Tom Kitt
Ceist:6 Mr. T. Kitt asked the Minister for Enterprise and Employment if he will make a statement on the impact of EU employment and labour laws on the competitiveness of Irish companies. [5641/95]
Ceisteanna—Questions. Oral Answers. - Employment and Labour Laws.
Most other EU member states already have significantly higher standards of social protection than those currently obtaining in Ireland or those which will be put in place as a result of the transposition of recent EU social legislation into Irish law. For example, in Germany, Europe's strongest economy, there are significantly higher standards of social protection than those required under EU social policy. In many EU member states, there are stronger standards prevailing in the area of employment rights and the health and safety of workers which arise from policies adopted at national level rather than those resulting from EU membership. I, therefore, believe that concerns about competitive disadvantage arising for Irish businesses within the Community or in a wider global context resulting from the implementation of EU social legislation have been unnecesarily magnified.
The effect of the United Kingdom opt-out from the Social Chapter is more optical than real. In fact there is only one directive, the Works Council Directive which has been adopted to date without the participation of Britain. Indeed, Britain is implementing the Works Council Directive in many areas on a voluntary basis. We should not allow ourselves fall into the trap of believing that the United Kingdom has gained a significant competitive advantage by virtue of that opt-out; that would not accord with the facts.
Indeed, Ireland's high level of investment in training and education, and our tradition of social partnership, places us in a good position to offer the kind of flexibility to meet the challenge of change. I will shortly be announcing the setting up of a new unit in my Department, in line with the commitment in the Programme for Government, to better equip Irish business to meet the challenge of change through developing new forms of working, and new ways, in partnership, to meet the standards required by total quality management and world class manufacturing.
To achieve the changes we need to make to compete in a changing and competitive world will require a new spirit of co-operation between workers and employers, the sharing of information, and the realisation that business is a shared enterprise involving the fullest commitment of both management and workers. That commitment on the part of workers is best earned in an environment where basic employment rights are protected and respected.
Employers should not fear the social policy changes proposed, instead they should seek to avail of the opportunities they present in the form of a stable, well trained, highly motivated labour force. We have an increasingly flexible and adaptable workforce which compares very favourably with those in other similar European countries, including the United Kingdom. Both employers and workers should seek to utilise this flexibility and, where possible, co-operate at enterprise level as regards the introduction of new work practices with a view to enhancing industrial competitiveness and creating additional jobs.
European social policy has proved of enormous positive benefit for Ireland. Social policy is not just about labour legislation. It is also about employment creation. I must point out that Ireland continues to gain considerably from EU membership in terms of funding. The European Social Fund, for example, is expected to provide 1,953 million ECU, or some IR£1,562 million, to Ireland over the six years 1994 to 1999 for our human resource development programmes. If we are happy to take the money we should also be happy to take the social legislation.
In the Government's view, a meaningful social policy, which contributes to raising standards of living, income and education is essential in order to achieve a healthy and competitive economy and is an accepted fundamental in our society. The harmonisation of European social policies is a corollary of the opening of borders and the breaking down of barriers to trade, which should be so beneficial to a country like Ireland which exports 70 per cent of what it produces.
The consensus on economic and social policy issues which we have here could not have been achieved without the existence of basic social standards. This consensus approach has allowed us to put in place a well balanced body of labour legislation which, together with measures designed to stimulate employment, provides an appropriate framework for the purpose of achieving an efficient and competitive business environment. It is not the Government's intention to undermine that consensus and create a conflict between workers' rights on the one hand and industrial competitiveness and jobs on the other when it comes to participation in the framing of social legislation at European level or its subsequent transposition into Irish law.
The position of successive Irish Governments in this area, as signatories of the Social Charter and in line with Ireland's position on economic and social cohesion, has been to support the development of the social dimension of the internal market. However, successive Irish Governments have also sought to ensure that specific legislative initiatives do not impact disproportionately in Ireland, do not constitute an unnecessary burden on business and do not endanger the competitive position of Irish industry or jeopardise the maintenance and creation of employment in Ireland.
I believe that both the degree of the changes we have to make to apply EU social standards, and their impact have been greatly exaggerated. In most cases, these minimum social standards are the standards already being applied by good employers.
The Government is very much aware of the global competitive pressures to which Irish industry and business are increasingly exposed and, consequently, is seeking to ensure that developments in EU social policy are fully evaluated in the context of the national economic priorities of job creation and maintenance. In this regard, I should point out that, in dealing with our obligations to implement existing EU social legislation and in negotiations regarding new EU social policy initiatives, my Department always seeks to adopt a very flexible approach and to consult as widely as possible with the social partners and other relevant interests so as to minimise any undue impact of EU proposals on Irish industry.
I respectfully suggest that the Minister of State should save us from some of that elaboration; while agreeing with much of what she had to say, it might be more suitable to a conference speech or the like. I welcome the establishment of a new unit. Will the Minister inform us how many new units there are in her Department?
Eighteen today.
While agreeing with what the Minister said about our laws incorporating European legislation and the benefits to be derived from that, small businesses contend that so much is coming on stream that they cannot keep up to date, it is too costly and, in that way, would have an impact on employment. Rather they request that we consolidate, simplify and implement such legislation. I referred earlier to the matter of health and safety which comes within the Minister's remit and is a very good example of provisions we are required to implement in the interest of workers. I suggest that the Minister of State deal with some of these practicalities, that we implement such legislation as we are required to for workers with health and safety being particularly pertinent.
As Deputy Kitt knows, I am a very practical woman. I am sorry if he feels that a comprehensive reply to what was a very fair question was unduly long but, had I given a skimpy reply, that would have been unfair to him. These are important issues on which it is important that we place our views on record, in particular, our views on a very damaging campaign being run by Britain arguing the point that they are more competitive or flexible because they have an opt-out, which is more optical than real. It would be my hope that Irish business would not travel the road of buying the British propaganda on that issue. I do not accept that the requirements of European Union social policy are too costly for small businesses. We can not have a two tier workforce in that those who work for smaller companies would have fewer employment rights than those who work for large companies. People in business today must realise that their most important asset is human resources, the calibre and the commitment of the people working for them. Employers in small companies do not earn that commitment by treating their workers as second class citizens. Any small company interested in developing will demand a commitment from its workforce and will study its quality. Its employers will secure a good quality workforce and commitment if it treats its workers with respect and gives them the same employment rights as people working for larger businesses. Otherwise small companies will lose their best workers who will obtain work elsewhere.
I agree with Deputy Kitt about the need to simplify matters and that is a task on which I have embarked. We need to simplify paper work and the language used. I commend IBEC for organising a series of information conferences with small businesses on the area of employment regulations, EU social policy and producing a booklet which, while it may contain strong views in terms of its perspective on EU social policy with which I do not agree, has the merit of explaining simply the effects of such a policy.
One of the first tasks I undertook in my first month as Minister with responsibility for Labour Affairs was to reform the Employment Appeals Tribunal and give it a clear mandate about ensuring consistency in decisions. The chairperson of the Employment Appeal Tribunal is employed virtually on a full-time basis and the number of chairpersons has been reduced to ensure consistency in decisions. We are ensuring that training is provided for those employed in the Employment Appeals Tribunal.
I did a good deal of work on that.
I have built on the good work in this area undertaken by my predecessor, Deputy O'Rourke. It is important to have an adjudication system for employment rights in which employers and employees can have trust. If people believe adjudication is simple, fair, prompt and efficient, they will not have any difficulties with employment rights legislation, which is what good employers are implementing.
The area of health and safety is important. The fire in Government Buildings today makes us realise it is important to be alert to the hazards in the workplace. I had some difficulty in having the reply to Deputy Kitt's question printed, I could not get access to my computer in Government Buildings because of the fire.
The Minister could have used Deputy Rabbitte's computer.
The weight of Government advisers is too heavy for the building.
It was the length of the Minister's answer.
Let us hear the Minister's response.
I am paying a great deal of attention to the area of health and safety. The Health and Safety Authority has prioritised its programme for the coming year based on where it can best use its resources to reduce the toll of death and injury at work and I know we will have the co-operation of employers in this area. At the beginning of the week the farm organisations were involved in this area because the largest toll of death is on farms where 24 people died in farm accidents last year. I am anxious to ensure we move ahead in that area. Small businesses will find that if they draw up a health and safety statement and study the practices and procedures in their workplaces, they will learn not only how to run a safer workplace and, I hope, reduce their insurance premia, but also how to reorganise their work more efficiently. A study of the organisation of work practices will reveal how work can be made more efficient and I do not consider such a study an undue burden. At a joint conference of the Health and Safety Authority in the South and the Health and Safety Executive in the North held last week in Dublin Castle the point was made that health and safety concerns result in profit and that message should go out to large and small businesses.
Did the Minister secure the necessary finance to recruit additional staff to the Health and Safety Authority? If so, how many will be recruited and when will they take up their positions?
I secured additional finance for the Health and Safety Authority, six staff will be recruited in the current year and it is hoped that additional staff will be recruited the following year. Those jobs have been advertised and those people will be recruited shortly.
I suspect I am in a minority of one in asking the Minister if she is telling us that the 160,000 small firms in Ireland employing fewer than nine people should bear the brunt of EU legislation on worker protection. Will she not accept the reasonable approach of the recommendation to the Government of the task force report on small companies that while firms are below a certain level there should be a threshold to allow them to ease into implementing such legislation? Is the Minister's message to the 160,000 small firms, "tough luck, you will have to put up with it and if you are not big you cannot make it"? Has the Minister discussed her view with the Minister for Enterprise and Employment, Deputy Bruton and with the Fine Gael members of the Cabinet?
The Deputy has not discussed that view with me, which is more to the point.
I said I was probably in a minority of one on this issue.
The answer to the Deputy's first question is yes.
Small companies will be interested in what the Minister has to say.
Let us hear the Minister without interruption.
The answer to the Deputy's second question is no.
That is the shortest answer the Minister has given today.
I reiterate it is extremely important that small companies should be able to attract and keep good quality, motivated staff——
That is nonsense.
——and they will not be able to do that if they treat them as second class citizens. I do not accept that is nonsense nor do I believe Deputy O'Rourke accepts it.
I now call Deputy Eric Byrne who has been offering for some time.
I have not asked one supplementary question today.
I assure Deputy Harney that she will be called next. Deputy Byrne has been offering from the start on this question.
Deputy Byrne can ask his Ministers questions without taking up time at Question Time.
There is no need for that comment, it was uncalled for. I agree with the Minister that it is an outrageous decision by the Conservative Tory Party of the British Government to have opted out of the Social Charter. Given that we face much competition, particularly from Scotland, in attracting overseas foreign companies, has the Government quantified the competitive advantage, if any, that Scotland might have as a result of the British Government's decision to opt out of the Social Charter?
The only effect to date of the British Government opting out of the Social Charter is that Britain has not been a party to the EU Directive on works councils which involve companies which straddle EU boundaries, have more than 1,000 employees and a minimum number of employees in a particular jurisdiction sharing information with their workers. In Britain many of the larger companies are becoming involved in works councils on a voluntary basis. Irish companies who employ fewer than 1,000 workers are by far the largest group of companies. If employers share information with their workers and bring them along with them in good times, they are better positioned to bring them along in bad times. We need to learn lessons from industrial disputes like Packard that if employers win the confidence of their workforce, they are in a better position to deliver on change. However, if employers do not win the confidence, trust and support of workers and do not share information in good times, is it any wonder that there is difficulty in employers having credibility when they seek to implement a programme of change at a time of difficulties?
Regarding the Scottish position, the directive on works councils is the only issue relating to the British Government's decision to opt out of the Social Charter and it does not make any difference in terms of our competitiveness vis-à-vis Scotland. Our competitiveness is enhanced by the fact that we have negotiated national wage agreements which set a reasonable level of wage increases. We are investing heavily in the area of education and training, we have a highly educated and highly skilled workforce and that is the basis on which we offer genuine flexibility, not on the basis of notional opt outs from EU social policy. Britain, in possibly a dishonest way, has been marketing its opt out to give the impression that it has a more flexible workforce. Genuine flexibility and ability to adapt to change is based on a level of skills, education and a commitment of the workforce to the enterprise in which they work. Those objectives must be worked towards and achieved by management and they are earned through treating workers with respect. I cannot accept that Scotland has any competitive advantage arising from the result of the British decision to opt out of the Social Charter and I would not like any of us to fall into the propaganda trap being set by some British bodies who are trying to attract company investment. We are a competitive destination for any company and a competitive country in which to do business.
I would like to accommodate other Deputies who have tabled questions. Deputy Harney, please.
I certainly agree with Deputy Séamus Brennan, he is not in a minority of one.
That is two.
The Minister referred to companies with 1,000 people. Her response is indicative of somebody who thinks we have an economy where all companies have 1,000 people.
That is not so.
Some 90 per cent of companies in the State employ fewer than 50.
That is the opposite point.
Will the Minister accept that for many Irish companies, particularly smaller companies, a combination of EU regulations, domestic requirements, lack of incentives from a tax point of view makes the decision to employ another person so marginal that it is not worth while? Will the Minister accept that many of the EU regulations are not practical, that they are bureaucratic? For example, an employer who was in touch with me recently, said that by virtue of knocking down a wall between two small rooms they are required under EU regulations to provide a sick room. I regard that as sick. The regulations are bureaucratic. They are not drawn up by people who create jobs. We have to distinguish between workers' rights on the one hand and regulations which are impractical and lead to a disincentive and to frustration on the part of many employers who see no reason for them.
Unlike the Government of which Deputy Harney's party was a member, the Governments of which my party has been a member over the last two years and three months, have reduced taxation on the lower paid and have reduced PRSI levies for the first time on both employer and employees. That facilitates companies which are starting up and not in a position to pay higher wages to their employees.
Tax is increasing by 8 per cent this year, nearly three times the rate of inflation.
The economy is booming and that is one reason the tax receipts are going up.
The economy is growing by only 5.5 per cent.
The Government, unlike the Government of which the Deputy's party was a member——
Tax is all it is.
——has given practical support to small businesses in that area. I agree that in the area of paper work there is much to be looked at for small businesses. We can improve the paper work which many small companies have to do. Revenue are looking at this. An existing unit — if I may use the word "unit"— in my Department which is dealing with small business has a specific remit to examine the task force findings on small business——
I do not know what all the Ministers are doing.
——and to tackle the paper work problems facing small businesses. I do not accept we are not making progress and that there is a lack of incentive. We are making a great deal of progress. I do not accept there should be one rule for small business and one for big businesses.
There should be.
Culliton made the point very forcibly that we should not put in place a series of artificial rules and regulations that would encourage people to divide one big business into a whole series of small businesses to avoid various thresholds. That would be one of the effects if the rules for small business and those for big business are different.
That is crazy. There should be different rules for big businesses.
I accept that most companies in Ireland — I do not think Deputy Harney was listening to me — are small and medium sized. There are very few organisations, and those are mostly in the semi-State area, which would employ more than 1,000 people. Most of these companies offer conditions of employment which meet and often exceed those required by EU directives. The EU directives are drawn up in a consultative process with the employers federation at European level, with the trade union federation at European level and are agreed by the European Governments at the Council of Ministers. Deputy Mary O'Rourke, who represented Ireland at the Council of Ministers, was a party to agreeing many of these regulations which are drawn up with a view to enhancing the degree of social protection and maintaining Europe's competitiveness in the wider world.
I call Deputy Mary O'Rourke for a final question.
I am kind of gob smacked. I say, in a kindly fashion, that I did not occupy the position occupied by the Minister of State and that I hope I carried out my duties satisfactorily but I never engaged in long winded speeches. The Minister will win more friends and influence more people in the business world if the fine points she is making, and with which I agree, could be made in as clear and crisp a fashion as possible.
I replied very quickly to Deputy Séamus Brennan.
People would be more inclined to accept what the Minister is saying if they were not so massively lectured at and with so much dogma. That is meant kindly and from one remove. I note the Minister of State, Deputy Richard Bruton, is hanging his head because he berated me several times along the lines on which Deputy Séamus Brennan is now berating the Minister about the effect on small businesses, cost implications etc.
We must proceed by way of question.
In a general sense I am in agreement that if a worker is employed, whether in a small or big firm he or she should have decent standards of employment. I do not agree with one regime for one type of business. I was in conflict with the Minister's colleague, Deputy Ruairí Quinn and my own colleague, Deputy Séamus Brennan, regarding the task force on small businesses last year. Instead of dogma and long lectures would it not be better if the Minister sought to clarify, consolidate and cut out much of the jargon, EU thereby making it simpler for small buinesses?
If the Deputy is lecturing me about long winded answers that was certainly a long winded question. I do not accept that I am engaging in dogma. I agree we need to simplify the language. Sometimes the language of EU directives is horrific. We need to turn them into plain English, simple practices and simple procedures that people can follow.
Liz O'Donnell
Ceist:7 Ms O'Donnell asked the Minister for Enterprise and Employment if he intends to relocate the Companies Office or the Patents Office to Kilkenny; and if he will make a statement on the matter. [5630/95]
The Government has decided that the Patents Office will transfer to a new purpose-built premises in Kilkenny. Work on the construction of the building will commence as soon as possible and, I understand, will be completed within 18 months to two years.
The decision to relocate the Patents Office was taken following a re-examination of an earlier decision to move the Companies Registration Office to Kilkenny. However, the number of posts involved in the transfer will be approximately the same as that envisaged for the Companies Registration Office move.
Why did the Minister decide to move the Patents Office and not the Companies Office? What is the cost of the move?
The reason for moving the Patents Office rather than the Companies Office was essentially the high level of public contact with the Companies Office — about 200 per day or about ten times as many as the Patents Office handle. Consequently it was easier to move the Patents Office and ensure the minimum disruption. Despite the move to higher technology, virtually all contacts with the Companies Office are by hand rather than by post or any other method. The business of the Companies Office is predominantly centred in Dublin. We are working on issues relating to any additional costs that may arise. We do not envisage huge costs at this stage but it is part of an assessment of the move.
I am committed to the principle of decentralisation. The Environmental Protection Agency, with which I was involved, is located in Wexford. The purpose of moving offices from Dublin to other areas is to increase activity in those other areas. The Minister seems to have adopted the reverse approach. Because the activity is minimal with the Patents Office it is moved to Kilkenny and the office with all the activity remains in Dublin. This appears to be the reverse of the principle we have considered in relation to such decisions. How many staff are employed in the Patents Office?
The number of staff intended to be moved is approximately 80. In addition there are some professional and technical staff who may also move but that has to be finally decided. Our intention is to move the entire office. An important consideration in the move was that 90 per cent of the business in the Companies Office was Dublin based and many of their customers would be unlikely to move to Kilkenny. The other more compact office would have a better chance of some additional activity because there would be scope to move the specialised patent and trade mark firms to operate at a Kilkenny base. This is consistent with our policy, with which the Deputy agrees. One has to be practical when dealing with these matters. One cannot impose very heavy costs on those who seek to use the Companies Office, even though one might regard it as desirable to decentralise it.
I think it was the journalist John Healy who, during a campaign to save the west, asked why no one shouted stop. As a Deputy who represents a Dublin constituency. I resent and oppose the decentralisation of the Departments of Social Welfare and Education, the Patents Office and the Environment Protection Agency which is located in Wexford——
A question, please, Deputy.
As someone who also represents a Dublin constituency, does the Minister not agree that it is time someone shouted stop to the decentralisation programme so that as much employment as possible is retained in our capital city? Will the Government review this programme which is directing employment from Dublin to rural areas?
I agree that we have to be very conscious of the employment needs of Dublin but we need to adopt a balanced approach. One of the major areas where Dublin has lost out is in industrial employment, not in public service employment. I will seek the balanced development of the industrial base in Dublin and other areas. There has been a 20 per cent decline in manufacturing employment in Dublin during the past 12 or 13 years, and this will be the focus of my attention. A decentralisation policy in respect of what was once a very highly centralised public service in Dublin is sensible. We need to adopt a balanced approach to the decentralisation programme on the one hand and promoting Dublin as an attractive base for industry on the other.
I take a totally opposite view to the one expressed by Deputy Byrne. Will the Minister agree that workers should be able to get employment in their own areas? The purpose of the decentralisation programme is to give rural workers an opportunity to work in their areas. Is the Minister aware that a decision was made many years ago to decentralise an office to Kilkenny, which is probably the only city which does not have a decentralised office? Will he say when the 18 months timeframe envisaged for the opening of the office in Kilkenny will commence? The decentralisation of this office and the finance section of the Office of Public Works will bring approximately 250 jobs to Kilkenny.
I did not know that Kilkenny was the only city which did not have a decentralised Government office. The purpose of the decentralisation programme is to ensure a balanced spread of public service offices and to give people an opportunity to work in their areas. While there has been considerable delay in opening the office in Kilkenny, I can assure the Deputy that there is no intention to delay it further. I am committed to giving the relevant accommodation brief to the Office of Public Works within six weeks at the latest and construction of the building will commence as soon as possible. There will be no unnecessary delays.