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Dáil Éireann díospóireacht -
Wednesday, 5 Oct 2005

Vol. 606 No. 4

Ceisteanna — Questions.

Social Partnership Agreement.

Enda Kenny

Ceist:

1 Mr. Kenny asked the Taoiseach if he will report on the implementation of the programme for Sustaining Progress; and if he will make a statement on the matter. [24220/05]

Enda Kenny

Ceist:

2 Mr. Kenny asked the Taoiseach when he will next meet with the social partners; and if he will make a statement on the matter. [24221/05]

Enda Kenny

Ceist:

3 Mr. Kenny asked the Taoiseach if he will report on the recent activities of the national implementation body; and if he will make a statement on the matter. [24223/05]

Pat Rabbitte

Ceist:

4 Mr. Rabbitte asked the Taoiseach the matters discussed and conclusions reached at the meeting held on 14 July 2005 with the social partners under the auspices of Sustaining Progress; and if he will make a statement on the matter. [24364/05]

Pat Rabbitte

Ceist:

5 Mr. Rabbitte asked the Taoiseach when the next quarterly meeting with the social partners under the auspices of the Sustaining Progress agreement will be held; the likely agenda for the meeting; and if he will make a statement on the matter. [24365/05]

Caoimhghín Ó Caoláin

Ceist:

6 Caoimhghín Ó Caoláin asked the Taoiseach if he will report on his meetings with the participants in the Sustaining Progress agreement; and if he will make a statement on the matter. [24385/05]

Trevor Sargent

Ceist:

7 Mr. Sargent asked the Taoiseach if the agenda for Sustaining Progress includes a contingency for the current oil price hikes; and if he will make a statement on the matter. [25015/05]

Trevor Sargent

Ceist:

8 Mr. Sargent asked the Taoiseach if he will report on recent contacts with the social partners; and if he will make a statement on the matter. [25195/05]

Trevor Sargent

Ceist:

9 Mr. Sargent asked the Taoiseach if he will report on the final plenary meeting of the Sustaining Progress agreement in Dublin in July 2005; and if he will make a statement on the matter. [25196/05]

Trevor Sargent

Ceist:

10 Mr. Sargent asked the Taoiseach when he will next meet with the social partners; and if he will make a statement on the matter. [25197/05]

Trevor Sargent

Ceist:

11 Mr. Sargent asked the Taoiseach when the autumn talks will convene for a successor agreement to Sustaining Progress; and if he will make a statement on the matter. [25198/05]

Joe Higgins

Ceist:

12 Mr. J. Higgins asked the Taoiseach if he will report on his meeting in July 2005 with the social partners; and if he will make a statement on the matter. [25353/05]

Joe Higgins

Ceist:

13 Mr. J. Higgins asked the Taoiseach when he will next meet with the social partners; and if he will make a statement on the matter. [25354/05]

Joe Higgins

Ceist:

14 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. [25355/05]

Caoimhghín Ó Caoláin

Ceist:

15 Caoimhghín Ó Caoláin asked the Taoiseach if he will report on the work of the National Economic and Social Forum; and if he will make a statement on the matter. [26489/05]

I propose to take Questions Nos. 1 to 15, inclusive, together.

The last plenary meeting of the social partners, which I attended together with the Tánaiste and Minister for Health and Children and the Minister for Finance, took place in Dublin Castle on 14 July and included an assessment of the overall progress that has been made in the implementation of Sustaining Progress, including in particular the special initiatives. I made very clear the Government's continued strong commitment to pursuing Ireland's economic and social prosperity through the process of social dialogue and partnership. I also expressed appreciation for the key contribution made by the social partners to the development of our economy and society. One of the innovations under Sustaining Progress was the agreement on a number of special initiatives. There is a general consensus among the social partners that they have proven to be a very effective way of focusing resources on particular areas of concern. Undoubtedly, there are lessons to be learned from the experience of implementing these initiatives, including lessons about what kind of areas on which to focus, how many special initiatives on which to focus and what mechanisms we might best use to approach them. I expect these issues will be taken up in the forthcoming negotiations.

The considerable progress that has been made in implementing the wide-ranging set of commitments contained in Sustaining Progress is borne out by the ninth progress report and the final report on the special initiatives, which were produced for the plenary meeting. Copies of these reports together with the report of the steering group to the ninth plenary meeting and speeches have been laid in the Oireachtas Library. We have had six national partnership agreements since 1987 and are due to formally launch the negotiations on a new agreement at the next plenary meeting which will take place in November. I have invited the social partner organisations to participate in these negotiations in the context that the Government will be entering talks on the basis of our programme for Government and within the framework of the forthcoming NESC three-year strategic economic and social overview.

The national implementation body, which includes employer and union representatives, operates under the chairmanship of my Department. Its purpose is to oversee delivery of the industrial peace and stability provisions of the Sustaining Progress agreement. The body has met on a number of occasions recently to assist in the resolution of industrial relations disputes in both the public and private sectors. Meetings of the body also provide opportunities for informal discussion of some of the broader issues relating to the social partnership process and the industrial relations climate generally. The national implementation body does not seek in any way to duplicate or substitute already well-established industrial relations machinery. The role it serves is complementary in helping to identify and overcome obstacles to effective participation in these wider processes. The body will continue to meet as necessary to this end.

There is certainly plenty for the Government and the social partners to reflect on as we look beyond Sustaining Progress. The main risks to growth and inflation stem from potential second round-effects in wage and price setting behaviour resulting from ongoing oil price increases. In this context, the response of incomes policies will be critical to the short to medium outlook of the economy.

History shows the folly of trying to compensate ourselves for the effects of increases in oil prices. Social partnership has been of enormous benefit both socially and economically. Since the Programme for National Recovery in 1987, the stability it provides has allowed for record levels of growth and enhanced social inclusion. In recent times of more moderate growth, the processes of social partnership have helped maintain competitiveness and a pro-jobs environment while enhancing a co-ordinated and comprehensive approach to inclusiveness issues. This continues to be the overriding challenge looking ahead.

As I have already mentioned, the National Economic and Social Council is currently undertaking its three yearly strategic overview of economic and social policy, paving the way to negotiations on a successor to Sustaining Progress. The NESC has completed its study entitled The Developmental Welfare State, which was published on 19 May 2005. The council completed its report, Housing in Ireland: Performance and Policy in December 2004. In the coming months, it will complete a report on the Lisbon Strategy, focusing on the open method of coordination. Other studies in the council's work programme include migration policy, child poverty and child income supports, Ireland's first periodic social report, the taxation system in the medium term, competition and regulation in networked sectors, as well as a significant NESC contribution to a knowledge society foresight exercise. The reconstituted NESF held its inaugural meeting on 26 May 2004 in the Royal Hospital Kilmainham, at which the work programme for the coming term up to 2006 was discussed, as well as the appropriate structures and working arrangements in the context of this work programme. Early childhood care and education, care for older people and creating a more inclusive labour market were subsequently selected as priority topics.

The report on early childhood care and education has been completed. Following consideration by Government, it was published on 25 September 2005. A plenary session of the NESF was held on 28 September 2005 to discuss the draft report of the project team on care for older people. The report is now being finalised in light of the comments made at the plenary and will be submitted to Government shortly. A plenary session to discuss the final draft report of the project team on creating a more inclusive labour market will be held on 19 October 2005 in the Royal Hospital Kilmainham. Cultural citizenship and delivery of public services have been identified for inclusion in the second phase of the work programme. Preliminary work has been undertaken on both these topics and projects in these areas will commence shortly. The NESF held the second national anti-poverty strategy social inclusion forum in the Royal Hospital, Kilmainham on 26 January 2005. The social inclusion forum gives those who are not directly involved in the social partnership process an opportunity to input their views and experiences in implementing the national anti-poverty strategy. A report of the proceedings was published in April.

Finally, the NESF hosted, in conjunction with UCD, a conference of evidence-based policy making on 10 February 2005. The conference examined the supply and gathering of evidence and applying this in the policy making process and the design of practical policy solutions. The ongoing monitoring and evaluation of policy outcomes was an important focus of the conference. A conference report is being prepared for publication.

That is a comprehensive reply from the Taoiseach. I noted the report in The Irish Times outlining his concern about social partnership, arising from the actions of Irish Ferries. There seems to be an indication that he is taking legal advice on the matter of the State contribution to the company redundancy package. The report goes on to state the Taoiseach hinted at legislative change in this area. Can the Taoiseach elaborate on that? Does the Taoiseach care to comment on the remarks made by Jack O’Connor in respect of continuing in social partnership, given recent events? When will consumers have a seat at the partnership table in respect of social partnership talks? Will the Taoiseach comment on the current disputes at Irish Ferries, An Post and ESB, which are currently of concern to a great number of people?

The Irish Ferries dispute shows precisely the value of social partnership. I expressed the view in the House that the behaviour of the company in refusing to engage with the Labour Court and other industrial relations machinery, and its being intent on an apparent breach of obligations under Sustaining Progress, was unacceptable. The national implementation body correctly recommended to the parties, including the company, that the invitation to attend the Labour Court should be accepted. Both representatives of IBEC put their views on the record very publicly in this regard while fully expressing the difficulties experienced by the company. We can all understand the difficulties any company can face from competition but there is still a process to be followed and this should be done.

I very much welcome the fact that the company has now decided to fully participate in the process recommended by the court, including returning to it if necessary. This is how our business should be done. My point was not that a company had difficulties; it was the process to which I objected. I accept the company has difficulties, including competitiveness. I stated the process should be followed, which the company is now doing.

I very much regret the decision of the Communications Workers Union to proceed to a national ballot for industrial action. The situation in An Post, as in all postal services, is very serious. The viability of the company in the light of technical and market changes is critically dependent on its ability to adapt, become more efficient and to exploit new technology to the full. This is the only way in which An Post workers, like those in any business, can have reasonable security of employment at the pay levels to which they aspire and need.

Along with the Minister, Deputy Noel Dempsey, I met the An Post unions at their request some time ago. I left that meeting with the knowledge that the need for change and the nature of change has been the subject of extensive discussions. An expert review has taken place in accordance with the terms of Sustaining Progress and with the direct involvement of the Labour Court. The payment of the increases provided under Sustaining Progress is contingent on co-operation and ongoing change. Provision was also made for payment to be linked to necessary changes to offset the additional costs on the basis that the Labour Court would adjudicate on that issue. That is what happened in this case with the assistance of a detailed review by independent experts.

I am disappointed with the decision that has been taken because the threat of industrial action to overturn the outcome of the process agreed under Sustaining Progress is not satisfactory either from the employer's or employees' side. Last week I criticised matters from the employer's side and this week I do so from the employees' side. Industrial action that displaces the outcome of negotiation and, ultimately, adjudication of the Labour Court risks undermining the stability on which jobs and incomes rest and it is wrong to do that.

Industrial action in An Post would only deepen the problems and put jobs and living standards at risk. I urge members of the CWU to consider very carefully the options before them. It is not open to Government to change the realities faced by the company and its employees. At the meeting we had I believed they understood that. I accept there are difficulties but the path recommended by the Labour Court is the only sensible solution and I recommend it most strongly to the employees of An Post. We will see where we go from here.

I have not had a chance to read the full script regarding social partnership from the head of SIPTU, Jack O'Connor, whom I regularly meet, but I can understand his concerns about Irish Ferries and other companies. SIPTU has had it own difficulties on the Gama issue over the years. It is important for the union that we do not get into a race to the bottom and that the protection of employment standards is an important public policy goal. The best way of dealing with that is within social partnership. Any of the analysis that has been done on this by IR people, other than those on the extreme left who are really against social partnership anyway and have never supported any of the six agreements, shows it is the best way forward. The benefits are there for all to see. I will not go through them all. Anyone looking at where we have come from and where we are would see the benefits of social partnership. Of course there are tensions from time to time but there is less tension and fewer strikes in the private sector. We will have to see where it goes. A considerable number of trade unions want social partnership. I urge those in SIPTU to see the overall benefits as well. I hope they will do that in the days ahead.

May I ask the Taoiseach, in respect of the speech he made in July at Dublin Castle to the effect that the era of tax cuts was over as a bargaining counter in these discussions, if that is still his position?

In respect of the remarks he has just made about An Post, there is a very serious underlying grievance in terms of workers who could not in any circumstances be described as highly paid, operating in a very high cost society and who are still not provided with the basic increases agreed under the social contract. That especially impacts on the position of pensioners. Is it not a grievance so long afterwards that it must be more speedily addressed?

Deputy Rabbitte is right. That is a major grievance. I have met, as I am sure he has, many of the individuals concerned. That was comprehensively dealt with in the Labour Court findings. Every one of us who has met any postal workers during the course of the year would have heard that issue raised but it has been dealt with.

I agree that many An Post workers are not highly paid. The company is under significant pressure. The hard reality is that there are now many private operators in the delivery business and e-mail and other technologies have taken a large part of the business. Postmen have told me that little post remains if the free post and the business we give them are removed from their deliveries, even though we are under pressure from the EU because of the competition aspect. Every three years there is a battle because the State is giving them work and the market is continually looking for that work. I do not know how long it will be before Europe comes down on that issue. In the past 20 years we have found good ways of holding on to these areas but the pressure is increasing.

It is not the case that the business is out there and everything is the same. Technology has changed the position. I accept the issue raised by Deputy Rabbitte is important but it is addressed in the Labour Court decision.

The first question I asked the Taoiseach was about his speech in Dublin Castle.

That was just one aspect of what I said, that incomes policy was a large part of the agreement. We must keep our incomes at rates we can afford. I opposed the idea of trying to chase the secondary costs that would come from some aspects of energy, although perhaps they will not be as bad as I thought at the time. Social partnership should not just become a race on incomes, which is what happened before in some cases, as that would not get us anywhere. I also said that the resources were no longer available to give the kind of cuts that had been given over the years. Effectively, €5 billion has been given in tax cuts.

Although it was not reported at the time, and one national newspaper dropped the second part of what I said entirely, which always happens, I went on to point out that I was not talking about areas of indexation, I was talking about cuts. Indexation is something which the partnership process considers should be implemented. I was talking about cuts in rates, as distinct from the aim of trying to get 80% of people paying standard rate tax. Cutting down any more on tax from where we are now is neither necessary nor likely. We had high rates of tax but we decreased them. As I stated, there is now a demand to build up our services. At a 30% rate of tax, we are now eight points lower than anywhere else in Europe. There is no pressure to do any more in that regard.

Without going into the detail of the Irish Ferries scandal, does the Taoiseach agree that the conduct of the employer in that particular case represents a threat to the very partnership process itself? Does he accept the practice of letting go Irish workers and replacing them with vulnerable workers from eastern Europe and elsewhere, who are to be paid outrageously low wages, is not only a threat to social partnership but also undermines all the best practices concerning the protection of the rights of the workers' concerned, and the rights of all workers? Does he agree it is not acceptable that IBEC has come out in support of the employer's position in the Irish Ferries dispute and that its stated position is also a threat to the continuation of the partnership process?

Will the Taoiseach take up the proposal in the motion tabled by me and the other Sinn Féin Deputies and call on the European Commission to introduce urgently a European ferries directive aimed at combating what is described as social dumping on ferries and at setting minimum labour standards to ensure an end to the exploitation of workers on all intra-EU passenger and ferry services? Has he noted that his colleague, the Minister of State at the Department of Enterprise, Trade and Employment, Deputy Killeen, said in response to the proposal that he was quite taken with the idea of taking up the issue at European level. However, he felt there was nothing the Government could do. Does the Taoiseach agree it is imperative that this issue be raised at European level?

I was disappointed when the Taoiseach lumped Questions Nos. 1 to 15 together because the grouping incorporated Question No. 15, which I had tabled on the National Economic and Social Forum. Having noted the Taoiseach's welcome of the forum's report on early childhood care and education, I wonder, in light of the focus of my earlier question, whether the Taoiseach will indicate his acceptance of the key recommendations——

That question is more appropriate to the line Minister.

It is unfortunate that the Taoiseach has accepted Question No. 15 in this grouping.

Question No. 15 is a general question on the National Economic and Social Forum. We cannot go into detail.

I am asking the Taoiseach, in light of the forum's most recent report——

The Taoiseach cannot be permitted to give detailed replies to questions that are the responsibility of another Minister. I am allowing the Deputy's first three questions.

The Taoiseach has already issued a public statement on the NESF report. Will he indicate whether he is responding positively with the intent of embracing and implementing the key recommendations?

I am allowing the Deputy's first three questions.

Yesterday on Leaders' Questions I spelled out the policy on seafarers. This country, being an island, has always tried to have as many qualified and trained seafarers as possible and to maintain employment for them. I believe the National Maritime College, which, unfortunately, I have not visited, is considered internationally to be of the highest quality. Some €50 million of taxpayers' money has been invested in it. Those involved with the college are very proud of what it has achieved. Our concept was to have a policy whereby we would have a country of trained seafarers with expertise. This is happening with much success.

The seafaring issue and the question of operating under the flag of convenience do not just pertain to EU law, they are global matters. I am not against the European Union having some kind of examination of these but, on the basis of my understanding and the statements of the Minister of State at the Department of Enterprise, Trade and Employment, Deputy Killeen, and the Minister of State at the Department of Communications, Marine and Natural Resources, Deputy Gallagher, there are difficulties in this regard because of the global nature of the issues and the fact that people are going outside their zones. The question of how this can be managed or policed, either from an Irish or European position, presents an extraordinary difficulty. That is what the companies have been saying also. All the companies are now employing international staff and moving around the world with them.

What about intra-EU ferry companies?

I suppose it does not rule out EuroMed, for example, trying to reach some understanding on how one can achieve what the Deputy proposes. It is not an easy issue to address. I have been given information in the past week on what is happening in respect of all the operators, not just Irish Ferries. The information concerns not only those operating on the Irish Sea but also to those operating on other seas. They are all engaged in a similar practice. As I said last week, it is obviously not one with which I agree.

On Deputy Ó Caoláin's question on the practices of Irish Ferries having a knock-on effect, the protection of employment standards is an important goal of public policy. We do not want to revive a low-wage economy in this country and, in particular, we do not want to foster a social division by having decent jobs held by Irish citizens become low-paid positions targeted at migrant workers. That is precisely what we do not want to do. The country has invested considerably in tackling poverty and inequality. I am certainly not prepared to see this undone by short-sighted and exploitative decisions, which some of the companies in question seem to believe are all right. Ultimately, if one goes down this road, the State will wind up subsidising the individuals concerned because unsustainable low-paid employment will have to be augmented through family income supplement, social services and so on. I am satisfied we have a realistic minimum wage in this country to protect against this form of exploitation. It represents good protection of employment.

I have listened to many experts in this field in recent weeks because of the Irish Ferries issue. They all say the circumstances of the maritime sector would appear to put employment of seafarers beyond the minimum wage regime here. Both sides seem to say this is the position and that directly comparable circumstances should therefore not arise in other employments. However, I would be concerned about this in spite of what people say. Issues arise from recent events which we all need to consider, including the arrangements for repayment of part of the costs of redundancy settlements to employers and the adequacy of our industrial relations framework in circumstances such as these.

I meant to say in reply to Deputy Rabbitte the other day that we should make it very clear that the Government, and everyone in the House, did not agree to immediate access to the Irish labour market by citizens of new member states to displace Irish workers. We agreed to it because it was right to allow newly acceded countries to gain access to the European Union. This was not a green light for employers to decide it presented a way to cut their costs and increase profitability.

What about the non-EU workers?

I hope they take serious note of that.

A decision has not yet been made on the recommendations but the Minister will consider them and come to a conclusion on them. An interdepartmental report took into account the NESF and NESC reports and also some of the other reports. A host of reports have been presented on child care and the interdepartmental group is considering them collectively.

On the successor to Sustaining Progress, in respect of which I hope there will be a satisfactory outcome to the discussions, will the Taoiseach indicate whether the lessons learned from the Irish Ferries issue will give rise to any change to the current agenda? Does the Taoiseach have in mind any guarantee for the rights of workers in this jurisdiction that could form part of a successor to Sustaining Progress? Does he really believe this can stop with Irish Ferries? Is there not a danger that Ryanair will want to explore the possibility of following the same low cost option and the pressure will then impact on Aer Lingus and Ryanair competing with Iarnród Eireann will put pressure on competitors down the line? Did the Taoiseach look into this to see if we are unravelling a social understanding which exists or can we say that this is as far as it will go with Irish Ferries?

One of my questions to the Taoiseach concerned contingency plans for and discussions on fuel prices. Is it not time to recognise the benefit of having an environmental pillar in the partnership process and to recognise that what may be challenges for more conservative sectors are opportunities in terms of energy efficiency and renewable energy options for other sectors? It should be put into the new partnership agreement so that we may benefit from the opportunities the change in fuel prices will bring while having to accommodate that change. Ireland is unique in being unable to connect domestic renewable energy providers to the grid and in not having any grant system for installation of solar panels and for many other technologies that are taken for granted in other countries. Will the Taoiseach take that suggestion on board?

I pointed out the difficulties in terms of the seafarers issue and what is said by both sides. The Government did not agree to immediate access to the Irish labour market by citizens of new member states in order to displace Irish workers.

It has nothing to do with EU member states. It is outside the EU.

I would be concerned if people did that, either inside or outside the EU. If they are outside the EU, they cannot come in without permits. A small number come in from outside the EU, so there is no difficulty in that area.

I recognise in broad terms and from looking at many companies the commercial realities and competitive pressures that will impact on employment here that are not sustainable. Outsourcing can be a necessary legitimate response to those pressures. It generally involves a reorganisation of work practices and protection systems. In that sense it is not a direct displacement of one worker by another.

In reply to Deputy Sargent's question, the best defence for workers against these pressures is to ensure that our approach to wage bargaining is responsible and reflects competitive realities. Then we do not become uncompetitive and do not have people trying to come in and undercut in that way, at least in most cases.

There is a process for new members to join the social partnership. I pointed this out before. I am unsure of the environmental end. What has happened to date is that the NGOs have worked through Comhar, the national sustainable development partnership. That has been the appropriate forum through which environmental organisations with the social partnerships are engaged in the promotion of sustainable development. The Department of the Environment, Heritage and Local Government has in recent years built up a good relationship with the NGOs and has given them funding. It is a closed group, with about 20 organisations listed. Comhar is also represented on the environmental co-ordinating committee, which was established to co-ordinate environmental policies with regard to issues arising across Departments and under the national development plan and the Community Support Framework. The environmental NGOs are also represented separately on this committee through An Taisce. The Department of the Environment, Heritage and Local Government works closely with a variety of environmental NGOs on other issues. I understand the question of representation for environmental NGOs in the formal structures of partnership has been discussed in Comhar. I have received no formal response from these organisations on joint partnership.

Is the Taoiseach open to it? That is the question.

A process is there which allows anyone to present his or her case. It is considered within the existing structures.

The Taoiseach refused before. Is he open to it now?

I have not blocked any of them. Some people come in, others leave. There is a structure between the organisations. I do not get involved with who is in or out of the fourth pillar. While working out the last social partnership agreement, about ten organisations left and about 15 came in. It was negotiated between the groups. I am not against that.

Tell them to apply again.

How will the Taoiseach respond to SIPTU, which if apparently not pulling out social partnership, has certainly opted to defer any decision to engage in negotiations for a new social contract and what are the implications of this, arising from the Irish Ferries decision?

I am uncertain as to what SIPTU want us to do on this issue. It is currently before the Labour Court and will come before the Labour Relations Commission within the next few days. The process by which we had asked it to be dealt with is being followed. This has been ongoing for a long time and there are frustrations at all levels. The company can make quite a good case in terms of how long it has tried to negotiate. I do not agree with what it did, however. SIPTU has to deal with all of that as well. I am not clear if Jack O'Connor's statement yesterday means that if he does not get a full resolution with Irish Ferries, which may not be in the hands of Government, social partnerships or the Labour Court, he will not continue as a social partner. I am not sure if that is his position.

Would the Taoiseach legislate?

I am unsure whether the Deputy heard what I have said on this idea of trying to find ways around problems and the generality of legislation. People involved in all sides of the seafaring business tell me that it is impossible to try to regulate this on an EU or Irish basis. They say that it is a global business and will not be regulated. The Spanish, Norwegians and others have tried this over the years but it is not possible. By means of industrial relations methods we have to try to deal with this problem as best we can. What was not acceptable were the actions of Irish Ferries last week. It is back on track now.

Did we hold up the EU directive?

Even if a new EU directive was there, it would not control this on an EU basis. Since last week, I have seen the companies involved at a European level, their flags of convenience and where their staffs come from. Subject to correction — or I will receive ten more letters from it — Irish Ferries was planning to register in Bermuda. Many other companies are registered outside the European Union. We have to resolve the issue but it will not be done simply by means of an EU directive on seafarers. That is what people on all sides of the industry tell me.

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