Joe Higgins
Question:1 Mr. J. Higgins asked the Taoiseach if he will report on his recent contacts with the social partners. [14280/06]
Ceisteanna — Questions.
Social Partnership.
Pat Rabbitte
Question:2 Mr. Rabbitte asked the Taoiseach if he will report on developments since 4 April 2006 on the negotiations in regard to a possible new national agreement between the social partners; and if he will make a statement on the matter. [14871/06]
Joe Higgins
Question:3 Mr. J. Higgins asked the Taoiseach the studies currently being carried out by the National Economic and Social Council; and if he will make a statement on the matter. [14282/06]
Enda Kenny
Question:4 Mr. Kenny asked the Taoiseach if he will report on his recent contacts with the social partners; and if he will make a statement on the matter. [16019/06]
Enda Kenny
Question:5 Mr. Kenny asked the Taoiseach if he will report on the recent work of the National Economic and Social Council; and if he will make a statement on the matter. [16020/06]
Caoimhghín Ó Caoláin
Question:6 Caoimhghín Ó Caoláin asked the Taoiseach if he will report on his participation in the social partnership talks process since 4 April 2006; and if he will make a statement on the matter. [16088/06]
Trevor Sargent
Question:7 Mr. Sargent asked the Taoiseach if he will report on developments in relation to a possible new national agreement with the social partners; and if he will make a statement on the matter. [16189/06]
Trevor Sargent
Question:8 Mr. Sargent asked the Taoiseach the studies which are being carried out by the National Economic and Social Council; and if he will make a statement on the matter. [16190/06]
Pat Rabbitte
Question:9 Mr. Rabbitte asked the Taoiseach if he will make a statement on the recent work of the National Economic and Social Council. [17143/06]
I propose to take Questions Nos. 1 to 9, inclusive, together.
Discussions with the social partners continued up to Easter and resumed after the Easter break. Until recently, the first strand of the negotiations on pay and related matters focussed on concerns about maintaining and protecting employment standards in the context of a rapidly changing labour market, especially in light of the enlargement of the EU. A great deal of time and effort was devoted to addressing the important and complex issues involved. In particular, great efforts were made to strike the right balance between ensuring decent employment standards and maintaining competitiveness, flexibility and attractiveness to investment. An emerging package of measures has been identified, although more work needs to be done. I believe we can agree measures, in the context of a new agreement, which will provide the necessary strong protection for employment standards while ensuring Ireland continues to offer an excellent environment for business and job creation. As the House is aware, the executive council of the Irish Congress of Trade Unions agreed on 26 April that sufficient progress had been made in this area to allow the talks to address pay matters and other workplace related issues. A number of plenary and bilateral meetings, involving the Irish Business and Employers Confederation, the Construction Industry Federation and the Irish Congress of Trade Unions, have since taken place on such matters.
I hope we can make further progress in the talks so we can conclude the overall negotiations over the next few days. However, I have been advised that there is a considerable difference between the sides on the parameters of a pay agreement, as well as on some significant non-pay items. It is far from clear that an agreement can be reached. I have always believed that no agreement is better than one which is wrong in terms of the sustainability of jobs and living standards. I would greatly regret any failure to conclude an agreement that continues the benefits the country has gained from past agreements. However, the parties need to decide whether they can agree terms. As an employer, the Government has a view on what is sustainable, a view which is being reflected in the talks. I urge all parties to be flexible and creative in negotiating an agreement that is consistent with our genuinely shared concerns about employment, living standards and the quality of life of our people.
The House will be aware that the parallel talks within the wider non-pay strand have been focussing on the implications of the proposed longer-term framework for social partnership, the macroeconomic context for the duration of a new agreement and the economic, environmental, infrastructural and social policy priorities within a new agreement, where the social partners have agreed that a longer-term perspective is appropriate for full implementation. While I have not been directly involved since the initial plenary meeting on 2 February last, I have been kept fully informed by the Secretary General of the Department of the Taoiseach, who is chairing the ongoing negotiations.
The National Economic and Social Council completed its three yearly strategic overview of economic and social policy — NESC Strategy 2006: People, Productivity and Purpose — last year. The document, which paved the way for the current negotiations on a successor to Sustaining Progress, was published in December 2005. The council completed a separate study — The Developmental Welfare State — in May 2005 and a further report — Housing in Ireland: Performance and Policy — in December 2004. The council's work in 2006 will involve the completion of its work on child income supports, the preparation and publication of a report on migration policy and the completion of its earlier work on the Lisbon strategy, focussing particularly on policy learning through the open method of co-ordination. As part of the work of the National Economic and Social Development Office, the council's secretariat will be involved in the learning society foresight initiative, which follows up the work of the Information Society Commission and Sustaining Progress. Other topics in the council's work programme in 2006 are the preparation of a periodic social report, as requested by the Government, competition and regulation in networked sectors and taxation policy.
Does the Taoiseach agree it is no surprise there is such a significant gap between the employers and workers' representatives with regard to pay levels? For 19 years, so-called social partnership has allowed profits, speculation and rents to rise relentlessly and without restraints, while workers' wages in no way matched them. For example, many hundreds of thousands of workers, particularly young workers, find themselves priced out of a home as a consequence.
Does the Taoiseach agree with the general secretary of the country's third largest trade union, MANDATE, which organises 40,000 members in the retail and bar sector, who stated that partnership had condemned thousands of his members to poverty and that, therefore, the union would pull out of this process in favour of launching realistic wage demands?
Does the Taoiseach agree that the obvious difficulty in securing a new so-called partnership agreement also arises from the great pressure felt by trade union leaders from their members regarding the employers' thrust to undermine decent wages and working conditions by exploiting migrant workers? Does he agree this scepticism is well justified, given that in recent weeks the Technical, Engineering and Electrical Union has been obliged to expose a Polish subcontractor and a Serbian subcontractor. These companies, which operated in one of the country's most important industries, namely, the ESB, grossly and cynically underpaid their workers and then victimised them when they sought their rights on union advice. This follows from the Irish Ferries debacle.
I refer to a regime of proposed labour legislation that would destroy collective bargaining and force workers into individual contracts, one by one, at the boss's behest. It would destroy unfair dismissal protection for all workers in places of employment with fewer than 100 workers and amounts to an all-out attack on trade union rights. These are the policies of the Taoiseach's guest, the Australian Prime Minister, John Howard. Has the Taoiseach discussed workers' rights with Premier Howard and is the Taoiseach as much in agreement with him on this issue as he is on Iraq?
It is not the case that employees have done badly in any year over the past 19 years. Successive partnership agreements by successive Governments have shown that increases in workers' salaries and wages have far outstripped inflation and increases in similar countries. When taken with the tax concessions given during this period, the living standards of workers have increased dramatically every year. Hence, the Deputy's statement is entirely incorrect.
It is not incorrect.
Social partnership has also allowed companies to grow and expand, thereby creating an additional 1 million jobs in the economy during this period. At the same time, it created the economic climate which enabled us to move away from the conditions which existed when social partnership began, when there was an unemployment rate of more than 17%, with more than 10% in long-term unemployment. At present, we have one of the lowest unemployment rates in Europe. Moreover, at 1%, our rate of long-term unemployment is one of the lowest in the OECD. Social partnership has also allowed the creation of resources to allow us to expand all our services, including welfare services, pensions services, helping our old and young people, expanding health and education and everything in between. While I would like to find something in the Deputy's comments with which I can agree, I cannot.
I refer to the Deputy's comments regarding employers and improvements to our legislation. While we have a good stock of labour legislation, we have devoted most of our time in these talks to efforts to address issues pertaining to immigration, to ensure we can improve legislation to deal with the new situation in the economy, whereby we have moved from a small to a large number of non-Irish workers, and to provide the necessary protective legislation.
As I stated in my reply, we have achieved a good package of measures. Although they are not complete, we have certainly travelled a long way down the line.
What about MANDATE?
Every trade union leader is entitled to his opinion. The issues for which the trade union leaders have been fighting in these talks are those of the basic minimum wage and issues around what is the low paid category of workers — even if their pay is not very low in terms of what we used to call low pay — and that they should get the better share of the deal. That is the right thing for the trade union leadership to fight for and they have been fighting vigorously for those.
What about Mr. Howard?
I have not discussed the labour situation with Mr. Howard.
The Taoiseach should do so.
However, I acknowledged that the economy in Australia is very successful. It has unemployment down to approximately 5%, which is the lowest level it has achieved in recent generations. Its economy is enormously strong. Other issues are a matter for the Australians.
Does the Taoiseach support its trade union laws?
As one who has broadly supported social partnership for a long time going back to the 1970s, although not to the exclusion of the terms of any particular social contract emerging, am I correct in taking a pessimistic note from what the Taoiseach has said about the prospects for a new social contract? Am I right in thinking he is distancing himself from the talks and pointing out that the Secretary General is chairing them is an especially bad omen since, if there was the prospect of success, the Taoiseach would be in the middle of it working all night to bring the parties together? Am I right in taking the view that the Taoiseach believes the prospect for progress is not promising? These talks had an original completion target of 17 March. When does the Taoiseach believe the talks might conclude?
In the Taoiseach's role of employer, is it the intention of Government to put some proposals on the table in the matter of pensions, which is a growing issue of considerable concern in particular to great swathes of private sector workers? Does the Government intend to make some tangible proposals in that regard?
I raised the issue of job displacement and protection of living standards at the beginning of the year. While it was not supposed to be an issue at all, it has taken up 84 days of the discussion so far. Are proposals to alleviate this phenomenon that are focused on the construction sector likely to emerge in the near future?
Does the Taoiseach not consider it a failure of social partnership that the employer at the sugar company in Mallow, Greencore, is trying to sidle out of its commitment on redundancy payments to the workforce at Mallow? Given what has happened there, this would be disgraceful. Does the Government intend to intervene to cause Greencore to behave like a proper corporate citizen and to observe the correct interpretation of the Labour Court recommendation in that regard?
On the last issue, the Government wants to see the Greencore situation resolved. I have already talked to people involved. I think 85 workers have not received their proper payments.
On the issue of employment rights, I am not sure what Deputy Rabbitte means in referring to the beginning of the year. This matter became a major issue last September with the Irish Ferries dispute. It was the subject of ongoing difficulties and negotiations right through September, October and November and was completed in talks in which I was directly involved on 4 December. It was from that period——
They are not completed yet, as I understand it.
They are not. I said they were 90% complete and the remaining issues, if people are reasonable and do not look for impossible situations, can be resolved. However, this issue has been in the domain throughout the process. It is totally incorrect to say the issue was not around this year. It was a major issue throughout the autumn right up to 4 December when we tried to see whether we could get going on talks.
There has been enormous activity on pensions during the past year with different issues raised and different positions taken. The Minister for Social and Family Affairs issued proposals and the Pensions Board raised annuities issues. The Government is determined to resolve these issues but it is understood that it cannot be done in the short term because there is no short-term solution and the issues cannot be dealt with overnight. Pensions issues in the private sector must be resolved. Many workers do not have a pension and we must work to create a better climate. The Minister for Social and Family Affairs has outlined the Government's position at several meetings and conferences and we are determined to work over a period to deal with this.
Since the talks process began in 1987 — Deputy Rabbitte may not recall how it works but, having been involved in six agreements, I do——
So do I.
——the Secretary General of the Department of the Taoiseach has always chaired the talks.
The Taoiseach always got the credit. He is only telling us that now.
I am glad the Deputy is giving me credit for something on the record. I was never given credit previously.
If the Taoiseach wants to play hard ball, I will play hard ball.
Whether as Minister for Labour, Minister for Finance or Taoiseach, I have had a close involvement in the talks, as I have had this time.
So the media say anyway.
The Deputy knows more about the media than we do.
The Deputy knows precisely how closely I have been involved from speaking to trade union members involved in the talks who are leading members of his party.
Deeply.
I have no doubt the Deputy checked this before he came in for questions. He will be totally aware of how closely I am involved in the talks and that I have spent a fair few nights and weekends on them because he was briefed about this.
Deputy Rabbitte's final question, which is the most important, was whether I am putting forth a pessimistic impression of the talks based on my knowledge and experience and the answer is "Yes". I do not see two sides engaged to find a resolution right now. Everyone will be aware that finding a resolution in these negotiations requires people to work hard, which they are, but also to reach the necessary compromises to bring the process to an acceptable solution for all sides and not just one side. That position does not exist today. I hope it will and I hope all sides will try to find a way of dealing with the issues, which I have outlined. The circumstances do not exist right now.
The Deputy also asked how long the talks will take. The sides have exhausted each other, including the Government. However, we cannot force the sides to settle or to agree. There is a basis for settling but both the ICTU and, particularly, the employers — I do not exclude all the other social partners — must make the necessary effort to reach agreement. They have certainly put in the time and the commitment, but I do not see the basis to find agreement at the moment. Perhaps that will change in the days ahead, but I do not see it at the moment. These questions have been on the Order Paper for several weeks and it is only fair that I give my assessment.
The Taoiseach admits that he is pessimistic about the possibilities of concluding this. He said things were 90% complete, but that there had been no deliberations on pay and pensions. What are the sticking points as he currently sees them? What are the significant non-pay issues that are outstanding? Will we have a director for employment rights compliance, as has been mentioned in some newspapers? Does he agree with David Begg's comment that wages should be ahead of the cost of living? The Government has admitted that inflation will rise above 4% this year, meaning that a pay rise below 3% would result in anyone on the average industrial wage of €600 losing €6 per week and €15 to €20 in real wages per week over a three-year deal. Does that concern the Taoiseach? Does the Government accept that due to its inability to control prices over which it has some measure of control, inflation will rise above 4% this year? What is the Taoiseach's view on the impact of inflation on the talks?
Has anything been achieved at the talks that will prevent wildcat strikes? These can cause absolute chaos to travelling consumers, as it did last week during a two-day rail strike. Real investment has taken place by Irish Rail in the last few years.
What get-out clauses have been included in the talks to date? If the final deal reached in Dublin Castle is for in excess of three years, but were inflation to grow substantially due to the Government's inability to keep it down, what get-out clauses are there to rectify the situation? Wage increases are above the cost of living and the consumer price index is at its highest in three years at 3.8%.
The work on employment contracts is 90% complete, but not on the overall deal. If people are reasonable on the other issues, we can reach agreement. There are some issues related to employment contracts on which employers have moved a long way, as have the relevant Departments and agencies. These are issues that involve the Department of Social and Family Affairs, the Revenue Commissioners and the CIF. People must be reasonable and must not look for the impossible from employers, who can go a long way but cannot do everything. We can get most of the problems resolved.
The pensions report has been published and it will take some years to resolve the issues surrounding annuities and so on. The Government is prepared to work on the issues. There may be difficulties with some employers, who have their own responsibilities. This refers mainly to private sector staff rather than staff in the publicservice.
Regarding inflation, we have seen recently the issues concerning energy. According to the EU harmonised index, our inflation rate is 2.7% compared with 2.4% for the EU as a whole, so we are not that far ahead. In so far as we can deal with issues that have proved in the past few yearsto bring down inflation, we have beensuccessful.
While issues arise on the non-pay side, there is no need to go into them. In all discussions, different pillars raise different issues. By and large, the issues pertaining to agriculture can be resolved as part of an overall deal based on the successful negotiations completed by the Government last December on the financial perspectives, which were finally ratified by the European Parliament last week. However, we must take account of other expenditure issues in the context of the Estimates and other demands. These issues cannot be taken in isolation but must be discussed within the process of considering the Estimates and other issues.
The biggest issue before us concerns pay. It would be wrong of me to breach the confidentiality of the talks but the lines between the positions of employers and unions are not meeting and, at present, they do not appear likely to meet. Things can be done and ways found to deal with it but that will depend on whether the sides are prepared to get agreement and win support on these issues and see it in their interest to do so, while at the same time sustaining the strength of the economy and continuing to increase employment. These issues must be taken into account. It is not just a question of fixing on a figure for a period of close to three years or for a shorter period. We must sustain the economy while also allowing it to continue to grow successfully rather than outprice ourselves, lose competitiveness and damage exports, which will ultimately affect investment and employment.
The scale always remains the same and I urge all sides, and employers and trade unions in particular, to consider this, as people have had to do in previous rounds, and to try to find a resolution. A huge amount of effort has gone into it and they should be careful about moving away from social partnership to a period of free collective bargaining in which there will be some winners but lots of losers and difficulties. If that happens, all the other issues raised by Deputy Kenny fall by the wayside because all six agreements have had the same basis that nothing is agreed until everything is agreed. All the work we successfully carried out would come to naught and very little would be implemented in the forthcoming period. Many of the issues which would improve rights and protections for workers, including the important issue I raised earlier pertaining to immigration, on which we have worked out a good, although not perfect, package, would fall by the wayside to the detriment of workers.
There is more in this world than pay issues and, certainly, there is no way that people can be underpaid based on what we see happening here and in other countries. I hope we can resolve these issues. I have no question about the effort, commitment and time given by the people on all sides who have worked on this but, ultimately, everyone must compromise to reach a deal. We need to do that very soon.
Will the Taoiseach address the issue of Iarnród Éireann?
We have not seen many wildcat or irresponsible strikes or one-man pickets since the 1906 Act was amended some years ago and the Labour Relations Commission and the conciliation services were established and strengthened. Nothing in the package will provide for bans because that cannot be done. All we can do is work towards an industrial relations situation in which we do not experience wildcat strikes by very small groups which disrupt public services at a time when the State is investing €177 million in infrastructure. It cannot be done by legislation or draconian measures that would cause more conflict than they would resolve. I hope the strengthening of our labour law in this package, if we have a successful agreement, will be reciprocated by workers and that they will realise their responsibility not to engage in such actions. The organised trade union leaders were not in favour of last week's event.
Can the Taoiseach assure us that, in the context of agreement being reached, we will have a full debate on the agreement in this House? Does the Taoiseach agree that as the trade union movement in all its manifestations would have to vote, entailing a substantial public debate, a full debate in this House would help to inform that wider public debate and would be seen as a constructive contribution to the core issues?
Will the Taoiseach confirm that the question of companies involved in public sector contracts being fully compliant with labour law has been raised and is one of the stumbling blocks? If so, will the Taoiseach advise us from which quarter that element comes, the Government or the employers?
Does the Taoiseach accept that workers must have cast-iron guarantees that any deal will vindicate their rights in principle and in practice? Is he aware that in 2005, 89 employers were found to be in breach of public holiday entitlements, compared to 17 in 2003 and that 40 employers were found to be in breach of annual leave entitlements in 2005 compared to eight in 2003? Does he recognise that this represents a five-fold increase in both cases, which is deeply disturbing? Does the Taoiseach accept that indicates not increased detection due to increased inspections, because there were——
The Deputy should confine himself to questions. Deputy Sargent has not spoken yet.
I am finishing. There were 5,719 inspections in 2005 compared to 7,168 in 2003. It is the contraction——
The Deputy may not make statements. I would like to facilitate Deputy Sargent.
I am not making a statement, I am asking if the Taoiseach accepts that the only way the problems I have highlighted through those statistics can be satisfactorily addressed is through increasing the number of inspectors and those working for the labour inspectorate. That is critically needed. Does the Taoiseach agree?
We have given resources to increase the inspectorate and to toughen the law. It has always been our policy to stop breaches whenever we can. Because far more people are working than ever before, there will be greater difficulty, but we must keep working to clean up all sectors of industry, including construction. All the issues around tightening up employment law have been examined at great length. The social partners spent from early February to approximately 20 April working on that aspect of it. They have put huge effort into exploring the measures they can bring to strengthen the law, procedures and codes. Some 90% of that has been agreed, a good result in any negotiation. We hope to achieve higher than 90% agreement, if not agreement on everything.
The manner in which public sector contracts are interpreted is posing difficulties. We are close to completing a review of public sector contracts. The Construction Industry Federation, CIF, and relevant officials have taken part in a major exercise to produce a different kind of construction contract, taking into account value for money reports. The Government is determined to bring this to a conclusion and has had endless meetings to achieve this.
Pay is the major issue but we are hopeful of working out a conclusion. I can only report the factual position to the House. Both sides are apart and we must work hard to resolve this. I urge both sides to do so as soon as possible. If it is not possible, there will be no agreement and we cannot implement the measures that have been negotiated and agreed because all these issues would fall on the basis outlined.
I will take a brief question from Deputy Sargent.
What about the Taoiseach's commitment to a Dáil debate? It was the first question I asked.
The Chair has no responsibility. I want to hear Deputy Sargent.
The problem is that Deputy Ó Caoláin asks so many questions.
I asked if there would be a Dáil debate.
There will be.
Does the Taoiseach accept that not fulfilling promises made in the last partnership agreement has not helped his case for this potential agreement, about which the Taoiseach is pessimistic? Is there a timeframe by which 90 additional labour inspectors are to be appointed, given the Taoiseach's commitment?
Will there be any provision in the forthcoming discussions for the Kyoto agreement, climate change and the matter of who will pay for this under the partnership agreement? Can this be agreed upon and does the Taoiseach have any intention of agreeing this?
On the basis of the National Economic and Social Council strategy report 2006, to which the Taoiseach referred, does he accept that the level of indebtedness with which people are burdened as well as the increases of 40% in apartment management fees and 40% in gas bills require that such costs be contained so that they do not rise above inflation, as is the case currently? Can the Taoiseach provide any assurance on this, a fundamental reason agreement on pay cannot be reached?
That is not the issue; these are pay negotiations. The Government tries to keep costs low but that is not the difficulty in these talks. The Government has fully honoured its pay commitments and the benchmarking process.
What about social housing?
The Government has honoured its promises with regard to land under the social housing agreement. It has to work its way through the system. We must await the planning process before continuing. Concerning child care, long-term care, older people, disabilities, and employment for vulnerable people, the Government has honoured an enormous number of commitments. We have also provided resources for them while maintaining a positive financial position that allows employment levels and living standards to increase, and that brings workplace sustainability to a large number of workers. The NESC has set out a long-term strategy. On 2 February I stated that we sought a ten-year agreement with pay elements within that sector. It would be important that we would get that. I hope we can achieve that in the current negotiations. In the NESC strategy, there is a very good work programme, for a ten-year rather than three-year period, and the Government is acting to enhance competitiveness, increase skill levels in the labour force, provide sustainable employment opportunities, improve workplace conditions and help build an inclusive society. The Government has set out its stall and programme on all those issues. It is prepared to work towards that with a greater degree of confidence in delivery. There is agreement on those issues with the social partners, but regarding pay and some other issues, there are greater obstacles.
Tell the workers——
That concludes questions to the Taoiseach.
I have not been in the House since Wednesday morning, and there has been some controversy regarding an issue that I raised in response to a question from Deputy Rabbitte. Since I comply with all Standing Orders and have been doing so for the past 29 years, I will do so now.
I have always felt strongly that the perception that the then management of Aer Lingus was proposing to organise the purchase of the company from the State was unwise and divisive. It was the impact of that perception to which I was referring in my comments last week. At the same time as I did so, I emphasised, as I have done several times, the quality and achievement of the then management team.
The comments give the impression that I was impugning the integrity and motivation of the former management. While I did not refer to anyone by name, I accept that the clear implication was a reference to Willie Walsh and his two colleagues. Comments made in the context of robust political exchange in this Chamber can sometimes have unintended effects. I regret any implication that might have been taken from them regarding the position and contribution to Aer Lingus of the former management team, which was hugely significant. I have written to Willie Walsh personally conveying my regrets. As I stated to the media last week, using the words "steal the assets" and "shaft the staff" were inappropriate. I withdraw them from the record of the House.
What about the way in which the Taoiseach misrepresented me? Will he withdraw those comments?
Not a chance.