides definitions of terms used in the Act. Section 2 provides that the social insurance fund may cover the administration costs of the redundancy and insolvency schemes.

Section 3 provides for the amendment of section 2(1) of the principal Act by inserting up to date definitions of "contract of employment", "employee" and "employer". These definitions are similar to those given in the Protection of Employees (Part-time Work) Act 2001 and other legislation, that is, the Organisation of Working Time Act 1997 and the Carer's Leave Act 2001.

Section 4 provides for the amendment of section 4 of the principal Act, which deals with the insurability of an employee. The purpose of amending this section is to add clarity to the insurability requirements in line with the Social Welfare Acts and the Protection of Employees (Part-time Work) Act 2001.

Section 5 provides for the amendment of section 8(2) of the principal Act. The Employment Appeals Tribunal when dealing with redun dancy cases has long been of the view that redundancy is impersonal. According to the tribunal in the case of St. Ledger v. Frontline Distributors Ltd., the statutory definition of "redundancy" has two important characteristics, namely "impersonality" and "change". This section is designed to provide certainty in this regard.

Section 6 provides for the amendment of section 9(1)(b) of the principal Act to include fixed purpose contracts and when the fixed purpose contract ceases there is a redundancy situation.

Section 7 provides for the amendment of section 17 of the principal Act. The position at present is that the three forms RP1, RP2 and RP3 are the main ones used for statutory redundancy. They contain a good deal of repetition and will be amalgamated into one form when the new IT system is available later this year; this one form will be the basis for any rebate or lump sum claim.

Section 8 provides for the amendment of section 25 of the principal Act to include an employee who started work in an employment abroad, is transferred to the company or associated company in this jurisdiction, works here for a least two years and is subsequently made redundant while working here; he will be entitled to statutory redundancy for his entire service from the date of commencement of his employment in the company abroad.

Section 9 provides for the amendment of section 39(2) of the principal Act so that the vice-chairmen of the Employment Appeals Tribunal must have been practising barristers or solicitors for at least five years. The existing service provision for the chairperson is seven years.

Section 10 provides for the amendment of paragraph 1 subparagraph (a) of Schedule 3 to the principal Act by substituting “two weeks” for “one-half” and subparagraph (b) by inserting after “product of”“two weeks of”. These amendments are known as transitional arrangements, which will allow for the payments of increased statutory redundancy levels as soon as the Act comes into force following minor changes to the IT system. These arrangements will cease to have effect on the commencement of section 11.

Section 11 provides for the amendment of Schedule 3 to the principal Act by substituting new paragraphs for paragraphs 1, 2 and 3 to allow for enhanced redundancy payments of two weeks pay per year of service plus one extra week's pay. Any excess days will be credited as a portion of a year. These arrangements will come into force when a new IT system becomes fully operational.

Section 12 provides that continuity of service is preserved when there are certain breaks in employment. It also provides that certain breaks in service are reckonable in the calculation of a lump sum except breaks occurring in the three year period prior to the date of termination of employment. These arrangements will come into force when a new IT system becomes fully operational.

Section 13 provides for penalties that may be imposed on people who defraud the system.

Section 14 provides that the minimum rates of pay laid down in the National Minimum Wage Act 2000, as updated, be taken into account when calculating a statutory redundancy lump sum.

Section 15 provides for the amendment of section 6 of the Protection of Employees (Employers' Insolvency) Act 1984 to 2001. At present, where a worker in an insolvent firm has not received statutory notice, it is necessary to take the case to the Employment Appeals Tribunal to determine the minimum notice entitlement. In order to streamline the process and relieve pressure on the Employment Appeals Tribunal it is proposed to allow these employees to submit claims to the liquidator or receiver without having to go to the Employment Appeals Tribunal, thereby diverting these cases from the tribunal and ensuring a better service.

Section 16 provides for the repeal of section 17 (4) of the Employment Equality Act 1998. This section exempted the existing calculation of a statutory redundancy lump sum, which differentiates between service under and over the age of 41, from the provisions of the Employment Equality Act 1998.

Section 17 is a standard provision, which provides for the short title of the Act and the collective citation of the Act with other relevant Acts and the standard commencement provisions.

I acknowledge the work done by the social partners within the Redundancy Review Group, which reported to me last autumn. That group proposed several improvements to the operation of the scheme to make it more intelligible for employers and employees and to streamline the scheme. These improvements are included in the Bill and will improve efficiency and customer service.

In the negotiations for Sustaining Progress all social partners reached agreement to increase the level of statutory redundancy payments. This ability of the social partners to reach consensus shows the strength of our social partnership process.

I am very pleased to bring this Bill before the House. The method of calculation of the statutory redundancy lump sum and the level of payments have not changed, except for the ceiling on the weekly wage and a small change in 1979, since the redundancy scheme came into operation in 1968 some 25 years ago. This legislation is timely. It will give a reasonable level of increased statutory payments to employees who are unlucky enough to lose their jobs through redundancy. For some it will be a fourfold increase, for others it will be a doubling of what they would get by way of statutory redundancy. It is hoped the increased lump sum payments will help to alleviate the financial hardship caused by redundancy until these employees find alternative employment.

I wish to make this point concerning meetings I had with redundant workers because I have no doubt it will arise. I never assured anybody that his or her statutory redundancy payment would be backdated. I was not in a position to do that. In the first instance, when I met workers on 12 December last, we had not even agreed to increase the level of statutory redundancy. I said to those, and perhaps to other, workers that I would do my best to ensure that they were included, and I did my best. I cannot set aside constitutional law. I had to accept the view of the Attorney General. This matter was discussed at length in Cabinet, but unfortunately it is not possible, notwithstanding some very hard cases, to make the enhanced payment of statutory redundancy payable on a retrospective basis. That is the legal, factual position. Unfortunately, there is nothing I can do about that, notwithstanding my best endeavours and the best endeavours of my officials.

The publication and the debate on this Bill is an ideal opportunity for us to reflect on the current condition of the economy. Since 1994 Ireland has undergone enormous change, none more so than the number of jobs created, record exports and positive economic news generally. Never before in the history of the State have so many opportunities been available for our people to develop to their full potential and to become involved in the economic development of the nation.

During those years there was great expectation that issues related to education, health, transport and child care, to name but a few, could be resolved with the upturn in the economy and the available finances to the Government. In those years the Celtic tiger roared and the Government engaged in the largest ever spending splurge experienced with increases in public expenditure of the order of 20% in the years 2000, 2001 and in the earlier part of 2002, but it all came to a stop in June 2002. Any independent observer would have expected the problems that Ireland had faced and failed to tackle over of the years due to a lack of finance could have been tackled with a cost effective value for money approach that would sustain the economy and the people in their employment into the future.

The failure of the Fianna Fáil-PD Government to keep the nation's finances in order was acknowledged by the current Minister for Justice, Equality and Law Reform, Deputy McDowell, in March 2002 when he stated that sanity would have to prevail in respect of the finances of our country when the general election was over. That statement surely summarises the cynical approach taken in 2001 and 2002 by the Government collectively, but specifically by the Minister for Finance and the Progressive Democrats at the Cabinet table who squandered the boom in an outrageous fashion, which has led to the rapid deterioration in our economic indicators in the past eight months.

This Fianna Fáil-PD Government has imposed taxes on jobs by imposing a high number of indirect taxes in the last budget and since the election. It is estimated the Governrment has contributed to 2% of our current high inflation rate in the economy because of decisions made in the previous budget and by rapidly increasing the cost to consumers and businesses of indirect taxes and public utilities. The Fianna Fáil-Progressive Democrat Government is contributing to 800 job losses per week and a doubling in the number of notified redundancies since the general election.

The Irish Exporters Association recently stated that the continuing downturn in global markets and the persistent deterioration in exchange rates as well as out-of-control inflation were impacting on the ability of our exporters to retain employees. The association estimated that job losses would reach 25,000 in 2003.

The main findings of the Small Firms Association ninth national employment survey provides more reading for the Minister. It showed a 58% decline in the demand for labour, that 62% of companies have no vacancies, that the number of projected new jobs has decreased from 36,238 to 17,420, and that demand for foreign and part-time workers has decreased substantially. The director of the Small Firms Association, Mr. Delaney, stated that any further losses in competitiveness would have serious consequences in terms of job losses. The Irish Small and Medium Enterprises Association has painted a similarly gloomy picture on the employment front.

The question that must be asked of the Minister and the Government is where it has gone wrong in terms of the competitiveness of the economy. We have gone during her term in office from being fifth in the world in 1996 in terms of competitiveness to 24th in the world today. How could the successes of three to four years ago have been frittered away and how could there have been a failure to sustain a competitive economy today?

The Acting Chairman and I know the fragile nature of many of the traditional industries and many jobs have been lost in his county of Donegal. Many actions were promised in that regard, including task force reports and ministerial interventions. Regrettably, the fact is that we are now less competitive against countries in the Far East or eastern Europe, and the challenge is growing on a daily basis.

There was no planning in recent years for the shocks and surprises to our economic cycle that were bound to happen. We could have planned in a much better way through investment in infrastructure, research and development, supporting the roll-out of broadband technology and improving communications generally. These are issues that were on the Government's agenda for many years and which could have given us a great opportunity to bed down in the economic cycle and the economy the edge Ireland needed and should have had to compete with the applicant countries of eastern Europe and beyond. We do not need more commissions or reports to inform us that investment in infrastructure, along with the issues I mentioned, is required. We need action.

Notwithstanding the costs to business, it is essential that workers receive improved social protection. This would have been more affordable some years ago had we planned for it in a better way. It is worth noting that we have the lowest expenditure of any of the European countries on training and redundancy. This social protection is something I support and I also, therefore, support the legislation.

The Bill updates the Redundancy Payments Act 1967 to which there have been changes over the years, but this is a fundamental change to the level of remuneration and pay-out made under the Act. It is substantial, increasing the level from a half week's pay for each year of service to two weeks. It is a reasonable and prudent step forward for social protection for workers. The basic statutory redundancy payment to employees losing their jobs through redundancy resulting from closure, re-organisation or other grounds had not changed over the years. The purpose of the scheme was always to alleviate hardship for workers and their families in the event of redundancy and possible subsequent unemployment. A strong case has always been made for increasing the level of social protection as incomes have increased and the economy has improved. I am glad the Government task force report is finally being implemented.

The current statutory redundancy payment should be amended to reflect not only the requirement for a higher payment for those who lose their jobs but also to reflect the vulnerability of those who lose their jobs at various stages in their careers. I welcome the calculation of service for redundancy purposes commencing at 16 years of age and that redundancy entitlements are payable after two years of employment. The enhanced payment of two weeks for each year of service is a reasonable and prudent step.

The State should examine the desire of an employee to retrain with the necessary resources that will be made available through the redundancy payments scheme. Perhaps matching funds should be available to workers to help them attain the necessary qualifications to get back into the workforce as quickly as possible. FÁS could examine this option.

The spirit of what was intended in the Government task force in respect of simplification of redundancy entitlements should be brought forward as quickly as possible. We should not have to wait another year for these provisions to be implemented. I also welcome the provision under which time off for maternity, adoptive, parental and carer's leave will be recognisable for statutory redundancy. I am especially glad the issue of carers was recognised in the calculation of the pay-out.

Dozens of new houses have been built in the past ten years creating new suburbs in towns and villages for working people. The tax and spend policies of and cost increases imposed by the Government place some families under financial pressure. We must reduce those pressures for young couples as much as possible. I hope the Minister will seek to have financial institutions, when lending money for private house mortgages, take out compulsory insurance to protect employees in the short term who are made redundant and give home owners, especially couples, breathing space for a minimum period, for example, six months. The trauma families must endure due to a loss of employment is enormous and it would be a great step forward if negotiations could be concluded with financial institutions to assist couples with their mortgage payments for a minimum period at a time of redundancy. The basis of a redundancy payments system is that when people lose their jobs, they and their families are able to sustain in the short-term the financial pressures that accrue from such an unexpected loss.

The Minister, not surprisingly, mentioned the fact that she has met a number of workers' groups in recent months. Regrettably, she will probably meet many more in the next few months. She gave an undertaking on 12 December 2002 to workers in Comerama, Castlecomer, County Kilkenny, which is in my constituency. The company decided to cease trading and relocate some of its activities to other parts of the world, causing 180 workers to lose their jobs in north-east Kilkenny. The Minister indicated at the time that the partnership negotiations were ongoing and that any agreement reached on redundancy payments would be passed on to the workers in Castlecomer. These negotiations were concluded subsequently in the context of social partnership talks.

There is no ambiguity about what the Minister said at the time. I know she may have been under a different impression.

Did the Deputy receive the minutes of the meeting?

The Minister's version.

My officials' version.

Fourteen people attended the meeting. I received a letter from SIPTU in recent days addressed to all Oireachtas Members representing County Kilkenny. It states:

A Chara,

We are writing to you as our Dáil representatives who attended the meeting . . . as part of the delegation on Thursday, the 12th of December [at which] the Tánaiste, Ms Mary Harney, Minister for Enterprise, Trade and Employment [was in attendance].

You are all aware, as are the undersigned, that at our meeting the Tánaiste gave an unambiguous commitment that the Comerama work force would be included in any change in the then current formula for redundancy calculation.

Not true.

The letter continues:

Indeed, following the meeting we all exchanged our comments of satisfaction that the Tánaiste had exhibited such understanding of the plight of the workers in regard to the redundancy issue.

Our members in Comerama then accepted the Company's redundancy offer at a meeting for all members held on Saturday, the 14th of December, 2002, with the knowledge that the Tánaiste had made this commitment towards them on the statutory redundancy matter.

The Tánaiste's commitment was confirmed by our Regional Secretary, Mike Jennings, to your goodselves and indeed—

We have not agreed to increase it.

I know the Minister does not want to hear this.

The Deputy should not be selective. He should read the minutes.

The Minister should not interrupt.

May I have an opportunity to continue?

The Tánaiste's commitment was confirmed by our Regional Secretary, Mike Jennings, to your goodselves and indeed the commitment was also confirmed in a circular letter sent by [Deputy] John McGuinness to the Comerama workforce.

Against this background, it was with extreme disappointment and disbelief, that we heard that news is now coming to us that the Tánaiste is "changing her story" and reneging on her commitment to our one hundred and sixty (160) workers in Comerama.

While always disagreeing with the Tánaiste's political philosophy—

What is the date on that letter?

—we would have respected her as a person "of her word".—

What date is on that letter?

The date on this letter is 14 May 2003.

Did the Deputy ask Mr. Jennings when he was aware it could not be done?

They are acknowledging that the Tánaiste is a person of her word.

The unions were told that there would be redundancies.

That is an extraordinary statement.

Please allow Deputy Hogan without interruption because his time is limited.

"The Tánaiste told us that she would give us that commitment here and now and she said that at our meeting on 12th December, 2002.".

There were 14 people present on that occasion and the Tánaiste is the only person that seems to think she did not make that commitment.

The Deputy should read the officials' notes, the notes of the public servants.

Acting Chairman

Tánaiste, I must insist on Deputy Hogan being allowed to speak without interruption.

I wish to be helpful to the Tánaiste and to get her out of this problem. She quoted precedents and that the Attorney General said that this could not happen. In the past the Talbot workers were nationalised by Charlie Haughey when he was Taoiseach.

Thankfully we do not do those stupid things any more. We are not basket cases.

The Tánaiste is the Minister and can do anything she wishes with Government approval in the same way as Charlie Haughey was able to do it for the Talbot workers. We nationalised the workers and we gave letters of comfort—

Does the Deputy want me to buy it?

—to Aer Lingus employees and to CIE employees over the years. The Tánaiste gave a commitment and her word to do something and she could not follow through, she could not deliver.

I gave my commitment to do my best. The Deputy is being begrudging.

As deputy prime minister she could not deliver on the commitment she gave to those workers who left that meeting in good faith very happy with the acknowledgement that had been given to their plight. They are very reasonable people.

They have not even agreed to it.

Acting Chairman

Deputy Hogan without interruption and Deputy Hogan to speak through the Chair.

Deputy Murphy is sharing my time and I want to conclude by saying that the commencement order of this legislation should be back dated to the 28 November 2002 to take account of the commitments that were given on that occasion. That is my only quibble with the legislation, that the commencement order should be made from that date. If there is a will on the part of the Tánaiste and the Government it can be done and the Government's portion, at least, can be paid, notwithstanding what the Tánaiste had to say about the employer's contribution. The Government's contribution could be paid as an ex gratia payment if the Tánaiste has the will to do so.

The Redundancy Payments Bill [Seanad] 2003 is in general to be welcomed as it is a substantial improvement on the current position. However, it comes too late for many workers who have lost their jobs particularly those who lost them over the past 18 months. As Deputy Hogan said, it is particularly disappointing for workers recently made redundant as there were clear indications from the Government and from the Tánaiste that the Bill would be retrospective. The Tánaiste now says she meant only if it were possible to do so. She now claims it is not legally possible. It is difficult to believe that such an experienced Minister who is also the Tánaiste did not know the real situation when she promised to make the Bill retrospective—

On a Point of Order, Chairman, I am disappointed that the Tánaiste is not at least staying in the House for the speeches of the main spokespersons of the Opposition parties on this important legislation when she is challenging a position—

Acting Chairman

It is not a matter for the Chair.

—in relation to these matters. We deserve the courtesy unless there is a compelling case for her not to be here.

Acting Chairman

It is not a matter for the Chair. The Tánaiste is being deputised by a Minister of State.

It is very disappointing.

The only conclusion one can reach is that this episode is just a continuation of the untruths and deceit which the Government has inflicted on the Irish people since well before the last general election.

This time last year, just before the general election, we were seeing the beginning of a serious downturn and one of the first major factory closures was GI in Macroom, County Cork.

An unemployment level of 3.6%.

According to the Government of the time, redundancy was not a real issue—

The Minister of State should listen.

—as 200 replacement jobs were to be created immediately—

(Interruptions).

Acting Chairman

The Deputy has only about two minutes left to speak and should be allowed to speak without interruption.

— by the Government. Élan's publicity agent and former Fianna Fáil press officer, P. J. Mara, assured the people of Macroom and Cork North-West, that the factory would be up and running within 12 months. The 12 months have passed and the only sign of activity on the site in recent times was when a "For Sale" sign was erected.

This intolerable piece of deception by the Government in a very marginal constituency and just six days before the general election—

It is a private company.

—was rightly condemned last Sunday in the Sunday Independent. The report—

The dust from the Taoiseach's state car has not settled on the road.

—said that the sense of betrayal felt by those in the constituency of Cork North West is a microcosm of the prevailing mood of public disillusionment. The Government raised expectations and then failed to meet them.

The unemployment level is 3.6%.

It is going up.

The Tánaiste was heard without interruption.

Acting Chairman

I ask the Minister of State to allow the Deputy to continue.

This was the start of an avalanche of closures and redundancies, many of which should not have taken place and would not be still taking place except for the total and utter mismanagement of the economy over the past five or six years.

The two weeks per year of service proposed in the Bill is a minimalist approach but considering how badly the Government has managed the economy and as a result of the expected massive increase in redundancies, it is probably all the Exchequer can afford. Based on the redundancy figures for 2002 alone, this will cost the taxpayer €96 million. It will be interesting to see what the real outturn of this estimate will be, considering the ever-increasing number of redundancies.

Had the Government managed the boom and the economy well, it would have been possible to increase this figure as there would have been far fewer people looking for redundancy.

The Government and in particular, the Tánaiste, must take responsibility for the massive job losses. Despite the statistics constantly quoted by the Government, the cause of the job losses is the increased cost of services to business. Since the budget there has been a constant flow of stealth taxes, increases in energy and transport costs. Inflation is out of control and industry can no longer tolerate the costs.

The greatest scandal is the Government's inability to deal with insurance costs. The cost of employer's liability and public liability is causing a high rate of job losses. It is stifling the expansion hopes of existing businesses. It is nearly impossible for companies to get insurance. Despite the fact that the Minister has promised in this House to take action to deal with insurance, every employer's organisation is pointing out that jobs are being lost because of insurance costs. People do not want to be made redundant, they want jobs. The Government's inability to maintain jobs is a real problem.

With the permission of the House I propose to share five minutes of my time with the Father of the House, the Leas-Cheann Comhairle, Deputy Pattison.

Unless there is a compelling reason I find it unfortunate and discourteous to Members who have something to say directly to the Tánaiste today that she would come into the House for an important Bill that has been promised for a long time, deliver her own speech and not even wait for the first speech of the main Opposition party. It is particularly discourteous when she makes assertions that need to be addressed and cleared up during the course of the debate. I say that without any disrespect to the Minister of State who is present.

This is an important Bill and it is belated. Those of us on the Labour benches have campaigned for a very considerable time to have the out-dated redundancy payments properly enhanced at a time when the social insurance fund was significantly in surplus, so much so that at the last opportunity the current Minister for Finance saw fit to raid it in order to augment general Government finances. It is set up for a particular purpose and that is to give security, help and support to workers.

Workers who are faced with redundancy, the most appalling of issues, many after years of service, should be given some decent standard of support and remuneration to sustain them until they find gainful employment. It is quite clear for a considerable time that the meagre half week's pay per year of service for those under 41 years of age and one week's pay per year for those over 41 years was entirely inadequate. These standards set in the 1960s were entirely inappropriate. Before the dissolution of the last Dáil, the Labour Party introduced a Bill to significantly increase the redundancy payments to such workers and to abolish age discrimination altogether.

The Bill currently before the House addresses these issues to some extent. The increase is meagre enough and does not go as far as the three weeks we sought in our legislation. It settles for two weeks per year of service. Similarly, it addresses the age discrimination issue by abolishing that discrimination, which I welcome.

A number of other issues have been touched on both in the Tánaiste's and Deputy Hogan's comments which improve and update the redundancy legislation. It makes it more efficient and the calculation of the redundancy period more discernible and easy. It also makes it easier for workers to have a clear calculation of their entitlements. I welcome also the calculation from the age of 16 in employment. I welcome these measures and, therefore, would say to the Tánaiste that we will give quick and speedy passage to the legislation, as agreed. We hope the deadline she stated in her declaration to the House this morning of ten days from now will met and that these benefits will be available to workers who are already facing the threat of redundancy in firms and industries throughout the country.

The biggest deficiency in the legislation, however, is the abandonment of the clear promise of retrospection. Let us be clear about this. Workers involved in redundancies over the last year or so have been met by the Tánaiste and others. We have been discussing this issue since before the fall of the last Dáil. We were told then that negotiations on enhanced redundancy would form part of the new national deal and that independent legislation would not be published until that happened. We knew this was coming and those workers who were suddenly faced with redundancy wanted to be included in its provisions, including workers in Peerless Rugs in Athy and workers in Wexford Electronics in my home town. Many of these workers, after a lifetime of service to the company, were faced with nothing more than a meagre statutory redundancy.

I want to deal clearly and factually with the issue in relation to the workers in Comerama, Castlecomer. The Tánaiste has made an issue of this situation. If she had simply stated from the beginning that she could not comply with the commitments she made, well and good, but to deny that she made a commitment flies in the face of the clear evidence of a number of people who attended that meeting. It is not good enough for the Tánaiste to circulate what she presents as a minute of that meeting to those of us who questioned her commitment or the actual words used. It is a minute prepared by her own staff, which was not cleared by anyone else present. To purport that it was an agreed minute is to misrepresent the facts. I have a written account pre pared by Mr. Mike Jennings, regional secretary of SIPTU for the midlands and the south east, on the background of the meeting and the commitments made by the Tánaiste, Deputy Harney. It reads as follows:

On 12 December 2002 a large delegation of SIPTU representatives and politicians met Mary Harney and her officials to make representations arising from the closure of Comerama in Castlecomer.

In response to written and oral requests made at the meeting Mary Harney gave an unusually clear and unambiguous promise to backdate the revised redundancy payments. She referred to the fact that improving redundancy was then being discussed by the social partners in the post-PPF talks. She clearly said that if the statutory entitlement is increased the due date would be set so as to accommodate the Comerama workers.

The Comerama workers had already received their RP1s at that time. They were issued on 28 November 2002.

Mary Harney could not have been in any doubt what it was she was being asked to do.

Phil Funchion's (SIPTU branch secretary) written presentation given to the Tánaiste stated:

". . . to ensure that any change in the current formula for redundancy calculation will include the Comerama workforce who received their RP1 forms with effect from 28th November 2002." [That was the submission.]

The meeting of 12 December 2002 was attended by. . . Mike Jennings, Phil Funchion, Eamon Nolan, Anthony Barrett, Angela Byrne (all SIPTU), Liam Aylward TD, Phil Hogan TD, Seamus Pattison TD, John McGuinness TD, Senator Bernard Browne and Councillors John Brennan and Martin Carroll.

Senator Bernard Browne should read Senator Fergal Browne. The briefing note continues as follows:

Recognising that the Tánaiste's commitment was unusually explicit and unambiguous and therefore most valuable, I [this is Mike Jennings] took the trouble to double-check with Liam Aylward TD, John McGuinness TD and Seamus Pattison TD, that she had, in fact, said what I had heard her say. All three TDs [that is Deputies Liam Aylward, John McGuinness and Seamus Pattison] confirmed what I had heard.

This meeting with these TDs took place on 15 January 2003 at a meeting in Castlecomer. Not only did [Minister] Liam Aylward confirm my recollection but he said that on 14 January 2003 he had contacted Ms Harney's office regarding it.

Subsequent to that Deputy McGuinness circulated all the workers stating as follows:

The Tánaiste gave a commitment in our meeting with her on the 12 December 02 to ensure that the workforce of Comerama are included in any new deal which would be agreed. This is very positive news for those involved.

That was a letter circulated to the workforce in Comerama on 20 January 2003 and signed by Deputy John McGuinness.

I do not want to question the integrity of the Tánaiste but all these people have very firm recollections of the commitment made. If it is impossible to deliver on it for legal reasons, let that be acknowledged, but she should not fly in the face of the evidence of all those good people. The Tánaiste told the House on 8 May, and repeated this morning, that the unions were in no doubt that it could not be made retrospective legally. This makes a nonsense of the new version of what she told these people. Is she now saying she was giving an assurance that she would do her best to make it retrospective, if she already asserted that the unions knew it could not be done legally? Neither of her versions stand up. I regret greatly that she has taken this line.

I want to deal with one or two other issues in the couple of minutes left. I hope the amendments I tabled will be accepted. I have tabled two amendments which I am now informed will be ruled out of order. I understand most of the amendments tabled by other Deputies who want to enhance redundancy payments, or make it retrospective, will also be out of order because we cannot impose a charge on the State. However, the Government can ensure that ex gratia payments are made to those workers who have been shielded in their preparations for redundancy with the thought that these enhanced payments would be made available to them. There is an onus and responsibility on the Government, particularly on the Tánaiste, to do so.

The Tánaiste referred to the definition of redundancy. She said the Employment Appeals Tribunal, when dealing with redundancy cases, has long been of the view that redundancy is impersonal. She proposes to change the definition in section 5 of the Bill. I am concerned about that and I will deal with it in detail on Committee Stage. It is a narrow definition to provide that if redundancy is related personally to an individual, it is not redundancy. That is fine in the vast majority of cases. However, I wish to change it to read "the conduct of an individual". It could be a situation, for example, where somebody is made redundant on the basis of being last in and first out. That is personal to the individual concerned. I am fearful the provision would punch a hole in the definition of redundancy which would have a negative impact on some individuals in the future. I will deal with these points on Committee Stage.

By and large, I welcome the Bill. It is urgently needed. Unfortunately, the upward spiral of unemployment has again become a feature of the economy. In all constituencies there are situations where people will face redundancy. I deprecate the fact that at a time when supports were never more needed to assist in the retraining of workers to allow them to prepare themselves to re-enter the labour market speedily, those supports are being assaulted by the Government in a perverse type of pro-cyclical economic policy. In other words, when the money for retraining and supports is least needed, it is most available and when it is most needed, it is least available.

The training supports for FÁS have been cut this year by 41%. Workers will need the additional resources they have in order to live but their chances of being properly retrained are severely curtailed by the savage cuts in the FÁS budget. The FÁS employment programmes have been cut by 12% and there has been the unconscionable attack on 5,000 places in the community employment scheme. It is a bizarre set of circumstances. The State invests in retraining, job creation, social employment and the other mechanisms that exist to ensure that people are not left unemployed for a lengthy period of time and these mechanisms are now under attack.

Much more can be said about this Bill. I will not delay its passage but I deeply regret that the Tánaiste is not present to hear these points and to answer them. She has a fine and well earned reputation for being forthright and for confronting and answering any charges that might be made. She has done herself a disservice, hopefully for a very good reason, by absenting herself from this debate.

I, too, regret the fact that the Tánaiste is not present. I welcome the Bill. It is long overdue and should be given a swift passage through the House. However, I have one serious reservation and in the limited time available to me I will focus on that.

It concerns a definite commitment given by the Tánaiste to the deputation from Comerama, Castlecomer, County Kilkenny, which had a meeting with the Tánaiste on 12 December 2002. The meeting was held in the conference room of the Tánaiste's Department on Kildare Street. The deputation consisted of Oireachtas representatives from the constituency, local councillors, SIPTU officials, employees of Comerama and myself. We found the Tánaiste extremely helpful. She adopted a positive tone to the various points brought forward by the deputation and many useful suggestions and proposals were made. However, towards the end of the meeting the Tánaiste definitely made a commitment to include the Comerama workers in any new redundancy deal. I have no hesitation in putting that on record. There were no "ifs" or "buts" and it was not a question of doing her best or doing it if she could. It was a straightforward commitment to apply the terms of the new Redundancy Payments Bill to the Comerama workers.

Last week in the House I was not merely surprised but shocked to hear the Tánaiste say she did not make such a commitment. I was not the only Member who was surprised and shocked. I have never played politics in this House and I am not playing politics with this issue which is a straightforward one. Last week the Tánaiste attempted to justify her case by stating that she was at a meeting on the previous day with Mr. Jennings, who is a senior SIPTU official and was a member of the delegation, and he did not take up the issue with her. She inferred from this that he was in agreement with her statement.

Nothing could be further from the factual position. That meeting involved a deputation from the then about to be made redundant workers from Tex Tech, Kilkenny, and reference was made to the new legislation in the context of the Tex Tech workers. It would have been totally inappropriate to raise the issue of the Comerama workers during a meeting with a deputation about another group of workers. To infer from this that he was in agreement with the Tánaiste is out of line. Deputy Hogan and Deputy Howlin have put on record some of the correspondence on this matter and I do not intend to repeat it. The Tánaiste further stated last week that when the recent negotiations were under way, the trade union movement was told that the legislation could not be retrospective. However, that is not the issue. The issue is that the Tánaiste now says she did not make a definite commitment when she did.

There are many ways in which the Comerama workers can be compensated to the level of the new redundancy payments provided for in this legislation. Reference has been made to the famous or infamous, depending on one's point of view, Talbot agreement where an Estimate was introduced for a sum of £475,000 to cover compensation for those workers. There are also many ways in which ex gratia payments can be made.

As a result of the outcome of the deputation's meeting with the Tánaiste last December and taking that commitment into account, the workers reached agreement with their employers on redundancy terms. It can be argued that the workers might not have accepted those terms and would have sought more favourable terms from the employers if they had any doubt as to the Tánaiste's commitment. I make an earnest appeal to the Tánaiste. She has the power, if not under the provisions of this Bill, to make ex gratia payments available. There are 160 workers involved. They paid their PAYE and contributions to the social insurance fund. She owes it, in justice, to them. A grave injustice will be done to these workers if they are not compensated in accordance with the commitment given by the Tánaiste.

I wish to share time with Deputies Joe Higgins, McHugh and Eamon Ryan.

Is that agreed? Agreed.

I do not intend to be interrupted. I will behave like a Government Minister and not listen to anybody on the opposite benches. I wel come the Redundancy Payments Bill. It is urgently required because Government and employers' organisations have made every attempt to resist giving workers who are made redundant adequate compensation. This PD-Fianna Fáil Government has no desire to protect the rights and entitlements of the working class. Despite the wealth generated in the past ten years, life remains a perpetual struggle for the low paid workers of this State. James Larkin referred to William Martin Murphy as "the most foul and vicious blackguard that ever polluted any country. . . . a capitalistic vampire". If he were alive today, James Larkin would describe the current Minister for Finance in similar terms for it is Deputy McCreevy, through his political actions, who leads the lock-out against the workers of this State, preventing them from accessing the profits their labour generated during the years of the boom. Day in and day out we come here to argue on behalf of the people of the Twenty-six Counties for the services and benefits that are rightfully theirs. Relentlessly, we debate people's rights to housing, health care and education. We make these arguments in the knowledge that this Government is ideologically opposed to the delivery of these basic rights and is bringing public services in the State to their knees.

Members of Fianna Fáil who spent yesterday morning at the State's 1916 commemoration would do well to reflect on the ideals advocated by the signatories of the proclamation of independence. In its governance of this State, Fianna Fáil has dishonoured such noble ideals. Many Fianna Fáil Ministers are disgraced by their conduct in Government and by their betrayal of the people's rights. Fianna Fáil backbenchers should rein Ministers in and stop them in their tracks. In fairness to the Progressive Democrats, they have never pretended to be anything other than Thatcherites.

The workers of Peerless Rugs in Athy and the Irish Glass Bottle Company in Dublin deserve much of the credit for forcing this uncaring Government to reform the outdated redundancy legislation, the basic terms of which had not changed in 35 years. It is a sad indictment of this Government that it took the protracted disputes at Peerless Rugs and the Irish Glass Bottle Company, a profitable company which had refused to abide by a Labour Relations Court ruling of five weeks severance pay per year of service for each of the work force, and the determination of the workers of those and other companies to force the Tánaiste to introduce legislation to increase redundancy entitlements.

The legislation was introduced following a commitment in the new agreement, Sustaining Progress. The Government and employers' organisations are increasingly forcing workers to bargain for rights that are already theirs as part of the wider social partnership deal. Employer recognition of unions, compliance with labour legislation and the fulfilment of statutory redun dancy rights are not concessions, they are all basic rights and should not have been up for negotiation in the first place.

On behalf of Sinn Féin, I commend the large number of workers who protested in October against the inadequacy of redundancy compensation. We have supported those protests and support the workers on the ground, particularly in the Irish Glass Bottle Company in Ringsend.

Though I welcome this Bill, it does not go far enough. I welcome the fact that discrimination suffered by young workers under the Redundancy Payments Act 1967 is being abolished and the discrimination against older workers, whereby those over the retirement age are not entitled to statutory redundancy payments, is also being tackled. It does not go far enough, however, in addressing the level of statutory redundancy. Workers who have waited for this legislation for a long time are deeply disappointed that the Government has once again given in to pressure from employers' organisations to restrict the level of redundancy payment to two weeks per year of service. We support the demand made by the trade unions that the statutory redundancy payments be increased to three weeks' pay per year of service. I tabled an amendment to that effect on Committee Stage but it has been ruled out of order. I hope the Minister will accept the principle behind the amendment anyway.

It is not often one comes into this chamber without a reason to complain but the debate on the Redundancy Payments Bill 2003 is one of those rare occasions. The Tánaiste should be complimented for the speed with which she dealt with this issue. Negotiations were entered into and concluded and the Bill was drafted, approved and published in less than a month.

The process has been under way since the last Dáil.

As a new Deputy, I am amazed at the pedestrian speed with which most things progress. It is refreshing, therefore, to see the efficient manner in which this legislation has been attended to. The swift progress no doubt occurred because the Tánaiste took a personal interest in this issue, having appreciated the seriousness of the situation for the workers who lost their jobs.

This legislation has particular relevance in my constituency of Galway East. The shock announcement of the closure of Square D in Ballinasloe with the loss of 385 jobs was a major blow to the workers in the town. The Tánaiste is aware of the situation in Ballinasloe and is acquainted with some of the workers and their families. The Square D workers were concerned that this Bill will not cover them before the job losses take effect. The Minister of State should take this opportunity to confirm that the Square D workers will come under the provisions of the Bill.

It is good to know that this Bill will ensure that workers under 41 years of age, who heretofore would have qualified for half a week per year of service, will now qualify for two weeks' pay per year of service and that workers over 41 years of age, who heretofore would have qualified for one week's pay per year of service, will also qualify for two weeks' pay.

Retrospection has been mentioned by many commentators and confusion reigns, with Fianna Fáil backbenchers issuing letters telling people that the provisions of the Bill will be retrospective while, at the same time, the Tánaiste has said this could not be done. The Tánaiste's speech this morning clarified this issue and while I regret that the provisions cannot be made retrospective, I welcome the legislation and compliment the Tánaiste and the Minister of State on the manner in which the situation has been dealt with.

I support this Bill as far as it goes but it does not go very far. I was amazed at the effulgent tributes paid by Senator O'Toole, a leading official of the Irish Congress of Trade Unions, to the Tánaiste in the Seanad because she introduced this Bill. The Senator went on at length, lionising the Tánaiste for moving from a situation where workers who are made redundant get some crumbs to giving them a crust of a little more substance. Let us get real about this. If we are talking about workers on low to medium incomes of around €400 per week, two weeks for every year would amount to €800 and after ten years they would be entitled, according to this Bill, to the princely sum of €8,000. This is supposed to be a massive advance for the working class of the State. I am afraid that the standards of leadership in the trade union movement are not very high at present if it is so welcoming of this legislation.

There was no reference to the profits of the employing company from the labour of those workers in their previous years of employment. This issue arose in the case of the Irish Glass Bottle Company workers who were employees of a major multinational corporation. When they were let go with disgraceful redundancy terms, one of the workers said bitterly – but accurately – when referring to purchases of assets abroad by the company that all the money came from their labour and now the company was saying they could not have it and that hurt more than anything.

There is no regard to the profits that have been salted away by some quite substantial companies when it comes to the level of redundancies that would be made available to those workers. The right to work is a fundamental human right in the view of the Socialist Party, involving a person's right to make a contribution to society, to have dignity and to earn an income that provides reasonable comfort for us all. It is a right that is not properly appreciated in the capitalist ethos that dominates the present economic system. The protection and maintenance of employment should be the first priority of Government but unfortunately this Government has fallen down badly in this regard. There is a general problem of policy in the over-reliance of this Government on multinational corporations, which when it suits their profits will quickly disperse to far flung places where they may be able to source cheaper labour and leave Irish workers in the lurch. The Government is giving hostages to fortune in that regard and that is one danger for workers, particularly in the context of a new economic situation.

Acting Chairman, can you ensure that I leave six minutes for Deputy Ryan?

Acting Chairman

The Deputy has one minute and 39 seconds left.

This is like the four minute mile.

I would not want to encroach on the agreed time.

The Deputy has only three minutes left now.

As regards the Irish Glass Bottle Company there was a particularly disgraceful dereliction of duty by the Government. I wrote to the then Minister for the Environment and Local Government, Deputy Noel Dempsey, to the effect that the Government should have moved immediately to maintain the employment there by bringing together the local authorities, the Irish Glass Bottle Company workers and the Department of the Environment and Local Government. This was an essential industry related to the recycling aims supposedly being advanced by this Government. That enterprise could have been taken into public ownership and run as a viable and thriving concern with the workers at the heart of its management, providing these essential services, in view of our imminent need to recycle glass. However, the Government would not even entertain the idea. It is blinded by its subservience to the ethos of the capitalist market and the domination of big business in every matter of life. Therefore, while we can support this Bill as far as it goes, it will not make up for the downfall of the Government in that and other matters.

I am concerned for the Minister that in her absence some amazing comments have been made that she should be addressing. I am certain that the media or others will comment on them. Maybe members of her coalition partners in Government might care to notify her as to the situation in the House. It is important as there is no Progressive Democrats member present. The Minister would surely want to address quickly the comments from the Leas-Cheann Comhairle, Deputy Pattison, which directly contradicted her earlier statement on the commitment given to the Comerama workers. When I heard reports of the meeting I gave it a certain amount of latitude thinking that sometimes people have a hazy recollection and the trade unions' view might be somewhat coloured by their experience. To hear Deputy Pattison, the father of the House, be so categoric in his contradiction of the Minister leads me to advise the Progressive Democrats member, Deputy Grealish, who is coming back into the House, to alert the Minister to this issue. She may want to come back to this debate to address the matter that has been raised because it is a serious contradiction.

Hear, hear.

I will concentrate on one issue in the Bill. Like most speakers I am in favour of it. My party, however, has concerns about how the operation of redundancy payments is working, the lack of enforcement measures for certain companies which have not followed through on Labour Court redundancy settlements and the poor rating of workers in the creditors' listing in the redundancy situation. There are many serious issues around redundancy and unfortunately in the present situation of an economy which has been made less competitive by this Government's mismanagement, we will see increased redundancies in the next two or three years. This is going to be a serious issue.

My main concern involves the number of weeks that is allowed. It would have been better had the legislation allowed for three weeks statutory redundancy rather than two as applied in the law. The Minister will say that is an easy argument for an Opposition spokesperson to put forward and that there are costs and other implications. To an extent, for proper long-term economic management we need to have a certain standard and way of dealing with workers and with how we view employment. The course that the Minister and her coalition partners are taking is not the correct economic path and their view of employment is largely geared to what the multinationals want from this country, rather than what we need.

The Minister famously draws our attention to the choice between Boston or Berlin. She tends to espouse the Boston vision. She described it in the House recently as a one of extreme liberalisation which she believes will benefit our economy. It emphasises competition as a way of developing our economy. It derides State support or tries to reduce it as much as possible because the Minister believes, as do others with the same liberal economic agenda, that it interferes with the workings of business. We saw her only yesterday contradicting the European Union's desire to put some regulation on the chemical industry. That is a regular occurrence with this Government which is constantly trying to support businesses and not put in the regulation or supports that would make for a fairer, and in the long run, better economy.

The comments about Senator O'Toole were interesting. His lavish praise of the Minister in regard to this Bill is probably due to the fact that it was more the social partnership system that brought the Bill through than any great impetus from the Government. That redundancy conditions have not changed in 35 years yet the country and the economy have changed so much, raises questions about why over the last five, ten or 15 years this has not been reviewed. Social partnership, in which Senator O'Toole is involved, is the real author of this Bill.

The employment situation is changing. We no longer have the type of employment where someone stays in the same manufacturing service or company for 50 years and then goes into retirement and takes a pension. Our manufacturing base is diminishing rapidly and what remains is largely capital, rather than labour, intensive. We no longer have a large agricultural workforce. We are moving into a different economy in which long-term employment contracts do not exist. Instead there is contract work, short-term work and companies come and go quickly. In those circumstances one has to protect workers, set certain basic rights and set a tone which shows that employment is not just about getting the most out of the workers to try and boost the economy. It is necessary to have a balanced approach. The provision of a statutory redundancy of three weeks is a justified basic rate. I approve of the Bill but it does not go far enough. While supporting it my party is concerned about that element.

I wish to share time with Deputies Michael Finneran, Charlie O'Connor and Eoin Ryan.

Acting Chairman

Agreed.

Like everyone in the House, I welcome this timely legislation and appreciate the work of the Tánaiste, the Minister of State and the Department.

It is important that we have this Bill before us, for, quite clearly, the fact that the world economy is in a continuing slump will have some effect on our economy. We have built a large proportion of our economic growth and progress on foreign direct investment, but unfortunately the shape of the world economy means that we can obviously be affected by an economic downturn. In such a climate, with so many multinational organisations providing employment here, sadly there will be job losses, and that is an unfortunate economic fact. The Tánaiste and the Department are currently doing all they can to minimise the level of redundancies and will continue to strive to replace any companies which fall by the wayside. However, in the meantime, we must accept that there will be job casualties, and this Bill represents a very pragmatic approach.

I welcome the Bill because it provides for the implementation of enhanced redundancy pay ments and other improvements to the operation of the redundancy scheme. I wish it had been here some time ago. The changes were provided for under the Sustaining Progress partnership agreement and the report of the redundancy review group, which was set up by the Government in April 2000 to examine the operation of the statutory redundancy payments scheme to ensure that it met the needs not only of employees but employers in the best possible manner. I welcome the group's main recommendations and the fact that a simpler method for calculating service was part of it. Changes in the treatment of absences from work and different treatment of services abroad, the simplification of application forms and the new IT system, which will include an e-Government aspect, are things that we obviously welcome. The Bill encapsulates all those measures, as well as dealing with the extra commitments made under the Sustaining Progress agreement.

I welcome the change to the Bill whereby those made redundant will now be able to claim two week's wages for every year served with a company on top of the bonus week. That payment is made regardless of age. As we are all aware, it was previously the case that those under 41 received half a week's pay per year served and those over that age a single week's pay. As well as raising the amount due to employees in the event of redundancy across the board, the legislation also removes the blatant age discrimination that exists under the current system.

It is important to point out that, when the Government gave the go-ahead to draft this Bill earlier this year, the decision was also made to provide a sum of approximately €1 million to cover the cost of supporting information technology, administration costs and operational overheads through the support of the social insurance fund. Once the new IT system is in place, it will have a profound effect on the administration of the process. Not only will it make processing the various pieces of paperwork easier for the Government and the various agencies, it will make matters simpler for employers. When the new IT system is used in combination with the amalgamation into a single document of the three forms used as the main records of statutory redundancy – RP1, RP2 and RP3 – we can expect significant improvements in administrative efficiency. By allowing the process to be conducted by e-Government, we can also expect further significant economies in data entry costs. Last year the cost of the scheme's administration was approximately €1.3 million. With this Bill we hope and expect to see sizeable savings in that area.

The Bill will also amend the legislation that currently deals with insolvency payments. As things stand, any employee of an insolvent firm who has not received statutory notice must take his or her case to the Employment Appeals Tribunal to ascertain the minimum notice entitlement. However, under this Bill, if such a scenario arose, employees would submit their claims directly to the liquidator-receiver without having to go to the tribunal. That will streamline the process and relieve the pressure on the Employment Appeals Tribunal, thus allowing it to deliver a better quality of service.

It is difficult to say all that one would like in a few minutes, and if the Leas-Cheann Comhairle is agreeable, I propose to share my part of the time, perhaps letting Deputy Eoin Ryan in. I would love to talk for the rest of the day on this issue, and, just like other colleagues—

Spare us that, Charlie.

I have much to say, and Charlie O'Connor speaking for the rest of the day would not be as bad as some of the alternatives, for I have heard them. I could talk at some length about my own constituency, as other colleagues have done. There have been many problems in Tallaght in that regard.

I was amused to hear some colleagues this morning, whom I will not name, talking as if we Fianna Fáil backbenchers were some sort of crazed race without the normal feelings held by everyone else and had not come through the system. I say very bluntly that before I became a politician I was quite normal. I was made redundant three times in my life – not always, I might add, under Fianna Fáil Governments.

Mostly, though.

I remember now that Fianna Fáil was not in power on even one of those occasions.

It is important that we bring our own experiences to the House, and that is what I am doing as far as this issue is concerned. In the brief few seconds available to me, I strongly welcome and support the Bill. I congratulate the Tánaiste, her departmental officials and the Minister of State on bringing it to the House so quickly.

It is important that we, as Members of this House, pass this legislation as quickly as possible. I hope that we will all work to ensure its enactment, for the legislation will give us a simpler and improved scheme that will be a great deal easier to operate and understand. It is fair enough that colleagues score political points, but ultimately it is a good Bill, and we should support it. Let us deal with all the issues and let the Minister understand that there is a PR job to do as far as communication is concerned. Even this morning I was still getting a large number of questions, and that is fair enough. Regarding another taunt made, I can say that I have not written loads of letters to companies in different constituencies. I represent Dublin South West, where there is a challenge as far as unemployment is concerned. The other day the Tánaiste told me in a Dáil reply that it was the second time in the space of a few months that I had raised the issue of jobs. I will continue to do so for as long as I am here. Please God, I will never be made redundant. However, if I am, I will find another job to do in my community.

At least Deputy O'Connor will get some redundancy money.

I am happy to support this Bill.

Acting Chairman

I call Deputy Finneran.

I welcome the Bill and compliment the Tánaiste, her Department and the Minister of State on their initiative in introducing it. I heard some criticism this morning about the legislation not having been amended since 1971. Criticism has been piled on my party and our partners in Government, but I remind the opposition parties that, during that period, most of them were in Government for 12 or 13 years without seeing fit to enact or amend any of the legislation during that period.

The Deputy was too young.

I compliment the Tánaiste and the Government on their initiative in this matter. It is very important that we have legislation that protects the rights of workers in the event of redundancy. In my own constituency of Longford-Roscommon we have had a spate of redundancies in recent years. Unfortunately, not all of them will be covered by this legislation. I speak in particular of a matter which I previously raised in an adjournment debate: the position of the 30 workers from Roscommon Precision Castings Ltd. who were effectively locked out of their jobs in June 2001 and will not qualify for payment or support under this legislation. Their case should still be examined by the Department with a view to an ex gratia payment. Their rights, even under a Labour Court decision, have not been upheld, and the company has treated them badly. To date, the State has not seen fit to respond positively to them. I make a further call today to the State to have another look at their position to see whether an ex gratia payment can be made. What is the position with the employees of Square D, Ballinasloe, County Galway? While the company is not in the functional area of my constituency many of the workers live in Roscommon. Some 385 employees will be made redundant in June. Will these workers qualify under the new legislation?

As regards jobs generally, even though the BMW region is supposed to attract 50% of all new jobs that is not happening. However, I do not have the exact figures. In recent months I have looked at job announcements and from what I can gather there has not been a redistribution of jobs into the BMW region. I repeat a call I made in January that further attention be given to the area that does not have Objective I status, that it be given the job entitlement it was supposed to receive under the decision to develop the part of the country that was underdeveloped, that job creation be focused in that area and that increased grant aid be given to companies locating there. I call on the Tánaiste and the statutory agencies such as the IDA and Enterprise Ireland – sometimes I wonder what they do as I have not seen anything from them in my region recently – to focus more on that region.

I welcome the legislation and compliment those involved. This is an important protection that is being put in place for workers and it shows the social partnership discussions can be broadened every time there is a new agreement. It is a positive step and I welcome it.

I thank my colleague for sharing his time and allowing me to speak on this important and long overdue legislation which I welcome. In my constituency, the Irish Glass Bottle Company received a huge amount of publicity when it closed down through no fault of the workforce. It was a huge employer for a long period in Dublin's inner city. The workforce had dwindled over the years but the company still remained part and parcel of that area and its closure came as a shock to many people.

In November there were protests outside the House about the closure and the redundancy package. At the time the Taoiseach, the Tánaiste and the Government promised to introduce legislation to deal with redundancy payments. They have kept that promise. I hear many people speak of broken promises, much of which is exaggerated, but the Government has kept its promise. This legislation, which is difficult and complex – one of the reasons it was not introduced by previous Governments – has been introduced in what is probably a record time. It allows for the greatest increase ever made in redundancy payments and has to be welcomed by all sides of the House. I am surprised people are nit-picking at it. When, through no fault of their own, people find themselves redundant they are very vulnerable and should be helped. I am pleased we are doing that. Unfortunately, for the legal reasons outlined, this Bill does not allow for retrospective payments. While I have listened to some Members in Kilkenny debate this issue, it was always made clear to me that retrospective payments would be impossible because the idea of having to pay redundancy retrospectively would open up a huge—

I have spoken to the Tánaiste about IGB and she was very clear about it.

Somebody should have told the Tánaiste that.

She wanted to bring in a Bill covering this but she always said, and everybody I spoke with in Government said, there would be huge difficulties. We all knew it and the unions knew—-

The Deputy should have told Deputy Pattison about it.

—there would be difficulties with retrospective payments. I do not know what the Tánaiste said down there but I know her pretty well. We all know her record in the House and in politics. She is not somebody who would intentionally mislead anybody or any group of people. It is unfair of people to say otherwise. When I spoke to her about IGB she always said there would be a difficulty with retrospective payments. It is unfair of people to pull out a letter from somebody to say she said it would be done. I do not know how she could say it would be done because she has made it clear to us and other people—

It was very clear.

—and the Deputy knows it. That is one of the reasons this legislation is difficult. It has to be welcomed. I congratulate all those involved in the Bill. I listened to Deputy Eamon Ryan earlier who spoke about Berlin and Boston. In the Seanad, Senator Joe O'Toole said "if this is Boston, we could do with some more of it". He will negotiate with anybody if it is good for workers. That is a very healthy attitude for any politician or trade unionist going into any negotiations.

I welcome the legislation which is good and positive and will help people at a very vulnerable stage. In listening to the debate I heard Members say that job losses and inflation were out of control. That is not true. Inflation is not out of control; the rate is dropping. Every independent economist will testify to that. It is fine to criticise the Government – the Government should be criticised – but one must put forward one's own ideas. I have not heard any ideas coming from the Opposition. Do Deputies wish to follow the United States whose economy is in the doldrums as are the economies of France, Germany and Japan? We still have growth in our economy. By international standards we are doing well and we must continue that progress, consolidate what we have and move forward. These are difficult times in the international economy and we must recognise that. I am worried that we are talking ourselves into the doldrums. Everybody is saying there are massive cutbacks here and job losses there. We have to be more positive – there are not massive cutbacks, there are not massive job losses and inflation is not out of control.

It is "Comical Ali".

It is not "Comical Ali". You are well aware that if you had an economy that was growing at between—

Acting Chairman

Tá nóiméid amháin fágtha. I would remind the Deputy to address his remarks through the Chair. He is addressing his remarks directly to the Opposition and is being provocative.

If that is provocative, I do not know what to say about what has been said to us in recent months. There is nothing wrong with a good robust debate. I welcome this legislation. Let us all be more positive about ourselves and where the economy is going as opposed to talking ourselves into a recession, which is not happening. Most countries would be delighted with an economy that was growing at the rate of between 2% and 3%.

I wish to share my time with Deputy O'Dowd. It was entertaining to listen to some of the comments of speakers on the other side of the House. This legislation is a response to the refusal by several firms, including the Irish Glass Bottle Company in Ringsend and Roscommon Precision Castings in Roscommon town, to make any attempt to abide by the Labour Court decision on redundancy payments arising from a number of judgments it has made. The decision put pressure on the Government to increase statutory redundancy rates.

However, this legislation will not affect those who campaigned for this change, including the 30 employees in Roscommon Precision Castings. They will be left high and dry because the legislation is not retrospective. Other campaigners will also fail to benefit other workers, such as the employees of Square Deal in Ballinasloe and the hundreds of employees of multinational companies in Athlone, because redundancy notices will be issued prior to the enactment of this legislation.

Many hundreds and thousands of jobs in small business around the country have been lost because for six years the Minister refused to deal with the spiralling cost of insurance, which has accelerated over the past two to two and a half years. As a result, many small businesses have closed or have laid off staff. This is especially prevalent in my own County Roscommon where small businesses have gone to the wall and have had to lay off employees. They are unemployed because of the lack of action by the Government. The Government compliments itself for introducing this legislation, which will increase statutory redundancy payments, yet it refuses to provide for the retrospection to which it had alluded on a number of previous occasions.

Deputy Finneran considers that the workers of Roscommon Precision Castings have been badly treated and he has asked the Minister to reconsider the retrospection aspect. We will give the Deputy the opportunity to join us on Committee Stage in opposing section 17 of the Bill, which sets the date for the commencement order. Defeat of this section would enable the staff of Roscommon Precision Castings and Square Deal and the employees made redundant in Athlone and from many small businesses in County Roscommon to benefit from the legislation.

There has been much comment on what the Minster said when she visited Kilkenny. The most damning remarks were made by the former Ceann Comhairle, the Leas-Cheann Comhairle and Father of the House, Deputy Pattison. No Member of the House would question the integrity of Deputy Pattison. I ask Deputies on the other side of the House to read what he had to say. He has made his views clear on the Minster's remarks and the question of retrospection.

When the Bill was first published the commencement order was contained in section 1. However, because the Government backbenchers got cold feed and did not want to be embarrassed on the question of retrospection, the order was shifted to section 17. When the Bill was before the Seanad, a Fine Gael Party amendment on retrospective payments was allowed to be tabled but it has been ruled out of order in this House because of the fears of Government backbenchers. This is an indication of the view taken by the Government on this issue to those employees who campaigned for this legislation because their employers refused to abide by the Labour Court recommendation. They will lose out. While the provision allowing for a minimum of two weeks statutory redundancy pay is a positive step, it should be retrospective and should include those employees who have campaigned on this issue. It will not cover those employees who have already received redundancy notices, including those affected by the major job losses announced in County Roscommon and its hinterland.

Deputy Eoin Ryan said inflation was falling. However, more jobs will be lost because of the rate of inflation, which is twice the European average. That has not changed in recent years. The Government can take no credit for the fall in inflation, which occurred because of external factors. Some 60% of the current rate of inflation is accounted for by decisions taken by the Government and its agencies over the past six to eight months, including the stealth taxes introduced by the Minister for Finance in the budget. If the Government is to take the credit for the fall in the rate of inflation it must address the stealth taxes it has imposed on ordinary people and workers.

Deputy Finneran criticised the Minister and other State agencies for failing to meet the employment targets within the BMW region. The Deputy should realise that for the past six years he has been a member of one of the Government parties. There has been no increase in employment and no new investments have been announced in the BMW region. IDA Ireland has failed to meets its targets for the region and is not prepared to bring employment to it. The Minister of State, Deputy Michael Ahern, wants the jobs to go to Cork and he could not give a damn about anyone in the BMW region. It is the same for every other Minister. The Ministers from the west are, like the Minister, sitting on their hands on the question of employment and job losses. Not one of them will budge on the question of retrospection and allowing for increased redundancy payments to those former employees who fought for them arising from the intransigent failure by their employers to give them basic levels of redundancy payments.

Acting Chairman

The Chair decides on the admissibility of amendments.

I am aware of that, but a different policy has been followed in this House than in the other House.

I submitted a parliamentary question to the Minister on the closure of Lissadell Towels, a factory in County Louth that closed recently. The firm employs 76 people. A significant number of them worked at the factory for all of their lives. One man who telephoned me worked there for 30 years. They have a considerable commitment to the company, their community and their families. They asked that the redundancy package being offered to them be made under the terms of the Sustaining Progress programme accepted by the Irish Congress of Trade Unions on 26 March 2003. These people were made redundant after the programme was signed by the Government and the unions. The response of the Minister was that on 26 April, liquidators acting for the company made a formal application on behalf of the employees. She said the application would be treated as a priority case, that every effort would be made to ensure that all eligible employees received their payments as soon as possible and that all payments would be tax free. She continued by saying that while every effort would be made to secure the successful passage of the Redundancy Payments Bill 2003 through the Oireachtas, it would not be applicable to the employees of this company.

The issue is that workers who were part of the Irish Congress of Trade Unions agreed and accepted a pact which the Minister of State at the Department of Enterprise, Trade and Employment, Deputy Michael Ahern, signed off on also. They became redundant subsequently and the terms of this Bill should be made retrospective to include them. I understand from other Deputies that there are workers in other parts of the country who face the same significant problem. Under the old scheme, the gentleman who rang me in connection with this and who has 30 years service will receive €8,000. He would receive in excess of €20,000 if the new Bill were to apply to him. The workers believe that the Minister for Enterprise, Trade and Employment is responsible and has the power through this House and the Government majority to make this legislation retrospective.

I understand that it cannot be made retrospective without limit, but these workers ask that it be made retrospective to the date on which the agreement was signed. The agreement represents the commitment everybody made. I would like to see the trade unions campaigning more strongly on this issue. The deal was done at a national level among the Government and the social partners and there is no reason the trade unions should not insist the legislation be made retrospective. As the economy slows, times become more difficult for companies and inflation increases, more workers will become redundant through this Government's mismanagement. The fruits of the labours of workers who have given all their lives to a community should be recognised. If a Member of the Dáil is made redundant through the loss of his or her seat by the will of the electorate, he or she receives a generous redundancy package which no one here has complained about. The decision in such a case has been made by the public, rather than by a Minister. The system is fair in the context of the commitment people make to come here for so long.

The same significant elements should apply to those who work in the community. The agreement was sacrosanct from the time it was made and it is a benchmark the Government could reasonably take on board. I cannot see why it would be open to challenge or why it should be challenged. The Government must be generous to the people who signed off on an agreement which was put to them. I would like the Minister to respond. The workers in Lissadell Towels, which is in the middle of nowhere, are faced with absolute ruin. The factory is between Ardee and Carrickmacross and it had a significant impact on the rural economy there. Its closure is a serious blow to everybody. The likelihood of the textile industry placing another factory at that location is remote. While there are social issues involved, there is a question of justice and fairness to be addressed also. I urge the Minister for Enterprise, Trade and Employment, Deputy Harney, to think again about the matter.

I wish to share time with Deputies Wallace and O'Donovan.

Acting Chairman

Is that agreed? Agreed.

Regarding criticism of her inability to remain in the House for the full debate, the Minister for Enterprise, Trade and Employment facilitated the Opposition's request to take Second Stage today. It was supposed to be taken tomorrow. The Minister had a prior engagement to attend.

There was no problem with having the debate tomorrow.

I welcome the opportunity to give my full backing to the Redundancy Payments Bill 2003 and to voice my support for my party colleague, the Minister for Enterprise, Trade and Employment, Deputy Harney, whose Department drafted this legislation. The Progressive Democrats have always been a pro-work, pro-enterprise party and we have done more than any other party in this State to create the economic conditions needed to foster job creation. Over the last five years, PD-inspired policies have brought this country unprecedented success with almost 400,000 more people at work and a rate of unemployment reduced from 10% to just over 4%. In the last five months of this year, the Minister, the Department of Enterprise, Trade and Employment and the Industrial Development Authority have enjoyed tremendous success in attracting new jobs and investment to Ireland. To name but a few, at Baldoyle, Dublin, 380 new jobs have been created while Inamed in Arklow has added 200 new jobs to its existing work force. Accenture's European services centre in Dublin will see 150 new jobs and 350 new jobs have been created in my Galway constituency.

In the first quarter of 2003, 3,096 new jobs have been created in 14 IDA supported ventures at a total combined investment which exceeds €220 million. Even Opposition Deputies must concede that this is a remarkable achievement, especially in the context of the changed economic climate and the general international slow down. These achievements are all the more remarkable in light of the stiff competition from overseas which the IDA faces in attempting to attract new investment. Unfortunately, there has also been a number of high profile job losses in the same period, most recently with the closure in Swords of Celestica. That blow was eased considerably by the speed with which replacement jobs were found and the announcement a fortnight later that Gerard Laboratories was to embark on a major expansion of its workforce.

While as coalition partners in Government the Progressive Democrats will continue to work tirelessly to secure new jobs and investment, the dynamics of international economies mean that job losses are inevitable. Our continuing priority is to ensure that the rate of job creation continues to significantly outpace that of job loss. In addition to ensuring that workers who are made redundant are quickly able to secure alternative employment, we must ensure they receive an adequate financial provision to protect them in the immediate aftermath of losing their jobs. The Bill's provisions focus on this area.

At present, workers of 41 years of age and above receive a week's pay per year of service if made redundant, while younger workers receive just half a week's pay per year. It has been accepted by all those who signed up to the sustaining progress partnership agreement and the report of the redundancy review group that the provisions are insignificant and must be increased. Once passed, this Bill will remove the age distinction and provide each worker made redundant with a statutory entitlement to two weeks' pay for every year of service. The existing provisions for the payment of an additional bonus week is being retained. Workers under 41 years of age will receive a fourfold increase in their entitlement while those over 41 will receive twice their previous entitlement.

I am fully supportive of this Bill which will give employees who were unfortunate enough to be made redundant a reasonable standard of statutory redundancy entitlements. It will give them financial support in the immediate aftermath of being made redundant. I welcome also the removal of the age distinction which the current legislation makes to penalise younger workers. The Bill will simplify the operation of the scheme governing redundancy payments to make it speedier and more effective. This should not be overlooked. Simpler methods of calculating service, simplification of application forms and a new IT system, including an e-Government aspect, are to be introduced. The Bill will provide for a better redundancy payments scheme which will be easier to operate and understand.

The Opposition has tried to score cheap political points in the House by attacking the Minister for Enterprise, Trade and Employment for allegedly breaking her word. I have the privilege of being the Tánaiste's colleague and I can state categorically that she does not break her word. She promised those workers whom she met that she would do her best to increase payments applied to them. However, this has not proved possible and the legal advice available to the Government is clear that obligations such as increased statutory redundancy cannot be assigned to employers retrospectively.

It appears there is case law to back up the Tánaiste's stance on retrospection. This entire scenario was played out about 20 years ago in the courts when Nokia Ireland took a case against the then Minister for Labour who was attempting to apply recently introduced redundancy legislation retrospectively. The Bill sought to make more generous redundancy payments and the company went to the employment appeals tribunal opposing the move. Their position, that it should not be made retrospective, was upheld. The State appealed the ruling to the High Court, but Mr. Justice Declan Costello ruled that one cannot constitutionally impose an obligation on to a company or an individual retrospectively.

Did the Tánaiste not know that?

The Opposition is playing a game of political football with this and is in danger of scoring an own goal. As the Tánaiste pointed out, the Labour Party clearly did not regard the protection of redundant workers as a priority when it was in power and failed to introduce a Bill of this nature. The level of payments had not changed, except for the ceiling on the weekly wage, since the redundancy scheme came into operation in 1968.

The pace with which the Bill has been brought to the House has been remarkable and I pay tribute to the Tánaiste and her Department for it. The drafting of the Bill was approved by the Government in February and the text was approved on 30 April. It was published on 7 May, is before the House today and will come into effect on Sunday 25 May. The best option available to Opposition Deputies is to fully support the Bill. They did not bother to introduce such a measure themselves and it is cheap politics for them to try and score points by criticising its provisions.

It is extraordinary for the Deputy to attack Members of the House in such a manner.

I congratulate the Tánaiste and the Minister of State at the Department of Enterprise, Trade and Employment, Deputy Michael Ahern, for bringing the Bill before the House. I welcome the Bill and acknowledge its importance for employees who are unlucky enough to lose their jobs through redundancy. In employment terms, the last few years have been a time of growth and great security for most employees. However, even if these boom times continue for the foreseeable future, we must be mindful of providing properly for those who will unfortunately be made redundant. For many people, losing a job can be as traumatic as the death of a close relative. The sense of loss is immense and the resultant financial hardship often leads to other problems for the individual employee and those close to them.

The increased lump sum payments proposed in the Bill will help to alleviate the financial hardship caused by redundancy. Under this Bill, employees who are issued with notices of redundancy will be entitled to two weeks pay for each year of service plus a bonus week. This is a significant enhancement of the current redundancy provisions. The changes have been well thought out and have come about following the establishment by the Government of a review group in the context of social partnership. This review group, having examined the operation of the statutory redundancy payments scheme, agreed a range of changes to it and this Bill will give effect to some of these changes.

The Government has also agreed to amend the Protection of Employees Acts 1994 – 2001, to enable employees of insolvent companies to make claims for minimum notice entitlements under the insolvency payments scheme without having to obtain an award from the employment appeals tribunal. This provision in the Bill is a significant safeguard for employees and must be welcomed. I am sure most Members have had occasions when constituents have approached them with the difficulties and delays and the associated trauma they have had in relation to having to go to the Employment Appeals Tribunal.

The review group also recommended an IT system to improve the efficiency of the service. The Minister proposes to spend €1 million to cater for the administrative implications of implementing the full range of changes set out in the Bill. This new system will simplify administration, especially for employers, and will bring about improved efficiency in administration by the Department.

In her speech to the House, the Minister confirmed that this Bill cannot be retrospective. I regret that this is the case but accept the reasons as outlined by the Minister. The protections for employees and improved financial provisions should be made available to all employees as soon as possible and there is an onus on the House to deal with the Bill as a matter of urgency so the Minister can proceed to sign the ministerial order giving effect to the new redundancy Act. I acknowledge the Minister's comments paying tribute to the Opposition, particularly the spokespersons, for their co-operation in this regard.

We have often discussed at length the merits of social partnership and how beneficial is has been for employers, employees and the economy. In the negotiations for Sustaining Progress, all social partners reached an agreement to increase the level of statutory redundancy payments. The introduction of this Bill shows further the ability of the social partners to reach consensus and influence social policy for the benefit of their members. It is a further evidence of the strength of the social partnership process.

When the improved statutory redundancy payments come into operation, it is likely to cost the Exchequer an additional €96 million, based on the 2002 levels of redundancy of 24,000. The improved financial provisions will provide some consolation to people at a vulnerable and often traumatic time in their lives. However, while the increased payments will ease the financial burden on a short-term basis, the priority must be for all of us to ensure that we continue to maintain the climate where the economy will prosper and employment opportunities will be readily available for those who wish to avail of them. This, more than anything else, will minimise the effects of redundancy on society and those affected by it. I welcome the Bill and congratulate the Government for bringing it before the House.

I congratulate the Tánaiste and the Minister of State at the Department of Enterprise, Trade and Employment, Deputy Michael Ahern, for bringing forward this legislation in a swift and efficient manner. In some instances, we are blamed for being lethargic and dragging our feet but this Bill has come through swiftly. It is a milestone Bill, which updates an Act that goes back 35 years. When that Act was first introduced it was also an historic Bill.

The Bill eliminates an anomaly whereby, under the old Act there was discrimination. If one was under the age of 41 and over 16, one was entitled to a half week per year of service and, if one was over 41, that rose to one week. I am glad that anomaly has been wiped off the Statute Book. The Bill also increases the statutory minimum limit to two weeks and it applies across the board from the age of 16 through all years of service, irrespective of age.

I listened to some of the adverse comments made. Some Deputies were using parochial instances of factories that closed in their own areas or companies that laid people off. That is a sad situation but Ireland is close to zero unemployment, which is a substantial record. If we take the heart of Europe, Germany – one of the big countries – has some 11% unemployment. It is a frightening statistic and we have done well in that regard.

The negative comments remind me of a woman who came to west Cork in the early 1950s called Mrs. Kitchener, who wrote a book which was a satire on the poor people of west Cork called "Summer in Another World". I wonder if the Deputies are referring to another world. I was in west Cork last week, the Minister of State at the Department of Communications, Marine and Natural Resources, Deputy Browne, visited some fish factories, all of which are doing excellent work. Many of them could not operate were it not for the fact that they have Latvian, Lithuanian and Russian workers. Nearly 25% of the nurses in Bantry hospital in west Cork are Filipinos. Our doctors are mostly either North Africans or Asians. They are most welcome there, but they represent a problem: on one hand, we are bringing in thousands of people not only from the EU but from beyond and giving them gainful employment, while on the other hand we are worried about unemployment. Long may this situation last.

I was reminiscing recently about a great book by Mrs. Kitchener which was read by many people before my time. It was a satire on the less well off of west Cork in the 1950s, who had few facilities.

The Tánaiste will not let those people in any more. She will put them out.

Well, if she does she will close down a few businesses.

That will be the PD policy.

I was delighted to receive a note from the Minister for Communications, Marine and Natural Resources, Deputy Dermot Ahern, this morning—

Will the Minister let Deputy Browne bring a few jobs back to Wexford with him?

There were many years in west Cork, when Gulf Oil left us and Whiddy Island closed down, during which we had problems with redundancies. We had our sad days too. However, today there was a bit of positive news. The Minister, Deputy Dermot Ahern, announced 41 jobs for Castletownbere.

That is great news.

That means there is bad news coming from the Department tomorrow. The Deputy can be sure of that.

It is positive news. We do not have the luxury of the Luas, nor any national primary routes, but we do have some salient features.

We all criticise multinational companies that come and go but to be fair, the vast majority of the companies I have studied, when they leave our shores and make people redundant, pay well above the statutory rate of redundancy payment that has been there for many years. I am subject to correction, but that is my view. When Gulf Oil pulled out of Bantry in about 1980, it paid about six times the statutory rate. That was welcome.

I came across a chap this morning who has been working for 11 years in a temporary capacity for a particular Department. He has not been made permanent. Are these temporary workers covered under this legislation? Also, are part-time workers covered? In my own business, many of the staff job-share, particularly young married women, working perhaps three days per week or one week on, one week off. In essence, this is a positive Bill. It is important to note that it has been welcomed from all sides of the House.

I have studied closely the requests from some of the Opposition spokespersons and speakers for this legislation to be made retrospective. I would have no problem with that if it could be done, but the Attorney General has advised the Minister for Enterprise, Trade and Employment that this is not possible. If it was to be done, where would we draw the line? Do we go back to 1 January 2003 or 1 January 2002? What about people who were made redundant in 1999? However far it is rolled back, some people will feel they are left out. If it can be done, it would be welcome, but I have great reservations. Many people have been in the House much longer than I have, but from what I can see it has not been established that it is possible to make matters such as this apply retrospectively. I am acutely aware of the position in which the Minister and the Government find themselves. It is an issue over which they have no control. They are obliged to stick rigidly to the fact that legislation cannot in most instances be made retrospective.

I am delighted to welcome this Bill and I compliment the Minister for Enterprise, Trade and Employment on her foresight in this regard. I also compliment my Cork colleague, the Minister of State, Deputy Michael Ahern, on the great work he is doing.

I wish to share my time with Deputies Neville, Crawford and Ó Caoláin. I am delighted to have the opportunity of speaking on this Bill. There is nobody in the House who does not welcome it – we have been waiting for it for a long time. I also compliment our spokesperson, Deputy Hogan, on his speech.

It is disappointing when a commitment is given by a Minister and backbenchers of the Government to workers who have already suffered the loss of their jobs and that promise is not kept. I say to the Government, the Minister and the Department that this is an outrageous attack on people who have already lost their jobs, who agreed to take redundancy because they thought that when this Bill was passed in the Dáil they would be included among the beneficiaries of the new redundancy payments.

It is time this Bill was passed. I recently had a man in my office who had worked for a company for 29 years. After 29 years of work, he was given a redundancy payment of €8,000. He worked loyally for that company for 29 years, but that is what he got from the State. This case will be before the courts tomorrow so that he can get the company's portion of the payment.

The previous speaker talked about jobs. I welcome jobs anywhere, but when one hears small announcements of 29 jobs, one should watch out. I predict that tomorrow or the next day bad news will come from the Department. I assure Deputies this is what it does. It sends out a press release saying that this or that company will create five, ten or 20 new jobs. These jobs never arrive. All that happens is that the company gets grant aid from the Department. The following day, there is bad news from the Department.

In 1997, when Fine Gael were in Government with the Labour Party, more than 1,000 jobs a week were being created. Now, about 800 jobs are lost per week. I have listened for the past five years to that side of the House telling us the wonderful job the Government has done with the economy and how great the economy was going. They were prepared to take the credit when jobs were being created, so they should now take the blame when jobs are being lost. This Government must take a great deal of the blame. Small business and industries cannot survive any longer with the kinds of charges that are coming down the tracks. No matter what one gives the local authorities now, they are still not satisfied. The Government may think that small businesses can subsidise local authorities, but that day is long gone. It is time the National Chamber of Commerce took the issue of rates to court. Why should one section of society have to pay rates, while nobody else does? This double taxation is creating great problems in the workforce.

If the Government still thinks that at every opportunity it should create further taxes for employers, it is wrong. It will not work. I listen to small businesses every single day. They are sick and tired of being the soft touch for further taxation. They pay rates and then they get a separate bill for the water supply and another for refuse collection. Then they have to contend with the famous inspectors from the Department of Enterprise, Trade and Employment, from the Department of Health and Children and from the council. These are jobs for the boys and girls of this State, being paid for by the people who are trying to create employment. The other day I was at my clinic in a hotel. The owner came out to me with a 15-page report from an official of the health board. Fifteen pages – the official must have spent the full week drawing up the report. This man had spent nearly €0.75 million on his business. He said he was sick and tired of this and threw down the report. He employs 70 people and every single day he is attacked by the State. He is an employer, with people working for him, and he is sick and tired of these bureaucrats – he used another word, but I will not put it on the record of the House – coming in and telling him how to run his business.

Acting Chairman

The Deputy has one minute left.

That is a shame, because I am just getting going.

He is only warming up.

I welcome the Bill on the basis that it will help people who lose their jobs, who have mortgages to pay and who have given loyal service to their employers. The State has an obligation to look after these people. They have worked hard and paid their taxes. It is outrageous that the man I mentioned earlier, who worked for a company for 29 years, is getting a payment of €8,000. The Government should look at another way to honour the promise it made to the people in, for example, a company in Kilkenny. If it cannot do it through this legislation, there should be another one-off payment to these workers, and it should happen soon.

I welcome the opportunity to speak on the Bill. It should have been introduced many years ago, but nevertheless it is more than welcome to see an improvement in the level of redundancy payments. The increase in the statutory payments has been long overdue. I never understood why the principal Act provided only for a half-week's pay for each year of service for people under the age of 41.

I want to deal with a number of points regarding redundancy. I should record my experience in this area. I was a personnel manager for 15 years and was involved in quite a number of redundancies. I then was made redundant and subsequently spent nine years on the Employment Appeals Tribunal adjudicating on issues, including the redundancy Acts.

Sometimes people interpret redundancy as being a way in which an employee can get at his or her employers. However, in most cases, 90% of cases, it is necessary for the survival of the organisation and the protection of the jobs of the remaining employees. Companies move on and must keep up with efficiencies created by mechanical or other means. If a company does not keep up with those improvements, it loses competitiveness, goes out of business and the employer will be responsible for not ensuring the efficiency of his or her organisation and for not ensuring that redundancies took place at the appropriate time in order to maintain the efficiency of the organisation. In most circumstances an employer has a responsibility to ensure that his or her corporation is performing efficiently for the benefit and security of the workers. In the case of liquidation, the company would have gone out of business and redundancy becomes inevitable.

There is also the other side of the coin, that of the experience of being made redundant. It is a unique, difficult and shattering experience. Employees are sometimes aware of changes and may expect to hear news of redundancy, but people are always in shock and find it traumatic when they are informed that they will be made redundant. They go into denial. Being made redundant is almost like a death in the family. People suffer similar symptoms and experiences. They go through a phase of arguing, fighting and trying to persuade their employer that the redundancies are not necessary. They often get depressed and finally they accept the position and move on. This is a difficult experience for an individual.

I have had the difficult job of having to tell good, loyal employees that they no longer had a job. I have sat with people often for an hour and talked matters through with them while they began to take in the news. It is amazing how people can move on from hearing such news. I remember telling a person she was being made redundant and she was extremely shocked and depressed on hearing that news. However, within three days I was able to reverse that decision as a result of another employee opting to take voluntary redundancy. When I brought that person in and tried to persuade her to stay with the organisation, she had moved on to such an extent that she wanted me to withdraw the offer, but I persuaded her to accept it. That was almost 20 years ago and that person is still working in the organisation.

The unions have been good in negotiating redundancies and good packages have been given through the Labour Court. This Bill is necessary to provide for the vulnerable sole trader or employer employing one, two or three people. While the employer will honour his or her statutory requirements, an employee has no power to negotiate a reasonable package. The package provided under this legislation is even on the low side in terms of the compensation a person should get on being made redundant having worked in a job for five, ten, 15 or 20 years. I joined an organisation on leaving school and had worked there for 23 years when I was made redundant.

I welcome the Bill. I would like to have had more time to develop those themes and I tried to cover as much as I could in the time available.

I also welcome this legislation. It is a measure I and many other Deputies have sought for some time to have introduced in light of factory closures in our own areas and from being aware of the difficulties with which workers who were made redundant have had to deal to get the necessary funds to meet their mortgage repayments in order to retain their homes. I can think of Teradyne workers in Cavan, Wellmans, CPV and Lissadell Towels who have lost out having regard to the Minister's speech today.

I remind the Minister of State that fund was raided by the Minister for Finance last December. I urge the Minister and the Government to re-examine the issue of backdating payments. There are precedents for doing so. When the Minister for Agriculture and Food announced the increase in the compensation payment for reactor animals in May of the year concerned, those payments were backdated to 1 January. When that did not meet the requirements of some people, it was backdated to when herds were closed on 1 January. Therefore, there is a precedent for the backdating of payments. This issue needs to be examined bearing in mind that factory owners and workers were desperately clinging to the day when this legislation would be brought into force. While I fully understand the comments made by Deputy Pattison, Deputy Hogan and others about commitments made by the Minister that should be honoured, there is a wider spectrum in this regard. A means should be found to at least backdate these payments to 1 January for those persons concerned.

Small industries are under a good deal of pressure. Given the small number of jobs in those industries, workers in them can lose out much more than workers in larger industries. From that point of view, I welcome the provisions in the Bill. If the Minister is slow to bring in changes and regulations to deal with increasing insurance costs, this redundancy package will be important. We do not want any more public relations exercises or promises; we want real action taken to deal with this issue.

I was assured this time 12 months ago that if a certain Government got elected, the insurance issue would be sorted out the next day. We have now been told that Bills in that regard that were to come before this House will not come before it for some time. As the Minister has taken responsibility for dealing with the insurance issue, I ask her to make it a priority in order to ensure that small industries and others who must deal with this issue are not forced out of business. The furniture industry, the mushroom industry and several others are high risk sectors in some areas. If the insurance issue is not dealt with, they will be forced out of business.

As far as I am aware the Minister has not visited Clones in her capacity as Minister, yet Clones is one of the hardest hit Border towns. If she is to be a Minister for all the people, areas such as Clones must be seen to. The CPV plant has been closed, although we hope that it will reopen, but it will not reopen without some genuine help. The Minister visited Lough Egish a few years ago and promised the delegation there that she would examine the possibility of putting in place a tax structure for food production in that area, but nothing has happened in that regard. Buildings are lying idle there, which could have been used to help to save unnecessary redundancy packages.

In Monaghan town, Monaghan Poultry, McCaldin's Bakery, Patton's Mill, Montex are among the factories that have been closed over the years. The Minister has a legal obligation to make sure that all people in this country are treated equally. Under the Good Friday Agreement an effort should be made to ensure that jobs are created in those areas. If the euro-sterling relationship changes, the benefits we have obtained from cross-Border trade will have major effects on towns in the Border area. We need to look at creating employment to ensure there is somewhere for young people to find jobs and work.

I thank the Fine Gael Deputies for sharing their time.

There is a growing number of redundancies in large and small enterprises and that makes the Bill more necessary and urgent. Will the Minister of State advise how quickly will the legislation come into effect?

I share the concern of many that some redundancies forced on workers in different situations have been introduced ahead of the legislation to avoid its effects and having to pay levels of redundancy payments that I regard as fair and reasonable and which are provided for in the Bill. This needs to be examined because it is a serious charge and I do not make it lightly. Some managers judged that, if redundancies were to be faced later in the year, it would be more cost-effective to bring them forward and have them put into effect in advance of the legislation being passed. That is a disgrace if it is the case and can be proved.

The current level of redundancy payments at a half week's pay per year of service is, as we have acknowledged, derisory and the Bill proposes to change the level to two weeks' pay per year of service. It should go further, and my colleague, Deputy Morgan, had tabled amendments to that effect. This is an issue that should have been allowed to be debated to give it an airing and full exploration because there is a sustainable argument that the level should have been increased to three weeks.

Also, the legislation should have been retrospectively applied. I have listened carefully to all the responses from the Government and its claims that it could not introduce retrospection. What evidence is there of whatever effort has been employed in pursuing that course or option? What options were examined? Were there other imaginative means that would have allowed for a retrospective application of the terms of the Bill? Perhaps the Minister of State would address those concerns.

As Deputy Crawford said, people in our constituency of Cavan-Monaghan, while welcoming the Bill, are conscious of the many workers who have lost out on benefiting under its terms. The Deputy instanced and named a number of them, especially the workers in Lissadell in Carrickmacross, County Monaghan, a long-standing employer which laid off 60 workers and whose factory is now closed. I have real concern in that case and have no doubt that there are others within the constituency who share the concerns already expressed by the previous speaker.

The workers in Lissadell and others have been forced to accept what I regard as a derisory half-week per year of service statutory redundancy. They have looked to the House and the elected Members at this level to seek redress and address of the deficiency in the existing provision and an increase in redundancy payments as signalled. They and thousands like them are not being catered for and their bitter disappointment will continue.

I wish to raise the case of the workers made redundant at Richardsons, the Irish Fertilisers Industry's plant in Belfast. IFI was a company owned by this State. The Belfast workers had a redundancy agreement and, when the company was wound up, it was not honoured by the Government of which the Minister of State is part. As a result, the workers have been left short and out of pocket.

That is not correct.

The workers left a meeting with the Minister for Enterprise, Trade and Employment last November deeply disappointed and sorely offended. The failure of the Government to meet the terms of the agreement in place is damaging to the development of real and effective cross-Border relations.

The Deputy has definitely got it wrong.

Unfortunately, he got it right.

I know IFI. I lived next door to it.

I live next door to Northern Ireland.

I wish to share my time with Deputies Kirk and Blaney.

Is that agreed? Agreed.

It is ironic to speak on the Bill when it will hardly make the headlines of the newspapers and television news, yet the changes we are discussing and making will have a major impact on many people over the next few years. Deputy Ó Caoláin referred in his contribution to the fact that we will face more redundancies. It is those people who, unfortunately, will be made redundant in future who will benefit from what we are doing here today.

One of the reasons there will always be a growing number of redundancies is that there are more workers. The work force is larger than ever before. Another reason is the changing nature of employment through advances in technology and so forth. While the total figures may fluctuate marginally at a given point, there can still be many redundancies within the economy.

I was talking casually to someone about the Bill and its relevancy to redundancies. They said it was great that the payment would be increased significantly and that they would have a lump sum to go on holiday or whatever. Redundancy payments are for a different purpose. Statutory redundancy is a compensation for people.

The system in place, which pays a half week or a week depending on age, is 36 years old, having been introduced in 1967. The economy and our lifestyles have changed significantly since then. In 1967, when I was a young fellow, we did not have a car and did not go on foreign holidays. My mother and father had few debts except the mortgage on the house. Lifestyles today are quite different. People are prepared to buy on hire purchase or lease and so forth.

The purpose of statutory redundancy is to compensate people adequately for a period to give them an opportunity, if they are unfortunate enough to lose their jobs, to re-organise their lives without getting into serious debt. It is appropriate that the level has been increased to two weeks per annum. It is important that, when people receive this lump sum, as will inevitably happen as we go forward, they look on it in those terms. It is important the money they receive is used to meet their financial commitments at that time.

We live in an era when people have financial commitments other than their mortgages. It is important that they realise we are giving them an opportunity to readjust and find employment without going under and getting into serious debt. That is one of the major problems of which the public must be aware. Statutory redundancy is not a holiday fund.

I compliment the Minister on what appears to be the speedy manner in which the Bill has been brought before the House. I read some of the comments of Senator O'Toole when he referred to meeting the workers from the Irish Glass Bottle Company last November at which he said he would make this an issue with the Government on their behalf. He referred to his dealings with the Minister and so on.

It is now May, six months on, and a great deal of work has been done by the Minister and her Department in producing the Bill and obtaining the agreement of her colleagues to have it brought before the House. It is my understanding that, when it is passed, the Bill will become effective very quickly, and that is important. If the point made by Deputy Ó Caoláin in relation to companies being opportunistic and making early redundancies is true, then that needs to be investigated and made public. It is equally important that this Bill becomes effective immediately so as not to increase that opportunity or to afford time to others to engage in that type of practice.

I am grateful for the opportunity to share time in this important debate. I join with the other speakers who have welcomed this very worthwhile Bill. At a time when there is clearly an increase in the number of workers being made redundant, many people who find themselves in that position will welcome this legislation and the benefits it will bring.

The proposed changes will benefit those in the community who have lost their employment through redundancy. Many of the traditional industries in Ireland that provided steady employment in the past are now finding the chill winds of competition quite difficult to deal with.

In the past in my area of the north-east, thousands of people were employed in traditional industries such as footwear and textiles. Unfortunately, the footwear industry is long gone and is part of the industrial history of the area and the textile industry is following suit.

In the last number of weeks, Lissadell Towels, an industry which was based on the Louth-Monaghan border between Ardee and Carrickmacross, closed its doors. Lissadell Towels provided good and steady employment for many people over a long period of time. The plant survived many ups and downs and displayed a resilience and a staying power which owed much to the loyalty and flexibility of its workforce. The staff are drawn from three counties, west Louth, south Monaghan and north Meath. Many of the employees spent all their working lives in Lissadell and are now devastated by the closure of the plant. New houses were built and families were reared as a result of employment in Lissadell but, sadly, the plant is no more.

Those made redundant are of an age where re-training is particularly difficult. It will not be easy for them and it is to be hoped that as many as possible will be able to avail of re-training facilities provided by FÁS. Employees are saddened and disillusioned with the demise of the local industry.

The news of the Redundancy Payments Bill 2003 created hope that there would be increased payments to soften the blow of unemployment. Redundancies were made in Lissadell just a few weeks prior to the Bill being circulated and there was clearly an expectation among the former employees of Lissadell that they would benefit from the increased payments. It goes without saying that being made redundant on 20 April 2003 is no different to being made redundant on 20 June 2003.

The Tánaiste spoke about the difficulties with retrospection. I appeal to her to have regard to the circumstances of the employees in Lissadell and those in other industries that have closed recently. These employees must now feel very embittered that they may well lose out on the increased payments. I ask her to consider the position within the context of this legislation or of other amended legislation.

Many of those who have been made redundant, particularly in the textile sector, will find it extremely difficult to find alternative employment. They have mortgages to pay and families to support and all the weekly domestic financial outgoings that everybody has to meet. It is difficult enough to do that on a low or medium income in normal times but being made redundant clearly increases the burden and the responsibility in those circumstances.

I appeal to the Tánaiste and to her Department to consider the implications. I know it is a question of where retrospection begins and ends, more particularly where it begins. This legislation is part of the partnership agreement and the expectation about it has existed for some time. It may well be that some industries may have been able to hold on while others in different circumstances have been unable to do so, but a transition period exists which bears sympathetic examination to see what can be done to accommodate or at least ease the blow for those who have become unemployed during the transitional phase.

It is a pity that the Tánaiste is not in the House because I would have liked to address my remarks to her. She carries a fair bit of the responsibility for the unemployment situation in Donegal. This Bill may pertain more to Donegal than any other part of the island given the job losses over the past six months and even long before that. Sadly, there is no sign of a change in the trend.

Unemployment figures for Donegal are running some 10% higher than the national average. I want to say to the Tánaiste and the Government that we are in crisis and cannot take any more in Donegal. Something must be done. Over the past five years we have had unemployment levels of between three to five times the national average. It is not just today or yesterday that the job crisis began in Donegal.

A task force was set up four years ago and it was intended to spend €598 million on job creation in Donegal but nothing has happened. I would like to know where the money and the jobs have gone. From what I can see, these jobs have gone to every other county but Donegal has been neglected for some reason. I do not like saying that to a member of a Government whom I have supported this far. The only thing achieved by the task force in Donegal was to take the heat out of the redundancies in Fruit of the Loom.

Unifi in Donegal are letting 250 jobs go on a phased basis from the end of this month until the end of July. While I welcome this legislation, I want to ensure that these employees are dealt with under the terms of this Bill. I wrote to the Tánaiste two weeks ago inviting her to visit the county. While I appreciate her reply, I and many others are urgently awaiting a date for her visit as we need assurances that the other 420 jobs in Letterkenny are secure. We need to know the position on job security at Donegal Healthcare and other smaller industries in Letterkenny and in the county as a whole.

We no longer accept the excuse that Donegal is inaccessible; we are no more or less accessible than some other counties. The Tánaiste knows better than I do about the job losses in Donegal, whether in Fruit of the Loom or the industrial estate in Gweedore which now lies empty. Unifi and many other smaller industries have gone to the wall.

There are a large number of small farmers in Donegal and they are going through hard times at present. Many have left farming and more will follow. The conditions laid down by the Minister for Communications, Marine and Natural Resources, restricting the number of days on which fishermen can fish, has badly affected Donegal.

It is not my intention to attack the Tánaiste but these facts need to be outlined. The time has come when we in Donegal must shout "stop". We cannot sustain any more losses. We must try to bring the unemployment figures in Donegal back to the national average.

I look forward to the opportunity of meeting the Tánaiste in Donegal in the near future and discussing the issue in depth. It is time to provide sustainable employment in Donegal.

I wish to share my time with Deputies Timmins and Wall.

This Bill is too little too late. While any improvement in statutory redundancy terms is to be welcomed, what is on offer in this Bill is not good enough. The Labour Party will support the rapid passage of the Bill through the House because to do so will be in the best interests of the hundreds of workers who urgently need improvement in the statutory redundancy terms. Let us not pretend, however, that this measure is anything like a decent or enlightened piece of legislation.

The Labour Party has been campaigning for years for an improvement in statutory redundancy payments. In our election manifesto we called for redundancy payments to be increased to at least three weeks' pay per year of service, with the removal of restrictions on the basis of age. The trade union movement made the same demand and was backed up by thousands of workers who took to the streets on 4 October last. At that stage the need for reform was more obvious and urgent than ever. Through the gross mismanagement of the economy by the Fianna Fáil-PD Government, there has been a constant flow of redundancies. In fact, the total number of redundancies doubled in 2002 compared to the previous year and we are continuing to see major job losses on a weekly basis. These workers do not need a load of waffle from the Tánaiste and the Taoiseach about the international downturn. They need reasonable redundancy terms and some prospect of finding work. The same Ministers who were so ready to take the credit for job announcements during the boom have nothing to say to workers facing redundancy.

This Bill represents the very least the Government could get away with without collapsing the social partnership talks. It is extracted grudgingly and belatedly from a Tánaiste and Minister for Enterprise, Trade and Employment whose dedication to the IBEC agenda is above and beyond the call of duty. The Bill is grounded in meanness and a basic lack of compassion for those who find themselves without work, and a concern only for the interests of big business and the corporate sector. I only mention "compassion" because it is lacking. Statutory payments are not a matter of compassion or charity.

We are talking about workers who have paid PRSI payments in some cases for decades. They have made their contributions to the social insurance fund and it is only reasonable that they should be entitled to a decent payment when they lose their jobs. It is supposed to be an insurance scheme where one pays in and gets something decent in return. However, we all know the Tánaiste does not hold this view of insurance. Otherwise, she would not tolerate the organised test, which is the current Irish insurance market. She has had responsibility for this industry for the past six years. It is not as if the State cannot afford to provide for decent statutory redundancy payments. The surplus in the social insurance fund at the end of 2002 was €0.25 billion. The projected surplus at the end of 2003 is €1.5 billion in spite of the Minister for Finance's raid last year of the sizeable sum of €635 million from the social insurance fund.

I want to put on record my abhorrence at the way in which the Tánaiste has dealt with the issue of retrospection. She accused my party leader last week of playing politics with vulnerable people. This morning and throughout the debate on the Bill, my colleagues, Deputy Howlin and Deputy Pattison, made the case convincingly that the Tánaiste led workers from Castlecomer to believe they would be covered by the terms of the agreement on redundancy as set out in the new partnership agreement and in this Bill. As a matter of honour, on the basis of basic decency, the Tánaiste has no option but to redress the wrong she has done not just in this instance but in regard to the thousands of others affected.

As someone who received the princely sum of £300 in 1980 under the current redundancy scheme, I recall the stark reality for the long-serving members of the company for which I worked. Unfortunately, the then Minister, former Deputy Des O'Malley, refused grant-aid to sustain the company, which was a viable company using natural resources. The stark reality of the redundancy payment for workers who had given 40 years' service was evidence of the major problem in relation to the redundancy payments scheme. Unfortunately, it has taken until now to change the scheme.

There have been many sad cases of years of experience, ability and work going by the wayside due to the fact that the Government of the day did nothing to improve the scheme. Now that we have reached this stage, there is still a grey area which is causing major concern, namely, retrospection. During the Celtic tiger years there were very few redundancies and we were not accustomed to making redundancy payments. Suddenly as the Celtic tiger began to wane and redundancies became a fact of life, the Tánaiste did not know how to deal with the issue. Perhaps she made promises on retrospection in good faith which she felt she could honour. I ask her to come to this House and clarify the promises she made in regard to retrospection. The father of the House, Deputy Pattison, a man who has given a lifetime to this House, made it clear that such promises were made. I understand promises were also made to the workers of Peerless Rugs in Athy who had a number of meetings with the Tánaiste.

I want to know if the Tánaiste agreed that these payments would be made. If she made these promises, she should come in here and clarify whether she made them in good faith, but because the Attorney General has stated otherwise it is not possible to honour them. It is not a lot to ask someone to clear up such confusion. The Peerless Rugs workers fought a long and difficult battle which was a lonely one at times. Despite numerous representations to the Tánaiste and the Department of Enterprise, Trade and Employment, they got little, if anything, in return. In fact, the courts settled the problem. The problem in that instance was that the legislation was not in place to provide an alternative payment. Because workers received the basic statutory redundancy at the time, the Labour Court made a recommendation which could not be sustained against the employer. I say to the Minister of State, Deputy Ahern, that there is need for further legislation to encompass redundancies. If the Labour Court makes a recommendation which cannot be sustained, it is imperative that the State honours these commitments. This is what happened in regard to the Peerless Rugs workers. These people were told they would receive three weeks' pay but this could not be sustained because the legislation was not in place to enforce the decision made by the Chairman of the Labour Court, Mr. Finbarr Flood.

I ask the Government to consider this issue and to encompass what is happening here today. Reflecting on my case in 1980, an extra half week's pay per year seems very little given the funding provided by workers to the Exchequer during that period. There is a need for people to reflect on this issue and to say that two weeks is not sufficient. This does not provide sufficient back-up in this day and age. In 1980, very few people owned their houses or cars but nowadays people have huge mortgage and other commitments. The size of this redundancy will not reflect the pressure, torment, worry and concern of people who are unfortunate enough to be made redundant, as we were in 1980.

The Minister should consider the amendments that increase the rate of payment. The lump sum payment of one year's salary should be looked at as well. Now is the time to do something about this issue. Look at what has been done with this legislation in the past. The legislation dates from before 1980 so it has been in place for almost a quarter of a century without amendment. Will we have to wait another quarter of a century before doing something that is honest and worthy of our workers or will we continue to protect the employer, despite the efforts of so many to improve the employment situation?

The Minister should do a number of things. He should ask the Tánaiste to come to the House and clarify the retrospection matter. Where the Labour Court made recommendations they should be honoured in the legislation. The amendments providing for an increased number of weeks should also be taken on board. Only then can we move forward and claim the House has produced legislation that is honourable, favourable to the worker and will do something to assist the many workers who are unfortunate enough to face redundancy.

This morning I received a phone call from a woman who was made redundant in recent weeks. She was wondering if this legislation would be passed before her husband is made redundant in the next two weeks. Unfortunately, I gave her the wrong answer. I did not think it would be passed but I am delighted there will be some comfort for that woman tonight. I will be able to assure her that the legislation will be in place when her husband is made redundant.

I urge the Minister to talk to the Tánaiste before the next Stage of the Bill. Consideration should be given to accepting the amendments so there can be unanimous support for this necessary legislation.

I am glad to have the opportunity to speak on the Bill. The Bill is welcome but it has been long delayed. The existing legislation has been in place for many years. In recent times we have seen many instances of people being laid off work. The sums of money they get are paltry. For people with families and school going children the sums would only last a couple of months. The redundancy payment might seem to be a big payment to some but €10,000 to €20,000 would not take one far nowadays.

Redundancies will be a feature of the economic landscape in the next few years. This is mainly due to the lack of competitiveness in the economy, which has not been assisted by the policies of this Government. I will make a number of points about the IFI company in Arklow, which also had a depot in the Minister of State's constituency.

It was a factory.

It was not well looked after, unfortunately, because it is no longer there. There should be retrospection for those workers. The first they knew about the closure of their company was when they read about it in an English newspaper.

The Deputy is codding himself. They knew about it six months beforehand.

I do not wish to go over sensitive ground for the Minister but it was regrettable that this happened. This was not a private enterprise or a company whose boardroom was located in Detroit or Denver. The boardroom of this company was basically on the benches opposite. It was most insensitive to the needs of the workers. If workers in a private company were treated in the same manner, the Minister and his colleagues would have been the first up to bang the table. These workers were sold down the Swanee, particularly the workers in the Arklow area. For a number of years they sought to put forward a viability plan for that part of the company but to this day I do not know what happened to it. It never came to fruition.

There is a strong feeling among the workers that there might have been fraudulent trading. I understand the local groups will take a case against the Government. There is a strong impression that the company was kept open in view of the upcoming general election.

That would be against the board of directors, not the Government.

In addition, many local creditors are owed money by a company in which the State held a 51% share. Some are owed sums of €100,000 and €200,000. These are small family businesses.

A holding is different from a company.

The Deputy without interruption.

Thank you, a Cheann Chomhairle. I am aware that this is a redundancy Bill and that it relates to workers but I should have the latitude to refer to the creditors of IFI. It will not be long before they are back at Leinster House looking for a fair deal. They are owed money by the State and their businesses are going to the wall. Many of them are experiencing severe difficulties. I do not generally come to the House to articulate a point that is inaccurate for the sake of sensationalism. I know people from that area who are owed money by the State and who are in financial difficulty. I ask the Minister to give that message to the Tánaiste and I hope she will refer to it on Committee Stage and give them some hope that they might get their payments. My understanding is that they might get 50% of the payment in one or two years, which is not satisfactory.

Fine Gael is generally in favour of any measure that will improve protection for workers. I support the Bill but the Government should seriously consider the issue of retrospection. It can be done if the will exists.

I thank the Members who contributed to the debate. It shows the humanity of the Members that so many were interested in participating in this short debate.

The Tánaiste believed it was time redundancy levels and the administration of redundancy should be changed so this Bill was brought forward. Negotiations about the provisions in the Bill took place between the Government and the social partners in the Sustaining Progress programme. Account was also taken of the report of the redundancy review group. The Bill has been welcomed by all Members of the House.

A number of questions were raised during the debate. The main issue mentioned by speakers from all sides of the House was retrospection. It was a cause of great concern. It was felt that the Tánaiste, at her meeting with the deputation from Comerama in Kilkenny, said that she would give retrospection to those workers. However, according to the minutes of that meeting the Tánaiste said talks were ongoing on the statutory redundancy issue and she gave an undertaking that if the legislation is changed, she will do everything she can to ensure that the Comerama workers will be included in any amendment. I was not at the meeting so I cannot say anything further. I can only quote from the information provided to me.

I am sure the Minister will accept the word of the Leas-Cheann Chomhairle.

With regard to the Comerama workers, the exit package was statutory redundancy multiplied by 3.5. That would be one and a half weeks per year for those under 41 years and 3.5 weeks per year for those over 41. That is in excess not only of the existing statutory redundancy terms but of the new statutory redundancy terms provided for in the Bill. Deputies McHugh and Finneran referred to the situation in Square D. The package agreed there was statutory redundancy plus five weeks' pay per year of ser vice, again greater than the existing statutory figure and the new statutory terms.

That depends on what is the level of statutory redundancy.

Those are facts, I am not making a statement on the issue. Retrospection was mentioned by almost every speaker. On advice from the Attorney General the legal position is that as a payment of a statutory redundancy lump sum is a legal requirement on employers, it could not be imposed on them with retrospective effect. Employers are entitled to due notice of the intention to require them legally to pay enhanced rates. The Redundancy Payments Bill must be brought into effect by ministerial order after enactment by the Oireachtas and it cannot be made retrospective. There was a case in 1984, Nokia Limited v. the Minister for Labour, where the Minister wanted to make a retrospective payment but it went before the courts and Mr. Justice Costello's decision was that it could not be made retrospective.

This Act will come into effect once the Bill has passed through the Oireachtas and been signed by the President on Sunday, 25 May 2003.

Deputy Murphy asked about redundancies. Notified redundancies for the period January to April 2003 are about 1% less than for the period January to April 2002. The Deputy should look at the live register in his own area – it stands at 3.6% – and if he deducts 40% of that figure he will find the level of unemployment, which is low in spite of current circumstances.

Deputy Morgan acknowledged the Bill but then went into a tirade about the economy going downhill and a lack of progress in recent years. We reduced tax from 28% to 20% and 55,700 houses were built last year, more than in any other year. Public services have been improved.

What public services? Not health, education and local government.

Generally the economy has performed well. An additional 300,000 people are working. Improvements have been made in the past five years.

The payment of two weeks' pay per year of service was raised by many speakers. That is the figure that was agreed between the unions, the representatives of the workers, and the Government and that should be remembered.

Deputy Joe Higgins stated that there was no benefit whatsoever in the changes that are being introduced. He said that if an employee was earning €400 per week, the changes would be irrelevant. If a person is earning €400 per week and has ten years' service, as the Deputy mentioned, under this Bill that person will get €8,400. At present, if the person is under 41, he would get €2,400 and if he is over 41, he would get €4,400. There are substantial benefits in the increases contained in the Bill.

Deputy O'Donovan asked if temporary and part-time workers will receive redundancy under this legislation – they will, provided they have two years' service.

Deputies O'Dowd and Kirk asked about workers in Lissadell Towels. They do not qualify because the Bill will not be enacted until 25 May. Those workers will receive their cheques soon; some probably received them today because they were issued yesterday.

Deputy Naughten forgot the subject matter of this Bill and launched into a discussion on insurance. I agree that insurance presents major problems for the economy in terms of competitiveness. The MIAB brought out a report containing 60 recommendations, some of which have already been put into effect and which are already benefiting car insurance, with reduced or level premiums being requested. On the PIAB, it was also made clear, despite an assertion by the Opposition, that this report will have immediate effect. It has had such an effect in the motor insurance sector but we also made it clear that it would take between a year and a year and a half before there benefits would be seen in the employee liability sector. Change will not happen overnight.

Deputy Timmins asked about redundancy for workers at IFI and the problems of the employees there have been worked out to a satisfactory conclusion. He also asked me to bring the issue of creditors to the attention of the Tánaiste. I will do that.

I thank all Deputies who contributed to this debate.

Question put and agreed to.
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