The Labour Services Bill before the House today is designed to give legislative effect to a number of decisions contained in the White Paper on Manpower Policy published last September. These include: (a) the amalgamation of the manpower agencies into a single body; and (b) changing the youth employment levy into a general employment and training levy which can be used for all age groups and not be confined to under 25s, as at present.
The Bill is broadly similar to the National Employment and Training Authority Bill which was introduced in the Dáil in November 1986 and which lapsed on the dissolution of the Dáil in January last. The major change from that Bill is the exclusion of CERT from the proposed amalgamation of the existing agencies. This decision was taken against a background of CERT's close involvement with the tourism sector which has been identified by the Government as an area with growth potential. The Government considered it unwise at this stage to change the status of CERT which has a major role to play in the development of the tourist industry.
In recent years there has been criticism of the level of support given by the hotel and catering industry towards the cost of training carried out by CERT. The value of CERT's contribution to the industry is well known and has been publicly acknowledged on many occasions. I have, therefore, initiated consultations with a view to securing a substantial increase in financial support from the industry over the next few years with an initial target of £500,000 for 1988.
In the debate in the Dáil there was agreement on the general provisions of this Bill and I am confident that the same general support will be forthcoming in this House. The major provision in the Bill is the establishment of An Foras Áiseanna Saothar, FÁS, through the amalgamation of AnCO, the National Manpower Service and the Youth Employment Agency. These three bodies have contributed to the general economic development of the country and in more recent times have been to the forefront in the battle against unemployment.
In a situation of high unemployment, however, where the agencies are directing their considerable energies at the unemployed, it is important to ensure that their resources are used in the most coherent and efficient manner. This will benefit both the users of the service and the taxpayer. The proposal to merge the bodies is prompted by the need to provide the best service possible for the public and to eliminate the confusion in people's minds about who does what. The new body will provide the gateway for the unemployed to the wide range of employment and training programmes available.
As I indicated in the Dáil, I propose to have FÁS established with effect from 1 January 1988. There are certain advantages in choosing this date in that it will coincide with the start of the financial year. In addition, it will allow me time to have the necessary arrangements in place including the appointment of the board and the director general of FÁS.
The main functions of FÁS are set out in section 4 of the Bill. They include the operation of training, re-training, work experience and similar manpower programmes, the provision of placement and guidance services and support for cooperative and community-based enterprises.
The tasks facing FÁS are formidable and challenging. We have nearly a quarter of a million unemployed and our labour force is increasing despite migration. One of the features of the steady rise in unemployment has been the growth in the numbers unemployed for more than a year.
Assistance for the long term unemployed and the unemployed generally is now being provided in a systematic way through the Jobsearch programme. Under the programme the manpower agencies will interview 150,000 people currently on the live register; provide up to 40,000 manpower opportunities for them; and provide places for a further 12,000 persons on a four week Jobsearch training course specially devised and operated by AnCO. Generally speaking, we are on schedule to meet these targets. The programme could not have got off the ground as quickly as it did but for the wholehearted commitment and support of the staff in the manpower agencies.
Despite the increase in the numbers attending second and third level educational institutions, the numbers leaving school with minimum educational qualifications have remained relatively constant over the past number of years at about 5,000 per annum. There is a need to assist these young people through special labour market and educational interventions.
There is also a need to develop our workforce so as to increase the competitiveness which is essential to the future development of the Irish economy and the preservation and growth of employment. I do not believe in training simply for the sake of training. But I do believe that training is a decisive element in skill modernisation, effectiveness and occupational mobility of workers throughout their working lives. I also believe that industry must accept primary responsibility in this area. Our future development depends upon our people producing goods and services which we can sell in the world market place. The goods being demanded and the methods of production are changing at a rate that could not have been envisaged 15 years ago when we entered the EC. Industry is in the best position to identify and anticipate its skill and training needs. FÁS will assist industry in this task.
There is also a need to encourage enterprise at both the individual and community level. It is important to assist employment growth in this area by helping people, particularly the unemployed, to start up new businesses and enterprises. This is being done through the enterprise scheme, start your own business courses and the community enterprise programme and the initial efforts have been very encouraging. FÁS will have an important role in developing and co-ordinating these programmes.
Another important function of FÁS will be the provision of pre-departure information and advice to persons contemplating employment abroad. Up to now this function has been the responsibility of the National Manpower Service under their obligations imposed by the EC regulations governing the free movement of workers within the Community. The amalgamation of the three bodies will ensure that persons trying to decide whether to go abroad or remain at home will be fully briefed on the training and other opportunities available to them here so that they can make an informed choice. If, in the end, they elect to seek employment abroad, FÁS will provide them with the best information and advice at their disposal.
These examples of the work of FÁS help to illustrate that there will be no shortage of work for them in the foreseeable future in the manpower area. The work will involve, to a large extent, face to face contacts between the personnel of FÁS and the general public. The quality of service provided will depend largely on the commitment and dedication of the staff. I have no doubt that this commitment will be forthcoming especially as the work of FÁS, while assisting the community, will also provide a real sense of purpose and job satisfaction to their employees.
The achievements of the staff of the three existing manpower agencies in recent years clearly show their potential to cope with the challenges of a changing labour market. It is entirely appropriate that this Bill should seek to minimise uncertainty for such staff as to their employment in the new organisation. Accordingly section 7, which provides for the transfer of staff from the three bodies to FÁS together with section 8, sets out to ensure that their existing conditions of employment are protected by providing that there will be no lessening in pay or terms and conditions of service. I am also of the view that staff interests can make a significant contribution in the consultation process during the coming months.
The scope and scale of work to be done will require FÁS to maximise the use of the staff resources at their disposal. This would see FÁS dealing with any imbalances in staffing as between their different services by deploying staff as required to the areas most in need. I should like to make it clear that this integration of manpower services is not intended to involve any large scale dismantling of existing services. On the contrary it should see their rapid adaptation from a relatively centralised approach to a more accessible regionalised structure. The prospect of continuous support from the European Social Fund should further help to underline the future development and maintenance of a wide range of programmes by FÁS, fully utilising the expertise, experience and adaptability of the staff for existing services.
The other main provision in the Bill is the changing of the youth employment levy into a general employment and training levy. The decision was taken in the context of the changing age structure of the labour force and the unemployed. By 1990 over half the work-force will be in the 25-44 age group. This will give FÁS more scope and flexibility in the allocation of resources and will enable programmes to be adjusted in response to labour market developments. It will also reduce the cumbersome administrative constraints required in the allocation of funds between the different bodies and different age groups as at present. This does not mean there will be a reduction in the provision for youth. I would foresee a major youth dimension in the work of FÁS.
The Bill also empowers FÁS to undertake consultancy work overseas on a commercial basis in line with Government policy. This is likely to be an important feature of the new body's activities in the years ahead. Over the past few years AnCO, particularly, have identified commercial possibilities for the export of their training expertise. Most recently AnCO were successful in securing a major sub-contract, worth about £4 million, as part of a £20 million World Bank project to improve the organisation and standards of training in Indonesia. Overseas contracts for training and employment schemes will be handled by a subsidiary company which will be set up under sections 4 (6) and 4 (7) of the Bill.
Changes in our manpower agencies will not of themselves solve all the problems in the manpower area if the Minister and Department of Labour do not take on the enlarged role of formulating, co-ordinating and evaluating policy, as envisaged in the White Paper on Manpower policy. I accept that in the past manpower policy has not always been placed within a broad general economic and social framework. There is a relationship between our training programmes and what is done within the educational system. There is a connection between the payment of unemployment compensation and assistance being given by the National Manpower Service to the unemployed. Training activities make a major contribution to the development of industry. The only logical way to achieve a proper relationship and interface between our manpower services and economic, social and educational services is for the policy function to rest clearly with the Minister.
It is important, however, to strike a proper balance between, on the one hand, exercise of effective policy and financial control by the Minister and, on the other hand, allowing the management of FÁS to get on with the job. This I have endeavoured to do in section 12 of the Bill. While FÁS must obtain the approval of the Minister and the Minister for Finance for their plans for the following year they will still have a considerable degree of flexibility in conducting their day-to-day operations within the prevailing agreed policy framework. FÁS will, of course, contribute to the formulation of policy by giving advice to the Department and the Minister based on their knowledge of the labour market and the operation of programmes. Under section 17, the Minister may give a direction to FÁS to carry out specified activities.
The success of FÁS will depend on how well they cater for the needs of different regions and areas in the country. This Government stated in their Programme for National Recovery their commitment to the development of the manpower services on a fully regionalised basis. It is my intention that FÁS should move rapidly to the provision of services more efficiently at local and regional level. This will also involve the development of closer co-ordination with the education and social welfare systems. A greater degree of devolution of decision making to local level will lead to more flexibility and innovation which can only improve the services to the unemployed, school leavers, the deprived and the unqualified. My policy on the regional and local delivery of services, decision making and cooperation with other relevant bodies will be reflected in the structure of the new body and will form part of the policy guidelines which will be conveyed to FÁS.
The board of FÁS will consist of 17 members, including the chairman. In deciding on the composition of the board, the conflicting objectives of having bodies which are active in the labour market represented on them had to be reconciled with the need for effectiveness and efficiency. The achievement of this latter objective has, of necessity, meant a level of representation for some interests below what they would consider desirable.
The board of FÁS will be appointed by the Minister for Labour. The board will consist of four representatives nominated by the ICTU; four representatives nominated by employer organisations; one representative of educational interests; one representative of social welfare interests; one representative nominated by youth organisations; two representatives of the employees of FÁS and one representative from each of the Departments of Labour and Finance. In addition, the Minister will appoint the chairman and one other representative. The board will comprise 15 members until the appointment of the two employee representatives following an election among the staff.
Other policies and in particular macroeconomic policy impinge on manpower policy and we therefore considered it necessary and useful to have a Department of Finance representative on the board of FÁS. This will help not only in the formulation of policy for FÁS but the first hand experience and knowledge of the activities of FÁS will assist in the consideration and approval of the reports to be submitted by FÁS under sections 11 and 12.
The new body are clearly an economic development organisation with a major social orientation. They will be operating in a dynamic situation and will need to respond quickly and flexibly. I believe the title which I have opted for, An Foras Áiseanna Saothair, best describes the mission of the new body.
I commend the Bill to the House.