I move:
That Seanad Éireann takes note of the Green Paper: Development for Full Employment.
Green Paper: Development for Full Employment: Motion.
It is very appropriate that the Seanad should have an opportunity of debating the Green Paper: Development for Full Employment, at the earliest possible opportunity. As the House will be aware, this is part of the general cycle which we envisaged taking place in future years, that there would be a discussion paper published each year and that, as a result of the discussions on that document, there would then be a White Paper, setting out Government policy for the ensuing period, published by the completion of the calendar year.
On a point of order, is it not customary for the Minister, on a motion of this sort, to intervene later in the debate when he has heard some of the views of the House?
The Minister opens the debate and the Minister closes the debate.
I see. I apologise.
This Green Paper is part of a cycle which we envisage continuing in future years. In this instance, the Green Paper not only sets out to elaborate on the policy to be pursued over the next two years in the fulfilment of the basic Government policies already outlined and set before the House on previous occasions, but also takes a step further in that it sets out proposals which in the Government's view should form the basis for policy into the early 1980s. It is those proposals which would require the greatest degree of discussion and consultation in coming months.
I will begin by spending a few minutes on what I might describe as the first section of the Green Paper, namely, those aspects of it filling out policy for the immediate future, that is for 1979 and 1980. The Government had set out a basic three-year policy designed to bring about a significant improvement in the employment position, in the rate of economic growth, the significant easing of our inflationary problems and at the same time, while making those attacks on our major problem in the economic area of unemployment and inflation, doing this in a manner which would also lay the basis for restoring stability to the Government's own finances because there was the problem that the Government's own finances had deteriorated substantially in the period 1973-77.
The documents before the House and the Green Paper illustrate that on the basis of the information available and the policies now in force there are grounds for believing that all the Government's targets for the year 1978 will be achieved. For the ensuing two years, 1979 and 1980, there is a gap to be bridged in the area of employment creation. In part 2 of the Green Paper it is illustrated that to achieve in full the Government's targets for job creation over the next two years would require that 29,000 new jobs in the industrial and services section be created in each of those two years.
On the basis of existing policies, however, it would seem that about 21,000 to 22,000 might be expected. There is therefore a gap of 7,500 new jobs a year to be bridged. In the subsequent chapters of Part 2 the various proposals put forward which would make a contribution towards bridging that gap would also have follow-through benefits on development in 1980.
In so far as the immediate requirements are concerned proposals are put forward relating to possible development in the areas of agriculture, industry, and some of the services activities. Proposals are also put forward for accelerating activity in the improvement of infrastructural services such as roads, transport, water supplies and other related items all of which are crucial to a satisfactory pace in overall development.
If these proposals for further progress in the industrial services and infrastructural areas are implemented to the full they will make a very useful contribution towards the bridging of this gap on the employment front. It is difficult to estimate with precision what the exact contribution of these various proposals will be but it is reasonable to expect that they would meet about two-thirds of the requirement by providing about 4,500 additional jobs in each of the two years. This would leave a smaller but nonetheless noticeable gap to be bridged in the period up to 1980.
In addition to those specific proposals which are important from their employment-creating aspects there is also a series of suggestions relating to the future development of agriculture set out in chapter 3 of the document. These, while not likely to be important in terms of actual job creation in the immediate future — indeed it seems almost inevitable that on the basis of existing trends there will be some further decline in the numbers employed in agriculture in the immediate future — will, nonetheless, be very important both in improving the overall employment level in agriculture in the 1980s and in adding to the growth of off-farm employment in the processing of the output of farms in future years. These various proposals then are of major significance for the overall health of our economy into the 1980s.
That is one section of the Green Paper, the filling out of policy proposals for the years immediately ahead in order to make the maximum possible progress towards the Government's economic targets especially in regard to employment.
One other area which is obviously relevant in this context is the Government's targets on public finances and, as I said in my opening remarks, the difficulty here is that the Government inherited a very unhealthy situation when they came into office last year. It was recognised that Government borrowings running at a very high rate, though perhaps necessary in the short term, could not be regarded as a viable long term position and that therefore there would be need gradually to phase down the overall level of Government borrowing. Nonetheless it was recognised that to begin with that as the priority would be to impair the development potential of the economy.
The Government's view, therefore, is that the appropriate order of priorities should be to begin by tackling the questions of unemployment and inflation, to promote a faster rate of economic growth, and that this faster pace of development would then create a situation in which there could be a gradual phasing down of the Government's own contribution to development in the form of measures such as special job creation programmes or measures such as major tax cuts as introduced in this year's budget, and that in later years, in 1979 and 1980, the private sector would be in a position to make a greater contribution to the overall growth of the economy. If this faster growth in the private sector takes place it would be appropriate that there should be a gradual diminution in the stimulus to the economy from the Government's own borrowing requirements.
The target envisaged therefore is that the Government's borrowing level would be enabled to fall from the figure of 13 per cent of gross national product this year to an estimated 8 per cent by 1980 and that this fall not be accompanied by a reduction in the volume of public spending — that in fact it would be possible to accommodate at least the maintenance of the real volume of public spending—and indeed the data set out in the Green Paper indicate that some further modest growth would be possible in this volume of spending — that this level of public spending would be accommodated by a growth in tax revenue resulting from the greater level of economic activity and also if necessary from modest increases in taxation.
That would describe the Government's objective in the financial area. Those two sections dealing with additional measures to create jobs in the immediate future and measures relating to the expected development of the Government's own finances are, as we said, the filling out of policies already discussed both in this House and elsewhere, and their successful implementation would represent a very marked improvement in the position of the Irish economy by comparison not only with existing level but also with the depressed state which it occupied up to recent years.
There is also the question of the policies that should operate into the eighties. If those policies are to represent any significant departure from those currently in operation, then it is clearly appropriate that any major proposals for change should be put before the people at the earliest opportunity and should be debated so that the full implications and consequences can be understood and decisions can be taken on the basis of the widest possible measure of not only understanding but support. The Government's view is that although the successful attainment of their targets up to the period 1980 would represent a major improvement in our economic fortunes, nonetheless it would still leave a situation in which the level of unemployment in Ireland would be unacceptably high and indeed would continue to be higher than in our fellow states of the European Community.
For that reason, therefore, we believe it is appropriate to set the creation of full employment as a priority objective in the field of economic and social policy, not only for the immediate future but also for the eighties. Therefore, in Chapter 6 of this Green Paper we outline proposals which would enable an even more rapid attack to be made on the unemployment problem in the years leading up to 1983. In fact, we suggest that it would be feaslible to adopt as a target the total abolition of unemployment by the end of 1983.
That is clearly a very dramatic and an ambitious target. Nonetheless, it is regarded as a feasible one provided there is the necessary degree of commitment to that goal on the part of all sections of the community and a recognition of the efforts needed to attain it and, more importantly, of the changes which will be needed to bring about that result.
The way in which this goal of full employment might be achieved is outlined in the chapter. It is suggested that there are two main ways in which the promotion of additional employment could be brought about. One is by a further programme of direct job creation initiated by the Government themselves, and a number of suggestions are advanced under that head. Clearly if the Government are to take the initiative and to be responsible for the creation of the number of additional jobs required to bring about the goal of full employment, the financing of those additional jobs will call for some addition to the Government budget, and because it would not be appropriate to envisage the operation of borrowing as a longer term method of financing, it naturally would be necessary to have acceptance that the provision of full employment would call for additional contributions to the Government budget from all the relevant sections of the community. Some indication of the scale of the effort that would be so required is given in the chapter, which suggests, for instance, that a sum of the order of 5 per cent of all incomes would be needed by 1983 in order to finance this goal of full employment. That 5 per cent would not, of course, have to come about overnight. The provision of such a sum does not imply any reduction in incomes or in living standards for any section of the community.
Instead, what is suggested is that if we are to enjoy a period of rapid economic growth between now and 1983, some portion of that growth, in fact 5 per cent of it, should be syphoned off or earmarked to finance this programme of employment for all. The earmarking of such a sum would still leave quite a substantial improvement in living standards for those already fortunate enough to enjoy work, so that there is no question of asking anyone to make sacrifices in the form of reductions of living standards. The form of the effort that would be required from those already in employment would be that they would accept a slower rate of increase in living standards than might otherwise be available to them were they to pursue existing methods for securing income increases.
That is one of the options which is put forward in the Green Paper as a means of achieving full employment by the early eighties. The alternative option, which was put forward and which attracted more comment, certainly outside the House, is the notion of arrangements for work-sharing in various forms. These ideas, in regard to work-sharing, are being put forward now in a European context. They are by no means confined to this country.
A suggestion is that the nature of modern technology is such that very rapid increases in productivity are feasible in many industries and that, as a consequence of these rapid increases in productivity, firms do not enjoy an increase in demand for their products at the same rate as the productivity gain and, therefore, they can supply their level of demand with a diminishing labour force rather than an increasing one. If these trends operate entirely spontaneously, one can produce a situation in which fewer and fewer people are employed, but these privileged few enjoy rapidly increasing incomes because they happen to be employed in these areas of rapid productivity growth. The suggestion is that it would be more appropriate to seek a deliberate sharing of the fruits of faster productivity growth by enabling a greater number of people to participate in whatever level of employment is associated with these high productivity industries. In effect, the suggestion is that those employed in high productivity sectors of the economy should take some of the benefit of that growth in output in the form of a shorter working year, rather than in the form of rapid increases in real incomes.
Again there is no suggestion that there will be no increase in real incomes for those employed in the sector, rather that there should be some combination of the two: a slower rate of real income increase than might otherwise be available, allied to some reduction in the length of the working year, so that a greater number of people may be employed in these areas. The actual methods by which this working-sharing could be introduced would span such suggestions as a phasing out in the incidence of overtime working, and perhaps some reduction in the age of retirement. Indeed, that might be accompanied not simply by a reduction in the retirement age as such, but perhaps in arrangements for gradual reductions in the length of the working year for older people and instead of having an abrupt cut-off point, there might be a gradual reduction in the length of the working year for older people, so that they do not have to move overnight from a situation of full employment to full unemployment.
Other suggestions in this area relate to perhaps taking more paid holidays, or some shortening of the working week, in exchange for some slower increase in the rate of wages and salaries in those industries. Whatever about the details of these arrangements for bring about employment increases, whether they take the form of work-sharing arrangements that would operate directly in particular firms and industries, or whether they take the form of direct job-creation programmes initiated by the Government and financed then by some appropriate instruments agreed on, the net result would be the same. It would be possible to produce a situation in which work would be available for all who seek it and it would not be necessary for a generation of young people to suffer the uncertainty and misery of prolonged unemployment.
The Government are conscious that their proposals for the creation of full employment in a relatively rapid span of years — five years — represent a very marked change in existing thinking, policies and behaviour in this area. We recognise that it will not be easy to achieve agreement on the precise changes to be introduced and we know also that it will not be possible to bring about those changes overnight. That is why we have set a time scale of five years for the attainment of this objective. We believe changes of this magnitude and of this order within this time scale are possible. Whether they can become a reality will depend on the response, the reaction of all the major groups in our community.
In publishing this document the Government are inviting these groups in the community, our political leaders, our social leaders, leaders of various groups in the community, trade unions, farmers, employers, and so forth, to think about their attitude towards the provision of employment. They are inviting them to think about the means by which that goal of full employment can be brought about. They are inviting them to think about whether they are serious enough in claiming they support this goal and, if they are serious, to indicate their support for a programme of action to produce that result at the earliest possible date. The proposals, as put forward in the Green Paper, do not purport to be a finalised set of decisions.
The Government have made it clear that they would welcome any suggestions from any quarter which would improve these proposals, which would help to produce the result at an earlier date, or which would help to produce full employment in a manner which would be more beneficial to the community as a whole. We have no doctrinaire approach to this question of creating full employment, but we are very much motivated by the view that the one option not acceptable is that we should pay lip-service to the goal of full employment and should then proceed to do nothing whatsoever about it. It is for that reason we are advocating a serious discussion on the whole question of full employment, and we will be seeking to get each group to define their attitude and policy on that goal of full employment in the coming months.
It is appropriate that Members of the Houses of the Oireachtas should have the opportunity of expressing their views at the earliest possible date so that they may take a leadership role in the initiation of this public debate. For that reason, I look forward with interest to the contributions from all parties in the House to this debate. The issues discussed in this Green Paper are so important that they transcend any immediate political boundaries or immediate political objectives and attitudes.
I understand we are also taking note of the report of the OECD on the Irish economy. If I may, before I conclude, I will spend two or three minutes simply drawing attention to this report published some weeks ago. It is an annual economic survey. One of these surveys is produced each year for each member state of the OECD, that is, the countries of Western Europe, the United States, Canada and Japan. The review of economic developments and economic policy issues in the report not surprisingly is similar to the views expressed by the Government, by other official agencies and by independent research institutes. Their actual assessment of likely developments for this year is not markedly different from our own.
There has been some comment in outside media on the fact that their estimate of our growth rate for this year is somewhat lower than the official one. They suggest a growth rate in output of 6 per cent as against an official target of 7 per cent. I should like to point out briefly that this difference does not stem from any fundamental difference about likely growth in areas such as investment, or consumption, or other major elements in the domestic economy. Instead it stems primarily from a difference of view about the likely growth in our external trade position. They take a somewhat more pessimistic view than the authorities about the likely growth of imports. They assume there will be a quite rapid growth in imports, of the order of almost 13 per cent in volume terms, whereas the Government assume a somewhat slower rate of import growth, in part because we envisage a significant impact from our campaign to switch some consumer spending away from imported products on to domestically produced products by an updated and enlarged "Buy Irish" campaign.
At this juncture I suppose the only comment one can make is that there is no way of predicting with certainty the outcome for the year and so it remains to be seen whether the Government programme will achieve the results we seek. Otherwise, it is fair to say that most of the other indicators about to develop into the economy are rather similar to those put forward by us. In particular, since one or two people seem to think that they take a more pessimistic view than the Government, I would like to emphasise that they recognise we will not achieve the progress we desire if we simply repeat the trends of the past, but that it is possible to achieve the results sought provided the changes which the Government are advocating also come about, changes not only in attitudes but also changes designed to secure a greater emphasis on holding down increases in costs and money incomes and concentrating instead more of our efforts in bringing about increases in real terms, in real living standards, and increases in employment as distinct from increases in simple money terms and increases in imports.
While there are a number of other aspects of this OECD report which merit comment, it is appropriate for me to conclude at this juncture in order to give Members the maximum opportunity to make their contributions. But, if there are any aspects of this OECD report on which they would wish me to comment, I shall certainly do so when I come to reply. I would emphasise again that the proposals in this Green Paper represent an attempt by the Government to come to grips with a major economic and social problem of our time. We are trying to tackle this problem in a very positive and realistic manner, a manner designed to break away from some of the pessimisms and failures of the past and designed, above all, to demonstrate that it is possible for the people themselves to apply the solution to the problem. It is not entirely, in other words, a question of external events imposing some sort of malignant destiny upon us; rather, if the people have the will and the commitment, they can produce a future for our young people in which there will be a place and work for all.
I welcome this opportunity to debate the Green Paper and I fully agree with the Minister on the importance of what is proposed in the Green Paper. The Minister was a little defensive when he implied, in his concluding remarks, that if we are not for the Green Paper we are somehow not totally patriotic and, perhaps, slightly anti-national. Now the Minister should not be so sensitive of criticism of this Green Paper. Granted there has been such an amount of criticism of it one would not be surprised at a little sensitivity.
We must distinguish here between the ends required by the Green Paper and the means proposed. We are all in agreement about the ends, the magic end of full employment in 1983, the year before 1984. We are all in agreement with achieving that particular end. Certainly nobody would be in disagreement there but there will, however, be disagreement as to the means suggested by the Minister in his Green Paper towards achieving that end. The fact that there may be a great deal of critical analysis of this innovatory kind of proposal does not imply that the people engaging in the criticism or analysis are necessarily opposed to the objectives which it seeks to achieve. There is a tendency on the part of some Government speakers to arm themselves with the baby of full employment and then attack their critics and dare them to hit them with this particular baby in their arms. It is important that the Government should become less sensitive of criticism of their proposals. The Minister is, in fact, inviting discussion and discussion implies analysis, and analysis very often implies criticism. It is part of the normal process of debate. I want to make that perfectly clear because I have noticed a tendency on the part of Government speakers up to now to react in a hostile and over-sensitive way to criticism of the Green Paper.
Another ploy used is to point to Members of the Opposition parties and ask: What is your solution to the problem? But that is not the question. What we are debating here is the Government's solution to the problem and we have to look at it in that way. We are debating the Fianna Fáil policy.
The majority of us who will speak here on the Green Paper will approach it as laymen, as practising, practical politicians. We will not approach it as trained professional economists and so our perspective will be somewhat different. From that perspective the first thing that struck me, and continues to strike me very forcibly, about the Green Paper is the almost universally hostile reception it has received. Indeed, I would go so far as to say that the reception would have been totally hostile and adversely critical were it not for a rather tentative welcome from the Confederation of Irish Industry. I suppose one could comment that, naturally and commendably, they are not prepared at this stage to bite the hand that has fed them so well in the recent past. But even they are seeing signs now that the days of affluence at the Government table may be coming to an end. As I say, this quite remarkable antagonism was a distinctive feature of the reception given to the Green Paper. Headlines with words like "unrealistic", "impractical", "targets unrealisable" were commonly to be seen in the media.
Many institutions have commented on the Green Paper. The Central Bank, from its impartial and weighty position in our economy, disagreed with the Green Paper in one fundamental matter — growth rate for 1978. The OECD report, which the Minister has just mentioned, also disagrees in that fundamental matter. Then, last week, we had a publication by a team of economists from the Economic and Social Research Institute which, again, disagreed in varying degrees of strength with the thinking in the Green Paper. We have had television and radio programmes in which academics from the various centres of learning appeared and the reaction there again has been universally antagonistic and critical and the general theme has been that it is an impractical, unreal document. This leaves the Minister in the position of insisting that he is right and puts him in the position of everybody being out of step but our Johnny. That there should be such a universally critical or hostile reaction to the Green Paper strikes me as odd.
The targets the Minister indicated in his opening speech are 29,000 jobs per annum up to 1980 and thereafter, so that by 1983 the 55,000 who would by then be unemployed will have jobs. These figures in the Green Paper can be described as being not much better than assumptions because they are not supported by any reasoned analysis and are historically impossible. Let us assume that the targets are on. What we have to do is to look at the means proposed to utilise the two main sectors of Irish commercial activity—agricultural and industrial. My view, and that of most Senators in this regard, will be given from the point of view of practising politicians.
I would like to look first at the Green Paper's proposals and thoughts in the agricultural area. I welcome the amount of attention given to this area in this document and contrast it favourably with the cursory reference which that sector received in the White Paper published some months ago. I indicated at the debate on the White Paper that it was my firm belief that our economic salvation lay in our agricultural sector. I would like to pay attention to that aspect and to the proposals in the Green Paper. For reasons which I will touch on when dealing with the industrial sector, I do not think it has the potential for our future the Minister hopes from it, and in that event we must rely on the agricultural sector.
The target set by the Green Paper is for an annual growth in gross agricultural output of 5.7 per cent. This contrasts with the annual rate of growth of 2.6 per cent achieved in the period 1970-1976. We can see immediately that the target proposed is an ambitious one. The target in the NESC Document No. 34 on alternative growth rates in agriculture is 5.5 per cent. In the conclusion of the summary chapter of that report the target in the Green Paper is described as very ambitious. To quantify how ambitious it is, I would like to refer further to where that report indicates that to achieve that target it will be necessary to have a different growth trend introduced into agriculture. The report speaks of the high and the low growth trends, the low growth trend being the existing one. To achieve the target of gross agricultural output of 5.7 per cent as opted for in the Green Paper in terms of actual production in the various agricultural sectors one would have to achieve the following: an average annual increase of 100,000 cows, 30 gallons in milk yields, 6,000 sows, 30,000 acres in feeding barley, an arrest in the decline of wheat acreage and more intensive beet production systems. Those who represent rural constituencies and who are aware of the present not static but not terribly active state of the agricultural industry will agree that these targets are formidable but they will have to be achieved if the Green Paper target of an annual growth of 5.7 per cent in gross agricultural output is to be achieved.
This in turn will require a high level of commitment, principally from the Government as being the motivator in this area, the people with the cash to assist in the motivation. It will require first a drastic change in the level of advice available to the agricultural sector. A recent survey carried out by the General Council of Committees of Agriculture has shown that of Irish farmers 30 per cent have no interest whatever in getting advice or technical assistance; 50 per cent have some interest and 20 per cent have a high interest. That report recommends certain changes, increasing the farmer-instructor ratio, providing field officers' technicians to assist the advisers and providing clerical staff to remove the awful burden they have at the moment of dealing with the documentation required under the farm modernisation schemes. It also recommends that offices and farm training centres be set up so that these people can be properly equipped to do an efficient job. It is quite clear that in the field of the advisory services there will have to be a commitment by the Government to vastly increase the extent and intensity of the advice available to farmers. Again I would strike a critical note here because the whole scene of farmers' advisory services has been soured by the piqueish attitude of the Minister for Agriculture in seeking to set aside the arrangements for advisory services left by his predecessor and bring in his own Bill, a Bill which has been received with some hostility by what I might call the troops in the field, the agricultural advisers themselves. It is not a good climate in which to embark on expansion and improvement of the agricultural advisory services. When we see the proportion of farmers, 30 per cent with no interest, 50 per cent with some and 20 per cent with a high interest, we can see the task involved in motivating farmers into taking advice and acting on it and ensuring that the advice will be available for them.
Coupled with the need for commitment in increasing the level of advice to raise production to meet the Green Paper target, there will have to be changes in the area of farm modernisation scheme. My colleagues, Senators Connaughton and Howard will be raising this matter on the Adjournment. At this stage I am talking on the importance for the future of agriculture. I would like to spend a few minutes on the question of the farm modernisation scheme and the need for changes there. These changes will be complementary to whatever improvements and extensions are made to the advisory service. At the moment only 17 per cent of farmers are in the development category. It is interesting that that percentage is not so far removed from the 20 per cent of farmers who show a high interest in getting agricultural advice and assistance. Farmers in the development category receive extra incentives by way of cash grants for the improvement of farmers and extra cash incentives for increased output. Part of the difficulty of the farm modernisation scheme is that this emphasis on capital investment does not require monitoring to see if there is an appropriate return by way of output for the investment in question. That is one fault of the scheme and arises from the fact that the directive under which the scheme operates was introduced at a time when there was not as much concern about some things connected with agriculture that there is today.
The fact that the farm modernisation scheme applies to only 17 per cent of Irish farmers only means that the rest are receiving either aid at a less high rate or not receiving any aid at all. Until this vast extra number of Irish farmers are put into the same category as development farmers and receive the aid and encouragement to increase their production, we cannot possibly meet the Green Paper target. Therefore, it is a matter of urgency that the other section of Irish farmers be put into the same category as development farmers. A development farmer is one who can within a space of six years bring the income from his land up to a level comparable with that of an industrial worker. That is the test. I suggest that that test should be abolished. It has not had any great relevance in a country which is essentially an agricultural one. Certainly it has no relevance in the west where the amount of comparable commercial work is nonexistent. In the west there is a great need because 5 per cent only of development farmers are to be found there. Therefore, the comparable income content should be abolished.
In addition, there should be a predevelopment scheme introduced to help the type of farmer who at present does not qualify for development status. Many of our farmers, committed to staying in farming, would be prepared to work to a development standard. However, they cannot do so because they would not be able to do so within the time limit laid down by the directive, that is, six years. They would be unable to do so because of lack of capital or because of the amount of land available to them. Nevertheless, these people want to stay on the land. They feel they have a future on the land and would be able to make a living from it. At present, they qualify for what is called transitional aid, that is aid at a lower level than that of development farmers. Because they are not in the development category they have a lower level of aid. They suffer also in that they do not have the same close relationship with agricultural advisers. These people, who are that bit more marginally engaged in agriculture and who need the extra support by way of technical advice and extra financial assistance, do not qualify for it. This is a glaring defect in the scheme and should be remedied so that people in this predevelopment category would receive the same level of aid as the development farmers. They should have a special scheme to increase the production from their farms. They need extra production to compensate for what in many cases is the small size of their farms.
These are some areas to which urgent and serious attention should be given by the Government. There should be a commitment by the Government so that the vitally important gross agricultural output target of 5.7 per cent per annum could be met.
There are some other ways too in which agriculture could be assisted. For example, grants for land drainage should be made to all farmers irrespective of their status. At present these grants are made available only to development farmers and, to a lesser extent, to transitional farmers. Money spent on land drainage permanently improves the land, thereby increasing the national wealth. Also there should be provision of aid for group schemes to improve farm water supplies. People coming from urban constituencies, not familiar with the problems of farming on a small scale, may not realise that lack of water all over a particular holding can be a tremendous impediment. Very often in an area of small farms, because of their closeness to each other, they would be suitable for group schemes on a farm basis. Assistance should be available for that purpose. It does not need a lot of thought to see how shortage of water can inhibit development in the agricultural area.
There should be performance grants for farmers who achieve specific production targets. I mentioned earlier that the present scheme is capital-intensive without much thought being given to the resultant output. There should be a switch-around in that there should be performance grants for those who achieve specific production targets.
The structure of Irish agriculture is such that there are times of the year when the farmer is exceptionally busy, when he does not have enough time to do what he wants. At other times of the year he has too much time on his hands. A lot of this is due to nature and the seasonal nature of farming. What happens is that the farmer tends to depress his overall level of performance so that he will not be caught short by having taken on more than he can deal with at the times of high activity. Attention will have to be given to some form of assistance, by way of labour or machinery, for certain times of the year in parts of the country where farms are not large enough to support their own independent labour force and carry their own elaborate machinery. This could be done by giving some assistance to private contractors in the agricultural field. It is important that this be done because the consequence of not doing so is that farmers tend to set their performance targets a little lower than their land or their ability would otherwise permit.
In particular parts of the country, in the so-called depressed areas where there is poor land and difficult soil conditions, there should be a more intensive programme of experimentation to ascertain what type of agricultural activity can be best carried out. EEC aid should be sought for this experiment. It would enhance the economy of these areas and make them more socially attractive by proving to the people living in them that there is a living for them there. There could be also an examination of the question of assistance for employment-intensive farmyard enterprises.
I dwelt at some length on the question of the agricultural sector because I consider that it is within that sector lies the salvation of our country. A rather ambitious target has been set by the Green Paper, but it can be achieved if there is a commitment made on it and the will to achieve it. Certainly I would support enthusiastically any action by the Government that one can see being taken towards achieving these targets. I should like to see more attention paid to the NESC document No. 34 on alternative growth rates in Irish agriculture. I know we are waiting on a further study, consequent upon that document. I hope that when it comes to hand it will get priority treatment and that its implementation will be taken up as a matter of great urgency.
The other area of our commercial life relied on is the industrial sector where the principle is that if it can expand its production, attract new investment and export more, it will creat the jobs that we need to achieve our employment targets. In theory that is fine, but I am afraid that there are some practical constraints on achieving what we hope to achieve in this area.
The first constraint is forced on us by international conditions. We are very dependent on the state of health of the international economy for the state of health of our industrial sector. I undertatio stand that no less than one-third of our goods and services are exported. We are subject to the free movement of capital. We have international obligations as members of the EEC. But perhaps the biggest external influence of all is the fact that we are linked to sterling. In addition, the external climate is not overly favourable because the world economy, more particularly the European economy, has recovered weakly from the recession, and this is the market into which we hope to export, the area into which we hope to expand and send more of our goods so as to produce more wealth here. Does the Green Paper give sufficient attention to the dangers implicit in that constraint?
We will feel more intensely than we have for the last decade or so competition from other parts of Europe, particularly from our neighbouring island, for new industry coming from the United States and Japan. There are signs that this competition is already hotting up and is being successful. The recent loss by Limerick of a motor car industry to Belfast is a sign that we were outbid there, that we lost that competition. The loss of the major Ford plant to Cardiff as against Cork was another sign that we are losing out on this competition. Recently there have been indications that regional industrial authorities in the UK have been indulging in practices that have been less than ethical in seeking industries for their areas. When semiofficial bodies engage in such practices it is a measure of the intensity of the competition and of what the Industrial Development Authority will have to face in the future. I have even heard it suggested that one may see a situation in the UK where the oil revenue, the bonanza which they have been lucky enough to receive, may be used to abolish corporation profits tax altogether for exporting companies in the UK so as to combat our export tax free scheme which runs out in a comparatively few years. That, of course, will alter the balance tremendously in the fight to attract new investment into the two areas. This is another constraint not adverted to in the Green Paper, one which is becoming very real.
Other constraints arise from our general budgetary position. Our goods, to sell, must be competitive and in turn that will depend on the tax burden on the firms. It will depend on the tax burden on the workers in so far as that will affect their wage demands, and it will depend on the general economic climate here.
What I find rather disturbing and worrying about the Green Paper is the bland optimism with which it approaches so many of these economic factors. It does not indicate any fall-back position in the event of income increases being greater than expected. There is no fall-back position for a situation where external borrowings have to be increased or where extra tax has to be imposed to pay for increased public expenditure. It assumes that there will be a growth rate of 7 per cent up to 1980. It is on that premise that so much is founded, but there are already serious disagreements as to the level of growth rate that will be achieved. The Central Bank forecast a growth rate of 5½ per cent this year; the recent document from the Economic and Social Research Institute forecast a growth rate of as low as 5 per cent, and the OECD paper which was just mentioned by the Minister mentioned a growth rate of 6 per cent. These are all significantly less than the growth rate forecast by the White Paper, and it is on the achievement of the forecast growth rate that all the other things in the White Paper are to happen. This is to be the economic engine that is to drive the economy to the stage where the overall burden of taxation will not have to be increased, where external borrowing will not have to be increased, and where the economy because of the substantial growth rate will generate its own impetus.
The Minister in his Green Paper is the only person to forecast a growth rate as high as 7 per cent. These other unbiased commentators forecast growth rates considerably less. I do not know where that will leave the question of public financing and the Exchequer finances. How will it affect the tax revenue if the growth rate is substantially less? I presume, as a layman, that the amount of tax being produced by that smaller economy will be less. This will mean less money coming into the Exchequer and less money available to lend out to provide incentives for further growth. We are committed — an undertaking has been given to the Central Bank — to bring the borrowing level down to 8 per cent of GNP by 1980. Therefore, we cannot borrow to get it back. If our growth rate is diminished and the internal revenue is not available, does the economy begin to stagnate? Normally, if that happened, there would be a push; but because of the policy adopted in this year's budget we have exhausted the means by which that push should be provided in the years to come. Because of the policy of this year's budget we find ourselves now proposing what are essentially deflationary tactics for the next two years. In that situation, there is something contradictory about speaking of a high growth rate and speaking of a job creation programme that is without precedent. It is unreal. It is a very serious fault in the Green Paper that there is no indication of what the position might be in the event of the growth targets not being met, if there was some upset to the set of calculations or the premises used by the Government. What is the alternative? What do the Government propose to do if they have to change tactics, if they have to mark time, to alter their policies or change course? There is a rather fatalistic optimism about this in the Green Paper.
The Green Paper says on page 74:
To the extent, of course, that the White Paper targets were not realised and future public spending did not develop as required, the increase in taxation necessary would undoubtedly have to be greater.
Does that mean that if the Central Bank, the ESRI and the OECD are right that we are going to have extra taxation? There should have been an examination to show what would be the consequence of not meeting the explosive growth targets. The threat is there but it would have been of assistance in the debate and would make the importance of achieving the Government's targets all that more visible if we knew what the alternatives were in terms of increased taxation and other harsh measures if these targets were not reached.
It seems to me that the proposal to hold the tax burdens unchanged is unrealistic, that it cannot be achieved and at the same time a reduction in borrowing achieved. We may possibly see a reduction in borrowing in the years ahead, a movement away from the proposed borrowing reduction on the grounds that it is better to maintain those at a slightly higher level for another couple of years than introduce tax increases. I make the forecast with some confidence that this in fact is what we will see.
The alternative, if one is to retain the tax burden as it stands, reduce the borrowing commitment and achieve the growth rate of the Central Bank, the ESRI or of the OECD which averages 5½ per cent, is to reduce public spending and/or charge for services. The Green Paper makes very grim reading when it touches on those alternatives. I do not think they are desirable economically or socially. It is difficult to find an area of public spending that can be reduced without having not just an adverse social consequence but an adverse economic consequence as well. It would be deflationary. We want to get into a growth and expanding situation. Any tampering with public spending is a very dangerous and delicate operation and is something which should be avoided, but, because of the extreme economic stance adopted in this year's budget, this type of policy may be forced on us unless the Government move away from their commitment to reduce the deficit as part of the GNP as proposed.
The other area where there is a proposal to ease the burden on the Exchequer is to make charges for services. It is suggested that rents payable to local authorities by their tenants should be increased. From an economic point of view, I am sure that these rents are too small but, from a social point of view, in the sense of having an effect on the general climate of satisfaction in the country, to touch these sensitive things could be very dangerous and it could have a boomerang effect when it comes to negotiating a national wage agreement. It may have a positive effect on the consumer price index but it would certainly sour the climate for a moderate wage agreement. User charges are not desirable because it is correct to describe them as being a regressive form of distribution of personal income. For example, it is mentioned in the Green Paper about a user charge being imposed on students in teacher training. They are students undergoing training at that level. They or their parents would not be able to afford any charge for accommodation and tuition. There are other students whose background would enable them to afford that, but this user charge would be imposed on all equally. Likewise, if, for example, farmers are to be charged for the services of the agricultural instructor I have no doubt that the effect of that would be regressive because farmers who might need it most would not use it. It would be difficult to decide on a differing level of charges. It would be difficult to have a charge that would fall equally fairly on the different kinds of farmers, different in size, different type of farming. With regard to payment for disease eradication I can see the payments demanded being regressive so that that important programme would slow up.
If we are reduced to making a choice between maintaining or borrowing at a higher level than is proposed in the Green Paper or introducing user charges, I would be inclined to maintain the borrowings at the higher level. I speak as a layman, as a politician and not as an economist. What I have just said may be awful heresy in terms of economic theory. There would be adverse affects from user charges on a wide scale. It would sour the plan in many ways for co-operation with the Government in general national advancement.
In the proposals in the industrial area there are serious question marks as to their feasibility. The main question mark is about the rate of growth to be achieved; there is the question mark on the world economy and its ability to expand and thereby provide a market for us; the question mark about the level of investment over the next few years in this country having regard to competition that one meets in that investment; the question mark about our competitiveness; there is no guarantee that there will be a national wage agreement at all next year or, if there is, what level will be insisted on. If it is at too high a level then we may as well not have one at all. This, in turn, will affect our competitiveness and we will suffer from what economists call tax-cut inflation.
At present there is a great consciousness of income and of keeping up with the Joneses. People are not going to sit quietly while income changes take place in certain key sectors without putting in for their share as well. There is a rather gloomy scene in that area. Much of the fault for that gloom and for this unhealthy envious attitude, this materialism, lies at the door of the Government. The unnecessary extravagant promises in the manifesto set a climate of public expectation that will take some time to die. Until it dies, it is going to have to be fulfilled or sated. In doing that there will be an adverse effect on our economy from the industrial point of view. There will be adverse effects on our competitiveness. There will also be adverse effects in terms of stability and peace in industrial relations. Much of this can be traced back to the political White Paper of 1977.
The extravagant and unnecessary promises made in that White Paper which had to be fulfilled, have produced economic consequences which are completely out of proportion and which have now induced this unusual Green Paper with its unusual proposals. It contains proposals designed to achieve full employment by 1983. I emphasise again that we are all in favour of achieving full employment. When I read them I wonder whether I live in a different world from the economists or from the people who wrote the Green Paper. There is an air of unreality in what is proposed which suggests that 1983 was dragged in so that this magical target of the elimination of unemployment would divert attention from so much else. The two proposals are work-sharing and residual job creation by the Government. The work-sharing involves less overtime. We will be asking a population to give up their overtime so that more people can have jobs, a population that we are nervous of in relation to its future level of wage demands. If we persuade them to moderate their wage demands we will not be able to persuade them to accept less overtime. Work-sharing could also mean additional workers coming in at peak time. That is a fine concept for an academic economist, but how does one organise additional workers coming in at peak times? Early retirement is commendable, but if a 60-year-old does not want to go on the scrap heap and wants to continue working to 65, what is his position?
Other possibilities mentioned are restrictions on second jobs and extra part-time work. This is what work-sharing means in reality and this is an alternative way of achieving the extra jobs needed to remove unemployment by 1983.
I speak as a layman moving around the country, listening to people who are familiar with how our society is structured, and I cannot see people on overtime giving it up. I find it difficult to see how the organisation of additional workers at peak times could be done. Early retirement is not something that is going to be accepted. Many families have geared their personal budgets to second jobs or to part-time work because they may have commitments in terms of house mortgages and commitments for their children's education. Having regard to human nature, I cannot see these people voluntarily agreeing to work-sharing when they see their wives being prejudiced in terms of new houses, when they see their children at secondary or third-level education being prejudiced. That is how they will rationalise their refusal to participate.
The alternative method of achieving full employment by 1983 is in the area of residual job creation by the Government. Again, I read this as a layman and with some scepticism, which may be unhealthy and wrong, but I have to honestly state my reaction. It would be a four-pronged attack on residual unemployment by Government action through (1) an increase in services employment consequent on the introduction of a residence-related employment scheme.
That sounds fine and impressive but it means giving tax relief for painting your house. There is a suggestion that there could be a drive to reduce energy consumption through improved insulation. One hesitates to be over-critical of something which is proposed as a means to such desirable end, but to envisage all the residual unemployed people between 1980 and 1983, or a big proportion of them, being employed in insulating the houses of Ireland strikes me as slightly unreasonable. It suggests greater short-term and temporary placement of workers by the National Manpower Service. This suggestion gives me a slight chill because it says that this can be achieved by more vigorous and positive placement work. There is no unemployment in Russia because in Russia you do as you are told and you go where you are sent. I wonder what "more vigorous and positive placement work by the National Manpower Service" means. These are two areas in which the proposals are imaginative. On the other hand, one could say they are fanciful. If one wanted to be totally uncharitable one could say that they pertain to the realm of fantasy. As a layman, that is the conclusion that I am regretfully driven to.
There is is a general air of unrealism about this Green Paper. I wonder is it a consequence of the imprudent policies initiated in the manifesto, a consequence which is now being presented with a certain amount of economic dressing to take it out of the realm of impure party policy. Was a decision made to get it out and to get it before the people at quickly as possible?
There internal evidence in it which suggests that the role of the Department of Economic Planning and Development needs to be questioned. There was very little co-ordination in the preparation of this fundamental document that was to be the genesis for doing away with unemployment by 1983, this important document that should have got the most scrupulous care in its preparation. The very first page of the preface speaks of a reduction to 5 per cent in the rate of inflation by 1980. The White Paper published some months ago actually said 1979. Page 83—the Minister can correct me if I am wrong in this — speaks of the abolition of the milk subsidy and says that it will add .75 to the consumer price index. I understand that the correct figure for abolition of the milk subsidy is .81 per cent. These are important little points in showing the approach to the Green Paper — is it a serious economic document or is it a piece of political sand in the eyes?
From page 32, which deals with the agricultural sector, I get the impression that it seeks to see the end of the intervention system but page 84 refers to the intervention system as being a very useful guarantee. Chapter 2 talks about productive jobs. Chapter 6 talks about work-sharing. These are, I think, certain inherent contradictions in it which would make one want to question the role of the Department that produced this. Let us ask if it is intended as a serious economic document or is it a smoke-screen with political motivation. On page 67, which deals with the question of residual job-creation programmes, there is a sentence which, I think, has a nice irony in it in the light of the examples which I have just given from the Green Paper and its authors. The sentence is as follows:
...an over-manned public sector hinders the development of productive employment in other parts of the economy and ties up scarce resources which could more effectively be used elsewhere.
I wonder if we are over-manned in the Department of Economic Planning and Development. We have it now but I often wonder — although this debate is now finished — if there was need for it, if the need for it arose because there was a Minister without a Department or was it the other way around.
In conclusion, I see the Green Paper as proposing means to achieve the employment target in the industrial sector which are not feasible. I see great hope in the extra attention given in the Green Paper to the agricultural sector and hope that at last there will be a recognition by Government and by the nation of the fundamentally important place of agriculture in the future of this country. The constraint and question marks about the industrial sector are the result, in some cases, of external influences over which the Government have no control but in many of them, unfortunately, the direct result of a Government policy. The manifesto issued in 1977 and to which this Green Paper is a follow-up was economically suicidal. The danger is that in getting out of the position in which we were placed by that manifesto, there may be times ahead for us in this country where the quality and nature of life will have to be drastically and adversely affected. I am conscious that in being critical of the industrial sector as I have been, and of some of the matters relating to the Green Paper as I have been, that I am open to the charge: "Are you not in favour of full employment? Hit me with the baby of full employment in my arms." That is a risk that has to be taken because I think it is important — and the Government have asked for discussion on the various policy options put forward — that the difficulties that are there should be pointed out to the Government.
The main difficulties are of their own creation, the creation of a materialistic, demanding society by virtue of the fact that in 1977 and in the budget of 1978 the Government gave the impression that if Governments had the will, the way was there for any Exchequer to give out easy money, to hand out goodies. People will see a certain contradiction in being asked in the next breath to be moderate about income demands and income expectations. People will become cynical about being asked to give up part of their working hours. They will be less than enthusiastic about being asked to retire early. The man in the street might, I think, be inclined to be jocose about a programme that seeks to eliminate unemployment by 1983 by putting fibreglass in the attics of the Irish nation.
In commenting on the Government's Green Paper one national daily commented that the document and the thought behind it were light years ahead of anything which the Coalition could have produced. On the surface that seems a superficial phrase. Perhaps it is apt in that the metaphor refers to time. Some people have said that if we do not get a significant reduction in the unemployment of youth, the time could run out for the Irish society. I do not agree with that.
In the Green Paper there is also another reference to time, that is the notion that the sharing of time, or work-sharing, or what we used to call at one time "time and a quarter" or, more recently, "time and a half", the curtailment, or limiting, of overtime could contribute significantly to the inroads in unemployment. I feel that the real significance of the Green Paper is that we have a growing population. The time has come to identify ourselves with this and to benefit from the population that we have. It is our asset and we should look on it as an asset, rather than adopt the attitude of the past when we looked on it as one of the liabilities which we were faced with. It is significant that we have this population and every report that has been issued has forecast that unemployment in Ireland as compared with the other EEC countries will be greater than in the other EEC countries for decades to come. The reason given for this is that we have a growing population and the percentage of youth in our population is greater in relation to our workforce than is the case in other EEC countries. Some have said that there is no way to tackle this, that we have to accept it, and again this word "time" comes in — that only time will tell. In the Green Paper it is obvious that the Government do not accept this position. In the Green Paper they have set about exploring possibilities as well as the possibility of implementing various strategies to cut drastically the unemployment figure. The Government maintain that this can be done within five years.
I appreciate that to certain people this seems an unrealistic approach. They will not share this Government view. They do not see full employment as a possible or a positive goal. But should this not be a high priority in what we have to achieve? Surely there are social implications here? Are we going to accept the fact that we are always going to have unemployment? We have to remember the demoralising effect it has on the individual to be unemployed. Therefore, to an extent there is a responsibility on us to achieve full employment even in the social aspect. If we achieve it, surely we will have a better society both socially and economically.
The Green Paper has put forward for discussion two approaches to full employment. It has put forward work-sharing in various forms and also specific job creation. There are difficulties associated with either approach. There are different estimates of the numbers of jobs required. There are different estimates of the cost but both — either work-sharing or specific job creation — envisage sharing of income. It is for the community to decide whether they are prepared to meet the cost.
The Government have presented these proposals and alternatives and the view that they really believe we can have full employment in five years from now, but they will have to have community support. The cost is approximately 8 per cent of non-agricultural wages or roughly 5 per cent of all incomes by 1980 and there would have to be a similar contribution by way of work-sharing. Full employment is a radical change in our approach and our view on society. The approach to full employment means a gradual phasing out of the dole and it is on this basis that we have to examine it.
Investment is a priority in the scheme, not alone having to create jobs but having to sustain jobs. Some of the investment will go to creating productivity. Possibly in the creation of productivity there will be a job loss but it will be essential during the period to be competitive. You cannot have job losses offsetting job creation but with the improvement in productivity there will be an improvement in the standard of living. Therefore, it will be expected that those who are in the area of better productivity will share that with those who are unemployed.
I have just referred to what I consider significant in the Green Paper. We have an increasing population. We have a population which is such that all reports say we are going to be faced with an unemployment problem greater than any other EEC country for decades to come. But in this Green Paper the Government do not accept that. The Government say this is a position where we have the asset of having an increasing population and, therefore, we must look on it as a benefit and an asset and face it now — not later. We must use this asset so that in five years from now we will have a situation of full employment. We have to look on it from the social aspect — it is our duty to do so. Some will still say "It cannot be done." The Government have said in their opinion "It can be done." They have put forward the alternatives and, therefore, the job now is to examine the alternatives. If a person is of the opinion that it cannot be done he should say why it cannot be done. If it is his opinion that the alternatives are not the methods by which it is to be done, then he should say how it should be done. In my opinion that is the objective of and the significance behind the Green Paper.
I welcome this debate on the Government's Green Paper and I would also like to thank the Leader of the House for allowing discussion at the same time on the recent OECD Report on Ireland which was published last May. That report should serve as an external corrective on some of the assumptions and predictions in the Government's Green Paper. On behalf of the Labour group in the Seanad I note with a certain satisfaction the clear indication in the Green Paper that the Government are wedded to the fundamentally conservative approach they have adopted in trying to resolve the immense economic and social problems facing this country.
There is, undoubtedly, a clear consistency between the Government's manifesto, the White Paper published earlier this year and this Green Paper. In the debate on the Government's White Paper in this House I referred to this consistency as frightening. I believe now that the Government's consistency is the Labour Party's opportunity, and we intend to take that opportunity. The Government have moved to the right in their economic strategy and this gives greater scope for the alternative proposals and the alternative socialist strategy of the Labour Party.
The Government came into office on the basis of their manifesto and they relied very heavily on the promises and undertakings they gave in their economic strategy. They seek to be judged by their economic policy and their economic performance so far. They must rely on this because of their very poor and thin legislative programme. It is surprising that a Government who have such a striking and unprecedented majority have been so tardy in putting forward the very necessary legislative proposals which are required as a matter of urgency for the sectors of the population who may not have the voice to be able to mount an effective lobby on Government or on Ministers of the Government but who need the protection, support and changes in our laws which any Government with such a secure majority should have introduced as a very strong priority. Out of a fairly long list of proposals that one could mention I will confine my remarks to the area of family law, children's rights and civil legal aid, all of which areas the Government have failed to tackle in their first 12 months in office. It is not surprising that the Government want to be judged on their economic policy and strategy and on their proposals contained previously in the White Paper and now in this Green Paper.
I described the Government's approach as fundamentally conservative because it appears to be a policy of placing the responsibility for economic growth and the means for achieving that growth in the hands of an elite minority and to give that élite and so-called "productive" minority every conceivable incentive to produce results, and to use the Government's own powers and resources to eliminate any obstacles in their path. That is the core of the Government's strategy. The basic elements of this approach have revealed themselves as part of that strategy. First, there is a commitment to discriminate in favour of the wealthy and better-off sections of our society in the taxation code. There is a fundamental change in approach towards taxation from that adopted by the Coalition Government and even by Fianna Fáil in previous administrations. It is accepted by modern Governments that taxation is a major method of and an extremely important instrument for equitable redistribution of wealth. Yet, what we have seen as part of a consistent and deliberate strategy since Fianna Fáil came into office is a discrimination in favour of the better-off in our society. There are a number of clear examples of this. The clearest case of all is the abolition of the wealth tax. Other examples are the removal of car tax, the increase in personal tax allowances and the removal of the rates from private houses. All of these are a clear favouring of this elite who are to lead us to the promised land of a remarkable and sustained economic growth and recovery. Therefore, the first element is this use of the tax code which discriminates in favour of the better-off.
The second element is what I have always regarded as being the classic conservative philosophy, that this minority in taking advantage of the incentives of the tax reliefs and productivity will somehow carry the rest of the population on a path of sustained growth in the eighties. This is the old idea that the rising tide will lift all boats. It is the kind of political philosophy that I would expect from, for example, a British politician like Sir Keith Joseph. It does not bear much relationship to reality. That is not what happens. If you favour the better-off and help them to enrich themselves they will thank the Government very much and enrich themselves. It has been by no means proved down the years that private enterprise turns out to be deeply concerned about those at the lower end of the scale, the less advantaged, the unemployed and those who are living on the poverty line. There is a basic flaw in that approach and I am surprised at how clearly it shows in the Government's present economic strategy.
The third element in the philosophy, which is consistent with this classic conservative approach, is that public expenditure is always too high. In particular, social expenditure is one of the first areas to be cut back when there is a need to reduce Government expenditure. On page 85 of the Green Paper the table referring to public expenditure shows clearly and starkly the degree of cutback in social expenditure over the years 1978 to 1980. While a number of other classifications of expenditure either remain static or increase to some extent, social expenditure decreases sharply. This is the prescription for what Senator Jago described as a very young and growing population, and I agree with him. Yet, we are going to cut back on social expenditure. In 1978 it will be 20.7 per cent, in 1979 it will be 18.9 per cent and in 1980 it will be 17.9 per cent. This reveals the same conservative approach. I will mention more items when I look in more detail at the proposals in the Green Paper.
There is a sharp reversal in the approach of the Government; it is a consistent reversal which has always been planned. It is something on which I would welcome further clarification and explanation from the Minister. Having a legal background rather than a training in economics, I need some of these problems and strategies to be simplified to a certain extent. Yet, I find it extraordinary that there is such a substantial reversal in the Government's strategy 12 months after taking office. I am not saying this is a surprising reversal, it is consistent with the approach in the White Paper, but the scale of it is quite breathtaking.
In 1978, on the basis of the figures available to us in Government publications, the Government will have pumped approximately £303 million extra into the economy to stimulate growth. Next year, if one is to believe the predictions in the White Paper, the Government will take £68 million out of the economy, and in 1980 it will take out a further £50 million. Yet the predictions for growth remain identical — 7 per cent in 1978, 7 per cent in 1979 and 7 per cent in 1980. It is incredible to find the Government suggesting that increasing public expenditure and reducing taxation, which is what was done in 1978 to a significant degree, will provide high growth. By any standards 7 per cent is high growth; it will be the highest growth predicted for the European Community but it will continue on to '79 and '80.
If that is the prediction when one massively increases public expenditure and cuts taxation, how does it remain the picture when one reduces public expenditure substantially and increases taxation, which is proposed in the Green Paper? When that is done in 1979 and in 1980 how can it be stated — without being argued or explained — that this will have no effect on the growth rate which will still remain at that uniquely high level of 7 per cent? Is it surprising that both in the OECD report and in the Central Bank report the predicted growth rates, even for this year, are different? I have not seen any objective economist support the prediction of a sustained growth rate of 7 per cent during 1978, 1979 and 1980, when there is a complete reversal in Government strategy during the years 1979 and 1980.
One initial problem which was mentioned by Senator Cooney — I join with him in this — is that the Green Paper states a great deal and uses tables which predict a great deal but does not give us the underlying reasons or justifications for these assumptions and predictions. I hope the Minister, in his reply, will give us some clearer indication of the analysis and arguments which underlie some of these rather facile assumptions in the Green Paper.
Obviously, the approach of the Labour Party towards our economic and social problems would be substantially different. We would not select a minority élite whom we would favour in the hope that through their increased productivity there would somehow be a general growth rate. We would see growth of the economy and the resolving of our major problem of unemployment as being things which cannot be solved at the expense of social justice. We would insist on a much broader based approach and would place the emphasis on the increased use of our productive resources. The Labour Party will be publishing shortly a Private Members' Bill on the creation of a State development corporation which would be part of a very different kind of strategy towards solving our economic and social problems. I have mentioned this because Senator Jago rightly said that, if there are criticisms of the over-all political philosophy and economic strategy of the Government, then the alternatives and differences should be brought out. The difference is an absolutely basic one between the approach of the Government which — although there are radical elements in it — is a classically conservative approach. This is indeed an opportunity for Labour, because it is at least polarising the approach to resolving the unique and very challenging economic and social problems facing us.
The basic points I was making about the Green Paper were well analysed by Dr. Brendan Dowling in the issue of Business and Finance of 22 June 1978 in an article, “The Green Paper — An Analysis”. Two paragraphs in that article summarise what I regard as the basic flow in the approach of the Green Paper and the basic point at which it ceases to be a credible plan from a Government which have prided themselves as being a Government that can and will plan.
Dr. Dowling stated:
When the White Paper was produced there was always the danger of confusing targets with reality, of believing that optimistic estimates are easily achievable. This is what has happened in the Green Paper. The growth targets of 7 per cent per annum for the period 1978-1980 are barely discussed. The Government view is that 7 per cent will be achieved for 1978 and that this in turn will lead to the achievement of the 1979 and 1980 targets. In that way the whole question of achieving the 66,000 or so jobs promised by existing policies is avoided. Yet this is still the fundamental problem facing the economy. It is not a question of makeshift policies to find an extra 7,000 jobs a year. The problem is to find 29,000 jobs per year or anything remotely approaching that number considering that in the period 1965 to 1974 — a period of strong growth in both the Irish and world economies — the annual average increase in non-agricultural jobs was only 9,000 per year and a significant proportion of those were in the public service.
The reality, which breaks through the Green Paper at times, though heavily veiled, is that the Exchequer position for the next two years will be such that a major deflationary force will be exerted on the economy. The problem is how to ensure that the economic consequences of that deflation are minimised and that the job losses consequent on this reduction in activity by the Government are kept to a minimum. Over the next two years the borrowing requirement will be reduced as a proportion of GNP by 5 per cent. The bulk of this reduction will have to come from deflationary measures — either by increased taxation, reduced expenditure, or both — although the presumed fast growth rate will help to reduce the borrowing requirement. The Green Paper does not address itself to the important question as to how the high growth rates can be achieved in the face of severe deflation. Indeed the Green Paper is quite evasive and misleading on this issue when it says that “the economic stimulus of increasing State expenditure has to be less generous than in 1978” for the trend is that there will be no economic stimulus from the Government fiscal stance in either 1979 or 1980.
That is the basic flaw, the basic point of credibility of the Green Paper. We would all like to see the targets set out in the Green Paper achieved, but anybody can set targets and then confuse targets with reality. The responsibility on the Government is to show, in a convincing and credible way, that those targets are not mere targets but can be coldly and responsibly argued on the basis of an economic strategy.
What I see as the basic core of the approach by the Fianna Fáil Government is that it appears to give a once-off boost to the economy in 1978. This boost is largely to consumer spending with tax incentives and other types of relief to the better off in society. This productive elite, if one can call it that, is expected to launch the economy on to a high growth path of 7 per cent sustained over the years 1978, 1979 and 1980.
As we know from the progress of the economy down the years, even at a time of high growth both here and in the other countries in Western Europe who are our markets, this would be unprecedented. The problem is that this radical pump-priming exercise has boosted our external borrowing to 13 per cent of GNP. I would welcome some clarification from the Minister on this, because we are clearly going to have to cut back — and this will clearly be deflationary — over the next few years. How do the Government reconcile that with sustained and unprecedented growth during 1979 and 1980? It seems that there is a technical contradiction there. It is the gravest problem in trying to assess the credibility and the force of the Government's strategy as outlined in the Green Paper.
I should like the Minister to give some clarification as to how binding and how inflexible the Government's commitment is to bring down the level of external borrowing. I understand that there is a commitment to bring it down from the present level of 13 per cent to 10.5 per cent in 1979 and 8 per cent in 1980.
I was interested in the report of the Central Bank published last May. At page 26 there is reference to Government financing. It seems that the Central Bank is pinning the Government very substantially on this issue and it is an issue on which I should like clarification. The report states as follows:
As indicated above, the Government borrowing requirement of £821 million is estimated by the Bank to require monetary financing of £560 million in 1980. When account is taken of the Government's proposals regarding external borrowing and a reduction of its balances at the Bank, and of the projected contribution to Government monetary financing of sales of Government stocks to licensed banks and non-residents, there could be a shortfall of about £100 million in the financing of this year's borrowing requirement. The Bank was informed that minimising external borrowing this year could assist the task of rescheduling external Government debt due for repayment during the years immediately ahead. It therefore agreed to provide, if necessary, up to £100 million to the Exchequer this year, on the basis that the total borrowing requirement and current budget deficit would not be greater than now envisaged. The Bank also took into consideration the Government's commitment to reduce the borrowing requirement—exceptionally high this year—to 10.5 per cent of GNP in 1979 and 8 per cent in 1980, and to reduce drastically the current budget deficit, through revenue buoyancy, restraining public spending and a reassassment of public expenditure priorities.
The report then goes on to make it clear that the bank is not changing its policy and providing a facility of this sort on a continuing basis.
I should like to ask the Minister whether that undertaking by the Government is an undertaking given to our foreign creditors or one given to the European Community or whether it is something which might be reviewed by the Government if, in fact, the predictions and targets do not turn out automatically and we are not resolving the unemployment problem with the degree of speed that had been hoped? It would be helpful in trying to assess the degree of flexibility in the Government's approach to know whether that is an absolutely strict undertaking by the Government, because it must inevitably have a substantial deflationary effect and it is hard to see how it is reconcilable with this very high 7 per cent growth rate in 1979 and 1980.
I should like to turn more specifically to some of the provisions of the Green Paper and I want to begin by expressing a disappointment which is felt, presumably, by any woman who takes the trouble to read it. It does not say anything very specific, anything useful, anything very much at all about the need for basic social justice, the commitment to equality of pay and opportunity. This is a serious lack on the social side. I refer to what I would describe as an angry— justifiably angry—letter written on behalf of the Labour Women's National Council and published in the most recent issue of Liberty. I quote from part of that fairly lengthy letter criticising the Green Paper for its lack of commitment in this regard. The letter states:
The Green Paper—since it was foisted on us as the "green crystal ball" on future economic prospects —should have provided for the long over-due abolition of the exploitation of women workers.
But it is clear from the Green Paper as a whole that Fianna Fáil has no intention of trying to put right the injustices now suffered by women in the spheres of employment and social welfare entitlement. No mention was made of the need to ensure that women workers receive a fair and equal pay. No mention is made of the fact that women are discriminated against in the entitlement rules relating to social welfare benefits. No mention is made of the vast numbers of women who seek and urgently need employment and yet cannot ensure that they be listed in the unemployment statistics.
The same Government which in one sweeping gesture was happy to abolish Wealth Tax, just in case any member of the community sufficiently wealthy to feel its effects might emigrate (not that Fianna Fáil is against emigration in general), is now prepared to levy tax on children's allowances.
Children's allowances is the only form of income to which married women with families are entitled—and in an unfortunately high number of cases the only income they get—and Fianna Fáil now proposes to tax it. The expected yield from this draconian measure is £8 million—far less than the actual yield from Wealth Tax in 1977.
They go on to make other equally angry criticisms of this substantial lack in the whole approach of the Green Paper, given that it is talking about development for full employment, as the title shows. That whole aspect of equity and social justice among all citizens, male and female alike, is singularly absent.
There are one or two other paragraphs on which I would welcome specific clarification when the Minister comes to reply. There is one paragraph that struck me in relation to taxation of the farmers. Paragraph 3.20 on page 28 under the heading "Taxation" states:
In general, the Government favour a taxation policy for farmers that is equitable in relation to earnings, that is designed to encourage the more efficient use of land and that will direct land into the hands of those most likely to use it efficiently.
I could not help feeling as I read that and then went on to read what the proposals were that the words "in general" seemed to mean what the French allies of Fianna Fáil in the European Progressive Group would mean by en principe. So, en principe there would be taxation of farmers but, when one got down to it, it would be very little indeed!
The proposals bear no relation to the enormous benefit to farmers of the common agricultural policy. The Labour Party are very much in favour of Ireland benefiting as fully and as comprehensively as possible from the common agricultural policy from membership of the European Community, which has failed to have an adequate regional and social policy, but we do not believe that the full benefits of the common agricultural policy should be retained in a relatively narrow sector of our own community. We believe that there should be a much more conscious attempt to redistribute the benefit of the common agricultural policy.
It has been called by many Europeans the substantial part of Ireland's benefits from a regional policy but the gain to our economy is not consciously approached from a point of view of ensuring that there is some equitable redistribution of part of it, especially because one of the direct results of the common agricultural policy is to push up food prices and that hurts particularly the poorer sections of the community, the poor who spend a larger proportion of their income on food, it being the largest single item in their budget. There is a lack of conscious thought in this regard. There is the lack of an approach to taxation as a major instrument of redistribution of wealth and one which is particularly relevant to the very substantial gains which Ireland makes from the common agricultural policy but which fall narrowly into certain hands only and do not benefit the community as a whole in a redistributed sense and, in particular, cause hardship on the poorer sections of the community who necessarily pay more for basic foods.
Another paragraph in the Green Paper on which I would welcome specific comment on from the Minister is paragraph 6.22 at page 70. This paragraph was referred to by Senator Jago but he did not make the comment that I wish to make on it. It is as follows:
A major job creation programme directed towards providing work for all clearly carries with it a variety of problems, but it would also bring enormous benefits. It would improve the overall level of skill of the labour force. It would help to make the best possible use of productive capacity. It would mean an end to the whole system of "dole" since unemployment benefits or assistance would no longer be needed. But above all it would put an end to the misery and degradation associated with prolonged unemployment and make a reality of the right to work.
The phrase, "it would mean an end to the whole system of ‘dole'" could have interesting implications. Is it, for example, envisaged that the approach would be one of introducing a compulsory element, that a person would not be able to benefit from a dole in the sense that we know it now but might benefit from some kind of public assistance provided the person was working? Is this the idea of suggesting that it would mean an end to the whole system of dole? There are extraordinarily complex social and economic considerations here and in particular this idea of introducing a compulsory element is one that I have seen put forward by various conservative politicians. This idea implies that one cannot have people in receipt of public moneys unless they "deserve" it, unless they are prepared to work. I would welcome clarification from the Minister as to whether that is what the Government had in mind in that paragraph.
I welcome the opportunity to comment specifically on the OECD report published last May. The Minister referred to it very briefly in passing and, indeed, I do not intend to delay on it, but it serves as a useful corrective. The first point that it serves as a useful corrective on is the impression given by Government Ministers and by Senators from the Government side of the House that somehow the economy was in a state of utter collapse until Fianna Fáil took over and that now we have a Government that can set the targets and that we will have an unprecedented growth rate because those targets have been set.
The OECD report makes it very clear that the upswing in the Irish economy started in the middle of 1975 and that it is a natural upturn in the economy. 1976 was a year of very high growth and 1977, similarly, was a year of growth. This is more a natural upturn in the economy than one necessarily totally related to Government strategies at the time. That is the first point to be made. Because of the very considered policies of the Coalition Government and because of the natural upturn in the economy the growth started in the middle of 1975, and in no sense is it to be attributed in an automatic way to the fact that Fianna Fáil was at the wheel in mid-1977. Apart from that, it seems to me, reading this OECD report and looking at previous reports, that it departs from the usual OECD report on a country, which is usually descriptive of the economic situation in that country. Bearing in mind the discretion and the deference of economists from other countries and the kind of team that would put together this report, between the lines it is about as critical and sceptical of the forecasts for the Irish economy as I have seen any OECD report be. It clearly does not accept that there will be a 7 per cent growth rate here. It puts the growth rate at 6 per cent and, if one reads between the lines, it is a maximum of 6 per cent.
It seems to criticise what I call the pump-priming exercise by the Fianna Fáil Government as not being the best strategy for the approach to our economic and social problems. At page 33 of the report under the heading "Short-term Prospects and Conclusions" it is stated:
The buoyancy of domestic demand should lead to a strong rise in import volumes. The growth of imports will probably be further encouraged by the likely composition of demand. As in 1977, strong investment demand—which has a high import content—will again be an influence but in addition a rapid rise in disposable incomes and attendant consumer durable purchases should also play a role.
There is the implication here that this pump-priming of consumer demand is going to have substantial implications for the rise in imports by this country and will have possible balance of payments consequences and it is not necessarily the best strategy in the circumstances.
This is even clearer in the paragraph towards the end of page 35:
While policy has given considerable emphasis to labour-supporting measures, it could be that a slower growth of private consumption than projected in favour of more direct labour-market measures would be preferable in the interests of employment.
It goes on to say:
For example, the possibilities of employment-creation in the service industry should be reviewed.
Again, the clear implication is that the Government are giving a once-off boost to the economy relying on this productive elite or minority who are going to produce and consume more in a dramatic fashion and somehow lead us on to the promised land of 7 per cent growth, not only in the year when this great boost was given both in the private sector and in increasing Government public employment and public expenditure, but also in the two following years when there is a total reversal of Government policy and when there has to be a very sharp reduction in the external borrowing requirement and when the policies, of necessity, must be deflationary and include, presumably, taxation as is indicated in the Green Paper, a sharp decline in real terms in social expenditure.
There are two general conclusions I would draw from the Green Paper. I would very much like to see some of the targets achieved. There are matters which are of considerable merit to be discussed and I welcome the opportunity to discuss them both in this House and in other contexts. But the great flaw is to confuse targets with reality, to set out the kind of assumptions that the Government have been doing consistently—assumptions of a 7 per cent growth rate in 1978, 1979 and 1980, and a prediction of a 5 per cent inflation rate.
My fear, and here I align myself with the concern of Senator Jago who expressed it very strongly—is this. Because of the understandable and indeed necessary expectations of young people, who are better educated and want to live in Ireland, to work here and be involved and make a life here, the present strategy is one of creating expectations of very high growth on sustained bases here regardless of what the growth rates and the inflation rates in Britain or in other countries of the European Community may be. It is impossible to be in any way against these tables leading to the abolition of unemployment or reaching the target of full employment, but it is also the responsibility of Members of this House to look for, first of all, more reasoned and detailed and hard arguments and analyses on which this is based, not just the assertion of these targets but some credible analyses on which they are based. Secondly, it is the responsibility of Members of this House to look at the inevitable consequences that would flow from the fact that the Government have over-borrowed and over-spent this year. We have to cut down very dramatically, and apparently in a very inflexible framework, on our overall external borrowing and on public expenditure, and introduce measures of taxation in order to meet the bill. How these are compatible in such a facile way with sustained growth of 7 per cent over the 1978, 1979, 1980 is to me the major question mark in the Green Paper, and I hope the Minister will enlighten us on that and on the other points I mentioned.
In the Green Paper we have spelled out some of the possibilities for advance in the coming few years in a very detailed manner, in a manner which enables reasoned discussion to take place on this matter. I was astonished listening to some of Senator Robinson's comments about overspending, over-borrowing and taxation and so on, reminding me so much of the sort of arguments one heard on the extreme right wing of conservative parties against those policies conducted by more progressive parties attempting to bring about full employment.
We must try here to get a little distinction as between the wood and the trees. The first thing is to realise the basic principles that we are looking at here. We have set a target of decreasing unemployment significantly in the coming years and then in the subsequent period completely to abolish unemployment in this country as we understand it today. I would think that this is a very noble, a very daunting target indeed, which certainly will not be easily reached and we do not pretend this for one mement. It is, however, a positive objective, a very good objective and I am sure nobody in the Opposition in all fairness would in any way argue about the laudability of attempting to reach this target.
Then we come to what seems to be the real division between us. Given the right positive approach by the Government, given an attitude of optimism and of good will, and working together, we believe on this side of the House that it is an attainable target, a difficult target but an attainable target and one which we should be happy and proud to move towards; whereas one gets the impression from the opposite side of the House that they do not really believe that it is feasible. Perhaps they are right. I hope not. But certainly that sort of negative attitude inevitably has its self-fulfilment. If you do not really believe that you can reach a target, that you can do something, you will find all the apparently logical reasons and rationalisations as to why you cannot, and all the rest of it.
We have here in the Green Paper a definite series of plans and programmes. They are not ideological. Perhaps this is one of the reasons why they have aroused so much emotion in certain quarters. We are putting forward pragmatic plans based on what appears to be the sensible, reasonable thing to do. They include the encouragement of the individual initiative and at the same time a readiness, where it is necessary, for the State to intervene—a combination in other words of the State and private enterprise. Quite frankly I do not think we can succeed unless we are willing and able to blend these two together. Our economy is not such that it can be left entirely to private enterprise.
Equally, we do not want to reach the situation in which one has solely a State economy with all the disadvantages, inefficiencies and inequalities which such an economy seems inevitably to cause, but instead to take the sensible, pragmatic, reasonable approach of trying to combine the two together as and when appropriate.
There has been a lot of talk about the financial implications of this, and clearly we must be very much aware of these implications; we must be very careful and prudent within the financial circumstances. I think we are doing this. We very clearly indicated that we are fully aware of the implications of our policies. We have made conscious decisions to take certain financial steps in our first year in office, financial steps which we quite rightly considered to be necessary to get the economy going again. This was absolutely essential, and the new mood of confidence and activity in the country fully bears this out. It will be necessary certainly in due course to reduce borrowing; but let us do this in a sensible way and not refuse to take financial steps just solely on the grounds that somebody or other does not necessarily 100 per cent approve of it. We are doing this. Our financial credit is good and we are staying fully within appropriate terms and parameters of financial prudence
There has been quite a number of comments on the OECD report, which is included as item No. 18 here, and on various other bodies' reports. Again can we distinguish the wood from the trees? It is not a question of these reports contradicting us; it is the question here of a series of different reports from a number of very reputable bodies, and they are all indicating that our economy is going ahead. The sole question is to what degree? By and large they vary between something around the 5 plus per cent to the 7 plus per cent, very closely in alignment with one another. I sincerely believe that the Government's forecast is the one that will prove to be correct. Indeed the figures which are available so far in such a crucial area as the industrial field indicate that for the first few months of this year our targets, far from not being reached, have been successfully exceeded. This is a very good sign. Let us be quite clear about these OECD reports, the Central Bank report and so on and what they in fact mean.
One aspect which certainly we must emphasise is the fact that this is basically an export orientated economy and here again our expectations are being borne out fully. Our exports are increasing and show every sign of continuing to increase. Here again we have this excellent combination, a pragmatic combination of private enterprise showing that it is willing and able to made a considerable contribution, and at the same time the Government and the semi-State bodies—in particular here one should pay a tribute to Córas Tráchtála which do so much for our exports and are indeed envied and now in course of being copied by many other countries throughout the world. We are in the lead here, we are doing extremely well in this direction and we should continue to do so.
There are certain specific points in the Green Paper which one would like to touch on very briefly. One is the question of our natural resources, and quite rightly pride of place has been given to the land. This is perhaps our greatest and best natural resource. It is only appropriate that, in the Green Paper, and in our development plans generally, full cognisance should be taken of the land and the development of agriculture. We are now in a position within the EEC to be able at long last to get the full benefit from agricultural developments. For too long we have been bedevilled by external economic forces which made it extremely difficult for Irish agriculture to develop as it should have developed. At last we have some opportunity to develop agriculture. We have an enormous potential for development there. I agree in general terms with much of what Senator Cooney said, but I must say that in terms of agriculture we have a great potentiality for development. Another area touched on in the Green Paper, where again there is an enormous potential for development, is horticulture, and I am glad to see it beginning to take the place it properly deserves.
One area which I would like to have seen emphasised more in the Green Paper is forestry. Here again we have a very much neglected natural resource. I know there are practical immediate short-term difficulties in relation to such matters as pulp wood and imports from certain other markets, but the basic prospects there are extremely good and I hope more emphasis will be given to forestry in the future.
We also have certain mineral and other great natural resources. If our hopes are justified, I hope these resources, which could make an enormous difference to our economy if handled properly, will be used judiciously and not squandered as happened in the Netherlands. I hope they will be utilised fully towards the development of the economy. In Britain where great hopes were raised resources seem to have been largely squandered on short-term policies. It is very important that, irrespective of what other natural resources are discovered, the basic economy as at present constituted should move forward. This in itself has a potential for great prosperity, quite apart from any further development.
One specific area I should like to refer to is education. It is tremendously important that the developments which took place in the thirties, forties and fifties in primary level education and continued in the secondary area in the sixties, should be continued in the seventies and eighties at the tertiary level. I say that in the broadest possible sense. We have an export-orientated economy. It is essential that the appropriate personnel are available to bring forward this economy and it is also very important and appropriate that Irish people should themselves benefit from and partake in the advances.
Perhaps parents in Ireland are still too wedded to the idea of their children entering into the more traditional occupations such as nursing, teaching, medicine, the law, the various professions, and do not fully realise there are certain areas—computers being one of them—in which there are great opportunities already for young Irish boys and girls if they take the appropriate training in these subjects which have a great potentiality for the future.
Senator Robinson referred to the question of employment for women. One should say first of all that this is not a sexist document. It applies to all our people, men, women and children. Of course, from the point of view of women in employment, it is in terms of full employment which this document is aiming for that the best and most favourable circumstances will occur for employment for women, for equality in employment, equality in pay, conditions and opportunities. On these grounds alone this Green Paper makes a very significant contribution. I will pass over her remarks on emigration which regretfully started again recently and hopefully will again be ended soon.
This is a document for general discussion. We live in a democracy, in an open society. At the end of the day it is not the Government, it is not we on the Government benches or, indeed, our colleagues on the Opposition benches who will decide this ultimately and finally. It is for the Irish people themselves to decide what they want. They have given a very strong indication of this but it must be followed up. It very much depends on employers, trade unions and everybody in our society making their contribution. We have the potential. We have the people, the natural resources. and the opportunities to have a prosperous, worth while and good society. This Green Paper lays down some of the guidelines for discussion as to how we may set about creating this society.
I am glad to have this opportunity of addressing myself to the Green Paper. I am glad also the Minister is able to be present in the House for this debate as he was for a previous debate. I do not see any disagreement within this Chamber, within either House of the Oireachtas or, indeed throughout the country on the objectives of this publication. There is a consensus on the objectives, the principal objective being that of creating conditions in which full employment may be achieved. We completely subscribe to this objective of full employment. Any disagreements there are concerning this publication really relate to the methods or the means by which we would seek to achieve such objectives. In one or two debates here last week there was a tendency on the part of one or two Government supporters to suggest they were for jobs with an inference that presumably Senators on this side of the House were not, which we have to reject. In the debate on the White Paper the Minister spoke at some length about regional development. I should like to make a few remarks about the regional development aspects of full employment, and to thank the Minister for his fairly extensive comments on this matter. I reject to a certain extent some criticism he made about the methodology we have been adopting in that regard. In that debate I spoke about the previous Government's proposals to establish a western development board with responsibility for the western counties and Donegal. In explaining why the Government had shelved this proposal the Minister said it was largely a piecemeal operation concerning one specific area and it might be a better approach to look at the nation as a whole and to look at sub-national needs in a more global context rather than choosing a specific area.
I would dispute that with the Minister for two or three different reasons. We have evidence from other countries that there are specific areas which are distinctly different from others because of minimal levels of growth, communication problems, remoteness from centres, farm structures, endemic unemployment for centuries and an horrific background in levels of emigration. In the north of Scotland, for example, there has been the emergence of the Highland and Islands Development Board as a completley separate and autonomous board and quite distinctly different from any other regional authority. Additionally we have seen in Italy developments in the Mezzogiorno which are totally different and seperate issues from those of other institutions.
We sought to look at Ireland on the basis that Connacht is one of the four provinces with problems distinctly different from those in the rest of the country. Now, if you have problems, which are distinctly different, they very often require different solutions. Those solutions may not be similar to the solutions you might adopt in charting the economic progress of, for example, the south-east or north-west of this country. It was in that context that the west was chosen as a specific area needing special treatment.
In addition, it seemed to us that, if you sought a concentration of effort where regional policy and regional development are concerned, then the one region in which one naturally sought the greatest level of development was the weakest region. In this case we are talking about the west. Our thinking was running along the lines that the establishment of a board in the west could be used as a model on which to plan other sub-national development in the other provinces. It was not a question of developing the western development board in isolation, but rather using it as a model on which one would plan other regional structures. It is in that context that, parallel with the western development board proposal, the sub-national development issue was being examined on a more global scale. I reject the Minister's remark that very little happened during the last four years, because it was the National Coalition Government that initiated all this investigation, both the sub-national issue, which I am glad the Minister is pursuing and also the western development board issue.
I am again very glad to note that the Minister is pushing the sub-national issue and has sought a report from his Department as a matter of urgency. At the end of the day it will lead to certain regional structures emerging, in the context of which there will obviously be a regional grouping, presumably based on the western counties. Whether we are to call it a western development board or any other name matters not to me. I welcome the Government's intention of pushing this sub-national regional issue because it is extremely important. It is important in many senses that relate to the paper we are discussing today because, going back a number of years when we had fundamental discussions on issues of full employment, we had the report on full employment, which was the focal point of a great deal of debate more than a decade ago. It is relevant and sobering in the context of the discussions we are having today, and the emphasis there is in some quarters about the achievement of certain objectives which, to me, frankly seem extremely difficult, even though I would wish to see them take place, to look at the report on full employment published perhaps 20 years ago. I have not got the date before me but it seemed to me that one of the greatest weaknesses in that publication, and a weakness to which the Minister should pay attention in the planning of developments over the next two or three years, was that the report on full employment, whilst making national projections about what was nationally desirable, and what it saw as being attainable, did not address itself to regional issues and did not spell out whether the projections in regard to jobs related to jobs that were going to be created in Dublin city or Cork city, or where the job loss was going to be, or whether Castlebar or Galway city were going to develop, or whether rural Ireland was going to be denuded of people in the achievement of these objectives. In other words, there was no emphasis on the regional side to the issue. There was no attempt to spell out in the provinces, the counties, towns or cities where employment was going to increase or where there was likely to be a decrease in employment for reasons over which a Government might not have control.
The result was disaster ensued. The publication of that report a decade or 15 years ago came at a time when we had a measure of prosperity but the imbalance in that prosperity was horrific and it is just in very recent years that we are beginning to redress the imbalance. For at least a decade after the publication of the report on full employment we had massive development in the major cities. We had massive levels of emigration from many western counties. In the context of particular regions, if one looked at the report in a micro-sense, from the perspective of a county such as Leitrim, a town like Belmullet or other parts of Mayo, from the point of view of someone leaving school, or the area in which people were living, the report made very little sense.
Today times are a little better especially in the context of industrial development because, since then, the Industrial Development Authority has become involved in the regional planning of industry and projections of employment in cities, towns and villages around the country. To that extent then there is a base on which to plot and there is a rationale in so far as industrial development is concerned. In that context things are easier. Issues concerning the total economy are wider than simply industry. If we are to plan at a more fundamental level, it has been my considered view for a number of years that this has got to be done in the region and, to a certain extent, a great deal of the decision-making, below the most serious decision-making concerning fiscal matters and broad policy matters within the Cabinet, or the Department of Finance, could be happening within the provinces if one could order a better type of development, given that type of autonomy in the provinces. In regard to the board again, the idea of which has been scrapped but which, hopefully, may emerge under a different name, the thinking we had there was simply the development of a board responsible directly to a Minister within the Government, cutting out the red tape, giving it discretion to spend certain funds voted annually, and co-ordinating on that board the representations of groups, such as the Industrial Development Authority, the Irish Tourist Board and the Department of Agriculture, committees of agriculture and other developmental interests, all of which could be a remarkable stimulus in development.
It could be extremely helpful if, instead of the Government being expected to do everything or expecting leadership from national institutions in this city, you pushed out your decision-making to the regions thereby creating more opportunities to generate certain levels of development within these regions that might otherwise not occur. This is a very important part of what we are talking about here and I am glad the sub-national development issue is being pursued, although I do not know of any comment on the development of full employment. That is less than worthy, but it is an extremely important issue.
Last week Senator McCartin, speaking about Leitrim and the problems there, pointed out, and quite rightly, the extent to which there is centralisation of many simple jobs which could be provided in the provinces. Previously in the Dáil and also here I referred to the same problem in regard to Mayo. One can multiply it around the country. The point I want to make is that in the routine administrative work and examination of applications for housing grants, compiling reports, paying simple grants, a great deal of work is being done in offices in this city which relate to the needs and simple administrative details of people in the counties where, with a stroke of the pen, a decision could be made which could increase to a very considerable extent the number of people employed throughout the different counties.
Let me give a simple example. Take a new house costing a certain amount, eligible for State grants, and a builder applies to his county council for planning permission. When he gets it he applies to a Government Department in Dublin for a grant. The Department write back to him acknowledging his application. They write to the county council to inform them that the application has come in. They take a judgment on the application and presumably give the grant which requires a further letter posted from Dublin to, say, Leitrim. The builder, when it is half completed, has to notify the Department that the roof is on the house. So he writes another letter, not to his county council, but to the Department. They write to Mayo County Council to inform them that the roof is now on and that it should be inspected. The local inspector then goes out to look at the house. When he has seen it, he writes not to Mayo County Council but to the Department of the Environment telling them the roof is now on and the first payment can be made. At this stage the first payment is made. The Department notify Mayo County Council that the first payment is made so that they can pay the second part of the first section of the grant. The building of the house proceeds.
When the house is completed the owner notifies the Department of the Environment. They write to the local inspector telling him they have been told the house is built. He looks at the house and presumably confirms to the Department that the house is complete. Then the Department pay the final section of the grant and write to Mayo County Council to tell them that the house is now finally completed and they may pay out the final section of the grant.
I am saying this in the most apolitical sense because I spoke strongly about it when my own people were in Government. In a country in which there is still a great deal of imbalance and in which there is a certain spread of industrial employment around the country—there is absolutely no spread in the service sector—it seems to be the height of lunacy that the most simple, mundane, administrative procedures are carried out in Dublin. Jobs could be provided if matters pertaining to Leitrim were dealt with in Carrick-on-Shannon or matters pertaining to Mayo were dealt with in Castlebar. If we are talking about fundamental regional development it is criminal that this work should be done in this city.
There is no reason to believe that the county councils are incompetent of administering all the details which I pointed out—advising the Department on a monthly, fortnightly or weekly basis, if they insist on the block number of applications, on how funds are running, or what is happening. This area is ripe for reform because what I described relating to the house grant multiplies itself through the whole system of local government. If the Government choose to do something radical in this area they have the power to do it with a stroke of the pen and it can be done very rapidly. I would commend the thought to the Minister. He will have our full support if he implements the type of thing that I am talking about. Looking at development in the country over a number of years, Governments have been underpinning their faith in industrial development. I support that because it is the largest single generator which can have dramatic, immediate and secondary effects, and there is a consensus again about this issue.
There is an area of the economy which we have not looked at—I speak about the service sector. In that sector there are an extraordinary number of jobs, administrative and other kinds, and, despite what we have been reading about developments in the west or the south there is a massive magnet in Dublin which is objectionable to many people who live in the city because of overdevelopment. While we tend to read IDA reports showing the level of grant assistance throughout the country, we can get a false picture from that for certain reasons. In the industrial sector we get a false picture because the major grants are paid outside the country, but we forget that the companies established in Dublin are availing of the tax relief on export sales which we do not read so that you still have this huge proportion—I think about 50 per cent—of industry situated in Dublin. In some other countries—I think Britain as well—a system of grants applies where companies, such as insurance companies and banks, in so far as certain types of procedures are concerned, get specific grants from the Governments—as we are giving grants, for example, in the industrial sector—if they move outside the cities, and provide jobs in the provinces. I think there is scope there that is worth looking at. It could be scope in certain State-guaranteed loans for the building of office blocks, subsidised interest rates on buildings or incentives of a different nature.
There is no doubt that there is this complete imbalance despite the fact that it is fashionable to believe that everything is happening in the west and in the rest of this country. Where I live today it is extremely difficult for any able-bodied young man leaving school to get a job. This is still a fact of life, despite the euphoria, and let us not forget that.
I referred to the relationship between the local authorities and the Department of the Environment and to the simple administrative procedure for housing grants, water and sewerage or supplementary grants. There are as many people employed in Dublin doing the administrative, simple, work for Mayo and Galway as there are in those counties. This area is overdue for reform and is an area where there are many ready-made jobs going, which would be very welcome.
Let us be absolutely clear that this is not an argument, as one or two people attempted to suggest, that there are those who are for jobs and those who are not. It is merely a consensus about the objectives but different views as to how we might achieve them. My main criticism of the Green Paper was made for me by the ESRI report by Duncan and Dowling. On the basis of that report we have seen the economy and the performance of the economy in the last 12 months—you can go back two or three years if you believe history did not start last year. Looking at what has been happening and at the level of Government borrowing to achieve very limited objectives and success, we have the very conflicting problem of having gone through a period of massive borrowing. Having achieved limited objectives we are now apparently going into a period in which one of the principal fiscal objectives is to have a lesser level of Government borrowing which should lead, in a normal financial context, to deflationary budgets. We have a fiscal policy that is moving towards deflationary budgets against a background that we have as objectives the achieving of double or treble the greatest level of the creation of jobs in this country. These objectives are fine but from what I know about business I would need to be a superoptimist—and I am not—to find myself agreeing that these objectives can be achieved by the methods the Government propose to adopt. The estimate of growth is inconsistent and has little chance of being achieved. While the present policy is stimulatory, the proposed fiscal policy will be deflationary and therein lies the root of the Government's problem.
The inflation projection—we spoke about this two or three weeks ago—to the end of 1979 and 1980 is 5 per cent. I find this incredible. I frankly do not accept it but I noted that since then the Minister has made some comments that he thinks it is probably a bit unrealistic to expect a 5 per cent rate at this stage. There are external factors which are dangerous. Because we are in the same sterling zone as Britain if we are basing assumptions on a 5 per cent inflation rate we are living in a fairytale world. We are not living in a realistic situation.
The "Buy Irish" campaign does not seem to be working. From my experience in the Dáil I know that there was an attempt made to push it as hard as possible at that time. When the new Government came into office in June of last year there were suggestions that our policy had not been the right one, that there would have to be a new, tougher policy in the "Buy Irish" area. This is not working because we see that, instead of 10,000 new jobs—through a switch of three pence in the £ of spending to Irish products—it is going in the opposite direction. From the figures we have, it seems that there is three pence in the £ loss to imports. This is gleaned from the fact that from August 1977 to February of this year retail spending increased by 19 per cent but imports of consumer goods increased by 39 per cent. Imports of consumer goods from August last to May of this year increased by 38 per cent. So the corollary is that it is not working. We need to stress that to buy Irish is absolutely vital if there is to be a sense of modern patriotism here. Patriotism means buying Irish when one can buy Irish, when the quality and price is right. But there are times when the Irish consumer finds it very difficult to buy Irish goods. That is a completely unacceptable position. There are a number of stores in this country in which it is extremely difficult to buy Irish drapery or a pair of shoes. When we have reached the stage that the consumer who has the will to buy good produce made in this country, when it is not necessarily even on display, asks if it is available and cannot get it, that is completely unacceptable. Last week I was in Dublin and wanted to buy a pair of socks. I went into a reputable store in this city and asked for a pair of grey socks, a very simple order. The salesman produced a pair of socks made outside this country. I said to him: "They are fine but I would like to buy a pair of Irish socks." He said: "I am sorry we do not have any." We are in a consumer age and, in a consumer age, one gives the consumer, presumably, what he wants to buy in terms of high fashion, style, design in shoes, certain kinds of suitings and so on. Certainly if it is designed in Italy, Switzerland, Britain or other countries the consumer is going to look for these things, and good luck to them, when we are in this type of age in which this country is dependent on exports more than any other country. But if we are reaching the stage where one cannot buy a simple pair of Irish socks in one of the most reputable drapery stores in this city we have reached a new low. Whilst legislatively no Government can do anything about that position, it is unacceptable and we should say so loudly and clearly.
Speaking of the west, one of the most seriously retarding matters where development is concerned—in the Mayo and Sligo regions—is the lack of an adequate airport, especially in the tourist industry where people are looking for package deals, are flying in from other countries and are not interested in driving perhaps for more than one hour from an airport. The north-west of the country is at an extreme disadvantage.
The south-east and south are covered by Dublin and Cork airports, the southwest and west, the west as far north as Galway city, by Cork and Shannon airports. In the west and east Mayo regions and going up through Sligo into Leitrim there is a critical problem because the nearest international airport is a very substantial distance away in either Shannon or Dublin. There is a very big limitation on the type and extent of development that could take place in these north-western countries if an adequate airport existed. When I say an adequate airport I am not talking about the type of airport into which scheduled national carriers would fly in and out. I am talking about the facility of an airstrip sufficient to take a reasonably-sized aircraft which would allow charters, at the very least, to fly in and out. At present the position in Mayo is that there is an airport two miles from Castlebar. But the limitations there are such that it is of extremely limited use. It is of use to private aircraft owners, for small charter crafts carrying, perhaps, six, eight or ten people at most. There is a further physical limitation in that it is placed in Castlebar between the railway line and the main road. As we know there are extreme difficulties getting across a main road at an airfield. It seems to me that one of two things must happen. Either some arrangement is made under which the people concerned in that airport, who have made numerous approaches to Government, get permission to cross that main road, to extend that runway or, alternatively—if finally that is not going to happen—something must be done about building a larger airstrip. And I am not talking about Castlebar only but about that whole region whether it be in Castlebar, Leitrim, north-east Galway or Sligo does not matter. In that part of the country it is a national weakness in tourism in the substantial industrial development taking place there at present and for the convenience of people living in the region. It is an important issue and I would like to read it into the record because, in terms of developments over the next generation, it will be a black mark until it is sorted out. If it is to be sorted out it might as well be sooner rather than later.
The telecommunications section of the Green Paper is quite unacceptable. This is one of the criticisms of the Green Paper. It is felt that there are a great many platitudes in it; there is a restatement of so many things on which we all agree, which we read about in Adjournment debates, by the Taoiseach, in the Budget debate, by the Minister for Finance, about which we read in the White Paper and in so many other papers. There are so many platitudes in it that one wonders whether—in the context of the White Paper having been issued and planning further down the line—it performs any more useful function than providing a focal point for debates such as this. The telecommunications section, a scant half page in a most critical area—one in which we had the most serious difficulties recently, not merely a strike situation but one in which telecommunications even at present are infinitely less than adequate—is an unacceptable contribution. Put into perspective it is receiving much less than worthy attention in the publication.
We might also revert to the dole issue because it has not been dealt with with any emphasis. There is the issue about which we are talking—full employment. We have the appalling inconsistency that, despite having job creation schemes and the apparent will of the Government to create more jobs, there is the anomaly that, in many parts of the country, and especially the rural parts, there is backwardness in simple road development, in drainage works, in public works schemes. Whilst all this is happening there is this massive sucking and sapping of people's energies, mentalities and physique and indeed the mental climate in their homes, through the paying out of the most colossal sums in unemployment assistance. In a very simplistic sense one wonders why these funds paid out in that manner could not be paid out to the same regions for productive work on the basis that many men are now getting probably two-thirds of a weekly wage for nothing and if this were done the net gain in so far as the Government, region and country are concerned would be fairly dramatic. That is an issue which, in the context of full employment, has not been tackled, is not being tackled and which is ripe for tackling. It is fashionable in certain circles to decry unemployment benefits and to be critical of recipients. I will only be critical of the dole recipients when some Government propose a scheme and these people refuse to go out to work on that scheme. Until that happens the obligation rests with the Government to take some initiative to get these people working. In County Mayo, for example, we have the largest backlog of untarred roads. A great deal of labour at present unemployed in the county could be used for the task, for hedge cutting, simple drainage works and so on. In an era when we are importing coal, large numbers of people could be employed in State schemes working the bogs. There is a huge vacuum at present in Government thinking. This is an area which is ripe for tackling, about which there is consensus but which requires leadership which should be provided.
I agree with the more recent thinking in some Government circles that there will have to be a measure of deflation in so far as our finances are concerned and that it is desirable that there should be a progressive reduction in borrowing as a proportion of GNP if we are not to compound our problems. It is appalling to reflect on the recent statement of the Taoiseach that almost £1 in every £5 is pre-empted to service debt and that this year's deficit in the current budget of £400 million is about half of total borrowing. On this whole issue of borrowing some Government spokesmen are being very unfair to this side of the House. The Minister for Finance has tended to come here and paint a fairytale picture which suggests that evil set in here in February 1973 and that the clouds lifted in June of last year but that nothing happened in between.
It is important to point out that, while before June of last year there was a substantial level of debt, that debt was incurred at a most critical time for this country. Present Ministers know all about it, but it may not be appreciated sufficiently by the people that we lived through two crises. The oil crisis meant massive justified borrowing. The EEC presented many problems, because while in the broader sense joining the EEC was very good for the country, it led to a great deal of inflationary pressures with the massive increases in food prices which led to pressures in the cities creating many problems which required substantial increases in social welfare benefits to a degree that would not have been necessary had we not joined the EEC. The financing in that era was absolutely correct. The right note was struck and borrowing was being progressively reduced. In 1975 borrowing was at a level of 16.9 per cent of GNP and in 1976 it was down to 11.5 per cent of GNP. Borrowing in the context of the events of 1974 here and throughout Europe is in a completely different league to borrowing in the context of 1978 where things are on the right track, where industrial exports are booming and where the country is in pretty good shape. For the future I support a reduction in borrowing as being the only sound policy unless we want to run into the most serious difficulties in years to come.
I read the OECD Report, which is not very sensational and has little to say in so far as the Green Paper and its objectives are concerned. I simply reiterate that we on this side of the House are in complete agreement with its objectives, which we define as being the creation of full employment. Where we differ is about the means whereby this might be done.
I add my voice to the various contributions on the Green Paper. I speak as a trade unionist and as a member of Fianna Fáil, which is the real labour party here and which has the backing of the majority of trade unionists. I hope that this charter, which gives everyone the right to employment, is fully and effectively debated. The editorial in the paper Liberty this month says:
A Green Paper is "a discussion paper". On this Green Paper at least, there is nothing to discuss.
Maybe that is the reason that there are no Labour members here to discuss this important document.
An Leas-Chathaoirleach
Senator, the presence or absence of Members should not be referred to.
It is an important factor in the discussions here that on a document such as the Green Paper, which is the basis for full employment, not a single member of the Labour Party is present. It is fair to put that on record.
An Leas-Chathaoirleach
I would remind the Senator that it is not in order to refer to the presence or absence of Members.
I bow to the Chair's ruling that I should not refer to the fact that Members of the Labour Party are not here. I will not refer to it on any further occasion. I will address some comments to the Labour Party.
An Leas-Chathaoirleach
The Senator is being deliberately disorderly.
I am not being disorderly. In an important discussion such as this one would think that one could at least refer to comments made in papers and that one could address comments to one of the major political parties to find out exactly how they feel in relation to certain aspects.
Fianna Fáil are the real workers' party. They have now produced a document, a workers' charter. We expect every party, including the Labour Party and the trade union movement, to discuss it effectively and to put forward their views. We have the views of many members of the Labour Party and many members of the trade union organisations in some of the documentation we have seen and to which I will refer in the course of this discussion. If it is an offence to stimulate public confidence in the economy, then we in Fianna Fáil have committed that offence. We have stimulated public confidence in the economy and we will continue to do so whether the Labour Party or the trade union organisations like it or not, because we have given an undertaking to the trade unionists and to the workers that we will do all in our power to ensure the development of full employment.
When the time comes we will see whether or not we have been effective. We can only be effective if we have the backing of every section of the community.
If the Labour Party are going to desert the workers by moving way from the ideal of full employment, we will accept their decisions and will carry on irrespective of whether the Labour Party are here to comment or whether they wish to comment on this only outside of the House. Apparently, they are not prepared to come here and listen to the responsible Members of the Upper House who wish to debate this document effectively and fully. The knockers, whom we have heard about and will hear more from in future, who have been vocal recently, have tried to distort the facts of the situation. I want to refer to the publication Liberty and to Mr. J.F. Carroll, Vice-President of the Transport and General Workers Union, who has been very vocal on many occasions, preaching on behalf of the workers. This is what he had to say in Liberty, July 1978:
The whiz kinds of the manifesto were now sounding warning notes and were cleverly trying once again to put the responsibility on the workers themselves for solving the unemployment crisis.
This is not correct. A paper has been produced which outlines details for discussion, but they are not prepared to come forward and discuss them. He goes on to say:
It was clear that these same whizkids were trying to set us up. They were opening up their campaigns to use work sharing as a means of dealing with unemployment by reducing existing weekly working hours, without maintaining existing levels of wages or earnings.
I want to say to Mr. Carroll and other members of the trade union organisation that I, as a trade unionist, repudiate what he says. Over the years the trade union organisation and their responsible members have been endeavouring to reduce the working week of the workers, not alone of this country but of other countries too. They have tried to reduce the number of sweat-shops and move the workers into an atmosphere where they would have a reasonable degree of recreation. Now, we find the vice-president of a trade union condemning Fianna Fáil because they are endeavouring to ensure that the conditions of workers will be better in the future.
I, as a trade unionist, gladly accept the responsibility of furthering the rights of the workers and their conditions of employment. As we look back on the records of both Houses of the Oireachtas, we see deeply engraved in those records the great strides made throughout the years to better conditions of employment, to improve holidays and all the other social improvements for workers which emanated from various Fianna Fáil Governments. We today are no less responsible than the people of those years. We will ensure that the good work done in the past will be maintained in the future. We will not be deviated from that course by the absence of the knockers from the House here tonight or tomorrow. We will comment on the remarks they have made. The knockers of the past will be vocal in the future too.
There are continually changing problems in an ever-changing world. We are living in a large community and the problems of that community are our problems. We must face up to these problems realistically. Fianna Fáil are concerned about every worker in the country. This is a charter which gives everyone the right to work. With the collective effort of every member of the community—trade unions, Fine Gael, Labour and Fianna Fáil—we can go forward and realise the terms of the charter. That is what we are going to do.
I had hoped that by this stage trade unions would be an independent force in society, that they would be independent of the shackles of politics; but unfortunately they are not. Listening to Members we see how they are shackled by the Labour Party. When we read their documents we find that their members are crying out time and time again about the fact that they were tied to this right-wing reactionary group, as they referred to Fine Gael. At a recent vote taken, it was decided by 91 votes to 98 that they would not participate with this right-wing reactionary group they state has been the downfall of the workers. That was a very slender margin. Now they have an opportunity to place on record their views in relation to this country and to the future prospects of every Irish man and woman, disabled or otherwise to have an opportunity to earn a living in the community. This is what Fianna Fáil aim to do and we will not be deterred by the knockers. We want to hear the cash registers ringing out more often in the retail stores. We want to ensure that the factory wheels are turning faster and that many new orders come into the country.
We ask that the trade unions examine their conscience in relation to the problems of society, in relation to the problems of the workers. Let us have no more Ferenkas in the country. Let us ensure that sanity will prevail in the discussions which will take place in relation to employment. Let us ensure that good employment, which has been brought to the country, is maintained. Let us ensure that the people who intend to come here will not be turned away by the comments we have heard from members of the trade union organisation.
No doubt there are in the trade union organisation many outstanding individuals who have made a substantial contribution to the conditions of workers in the past. Unfortunately, there are many others whose voices come through loud and clear, time and time again, whose only concern is to knock the Fianna Fáil Party. We can see this clearly in the newspapers or in the papers produced by the various organisations.
I want to refer again to Liberty, July, 1978, in the absence of any Labour member here. There is an article by Vice-President John F. Carroll with the headline “No way a pay cut-back”. The Green Paper never said there would be a pay cut-back. This type of confusion, which is running through the comments coming from irresponsible members of the trade union movement, will only delay the day when we can have the type of development which we all hope for in the future, that is, full employment. If we are to have full employment we want John F. Carroll and others to take a responsible line and not try to confuse the issue with that type of statement. If they want to examine the Green Paper critically, that is their right in this democracy. But they should put forward their views seriously so that the Minister and the Government can examine them in detail to see if there are any satisfactory aspects from their point of view. I challenge the trade unions now to put forward a constructive point of view so that we can reach full employment. Let us not reach a stage where we are ensuring that full employment will not take place because a climate is being created by certain people in the Labour Party and trade unions that it is not possible.
These are the aims of the Green Paper and we must discuss them now. The Green Paper is a discussion document. If members of the Labour Party are not prepared to come forward and discuss it, then they are throwing in the sponge at a very early stage. I want to refer back to what I said at the beginning. The editorial of Liberty, the paper of the Irish Transport and General Workers Union, states that there is nothing to discuss on the Green Paper. I know there are many responsible officials in the Irish Transport and General Workers Union, as there are in many other trade unions. I know that the majority of members of the Irish Transport and General Workers Union have supported Fianna Fáil. I call on them now to ensure that this document gets the recognition it deserves, they should speak up fearlessly at their trade union meetings to ensure that the less fortunate people on the dole have an opportunity of getting the best type of employment that is available. I know that the Government's effort to reduce unemployment will not be deterred by the knockers. The Government's efforts will continue until they achieve their objectives. We should get together to ensure that the less fortunate people get the opportunities they deserve.
Let us ensure that the dole queues are shortened in the quickest possible time. Let us ensure that the issues are not clouded by irresponsible statements. Let us ensure that the issues that are put before members of trade unions and other organisations are not clouded by political bias but are put forward on their merits in relation to the Green Paper.
Quite a lot can be said on the Green Paper. Much has been said of its technical aspects. I am not going to deal with these aspects as they will be dealt with by other Members of this House. My call is for a collective effort in this House. If any Member of this House or of the other House disagrees, that is his right in this democratic society. If any Member feels the Green Paper is a farce, let him say so and point out where it is wrong. There are aspects of the Green Paper on which we agree, as Senator Staunton and others admitted. Agreement should be reached as quickly as possible in order to reduce the dole queues.
For many years we were ahead of the ILO in many aspects of conditions of employment. We are no less concerned today with conditions of employment. We are concerned with the paypackets of the workers; we are concerned with the leisure hours of the workers; we are concerned with all the problems of the workers. This document relates to the problems of the workers. We intend to ensure that the views of Fianna Fáil and the other Parties, if they are present, will be noted in the record of this House. The record of this House will enable us to point the finger at the people who are not interested in full employment.
Much has been said about work-sharing and I shall refer to that briefly. I am not going to detain the House because I know that there are responsible Members who want to express their views in the limited time available to them. Our conditions are different from conditions elsewhere, as Senator Staunton said. When comparing our unemployment situation with the unemployment situation elsewhere we must consider a variety of factors. On that score I agree with Senator Staunton.
The unemployment figures in Germany, Italy and France have been mentioned here today. When considering their unemployment figures, we should take account of the 235,000 people conscripted into the armed services in Germany; the 274,000 people conscripted into the armed services in France and the 211,000 people conscripted into the armed services in Italy. That is only one aspect. There are very many others.
When Fianna Fáil came into office the position was getting worse. If we had not taken action we would be in a sorry state today. The reduction in the unemployment figure is there for everyone to see. We can look back with pride and forward with confidence because we know that we have reduced unemployment and will continue to reduce it despite any efforts to the contrary by other groups. If the position had remained as it was under the Coalition Government we would be in a sorry situation today.
As a trade unionist and as one who has worked on the shop floor and been a member of the executive of a trade union, I understand the people on the shop floor. I understand the people in industry. I understand the position at executive level in trade unions. I know what it is all about and I call on responsible members of society in the trade union organisation to support the party that they supported so effectively on polling day 12 months ago to ensure that their friends and their relatives—fathers, brothers and sisters—will be taken off the dole queue as soon as possible. Let them come forward and not be intimidated as they have been on many occasions in the past. I know that responsible members will make their voices heard. Having considered their views and the views of politicians of all Parties, we can go forward. It is regrettable that the Labour Party, who should be interested in full employment, are not represented here today.
In this debate on the Green Paper it is appropriate to go through the document and point out the implications and dilemmas which will arise as a result of the Government seeking to implement all or part of the proposals.
On page 13 the Green Paper sets out the targets which the Government have set, targets which are no different from those that any Government of this State would set at any time. These targets are for reducing the number out of work, easing the pressure of inflation, increasing national output and lowering the Exchequer's borrowing requirement.
These are commendable targets for any Government to have but they are aspects of control which have been operated by Governments as far as possible. In fact the numbers of unemployed had already begun to reduce before the change of Government last summer. Inflation had been decreasing since early 1977. The national output had increased extraordinarily in 1976 and also in the first half of 1977 and the borrowing requirements which the Coalition Government in 1974 and 1975 had to face to meet the heavy cost of meeting its expenditure during the recession had been faced up to as regards reduction in the budget of 1977. I do not think the present Government were elected by the people of this country to spend so much time, indeed what will amount to all of 1978 in discussion of both a White Paper and a Green Paper before it makes decisions in regard to implementation, at the earliest, in 1979. This Government was elected 12 months ago to act quickly and promptly.
The scale of the problems is spelled out in the Green Paper on pages 14 and 15. It is really indicative of the tremendous task which has faced all Governments over the past two decades. It is extraordinary to read that the total number at work has actually decreased from 1965 to the figure obtaining now. Notwithstanding that the 1960's are generally regarded now as boom periods, we find that at the end of that 12-year period the total number at work in this country has actually decreased. It is further seriously pointed out that, while the non-agricultural sector contributed mostly to the increase in jobs over the years, the great majority of these jobs were provided in the services sector, particularly in the public sector. This I think highlights the dilemma which faces this Government or any Government, namely, to continue on that trend would mean an increase in the numbers of jobs in the public sector thereby increasing costs in that sector which inevitably means greater borrowing or increased taxation.
On page 18 of the Green Paper the Government conclude that constraints must be exercised in those areas where the bulk of Government spending takes place. In the light of experience over the past 12 years, where the greatest number in the increase in the total of persons involved in work was in the public sector area, the Government in concluding that we must in future show considerable restraint in this area are thereby placing themselves in a dilemma. The Green Paper sets out the various headings under which they must act to increase the number of jobs to what was projected in the White Paper from what has actually been the experience from year to year. It states these headings to be the preservation of existing jobs; the industries small sector, the State-sponsored sector and marketing, research and development. I find what the Green Paper has to say in regard to preservation of existing jobs peculiar, certainly in the light of an experience in my own constituency in the past week where a factory employing 450 people has been placed in the receiver's hands. To highlight this contradiction between what is in the Green Paper and what has happened in County Louth in the past week I will read the Green Paper. It says on page 43:
Efforts to maintain on a sound basis existing manufacturing enterprises and to preserve at the highest possible level the jobs in them has always been a feature of our industrial strategy ... efforts to preserve existing jobs on a sound basis will assume an even greater significance than they have in the past.... It is recognised that some losses are inevitable as part of the process of restructuring and adaptation and that it would be shortsighted to give financial support to firms which do not have reasonable prospects or viability. Nevertheless, because the losses have been so extensive and have been concentrated in a few areas, measures to safeguard existing employment must be an integral part of the action needed to reach manufacturing employment targets. They must be framed, however, with regard to Irish obligations as a member of the EEC and as a party to international trade agreements.
I quoted the example of the factory employing 450 people in the manufacturing of domestic appliances such as refrigerators, kettles et cetera having been placed in the hands of the receiver because Fóir Teoranta refused to subvent it to any further extent than in the past five or six years. If the words in the Green Paper mean anything, that because the losses have been so extensive and have been concentrated in a few areas, measures to safeguard existing employment must be an integral part of the action needed to reach the manufacturing employment targets, the case of this factory certainly falls within the ambit of that sentence. I see no reason why the Government should not continue to give assistance to such a factory because the losses that have been incurred in that particular industry have been concentrated ones and represent a special case and, the numbers involved who will lose their employment are very considerable, it is an exceptional industry in the Irish context and therefore it is hard to understand why Fóir Teoranta should not have seen its way to continuing subvention for the future and particularly as a period of three years was regarded as being the shortest period within which that factory could be seen to reach a viable stage and the fact that only after two years of that period it has been decided to send in the receiver. It is not encouraging when one reads the Green Paper's objective as regards the preservation of existing jobs.
On page 57, the Green Paper spells out the importance of works on our infrastructure aimed at creating additional jobs. Here, the Government have to face again the dilemma in which it will inevitably find itself in spending moneys on our infrastructure. It admits that in spite of the fact that additional money allocated to roads would create more construction jobs if devoted to minor schemes, it is considered more advantageous to allocate the great bulk of any additional funds made available to major schemes because of the vital contribution which improvements in the principal road network can make to the overall environment for development and employment creation. That indicates again the problem confronting the Government as regards spending money where it would create the greatest number of jobs as against spending the money where a lesser number of jobs would be created in the short term and highlights the problem confronting the Government as regards reaching its employment targets spelled out so admirably—let us admit—at the beginning of this Green Paper.
The Green Paper further goes on to admit that by 1980, 80,000 people would still be out of work but suggests that this figure by 1983 should be reduced to 65,000. But then it takes the most extraordinary leap by saying it will tackle the problem of arriving at the stage of full employment and eliminating unemployment altogether—"abolishing unemployment completely" are the words used—within five years from now. It puts forward two options as a means of achieving full employment, work-sharing and further programmes of Government-induced job creation. There is no harm in spending some time on what these options are. That of work-sharing has received the most discussion in the media and at various meetings throughout the country. In identifying the cost of that work-sharing programme, the Green Paper on page 71 tries to give an idea as to what the sums of money involved would be. It stated:
... a sum equivalent to about 8 per cent of non-agricultural wages and salaries, or roughly 5 per cent of all incomes in the present year would be needed by 1983 to raise the total net cost of residual job creation programme. It should also be made clear that a similar degree of contribution ... would be needed under the work-sharing option ... those who have employment already must be prepared to make the financial contributions and provide the opportunities of work for the unemployed.
In stating that, the Government really are putting out a challenge to all the citizens of this State. To try to place it on an individual basis, to me it would appear that an average of between 5 and 10 per cent of income would be required from a citizen and, in addition, he would have to take part in the sharing of overtime, or indeed the phasing out of overtime altogether, accept a slower rate of increase in wage or salary levels, plus fewer opportunities for additional earnings. That is a very hefty challenge to any worker in this country and I wonder whether the attitude of the public is such as would welcome it.
One has only to go back to the election of 1977 when no such challenge was held out to the citizen. What was held out to them were tax cuts and nothing was asked in return except a vote. Now they are being asked to contribute a percentage of their annual income and also, if the programme is to mean anything over a long-term basis, to participate in the sharing or phasing out of any overtime that they have. They are also being asked to accept a slower rate of increase in wage or salary levels and fewer opportunities for additional earnings.
Debate adjourned.