I move:
That Seanad Éireann takes note of the White Paper: Programme for National Development 1978-1981.
White Paper “Programme for National Development, 1978-1981”: Motion.
The White Paper, "Programme for National Development 1978-1981", is the latest in a series of planning documents published by the Government. It outlines the programme of action which the Government are undertaking to develop our country and to improve the employment prospects of our people, especially our young people. The Government's programme is founded on faith in the ability of the Irish people, when given the required leadership, to make the most of their opportunities—and not to throw them away by ill-advised action—and to overcome the problems which beset us. In providing the required leadership, the Government intend to defeat the protagonists of despair who see the Irish nation, stricken by sectional interests, pursue lemming-like the path of high inflation and diminishing growth. Let there be no doubt but that such a dangerous path beckons the nation. The Government's programme is the positive alternative, which points the way towards the path of sustained progress.
This almost needs background music to give it the full flavour.
I do not know if it is normally the custom of the House to interrupt speakers, but if the Senator proposes to be so discourteous she can be assured she will be treated in like manner.
Very touchy.
The Minister must not be interrupted.
I was given to understand that the Seanad prided itself on its good conduct in its business.
The Minister please, without interruption.
The strategy adopted by this Government since we assumed office has been designed to restore the confidence of our people which had been shattered during the recession years, and once again unleash the dynamism which had transformed the economy in the late fifties and throughout the sixties. It was necessary to harness that dynamic towards a particular priority: the creation of employment for our people. The Government's strategy called for an initial three-pronged attack on the problem:
—an environment conducive to investment was provided by enhanced fiscal incentives to growth and by the overall redirection of policy;
—income restraint was encouraged by substantial income tax reliefs; and
—a massive programme of job creation in the public sector was put in hands.
That strategy has worked extremely well. Over 30,000 new jobs were created in 1978. Because of redundancies which continued at a disturbingly high level, the net gain in employment was in the region of 17,000. However, even that figure is a remarkable achievement and in fact represents the biggest advance in employment creation ever placed on record in this country.
This achievement in the employment field was accompanied by advances in other areas. The growth in output, of the order of 7 per cent, was more than twice the EEC average. Indeed, I might mention at this point that even if one takes the more pessimistic estimates of the rate of growth of output in 1978, this country's performance was still about twice that of the EEC average.
A particularly satisfactory feature of 1978 was the increase in total investment of about 15 per cent and in private investment of about 19 per cent, both in real terms. This development was a direct response to the Government's overall strategy an in particular to the fiscal incentives for investment provided through the 1978 budget. Investment expenditure not only has contributed to the high growth achieved in 1978 but, by enlarging the capacity of the economy, will facilitate growth in the years ahead.
Other developments of significance in 1978 were:
—the increase in personal consumption of about 9 per cent in real terms which is important in assuring investors that the demand for increased production will exist;
—a rate of inflation averaging just over 7½ per cent compared with an average of 13½ per cent in 1977;
—the substantial growth in exports in real terms of about 14 per cent achieved against an overall growth in world trade of about 5 per cent;
—the balance of payments deficit of about £150 million which was significantly lower than estimates made early in 1978.
At this point I will distinguish between targets and forecasts, because of the variety of comment both in the Oireachtas and outside the Oireachtas about the apparent divergence between the Government's targets and many of the forecasts for the economy for the current year. I should explain that no one can predict the future with certainty. Therefore, the task of a forecaster—that is, somebody who is setting out to seek to describe or define or specify the most probable pattern of developments as viewed by the forecast in question—is to survey the range of perspective outcomes and then to seek to home in on these particular numbers which the forecaster regards as the most probable. I should emphasise that even there any forecaster is still dealing with probabilities.
The whole thrust of Government policy is not to settle for the average, the normal, the run of the mill, the repetition of the past, but rather deliberately to set out to change things, and of course to change them for the better. The purpose of the Government approach to this whole area is to seek to identify the most rapid development path which can be achieved rather than to identify the series of actions which would be necessary in order to realise this more ambitious development path, and to set those forth as the targets for which we ought, as a nation, to strive. That, I hope, will finally, once and for all, put an end to the irrelevant, misleading, confusing and nationally unhelpful attempts which have been made by some people to mix up this whole question of target-setting: planning on the one hand and the routine business of economic forecasting on the other.
Having disposed of that general background point I will comment quickly on some of the individual targets. Having made a successful start, the task for coming years is to launch a second phase of sustained growth designed to set us on the path to full employment within five years. For the three years 1979 to 1981, the main targets set by the Government are:
—a reduction of 25,000 a year on average in the numbers out of work;
—a reduction in the rate of inflation to 5 per cent by the end of 1979 and to below 5 per cent by 1981;
—an increase in national output of 6 per cent a year on average;
—a reduction in the Exchequer borrowing requirement to 10½ per cent in 1979 and to below 8 per cent by 1981.
It may be useful for me to comment briefly on these targets.
The first point to emphasise is they are targets, not forecasts; that is they are statements of objectives which can be achieved provided the effort and other supporting action needed to attain them is forthcoming. They are not attempts to indicate what the actual pattern of behaviour will be. These targets are ambitious, but also realistic and the first step must be to mobilise support for the action programme needed to achieve them.
The primary objective of policy is to achieve the greatest possible increase in employment, and there should be no doubts in anyone's mind about the seriousness of the Government's commitment to their employment targets. The policies outlined in the White Paper for the various sectors, to which I will return later, are expected to support a net increase in employment of the order of 18,500 a year on average over the three-year period. The Government do not see this as enough to reduce unemployment as fast as they think is socially and economically desirable and have, therefore, set a higher target figure than can be met by the normal processes of the economy. To meet the target figure of a reduction of 75,000 in the numbers out of work, some 6,500 extra jobs a year are required. The Government have decided on a programme of further action to meet this additional requirement and last month's budget allocated £20 million for this purpose in the current year.
As part of that parliamentary programme, primary emphasis will be placed on direct job creation in the public service and through the extension of community services and training opportunities. Developments with regard to work-sharing and the proposed introduction of measures to encourage the expansion of residence-related employment will also make significant contributions. In addition, it is proposed to establish a special hire agency which will organise temporary employment. This, too, is envisaged to make a significant contribution in regard to additional employment opportunities.
Youth employment schemes are a major element in the direct job creation programme, accounting for over £9 million of the £20 million referred to. Taken in conjunction with the allocations for such schemes in the pre-budget Estimates, this means that some £12 million has now been provided for youth employment in 1979. This will allow for more than a doubling of last year's level of activity in this area.
The special job creation package for 1979 includes a new scheme recommended to the Government by the Employment Action Team, whereby voluntary organisations will qualify for special development grants to enable them to recruit young people for development work. The introduction of further new schemes for youth employment is also being considered.
I draw attention to this item not because this will itself provide a great deal of additional employment in 1979 but because we view it as an important step in laying the foundation for further progress in 1980 and subsequent years, and also as an important way of involving young people in the formulation of the programmes required to meet their needs and to solve their problems. I might add that this and further new schemes for youth employment will receive further consideration and we would expect to bring forward additional programmes of action in these areas.
Finally, by way of general comment on this employment aspect I might add that the target is expressed in terms of a "reduction in the numbers out of work" as being the most accurate and least controversial description available. Part of the 25,000 annual reduction for example will take the form of increased numbers of young people in training programmes. Such people are thereby not "unemployed" in the sense of being available for work, but equally it might be regarded as confusing to describe them as being in employment. Hence a reduction of 25,000 in the numbers out of work would be associated with an increase in employment as normally measured of somewhat smaller amount.
I would also emphasise that of course this target does not refer to changes in the live register. While the live register is a useful indicator of unemployment trends, it is not an accurate measure—indeed some research work suggests that on average an increase in employment of 100, is associated with a fall of between 53 to 67 in the live register—in other words the movement in the live register is only about ½ to ? that of the movement in employment. Quite clearly, therefore, the live register could not itself constitute a satisfactory basis for measuring performance. The target for inflation is to aim for 5 per cent rate by the end of this year. The White Paper states at paragraph 2.11 that "at present the underlying inflation rate is around 8 per cent". Quite clearly, therefore, if we begin with the situation where the underlying rate is 8 per cent and where we are talking about it, the target being to bring it down to 5 per cent by the end of the year, I fail to see how any reasonable person reading the relevant paragraph of the White Paper could ever have formed any impression that the target was one of a 5 per cent inflation rate in 1979 as a whole. It requires an incredible inability to understand normal use of the English language to arrive at such an interpretation.
I might add, of course, that since that sentence was written in paragraph 2.11 that "at present the underlying rate of inflation is around 8 per cent", there have been the indirect tax increases announced in the budget of which the Government would have been aware when the White Paper was being published, but for the normal budget secrecy it would have been improper to indicate the likely price changes that would arise as a result of budgetary action. I might say, then, that these indirect tax allowances naturally further raised the figure for inflation for the early months of this year. It is not yet clear whether these tax changes will be reflected in the mid-February consumer price index—which will become available about mid-March. If so, then the price rise for the November-February quarter will very likely be in excess of 4 per cent. If they are not so fully reflected, naturally the price rise for this quarter will be somewhat lower, perhaps in the 3 per cent region. Then, correspondingly, the figure for the February-May quarter will be somewhat higher. So it depends on the precise timing of the indirect tax increases on the observed price index. Whether these tax increases are fully reflected in either the February or the May figures, we would envisage that in the later quarters of the year the rate of price increase would be expected to decline towards the target figure of 1¼ per cent for the final quarter, the August-November period. That would be an annual rate of inflation of 5 per cent, which is the Government's target.
The third important target area of policy is the target for Exchequer borrowing. This, as we know, will call for the reversal of the trend in 1978. The Exchequer borrowing requirement was increased temporarily in 1978 in order to launch the first phase of our strategy, but as our manifesto made clear the level of borrowing must then be reduced. The high level of borrowing during the recession years has left us with a heavy burden of debt, the interest on and repayments of which constitute a drag on economic progress. This burden is all the heavier because such a high proportion of that debt was incurred, not to finance productive capital investment which would have generated the income to meet the debt service, but for current purposes.
Within the total of public expenditure, it is a crucial part of the Government's strategy to alter the balance in favour of productive and infrastructural expenditure. This will not only relieve the burden of debt service in future years but will also improve the efficiency of the economy which is a key condition for the attainment of the ambitious targets set in the White Paper. By comparison with the 1978 budget when an estimated 8.6 per cent of GNP was allocated by way of the Public Capital Programme for productive and infrastructural investment, the Public Capital Programme for this year provides an estimated total of 9.5 per cent of GNP which is a very substantial increase, all the more creditable when taken against the background of substantially reduced Government borrowing.
One of the more controversial measures which the Government took to contain current public expenditure was the reduction in the level of the food subsidies. The Government consider, and most thinking people would agree, that these subsidies, which were introduced nearly four years ago as a measure to combat inflation, then running at well over 20 per cent, can no longer be justified. The subsidies must be paid for out of taxation and represent a use of tax revenue which is not selectively directed to meeting need. It is important that scarce resources should be directed to where there is need for them. The Government, therefore, decided to reduce the subsidies which indiscriminately benefited rich and poor alike and to compensate those with smaller incomes through the substantial increases in children's allowances, social welfare benefits and income tax allowances granted in the budget.
A modern expanding economy must be supported by adequate infrastructure and growth can be constrained if this condition is not met. That some elements of our infrastructure are inadequate for present needs cannot be denied. Infrastructural development was deprived of capital during the recession years so that the rapid advances in the economy since the Government took office have overrun existing capacity in some instances. This is a problem arising from the very success of the Government's development strategy. As foreshadowed in the White Paper, the budget introduced last month provides for substantial increases in capital investment in the vital areas of roads, telephones and sanitary services. Further substantial increases can be expected in 1980-81.
The primary objective of Government policy in the years to 1981 will continue to be to achieve the maximum increase in employment. The employment target set in the White Paper for the next three years is an average increase in the region of 25,000 a year which will reduce the numbers that would otherwise be out of work by a somewhat similar figure. Developments to date indicate that this basic policy approach can be sustained and is supported by the great majority of our people. Continued maintenance of our present momentum will enable sufficient progress in employment creation to be made by 1983, so that unemployment can be eliminated by the end of that year.
Having summarised the main policy targets I would now like to comment briefly on the two sectors which must underpin and provide the major impetus to growth, namely industry and agriculture. The estimated growth of almost 10 per cent in the output of manufacturing industry and the strong growth in productivity in 1978 illustrate the rapid pace of development in the industrial sector. While the estimated increase of 7,000 in employment was less than expected, it nonetheless compares favourably with past experience.
The industrial sector is expected to be the main source of future job creation, with manufacturing industry providing an annual average increase of 10,000 jobs a year over the three-year period to 1981. The creation of these jobs depends on many factors, but ultimately, these all boil down to an increase in the output of marketable goods. The key word here is "marketable". Unless the goods which Irish industry produces are competitive on both the home and export markets, then we will not achieve the rate of output growth necessary to attain the employment target. On the contrary, our balance of payments could deteriorate to the point where corrective action would be called for and such action would be certain to result in business failures and redundancies.
The eventual establishment of the European Monetary System will provide industry with a more stable monetary environment within which to conduct trade with the other participating member states. This greater monetary stability should also enhance the prospects for attracting mobile international investment to Ireland. On the other hand, membership of the EMS will bring home to us with unaccustomed speed the consequences of a less than reasonable approach to the management of our affairs. The EMS is therefore a force which we can choose to use to our own advantage or disadvantage.
The Government for their part have sought to provide a climate which will encourage the maximum development of industry. As a further step in this process it was recently decided that company tax for manufacturing industry will be reduced to 10 per cent on profits derived from both home and export sales from 1 January 1981. Companies can therefore plan ahead with a greater degree of confidence.
The Government will continue to do all in their power to ensure that industrial progress is sustained not only where they can take policy action directly but also where the conditions of growth are amenable to indirect Government influence. However, the Government's measures have to be complemented by an appropriate response from both sides of industry. Management must seek out and develop opportunities for increasing output and employment and workers must take account in their wage demands, and in the action taken in pursuit of those demands, of the adverse effect on employment prospects, be it their own, their fellow-workers' or their own children's.
Given the rapid inflow of new IDA-assisted projects and provided the external environment does not deteriorate, industrial output should continue to grow at about 10 per cent annually and the White Paper target of an average annual increase of about 10,000 in manufacturing employment over the period 1979-1981 should be achieved.
The performance of the agricultural sector over the last two years has been remarkable by any standards. As a result of spectacular growth in gross output in 1977 and 1978, the target set in the White Paper of January 1978 of a 25 per cent increase in gross output in the four-year period to 1981 is now likely to be exceeded.
Membership of the EEC has of course been the dominant factor underlying the advance of Irish agriculture since 1973. EEC membership has replaced uncertainty about the disposal of farm produce on the volatile and generally low priced world market with guaranteed access to high-priced markets. This has provided Irish farmers with the confidence they needed to invest in their farms and increase their production.
While the scope for a direct contribution by agriculture towards the employment targets of the White Paper is limited, agriculture has a crucial role to play in a number of areas: agricultural production provides raw materials for processing in the food industries where there is considerable potential for future employment growth; agricultural exports also make a substantial contribution towards improving our balance of payments. Moreover, rural prosperity is to be welcomed not only for itself but also for its beneficial spillover effects on the commercial and industrial life of the country as a whole.
Government policy aims at encouraging still further the development of Irish agriculture. Already many measures have been taken or put in train to increase productivity: the field and arterial drainage programmes have been accelerated, the advisory services are being re-organised and the interests of Irish farmers within the context of the common agricultural policy are being protected and advanced on a continuous basis in Brussels. It is in nobody's interest to contain in any way the growth of sound, progressive farming in this country. It is certainly not the Government's intention to do so but rather to see that farmers and their families share in and contribute to the general economic advance that is planned for in the White Paper. In this context, the Government expect that farmers will pay their fair share towards the Exchequer's revenue so that Government-financed employment measures and desirable public services will not have to be foregone.
One of the crucial conditions for the attainment of the White Paper targets relates to the development of incomes. Our targets will not be achieved if the incomes increases of last year are repeated. What we pay ourselves must be matched to the needs of the economy. If it is not, competitiveness, and consequently output and employment growth will suffer. The new jobs which are so badly needed will not materialise and prices will surge upwards again to the take-off point of a dangerous inflationary spiral. The experience of the accelerating inflation of recent years, with its attendant social injustices and economic dislocation should be fresh in our minds and should prevent us from re-embarking on a similar course. It would be particularly tragic if we were to ignore the experience of the recent past at a time when the country has recovered its self-confidence and an expansionary momentum has been built up. The chance, now available to us, of providing jobs and raising living standards for all our people should not be thrown away. A heavy responsibility rests on anyone who, through self-interest, jeopardises the attainment of the goals within our grasp.
The Government have a clear duty to ensure that incomes develop in a manner compatible with overall economic strategy and, in particular, with the overriding objective of achieving full employment within five years. For that reason, the Taoiseach has suggested that unions and employers might come together with Government to relate future income developments to developments in other income-related areas such as taxation, social services and procedures for the ordering of industrial relations with a view to arriving at a comprehensive understanding on the action to support the employment goals which the Government have set.
This White Paper—like last year's— does not deal with the whole question of development in the area of social policy in any detailed manner. This was a subject on which a number of Members in this House commented last year when we had a somewhat similar debate. I pointed out at that time that I did not feel that it was feasible to come forward with any comprehensive statement for development in the social area because of the lack of information and also because of the necessity first to generate a sufficient basic momentum in the economy. In that sense the current White Paper is somewhat similar to last year's. However, in Chapter II of this year's White Paper there is a relatively brief section indicating the principles which will underlie the Government's approach to the formulation of social policy. I would hope that, if sufficient agreement can be achieved on the lines to which I have just referred, with trade unions, employers and other important interest groups in the community, it would be possible within a relatively short span of time to come forward with a comparable programme for development in the social sphere. In the absence of such a broad-based consensus and given that the overriding priority for policy in the immediate future must be the emphasis on employment creation, it would have been inappropriate to have attempted what would of necessity have been an incomplete and potentially misleading statement in that area. I mention that point to anticipate some possible questions which might legitimately be raised by Members of the House.
The creation of the maximum additional employment would itself be a profound step forward in the whole social area. Prolonged unemployment can itself be one of the major influences giving rise to poverty, deprivation, family stress, juvenile crime and many other unwelcome social characteristics in our society.
The targets set in the White Paper for the period to 1981 and indeed the targets set previously by the Government, have been criticised as being too ambitious. The targets are certainly ambitious, but they are also attainable. They are based on an objective assessment of the potential of the economy. This potential may not be realised, due to factors which are outside our control or due to our own misguided actions or pursuit of sectional interests at national expense. I think, and I believe the House will agree with me, in setting targets for economic and social advance, we should not settle for what is readily attainable. That would not meet our needs and would be essentially defeatist. It would be to concede that the Irish people cannot rise to the challenge and make the progress which is necessary if the economic and social objectives that we seek are to be achieved. It would involve acceptance of high levels of unemployment for many years to come and a resumption of large-scale involuntary emigration. The Irish people are entitled to expect a more imaginative, dynamic and positive approach from their Government.
The Government have done and are doing what we were elected to do. We have restored confidence and set the economy on a rapid growth path. The Government believe that the country can continue along this path and repeat in 1979 and subsequent years the remarkable results that have been secured in 1978. The attainment of such results cannot be guaranteed by the Government alone. Success can be achieved only if, as a nation, we are willing to act in the manner needed for success.
We cannot repeat in 1979 the excessive income increases which took place last year. Within the private sector such increases will be paid for by lost orders and lost employment; within the public sector Government revenue would have to be diverted from the special job creation programmes to increase the pay of those already at work. likewise, we cannot continue the luxury of settling our disputes by lengthy stoppages which result in damage out of all comparison with the cause of the dispute and, perhaps more unjustly, extend that damage far beyond the interests of the immediate protagonists.
Many of our problems stem from an apparent belief that the various groups in society are entitled to pursue their own narrow interests unfettered by consideration of how they affect others and that the function of Government is to pick up the pieces. Indeed much criticism of Government comes from groups whose very actions have given rise to the difficulties of which they then complain.
There are, of course, limits to the ability of the Government—of any Government—to steer a modern economy along a steady path of development. Some of these are external, of which the potential dangers of the situation in Iran provide a striking current example. It is, therefore, all the more compelling that we act sensibly in managing that part of our affairs over which we have control.
Already during our short period in office there have been giant strides forward. The progress of last year shows that our problems will yield to vigorous and decisive action. But we must not allow this early advance to lull us into the mistaken belief that ultimate success in attaining full employment will come automatically or effortlessly. We need a resolute, sustained onslaught over a period of years to guarantee that result. It is now for the various interests in the community to participate constructively with the Government in formulating the action needed to launch us firmly on the path to full employment.
I congratulate the Minister on his speech. It is a lucidly composed document in striking contrast to the quality of the composition of the White Paper which is the subject of this motion and one must regretfully conclude that the Minister did not compose the White Paper in its entirety. One can, unhappily, visualise the circumstances under which the various loads of bilge were poured in from the different Departments to fill up this document which is the subject of our debate.
The document, which is 122 pages long, is essentially no longer than some Acts of Parliament which I would find a great deal easier to read because I know that they had a form in the mind of the ultimate draftsman and each paragraph would relate to another. I must confess that this document has impeded my preparation for this debate. I found the White Paper, which I read and re-read when it first came out, extremely difficult to read, again because of the absence of appropriate cross-references. I do not want to get into a trivial debate, but I, and I think everyone else, would have found it more helpful if the document had always referred back—as it did in some paragraphs—to equivalent paragraphs in the Green Paper the decisions on which were to be in the White Paper. That is in a sense a trivial complaint which is capable of being overcome.
It is my duty here to complain about the White Paper, not to praise it; there are plenty of people here whose duty it is to do that. That does not mean that I do not see good elements in the White Paper which I am sure others will see and draw attention to. It is my duty to make criticisms in which I believe, and only such criticisms. My main criticism of the White Paper concerns the Minister's speech. One could sail along through a large part of it quite happily but when one comes across phrases like "already during our short period in office there have been giant strides forward", one asks the Minister whether he is being true to his best self, his very real academic attainment and the real reputation which he enjoys, when he attaches his name to a proposition of that kind. It would be a very wrong thing indeed if it came forth from even an Opposition Member of this or the other House that this economy has not been making considerable progress. Of course it has, but it would be equally wrong to send forth the message that this progress all started with the election of a particular Government in June 1977. It did not and, what is more, the Minister knows it did not. No one in this Parliament knows better than he that it did not. One of the things about which I must complain in relation to economic debates in particular is the comparisons always being made between what was done between 1958 and 1964, 1972 and 1975, and so on. I am always so pleased when we get away from such discussions.
Let me put on the record my view. In the economic field we see an analogy to people on earth receiving light from different stars. Some of the stars whose light we are seeing have actually died. Some sent their messages so long ago that it would take great scientific knowledge to estimate just how long ago that light started coming to us. The position is similar with regard to the economic progress of today. I am not going to tell about stars that have died, but to cheer everybody up, let us go back to the Fianna Fáil policy of encouraging industry by excessive protection in the 1930s. That is a star sending some light into our present economic progress. Similarly, the encouragement of agriculture by the Government which Fianna Fáil then put out with its emphasis on the importance of the export trade, is a star still sending some light to the current progress of the economy. The formation of the IDA in 1949 is a star which is sending a great deal of light. The introduction of the export tax relief is another star sending a light. The economic development programmes of 1958 and the early 1960s are sending still more light.
The economy started to recover from the recession and one of the things I liked about the Minister's speech today was that he did not refer unfairly to the burden of debt which was incurred by his predecessors. He might have been very wise if he had done so. In June of 1977, shortly after he took office, it might have been an extremely wise move to have discovered suddenly how empty the till was, in the traditional fashion of Fianna Fáil Governments coming into power. He did not say, "Let us forget about all that has been said, and let us start governing and putting everything right." He did refer, properly, to the burden of debt, a burden because it did not create productive income-earning receipts which would service it. He was right to attribute that to the recession. The point I am making is that the current recovery started in the second quarter of 1975, as I understand it. It had begun to occur before many people believed that it had done so.
The Government cannot get the support of all the people for the White Paper when it contains statements such as:
The approach involved a temporary increase in Exchequer borrowing to help restore confidence.
It did not require anything of the kind to help restore confidence. Confidence was very buoyant in 1977, and I challenge that proposition. There is an element of George Orwell making the future by writing the history involved in this myth of trying to locate the basic decision which led to a massive recreation of confidence. Confidence was magnificent. Extra borrowing was not the way to add confidence because in June 1977 there was too much borrowing. We ended the year in question with a total borrowing of £4,210 million. How could a decision at that time to increase that borrowing, which was four times what it was in 1970, have helped to restore confidence? It did not help to restore confidence. Confidence was high. Various decisions of a different character were required and no doubt would have been made. I ask the Minister at least to believe that I have tried to be totally fair and to say that which I believe to be true. The growth in the economy in this last year has been excellent, all things considered. There cannot be any doubt about that. We are disputing about whether it is 7 per cent or 5½ per cent at the lowest. We are out of our minds if we regard 6 per cent as a failure. Have we, hopefully, broken through to the stage where the structure of industry has so changed that growth rates of this kind may now be possible when they were never previously attained except in one exceptional year in the 1960s when the growth rate was 7 or 7½ per cent? I have forgotten the exact year.
That is the more interesting question but we should be having this in a real debate. The unreality of the debate is that it forces everybody into a false attitude of mind and we are having an illusory discussion when we should be talking about the realities.
I welcomed this whole planning process when it started. White Paper, Green Paper, and so on. I used to complain about the lack of information and the lack of paper. Merciful God, I wish people would stop writing comments and give me one every six months which I could study quietly and understand patiently after a long period. I used to complain about the lack of knowledge. Now, it is like Fr. Vincent McNabb's account of hearing nuns' confessions. He said it was like being pecked to death by ducks. Well, I feel a little bit pecked to death, not by ducks alone but by different types of amiable animals. I welcome the process, but would these achievements have taken place if there had never been a White Paper? To what extent would they not have taken place? What variants would there have been? It is reasonable to attribute a point or two on growth to some of the decisions, but I am not necessarily convinced that the decisions that led to that growth were long-term. I am not necessarily satisfied that some of the decisions to incur expenditure, not to borrow, not to improve the balancing of the budget, did not purchase short-term growth at a long-term cost. That is one of the real questions we have to ask ourselves.
I have considerable prejudice in favour of balancing current budgets irrespective of the pains involved in the decision to balance. Therefore, I am a reluctant opponent of endeavours to make specific decisions. Everyone accepts the general principle of balancing budgets; nobody likes the series of precise decisions. One has to look at them and make as good a judgment as possible. It is very easy, and perhaps even necessary, for an Opposition politician to say in answer to the question, "What would you do?" in terms of the old Irishman saying "How would you get to another place if you would not start from here?" That is fair enough, but it is not a total absolution from the necessity to approach at least what is proposed in a constructive manner. For example the reaction to this levy of the sectional interests affected, the farming organisations, was expressed in language absolutely intemperate and totally unjustifiable and such that any Member of Parliament would not be pleased to hear. The sensible approach to the collection of it was what I understood as adjustment for the benefit of those whose production would be affected or who were on a particular level of income. I thought the adjustment was right. I would find it hard to object to an adjusted levy in the absence of alternative choices. There may be alternative types of tax, but these decisions have to be made. With regard to taxing and borrowing I find myself unhappy about the emphasis the Minister and the Government are placing on the creation of jobs of an unproductive kind.
I understand from the Minister's speech that primary emphasis will be placed on direct job creation in the public service. I certainly object to that. I see no solution to this country's ills in adding to the number of people engaged in unproductive employment. They slot into the national income figure as some sort of contribution of services, but we delude ourselves if we think that this is any solution to our problems. The second part of the sentence is, "the extension of community services and training opportunities". I applaud that. I hope that I am not being unfair to the Minister for Finance when I say that on television one night he seemed to be boasting of the increase in the number of gardaí, as a governmental achievement. We must be out of our minds if it is national policy to boast about the number of extra civil servants and gardaí. Where would the employment programme be were it not for the crime wave? Where would the employment programme be were it not for the tax evaders? The tax evaders have created 500 new jobs in the Revenue Commission, and the robbers have created 500 new gardaí. Thanks be to God for the robbers and for the tax evaders. Do we need more uncivil and anti-social activities to create further employment and give further material to politicians to boast about in relation to the achievement? This is no solution to our problem.
I accept equally that it is no solution to our problem simply to sit back with a benign laissez faire attitude to industry and commerce, and expect the dynamism of that operation necessarily to generate employment. Of course it does not and need not. To an insufficent degree and during a short period one could be doing what one can in terms of incentives of one kind or another. Looking at these incentives, the position with regard to manufacturing will be that, where the 10 per cent operates, it will not be a system of taxation of manufacturing that will exist; it will be a system whereby under the fiscal code there will be negative taxation of manufacturing, whereby people will be able to sell their tax allowance. I am not talking about the grants that they will be getting from the IDA or Fóir Teoranta; I am talking about the operation of the tax system. A tax system which operates like that in relation to manufacturing even when the manufacturing investment decisions may be resulting in reduction in employment needs a close examination. This is what I would have expected from planning. I believe in the study of things in detail. The real criticism I must make of the Minister is that he has approached this problem excessively from the demand standpoint.
It is very difficult for me to understand how a consumer boom can increase national growth. When you were booming around Spain or wherever else last year you were increasing the growth of the Irish economy. Did you know it? You were increasing it—but not too much when you were in Spain, except for the travel agents whom you paid on your way out—but it is a very shortsighted approach. A necessary operation is to put in the demand bits in order to see what comes out at the other end of the machine. I am not necessarily saying that that 10 per cent manufacturing tax is beyond my criticism; I am just taking it as a type of a decision. This hard decision is the type of decision involved, for example, in trying to clean up the problems with regard to mining. These decisions will have much more profound long-term consequences of a good or bad kind. A long-term bad consequence results from the position this Parliament has got itself into, through the abolition of domestic rates. The Government did this, but the Coalition Government were about to do it, so we are all involved.
The Catholic Bishops of Ireland told us 30 years ago that to provide a maternity service free for all, no means test, was in some fashion immoral. Now I can get my sewage removed, my water supplied, my bins emptied, free for all, no means test. That was a decision which had an immediate effect and will have a long-term effect on local government. That is more important than what is in all these pieces of paper that have been produced. It is important when making these decisions to look at them in a clear way and not go—as Karl Marx has described religion—dancing around an illusory sun and as a result not looking at the reality of one's own situation. The religion he so described was, no doubt, to some extent the opium of the people. It was not, as I revere it, the true religion, a real religion, shall I say?
The plans, projects, targets, estimates may be illusory suns taking our eyes away from things like how we are to overcome the bottlenecks caused by a shortage of skill. This is an outrageous weakness in our situation.
I do not know the time period involved, but if there are shortages now, it is a real defect in planning that these shortages were not contemplated by somebody some years ago. The long-term decision in relation to the vital matters of telex and telephones was a real defect in planning. It was a bad decision also, with respect to all of you on the other side, to put masses of new cars on a lot of rotten roads. The roads should be put right before cars are put on them. It has got to the stage now where some of the Dublin Streets should be renamed Bottleneck 1, Bottleneck 2 or Bottleneck 3, or to say bottleneck hours will be between any time you want to go home, or anywhere, as far as I can see.
This planning process has degenerated a little, under pressure. I hope there will not be a Green Paper this year until Christmas or, better still, let the budget become the White Paper. Let us have a paper on proposals for discussion and let us not tie ourselves into black knots about production dates. Have your own targets and work towards them and then produce the proposal, but give us a few months to digest it. The roars of the grassroots will then reach you in time, not too late or at an embarrassing hour.
Apart from the question of whether we would not have done as well if we had not had any of the papers, I throw in a growth point here. The Minister is a bit tied up on his targets and forecasts. Of course, he knew exactly what they meant. I have gone over all the documents; the Minister could not be sued in the courts on them. There is no question about it, they are very precisely drafted. However, one does not read these documents as one reads a contract to purchase a private dwelling house. One does not read the definition section and find out what one would have to do to have a lovely year in which there would be 5 per cent inflation as you thought. One would have to annualise the last quarter to find out even if there was a 20 per cent increase in the previous three-quarters. I do not think anybody understood this when they read the mortgage document, which I brought with me, together with the other title papers. I do hope, by the way, that we are paying the last instalment of the mortgage and that this albatross will now be formally taken off the Government's neck and can be forgotten about. If it is not paid off, one could say that circumstances rendered it impossible to perform, or there is an implied condition that one does not have to pay any more when it is bad for the people that they should be paid any more. One cannot be expected to damage the creditor.
To take up the Minister's point, he annualises the 1¼ per cent to produce the 5 per cent. He then gives us 4 per cent for this quarter but he does not bother to annualise that. Was the target that he would attain 16 per cent inflation in the quarter ending 15 February? I do not remember that target in any of the White Papers. I also wonder what was the annualised rate of the quarter's inflation when the Government took office. I cannot remember what it was, but he probably has it firmly tucked away in his mind. I think it was moving down fast from what it had been annualising at during the previous 12 months. The only significance of the last quarter is, can it be kept up for the rest of the quarter?
My criticism of these documents is that they have had the bad effect of the continued raising of expectations; their good effect is the extra bit of growth. I genuinely believe that the manifesto took advantage of already embarrassing expectations which should have been reduced, but which have since been raised still more. I agree with the Minister that the real problem now is to find the solution to unemployment. Employment must be the first objective. The first objective of a man is to go out and bring home enough money for his wife and children; that does not mean that when he comes home he slaps them in the face and insults them. It is a logical priority that you create wealth, but logical priority for economic policy does not mean that the social thing is to stay outside in the backyard; the two should run together. It is all-important that expectations be reduced. The language does not altogether support this target. It speaks of consumer expenditure beyond what was projected, of incomes beyond what were expected. If that is not a forecast, I do not know what is. The really dangerous thing is undelivered growth. If you tell the people that they are going to get a growth rate of 6½ per cent, that it is beyond what is attainable and that they are getting it only on the basis that they consent to keep their incomes down, they will look for the incomes which were in their claims. The growth may not be achieved because of the increase in incomes, but if it is achieved it will generate pure inflation, or the Irish form of it, excessive imports, balance of payments pressures or the constraints that all that brings. It is very definitely the Government's responsibility to reduce expectations; it has done a great deal to increase them.
It is very important also that an honest account be given of the sources of anything that is cheerful or good—for example, the inflation rate of last year. There were some references to it in the White Paper, by insufficient reference to the favourable 12 per cent depreciation of sterling in terms of the dollar and insufficient reference to the fact that the sterling index for commodity metals was only very slightly increased in the year. People will realise that was an uncovenanted benefit, something they got for nothing, a benefit that was not there before, that may not be there again. That is why constraint is necessary. The economic realities must be repeated in season and out of season. Do not tell me that that is being dismal or pessimistic. I do not believe it is being dismal or pessimistic to be realistic. If you have a mind to understand your realities and a will to face them, you can do so. The community will have to be led to face its realities.
Our political system must deliver the goods. Fine Gael will put the Government out of power in due course. They will put them out of power when this country is a lot richer than it is now. I do not want this country to falter one step in its march forward. I do not believe that this party needs to cause it to falter one step in order to get political power. I do not believe anybody in this party would want that. Let there be all the progress in the world, with our full support, because we have complete confidence that the Government will make a mess of it, will irritate the people without damaging them and that Fine Gael will then put the Government out of office.
I am glad that this reasonably early opportunity has been given to the Seanad to discuss the Programme for National Development, 1978-1981. It is particularly important to uphold the status and role of this House in relation to major policy matters at a time when democratic Government is being challenged so much by organised minority interests.
I intend to say very little on the economic growth and employment targets of the White Paper. I regard the targets as desiderata but, as I explained here last year, I have difficulty in treating such top-of-the-scale aims as appropriate to a plan relating to a short span of years. I am thinking, in particular, of the zero unemployment target for 1983. I understand the motive in setting the most ambitious targets, but I would prefer to take a longer timespan and then focus on what seems practicable in the years immediately ahead, allowing something for adverse contingencies, rather than arouse expectations of what is only just possible if, as rarely happens in real life, all goes well. While I acknowledge the Government's good intentions, indeed the seriousness of their commitment, I, as an individual citizen, would be perfectly content if, even by 1983, we were coming closer to the desired goals. I remain apprehensive of the disruptive effect on confidence and on continuity of effort of our failing for any reason to attain the complete optimum. The Government well knows that there are many forces, already operative as well as unforeseen, which could cause disappointment. I would rather have some margin in hand so that if, by good fortune, we did better than originally envisaged, this would act as a boost to morale and confidence.
There is a biblical injunction which commends, somewhat paradoxically it seems to me, prudence in planning and courage in taking risks. My package would have rather more of the first than the second component but the White Paper mixes it the other way. Already some economists have been expressing doubt about the realisation even of the Programme's 1979 targets. They may be right or, happily, they may be wrong. I am not going to engage in statistical politics—I will leave that to the real politicians. I have not been misled by anything in the White Paper or other Government statements. I know what is meant by careful language, such as the end-of-year inflation rate. To be honest, I must confess that I cannot stretch my optimism enough to accept all the White Paper projections. I believe, however, that 1979 could be quite a good year, even if it is not as good as the White Paper, or, indeed, all of us would wish. But nothing could be worse than to strive doggedly for particular objectives if it should become clear that they cannot be attained without dangerous disregard of fundamental constraints and requirements. There could be no justification, for instance, for attempting to generate growth and employment in line with the White Paper desiderata, if this meant resort to expansionary policies which relied too heavily on balance of payments deficits and, therefore, necessitated ultimate recourse either to devaluation or to severe deflation. Fiscal policy, in particular, will need to be revised in the event of failure to realise the very sanguine growth expectations on which the high revenue and reduced borrowing expectations are based. Reform of the public finances could otherwise turn out to be quite transitory and illusory.
Much more important than the targets of the White Paper are the conditions essential to their fulfilment. These are, as mentioned in the White Paper, in the budget statement and in many Government speeches, pay restraint and good industrial relations. I shall be devoting most of my attention to these conditions of progress which, as is evident from everything I have said here before on planning and the EMS, I, too, regard as of far greater importance than any figures, forecasts, or financial facilities.
The Minister will not, I hope, think me too critical if I express disappointment on two scores about the content of the White Paper. My first disappointment concerns the lack of openness in the White Paper as to the basis for the main projections. The 6½ per cent growth target was not supported by consumption and investment estimates, nor was there, in the White Paper itself, any indication of the net use of external resources associated with the prospective growth figure. True, this deficiency was made good in the paper that preceded the budget—the "Economic Background to the Budget"—which suggested that the balance of payments deficit in 1979 will rise to £300 million. No doubt the reticence in the White Paper was due to reluctance to foreshadow the budgetary dispositions and, even more perhaps, to reluctance to hint at the expected rate of money incomes increase. This is understandable in the run-up to the budget. But I am worried now at not having yet heard any specific official indication of what pay increases we can afford, if inflation is to be reduced to 5 per cent on a continuing basis.
The second cause of disappointment is the absence of clarity—indeed at times I was tempted to think a teasing obscurity—in the White Paper as to the components of the employment estimates. It is, I suggest to the Minister, unsatisfactory that interested persons and bodies should have to put a wet towel around their heads and spend hours trying to unravel and reconcile the various definitions, the pluses for certain factors and the minuses for others. Why could we not have a technical appendix to the White Paper which would make the employment aspects more readily comprehensible? There is nothing to be gained by obscurity and I would recommend to the Minister, even now, that an explanatory memorandum be published. I am prepared to make available to him my own draft. My understanding is that achievement of the Goverment's target of zero unemployment in 1983 requires the creation of some 43,000 gross non-agricultural jobs a year, as against last year's quite splendid achievement of 30,000 gross. It is clearly a very formidable task, which seems to involve almost a doubling of last year's net increase in employment.
It is on the vital questions of how to achieve greater pay restraint, or realism as I prefer to call it, and how to improve industrial relations that the White Paper is most reticent. I take this opportunity to offer what I hope will be constructive comment. Progress in these areas is recognised to be obsolutely essential. This, indeed, continues to be stressed in all Government documents and speeches. Decisions, or even precise indication of policy, are, however, absent from the White Paper. After the consultative process set in motion by the Green Paper, it is in the White Paper that these decisions and policy pointers should be found if the Government's colour scheme is not to go awry. But in this critical domain green is the colour that still prevails. We are still at the consultation stage, not at the decision stage.
I am of course, pleased to see from ministerial speeches—the Minister referred to it again this morning—that efforts are still in progress to reach a consensus with trade unions and employers. It was my understanding of the planning cycle that the purpose of the Green Paper was to try to establish a consensus on the conditions of progress and the sharing of its fruits and that the outcome would be reported in the White Paper. Unfortunately, the White Paper was unable to do so. It is still asserting desiderata, not announcing agreement on how to achieve and share progress.
I am not happy that so much is being allowed to hang on trade union reactions to fiscal policy decisions. These must always have broader objectives and they have their own contribution to make to development planning. I am sure the Minister would agree that it would be most unfortunate if fiscal policy, our main instrument of demand management, were to become completely gummed up in commitments to particular interests.
We need the assurance of pay realism and good industrial relations, if the growth and employment targets and the aim to reduce inflation are not just to be vain ambitions. The White Paper in its chapter on incomes policy said exactly that. It went on to express the Government's overriding concern to "ensure" that income increases are not such as to jeopardise the targets for general economic development. Allied to this concern would be "the pursuit of stability in industrial relations". There is no specific indication of how the Government proposes to "ensure"—which is a fairly strong word—that pay increases are moderate and industrial relations stable, beyond the hint of a search for some form of social contract contained in chapter 8, paragraph 6 of the White Paper, which says:
Within the context of a ceiling on pay increases and a major effort to secure industrial peace, the Government would welcome an understanding with employers and unions on targets for the creation of employment and, possibly, changes in working conditions and policies in relation to non-wage incomes.
I take it that this is the aim of the talks that have been taking place with the so-called social partners and also, indeed, the aim of recent budgetary policy. We must all earnestly hope for the success of these efforts.
I cannot help wishing, however, that Governments were a little more modest about their powers of managing an economy and, in particular, of ensuring the right trends in pay and better industrial relations. Education and persuasion must be the main levers in a democracy. Though every day reveals new efforts, there has not yet been a sufficiently strong attempt to inform and influence public opinion in the direction of pay realism. The postponement of the European Monetary System partly excuses this. Unless such an attempt is made and, in particular, unless it extends to the hundreds of thousands of wives who are on the side of industrial order, pay realism and sound money, there may be a less than satisfactory outcome to the talks with trade union leaders alone. Some, at least, of these union leaders, though personally understanding and responsible, have not sufficient influence with their rank and file. Many of them also have too liberal a notion of what the economy can afford.
The White Paper states:
If immoderate increases in incomes are sought the only alternative will be to introduce measures which will secure the appropriate degree of restraint: this the Government will do where necessary.
I regard this as too indefinite to be really awe-inspiring. If the statement refers to the clawing back of excessive income increases by taxation I would like to repeat the criticism I have previously voiced of such a policy. It would not undo the destructive effect on competitiveness and on jobs of the addition to costs of production caused by the original pay increase.
Realism in pay matters must come before increases are awarded. Nobody should be under any illusion about the limited scope for fresh increases in 1979 unless we want to see inflation rise again. I am speaking of fresh increases on top of the carry-over from the last national pay agreement. Estimates of the effect of this carry-over, including this month's final phase of the national pay agreement, range from 6 per cent to much higher figures. Even taking the lowest possible figures for carry-over and for "drift", a new boost of more than moderate amount would destroy any prospect of bringing the inflation rate down to a sustainable 5 per cent by the end of 1979. I am not interested in getting it down for one quarter only and I doubt if anybody else is.
Chapter 2, paragraph 11, of the White Paper thinks this 5 per cent inflation rate would be attainable if future income increases were related to productivity gains which one must interpret as meaning at most 4½ per cent on an annualised basis. My assessment, also, is that if we are to hold our place in the EMS when we join it and even gradually pull down our price and cost inflation to competitive Continental levels, we cannot afford to have more than a single figure percentage as the standard for fresh increases for the year beginning this summer. Preferably this should be spread over two half-yearly stages. This would give manufactured exports the chance they need and would help to create jobs.
It has been inferred—I hope wrongly—from the recent ICTU statement that a general increase of 15 per cent or so might be envisaged and, as we know, 30 per cent and 40 per cent demands are already being pursued by various interests. I feel obliged to say that, while there is much that is constructive in the ICTU statement, any general pay settlement for the year ahead of the 15 per cent order and, even more so, any higher settlements, would be a prescription for a renewal of high, double digit, inflation. We will be uncomfortably close to that in any case during 1979 but pay settlements on the scale I have mentioned would entail not just the serious embarrassment of being forced to resort to devaluations in the EMS context but the slowing down of all economic and social progress.
I hope the ICTU and their members are aware of the complete contradiction which would exist between guidelines involving double-figure percentage increases for the coming year and their interest in the creation of the maximum number of new jobs. I hope, also, that they recognise that inflation will never be wound down if rates of pay increase of up to 15 per cent per annum are perpetuated. This would be a formula for keeping inflation at 10 per cent or higher. A winding down mechanism is essential in any indexation scheme. Unless a lower future rate of inflation is projected and incorporated in pay arrangements, that lower rate will never occur. To base any incomes index on the worst past experience of inflation is the best means of ensuring its continuance.
When one remembers that the per capita increase in non-agricultural incomes was of the order of 17 per cent in both 1977 and 1978 and could, unless there is real moderation, approach this level again in 1979, it is difficult to understand the constant invocation of “pay restraint” as if we were in danger of losing it and even more difficult to condone the irresponsibility of those who decry or resist it. The figures I have given are not, to my mind, indices of restraint. By our constant appeals for restraint and, indeed, our mealy-mouthedness about the actual implications of pay proposals and settlements we have encouraged workers to believe that they have been sacrificing themselves in the national interest. When in one year, 1978, real industrial earnings after tax can rise by 9 per cent, workers in general have obviously been doing very well, though, admittedly, it is a cause of resentment and strife that some have done much better than others.
I have already said that I prefer the term pay realism to pay restraint. I am supported by the information about Germany in the recent Central Bank bulletin. German workers, although their money income increases were much smaller, did as well in real terms as Irish workers over the last few years. What governs in the end the improvement in real pay is the contribution made to output. The ICTU document, indeed, explicitly recognises this as a fact of life and this is encouraging.
On the question of the relationship of pay to productivity, it may be helpful to use this occasion to draw attention to a major problem. There is an important issue here that urgently needs to be clarified, the issue of whether productivity should be assessed and rewarded on a national or on an individual basis. The two big influences are the prevailing community sense of fair play and the present organisation of trade unions on the basis of crafts and occupational categories rather than place of employment.
One could take the view that as long as no worker was condemned to suffer a real loss of income through no fault of his own, real gains in income should depend on, and be closely related to, the personal contribution made to increased output. In other words, everyone would be compensated within reason for price increases but only those whose productivity had measurably increased would have their real income correspondingly improved. This would seem to fit in with economic desiderata because of its direct incentive and reward effects.
The question that must be asked, however, is whether such a pay policy would be acceptable generally to a community which so far has shown a preference for raising the pay of all workers more or less in line, for preserving traditional differentials regardless of differences in actual productivity. Trade unions have been insisting on the same rate of pay for members in the same categories, whether they are employed in ailing or thriving firms.
It is important to face this problem if only because productivity increases cannot be rewarded on the double without highly inflationary consequences. If we want to or feel we have to maintain the traditional system, then we must continue to have generalised and uniform pay increases conforming to a norm which allows for the national productivity increase, that is, the GNP increase per head, and also, but on a winding-down scale, for inflation. If we want to recognise and reward workers for increases in productivity at sub-national or firm level, then we cannot have uniform across-the-board pay settlements and trade unions must abandon their equality principle and their attempts to restore differentials.
Above all, we cannot have it both ways. Doubling up of rewards for productivity is a prescription for accelerated inflation.
If we would settle for a compromise solution—and this depends essentially-on trade union acquiescence—I do not think our sense of social equity would be offended by some differential or bonus reward for those concerned in particular enterprises or sectors of the economy which achieve a rate of growth in production well above the national average. But since the national average itself has already taken account of the exceptionally high rates of productivity, anything over and above must be of modest proportions so as to limit its inflationary and, indeed, its disturbing social impact.
Such a compromise would recognise that the growth rate of any particular industry is not determined solely by factors within the industry but is supported by essential external services and, of course, by national policy decisions. In other words, there is no compelling case for saying that differences in productivity growth as between firms and industries are caused solely by differences in the rate of improvement in the skill or effort of the workers concerned.
Unfortunately, I see no sign that the considerations I have just been discussing enter into the generality of present day pay claims allegedly related to productivity. Nor am I aware of any open discussion of this major problem.
Relativities can, as we all know, become explosive issues. When pressure arises for radical departure from existing relativities, for, in effect, a status regrading of particular occupations and this appears to be in line with community needs, is there any orderly way of dealing with the problem except that recommended long ago by the NIEC and recently reiterated by the socialist Prime Minister of Britain, namely, an authoritative assessment in full public view by a reputable and representative body? Even then, as the Taoiseach emphasised the other day, no category can move up the scale unless all the others recognise them as a special case and abstain from seeking to maintain the old differentials.
It seems to me that at least some of the present unease in industrial relations and the inordinate scale of pay expectations, in particular, is attributable to the chaotic state of affairs in Britain. Might I just make one point to emphasise the dissimilarity between us and them? The average industrial worker there has, in fact, lost ground in real earnings. He is no better off than he was six years ago, perhaps not quite as well off. In Ireland, however, the average real weekly earnings of industrial workers went up by 18 per cent between September 1972 and September 1977 and have probably risen by a further 8 per cent since. In other words, since September 1972 real earnings here are on average up by well over 25 per cent as compared with nothing at all in Britain.
I feel strongly that we cannot afford to wait, perhaps years, for the recommendations of the Commission on Industrial Relations. Rome is burning now. Surely, some changes can be identified which would improve matters before it is too late? Why can we not know the Government's attitude to obvious questions such as the prescribing of secret ballots and cooling off periods before strikes are legitimate, at least in essential industries, and the barring of the special 1906 Act privileges where these requirements are ignored or unofficial strikes are launched? Trade unions might object in principle but in fact their status and influence in the community and their internal discipline would be strengthened by such provisions. Dismissal and redundancy legislation has already given job holders great protection.
Progress could surely be made also in the areas of better organisation of work and decision sharing. I would like to see, because public opinion is very important in these matters, the public clearly informed by the Department of Labour of the issues involved in every major dispute or stoppage as soon as it occurs or is threatened. The public are dubious about the ex parte advertisements of interested parties.
On fiscal policy I wish to express my commendation of the switch of emphasis in the recent budget to public capital expenditure, especially for remedying infra-structural deficiencies, and the concurrent reduction in the current deficit. A strategy that promotes public and private investment in preference to public and private consumption is on the right lines. So long as we have high investment our employment prospects are good.
Finally, I have focussed in this contribution on the pay and industrial relations aspects because the bright citadels of prosperity and employment are on the other side of a stormy sound which we do not yet know how to cross. We must concentrate our endeavours on bringing order and calm into pay and industrial relations so that we can safely make the passage to the brighter world.
I am amongst those who want our development and progress to be aided and guided by intelligent Government policies having democratic consent and authority. I want to see the objectives of the White Paper attained by a coordinated and co-operative process. We are seeing far too much unruly and selfish behaviour, with sectional interests defying the Government, demanding what suits them and rejecting what does not and threatening to disrupt the economy and hurt their fellow citizens as much as possible in order to get their way. All planning will be futile if we cannot observe the rules of democracy and unite in making a sustained effort to establish a better-off but also a more compassionate and civilised Ireland.
First of all, I would like to say that I do not propose to walk down the same road as Senator Whitaker. If you are not an economist you do not go into the other fellow's backyard for a row and I propose to look at matters from my point of view. I would like to say that in regard to that part of his contribution, directed to trade union leadership I would go an awful lot of the way with Senator Whitaker. His remarks which, I take it, were directed towards the leadership of the Irish Congress of Trade Unions and the Government, will not fall on deaf ears. They will probably get a favourable response.
It is not as easy at it seems. The Irish Congress of Trade Unions put forward pre-budget submissions which, in effect, if they were to satisfy the needs of their members and promote a well ordered approach to wage settlements in general, would have needed an injection of £100 million into the budget under the various headings they suggested. However, that did not come about. They got only £25 million of it. Subsequently we had the problem of the removal of the farmers' tax. These are all indicators of how difficult a task it will be when the unions sit down to talk. I believe, like Senator Whitaker, that everybody will want an ordered approach.
The Senator mentioned spill-overs and so on. The spill-overs might be a little in excess of what he said. We have to begin, first of all, to deal with the problems of the carry-overs from the national wage agreement where anomalies were created. There is room for an ordered approach. I believe it will be there, and I thank Senator Whitaker for his observations. I do not totally agree with him, but I agree with a great deal of what he has said. I agree with him on the point he made about the obscurity of information regarding projections of unemployment, inflation and so forth. As a layman, I find that the number of jobs needed in the non-agricultural areas will not be 43,000 but might be anywhere up to 60,000.
These are some of the problems the Government will face when they get down to talking about how the trade unions behave, because how others behave affects the number of jobs, taxation and everything else. When we are talking about the national wage agreement we must realise the effects of the ineffectiveness of successive Governments to handle the economy over the years. If the economy had been handled well and we had not got the unemployment situations we have, we would not have the trade union problems or the farmer problem.
I hope to God I never become perfect. Perfection is what the Government are aiming at in the White Paper. I agree with Senator Whitaker that we have got a problem. I was born into the slums of Dublin, into a family of 12. From the time I was born some of the family were hived off into domestic service so that we could make ends meet. There was not enough to keep all of them, so some of them had to go. It is the same situation with some of the small farmers. In Dublin slums, fathers of families were drawing nine shillings a week and two pounds of beef. When five or six of your brothers were idle you had to go out to work on a carrier bicycle at 12 years of age. You were listening then to people who were advocating changes in the state of the nation, who would create jobs and improve your education. I do not know how the private enterprise system can create full employment. I shall try not to be cynical, but it is difficult in view of my own background.
In November 1959, when James Mitchell was United States Secretary of Labour, he said that if he had not delivered on his promises with regard to a decline in unemployment, he would eat his hat on TV. It was a farce. The hat was a cake in the shape of a hat made specially for the occasion. In 1959 America was a wealthy nation, but he was not able to deliver on the figures he said he could deliver. He had to go on television and eat the sugar cake. The reaction was a little amusing and this is where one must try to avoid being cynical. It was mixed. Some of the public were amused, some were totally ashamed to see the Government so humiliated and some were justifiably indignant at the Government's neglect in the area of unemployment, just as the people in Ireland are. The unemployed, who could not get any cake to eat, felt that the whole thing was a pure insult. It was a reminder to a lot of people that the capitalist social order is not capable of stemming the growth of unemployment without the assistance of the public sector. I will come to the question of the public sector later on.
The situation was that this great man, James Mitchell, Secretary of Labour in America, had to go on television because he had made certain forecasts. I hope the Minister for Economic Planning and Development, Deputy O'Donoghue, or the Minister for Finance, Deputy Colley, do not make such proposals because they might have to eat their hats. America, with all its wealth, resources, skills, powers and prominence, was never in a position to do much about unemployment and are not in a position to do much about it today. They rely unduly on private enterprise to create employment.
In the decade following Mitchell there was a rise in unemployment. In Mitchell's time, there were 3,300,000 people unemployed or, to use the American phrase, underemployed. The number partially unemployed in Mitchell's time was in excess of 2,000,000, in addition to the 3,300,000. Up to 1964 there were two successors to Mitchell as Secretary of Labour in America. They were Arthur Goldberg and William Willard Wirtz. Under their secretaryship the numbers of unemployed rose to 5,000,000, the number partially unemployed increased and those who were getting employment for six months or less also substantially increased. That was the factual situation.
There is a tendency throughout the world to imitate the Americans' approach to life. There is a belief that private enterprise can create full employment. I have never believed that from my boyhood days and, to the present day, there is no evidence to satisfy me that it can be done. Some EEC countries are advocates of free enterprise, but if we take America as being the greatest advocate of free enterprise the only conclusion we can come to is that it has not worked for this great power. What great reason can anyone put forward that it will work for an island nation which is changing from an agricultural economy? That is where I see difficulty.
Perhaps the evidence is in the White Paper and maybe it is not explained correctly. The ordinary man-in-the-street when he goes in to have a jar does not know. The evidence is not there for him. In Mitchell's time, there were 85 million industrial workers and out of that ten million were unemployed, approximately 12 per cent. This was in a country which advocated free enterprise. That is one of the reasons why workers who read papers at that time can throw these things at you.
I spoke about my own background and what has happened in free enterprise societies. I did that because it was a base from which I could take a layman's look at the Programme for National Development 1978-1981, which is to reduce unemployment by 25,000 in 1979 with further reductions of 30,000 in 1980 and 20,000 in 1981. In January 1979, there were 104,000 on the live register. At the end of 1978 the number was 130,000. One could reasonably say, looking at that, that there was a reduction. The number went down substantially in September 1978 and went up to 104,000 in 1979. As a layman, I read that as being a reduction of 9,000 on the live register. Of course, if one takes the figure from January to September, there were 20,000 fewer; but if one takes the figure from January to January there are only 9,000 fewer on the live register. Take the Government's emigration figures at 7,000, which other sources do not agree with but which for the sake of argument we will accept. I am puzzled about where the 20,000 jobs are, because if you add the 104,000 to the 7,000 you get 111,000. That is how the layman looks at it. There is no explanation for it other than that. Nobody gets down to simplifying it. This may be one of the causes why there is not greater acquiescence in accepting a national norm for wages.
There were 9,547 jobs created in the public sector. If one takes that from the 20,000, does that mean that private enterprise delivered only 10,453 new jobs? What is the picture? If it is true that the private enterprise delivered only 10,000 jobs, does it not substantiate the argument that they delivered on only half of the goods? There is an undue reliance on the private sector to create employment. If one looks at the number of redundancies created in the private sector, one will see that there is no real case for claiming any decrease in the live register since January 1978.
This is the way the fellow on the floor talks when he is talking to you about claiming wage increases and so on. He talks to you in his own fashion. He says to you that in January 1978, there were 113,000 people on the live register. There were 14,300 redundancies in industry and 5,000 in agriculture—I do not know whether that is an accurate figure or whether it is a gross figure of 19,300—9,000 coming on to the labour market, 7,000 emigrating and 11,300 on the live register. That is a total of 148,300 people who need employment from the layman's point of view. If 20,000 jobs were created—I am not going to argue with it—that means there are 128,300 on the live register. If one takes the emigration figure away from it, one is left with 121,300. If one takes the argument of the other sources and adds 5,000 to it and says that 12,000 people emigrated, one is down to only 116,300. The position is that the more you do the sum the more puzzling it becomes to the layman to discover where the jobs were created and how the live register was affected. He is entitled to argue that, despite Government policies for 1978, the private sector, having regard to the figures I have given, failed to meet requirements in the area of job creation. It creates cynicism and it is a terrible struggle to fight against it.
There were over one and a quarter million people working in the country in 1926, 50 years later we still have that number at work. That is another indication to the layman that the system is not able to provide jobs. I agree with having a mixed economy but there should be more emphasis on the involvement of the public sector in the manufacturing side of industry.
Given that there is a decline of 5,000 jobs each year and that there are 9,000 new entrants onto the labour market, and looking at the White Paper projections, 42,000 jobs would need to be created in the three-year period which was close enough to what Senator Whitaker said. The layman wants to know about redundancies and if 42,000 jobs can be created. Let us say that the agricultural and industrial sectors go together for redundancy purposes, to simplify it, and that the figure averages about 15,000 people a year. There are 45,000 more people who are likely to be on the market. My simple way of looking at the figures, like the layman, is that, if one divides that by three, one is talking about 60,000 jobs. All the evidence shows that it has not been possible for the private sector to deliver on the requirements in 1978. Therefore, how are we going to prove to the layman that they can deliver 60,000 jobs? The emphasis will be on the IDA and on foreign investment to produce jobs.
This reflects back to the question of dealing with people who are being asked to work along normal lines in the interests of the economy as a whole. They have got to be made to understand that they should not be caught up between the whims of a lot of economists—one trying to outsmart the other and so on. They must know exactly where they stand and the efforts that are being made. It must be simplified for them.
Private enterprise is providing only half the jobs. At least that is what it looks like in my simple analysis of it. Some people argue that we must rely on the supporting role of the public sector and others say it is more important to give the greater emphasis to the private enterprise. I would agree with that if somebody could produce evidence to show that, over the years and having regard to the whole history of our economy, private enterprise has done the job. It has to be proved that private enterprise is capable of taking people off the dole queues and putting them into effective work, that it is capable, when they become redundant, of placing them in another job or into a training scheme that will lead them to another job. At the moment this is not being proved. If we do not prove that, the argument will remain forever that the public sector must be involved in the manufacturing side of industry to a greater extent to create the missing jobs.
I would like to see a balance between the public and the private sectors. I am not advocating the abandonment of the IDA or anything like that. I am not trying to denigrate it. In fact, I spoke in this House in favour of the IDA and had some kind words to say about their achievements. I do not believe that undue emphasis should be given to their capacity to solve the problem of unemployment for us. They attract more foreign borrowing than anything else, and apart from us being caught up in a system of landlordism which we are gradually getting over, there is the problem that the investors are not going to be there in the numbers that the Government imagine to see us over the hump for many years ahead. It is not a question of an ideological confrontation with the IDA. Successive Governments have placed the emphasis on private enterprise through the IDA to produce the goods.
I know that the IDA attracted 57,500 new jobs during the period 1972-77. But, having regard to the problems inherited in the private enterprise system, we had a reduction in effect in that number as the redundancies were in the region of 55,600 at that time. There were about 1,900 new jobs in that five year period in manufacturing industry. That is not a great achievement. This happened at a time when there was a growth rate of 5.5 per cent. It was the highest in Europe at the time, taking emigration and so on into account. The job was not done in 1977 either and that was when we were in Government. I should like to make that criticism also. I do not think it can be done.
I should like to quote from an analysis done by the Union of the Associated Technical Managers and Supervisors. They say that:
Over the three year period, unemployment will fall by only 9,800 in real terms rather than the 75,000 which is put forward in the White Paper. This figure takes fully into account the deflationary aspects of reduced Government spending and the falling level of activity within the economy generally.
It is impossible to gauge the effects which the EMS may have at this stage, therefore the prediction will be reviewed regularly to cover this aspect. We will also be reviewing on a regular basis the manner in which the live register is formulated because we believe Government in an attempt to justify their figures, will utilise unorthodox measures to artificially reduce the number on the live register.
This is the point I am making. I would not row in with the argument about artificial figures but I would row in with the confusion that is generated. The ordinary layman gets caught up between the various economic interests that put forward their own points of view. This is something which should not be accepted any more.
I hope, in the interest of the Irish people, that the emigration which started last year will not be implicit in the economic variable when we are talking about the creation ofjobs. It is a very sad reflection on all of us that so many people had to be shipped abroad—one million people to the United Kingdom and hundreds of thousands to other countries—as a means of dealing with our unemployment situation. We shipped not only the unemployed but the unemployable. I do not have to explain the cultural costs of that. If the Government are depending on emigration as part of the solution, the problem will not be solved. One of the problems created by emigration during that 50 year period was that we were left with a big in-balance in ages. It has left us with the type of population which is largely dependent on social services, which soaks up much of the money that could be directed towards creating employment and so on. It is not a solution and should never be accepted. We should be always critical of it.
I hope in the future we shall not see the numbers rising, but it seems that during the projected period of 1978-81, we will see emigrating a similar figure to the Government's figure of 7,000. I do not see anything on the horizon at the moment to suggest a solution in the next three years, having regard to all the problems including the numbers on the live register, the number of redundancies, the numbers coming on to the labour market and so on. I agree with Senator Whitaker in this. I cannot see the private enterprise system solving it at all. He cannot see the projections, as they are set out and the approach to it, being done correctly. He felt a more long-term basis would be better. I would settle for a long term basis if I thought it would solve the problem but, quite frankly, if we are talking about this problem in 1986—I do not know if I will be alive then—we will be talking about trying to create jobs and reduce the numbers on the live register.
It does not matter how we argue, because we can only refer to history. I started speaking on the basis of historical events which people of my age group would remember. Those people must look somewhere to try to find some evidence. In the 1960-74 situation, for example, which was the time of the spectacular growth of 4 per cent in the rate of the economy and when exports rose by 6½ per cent in real terms, the industrial sector expanded at just over 6 per cent per year. These were encouraging figures. Yet, in that period, the total number of people at work was just over 1.05 million, which meant, in effect, that we still had a very substantial number of people unemployed despite this good growth rate, the increase in the exports and the expansion in the industrial sector. The basic underlying problem remained unchanged. In 1960-70 wages were never better. I was representing the workers at that time and the wages were great. Profits were up very substantially. The wages struck a little bit more favourably than the profits, taking the decade objectively. At the end of the decade, there was not one extra person at work.
That takes some explaining. It takes a lot to get the ordinary fellow on the street to understand how wages can go up, the economy can be very buoyant, everyone has a good few bob for a few jars or a few smokes—everything in the garden is rosy. Yet there is not one extra person at work. He only knows there is an expansion in the economy if somebody says so. So he says: "What about this expansion? What is the situation? Here we are all doing well but we still have emigration in this period". There was not a lot of it. It stopped coming towards 1972, 1973 or 1974. Now, we have it again. He asks himself, what the score is. He is being told that the economy is right, things are good, inflation is down and exports are good. But this not resulting in full employment. There is not one extra person at work.
The Government predict a 7 per cent growth in the economy at a time when all other sources say 4 per cent. Even if exports continue to grow they will be only at a modest pace. The scope will not be there for domestic expansion which played a critical part in 1978. The evidence is not there to prove to me that it can, in fact, be achieved. I hope I am wrong.
Business suspended at 1 p.m. and resumed at 2.30 p.m.
I congratulate the Minister and the Government on this comprehensive White Paper, which is a programme, not a plan. The 1977 document could be said to have more of a political that a Government background. Last year, the White Paper dealt with just one year, 1978, but here we have a programme for 1980 and 1981 as well as the current year.
In general, the position at the end of last year was that real incomes were up, inflation down, production in industry was up, there were more jobs created and filled, unemployment was down, agricultural output up, tourism beat all expectations and the growth rate was the highest in Europe. Based on that alone, last year's programme fulfilled what it set out to do. As well as that, it achieved it against certain odds because during the year several things happened.
First of all, there was the Ferenka debacle which lost us about 1,400 jobs. Then out of the blue came unrest and wage claims that had been made and that had not been dealt with. Resulting from that we had the telephone and telex dispute and we do not know how much that affected industry. During the year we had unexpected things such as go-slows and certain of the Government programmes were delayed because of people working to rule. Despite that, the programme was fulfilled. That goes to show that if we really set our minds to do something, and if all unite, we can do it.
That is the starting point of this year's programme. But to a certain extent this year's programme is different from last year's. First of all, we are looking to the long term. Secondly, we have had the Green Paper which asked for, and got, views from various people. If we go through the paper we will find that 21 studies have been made, are being made or will be made. Although people may have said that last year's document was political, this year's document is by the Government except that we still have the three main aims: full employment, reduced inflation and reduced borrowing.
Everybody in this House believes in those aims and will be glad to see them achieved. We are all one in this. I do not propose to go into any figures to prove this or to question it. Already we have people questioning the targets in the White Paper. In yesterday's Evening Herald a well-known economist gave his view that the year ahead would not be so good and he gave figures supporting his argument. Either his attitude was wrong or the attitude of the media was wrong in the way they reported it. If we all agree that those targets are worth getting, some people may say: “In aiming at targets we all want to get, I have a different view from the Government”. That is not the same as saying “It looks as if we are not going to do what we all hope we will do”. The most important thing we have to deal with at present it attitudes. We are all used to talking in figures, balance of payments, growth, inflation and so on but the attitude of everybody in the country is important to us.
Senator Harte this morning said that sometimes this phraseology is wrongly interpreted down the line, and I feel there is a responsibility on everybody to get the right attitude by learning exactly what is involved. There is an Aesop's fable about a chap who came in and saw somebody blowing his porridge to get it cool and somebody else blowing his hands to get them warm, and this anomaly was shown. But there was a scientific explanation to that when you understood it.
Somebody outside, should come into this country and ask us what are we trying to do and what is wrong, and we could turn around and say we have an awful lot of people unemployed on the one hand and we want to give them jobs, and on the other hand our roads want doing, we want bridges, we want water supply schemes, we want our land drained and a lot of other work done. That person would say, "Why do you not put them to work and everything is solved?" But, unfortunately, we have to consider money, which is a measurement, and although we have the labour to do these jobs we have not got the machinery, the fuel and all the other things, and therefore we have to give of our resources in the form of money to somewhere else to get other things back.
Our resources are limited to land, what is in the air, what is in our water, our rivers, our lakes and under the sea. That is what we have got. So we have to convert it, to sell it, to get from somebody else, and this is where the money comes in.
That person could say, "Why do you not, like in the old days before money, start swapping one with the other?" The point is we are doing it but we are not doing enough. One of the reasons why we are not doing enough is that although we are spending as much money as we have on infrastructure and in this White Paper the Government are providing schemes to do as much as possible, with the standard of living that we demand, and we demand products from abroad to give us that standard of living, we have not got enough money to be able to do what we want to do. Our problem is to get money from outside the country. Therefore, we have to produce more and sell more and get the best price we can. By doing that we will be creating jobs and helping the economy.
Our first source is land and, therefore, in the White Paper the Government create the climate to get extra production. In the Government programme, without going into detail we have the formation of AnCOT who co-ordinate all the services. Research is continuing, there are schemes to improve stock, to provide finance for drainage, education, advice, and there are financial incentives. But how do you get this done? It is the attitude of the people who have to do it that will decide whether it is done.
In this programme there are money incentives, but do we have to have money incentives to get things done? Is there not the general overall incentive to reach those three targets knowing that if we reach them everybody will benefit? Can we see that down the line? In getting a better price for our products I do not mean just putting the price up. What I mean is selling what we have to sell in the form which would bring us the best price, selling our milk in as many processed forms as possible to get higher prices, selling our beef, sheep and lamb processed to the limit, so that we are selling the best quality with the highest added value. By doing it that way you are creating more jobs along the line.
I believe we will get it done if the attitude is to get it done. You cannot say that it is the Government's job to create the attitude. The Government create the climate but we have organisations in this country who have taken on the responsibility for certain groups and these organisations should pass down the line what we are trying to do, get the attitude changed and help it to be done. Farmers must see why this and that is being done, and to a certain extent in the case of farmers there is an obligation on the farming organisations to create the attitude that what we are trying to do is not to bring in immediate, financial benefit to farmers but long-term permanent benefits to the community. We have a similar problem in industry. We have to export more, produce more, give the quality that will be competitive, and finally we have to give value.
The Government's programme gives aids for production, extra funds for all the agencies, IDA, CII, AnCO, SFADCo. In other words, the Government are creating the climate but our problem is, can we get the right attitude to get our industry efficient, competitive and expanding? Has it been accepted throughout industry that that is what our attitude must be? By what is happening at the moment it does not look as if it is. Therefore, why are we not working as a community to a long term aim to improve the community in general? Is it because we have divided ourselves up into a lot of sections.
I have been looking at some of our divisions. We have employers and employees, we have low paid and high paid, we have PAYE taxpayers and other taxpayers, the private and public sector, manual and non-manual labour, and, of course, we have men and women. We have sectioned ourselves and we have sections vying one with another. If we are to get the right attitude this sectional interest, each striving to get an immediate gain for its own section, must go. We appear to have lost reality completely. I do not mean the workers, I mean everybody. Even the senior executive has to have as good a car as the fellow in the next door job. It is not just the workers. A trade union official recently said that his job was to get the most for his members. I do not agree with that. I think his job is to get the best for his members, and the best may not be to get the most.
One of the main things from which we are suffering in industry at the moment is strikes and the attitude to them. If we have the right attitude that getting increased production is selling more, obviously stopping work will not help. So why do we stop work? It is not necessary to stop work to achieve the aim. The same aims can be achieved without stopping work.
Looking at the causes, there are two fields in which strikes might take place. One is on the shop floor where a dispute might start if somebody is suspended. It could be settled on the shop floor. Why cannot we have an arrangement that if there cannot be immediate agreement with the management to get it settled, a rights commissioner should be called in and both sides should agree that whatever he lays down is right?
On the other hand you have the second field which is usually negotiating wages and conditions. If we cannot get agreement at negotiation level why can there not be a proper arbitration court set up to which both parties can demand to go immediately, and I am stressing "immediately", to get a settlement? We accept this type of thing in other fields: in the field of sport, you accept the decision of the referee; if I go out in my car in the morning and have an accident and have it damaged and I cannot get agreement on the cost of the damage from the person who hit me, we take it to court, and when the court makes a decision we accept it and that is the end of it.
The reason I am saying that is that in the last couple of days a representative of the Irish Transport and General Workers Union blamed the Labour Court for a lot of the strikes because of delay. We have conciliation procedures and I am not too sure that it is best to have conciliation procedures because it takes time. One of the things that causes trouble is not settling something as soon as possible. When I suggest that we have an arbitration body I am suggesting something sophisticated which would bring out a just and quick decision. They would have comparative figures of production costs, wages, productivity vis-a-vis our competitors in other countries. They would have comparisons with different types of workers from the top to the bottom in our own society so that when you get a decision you would feel you had received justice. I agree that this is important at the moment. Senator Whitaker has referred to it and the report from the Commission on Industrial Relations is awaited. I think it is most important, in getting the right attitude, to get this report as soon as possible.
Looking at the White Paper, if we are to succeed it is from now on a matter of attitudes, but I do not see how the Government can change attitudes. The Government can lay down the climate for doing the job properly, but other people have to change the attitudes. Once we accept that we are all trying to go together as one community we will get somewhere. The Congress of Trade Unions, the Federated Union of Employers, the farmers' organisations and even the media must take a realistic attitude.
Therefore, I agree with the Taoiseach's request for everybody to take a realistic attitude and also for restraint. What I mean by restraint is not so much keeping down the amount of income you want. What I mean is restraint in taking action before considering the implications of that action for the community as a whole—in other words, before going for the bird in hand looking at the long term gain for everybody by restraint and realism. Some of the claims we have got and are dealing with would, of course, make economic progress absolutely impossible. Whether we are being infected from outside the country, I do not know, but if we are we should get rid of it quickly and realise that we are Ireland and that we are working for Ireland and for ourselves.
I do not think there is any suggestion of a programme for tightening belts. What we are suggesting is that if you open the belt to be able to fit in all you can grab immediately, you may be caught with your trousers down. I would like to congratulate the Minister on this programme and hope that I have demonstrated that this programme can be successful provided we can all agree that the targets are targets we want to achieve and that with the right attitude throughout they will be achieved.
I am very glad that we have been given an opportunity to consider the White Paper at this early stage. After the publication of this White Paper it perhaps should not have been put on the Order Paper the first day we met. It was a pity that Senator Whitaker had to ask twice for it to be included for debate. We must welcome it now that it is here.
We cannot proceed without plans in our attempt to continue the growth in this economy. It was often an accusation that was levelled at the last Government that they were staggering from crisis to crisis without any plan at all. That was partly true. It remains to be seen whether the White Paper and Green Paper that we are debating now amount to a plan or whether, if you call something a plan, it actually becomes one. Senators so far in this debate have emphasised that it seems this country appears now to be staggering from crisis to crisis, despite White Papers and Green Papers. The reason it seems to be staggering appears to be because of an out of hand industrial relations situation on a wide front, and inconsistency or the vacillating attitude of the Government when faced with large pressure groups.
All the documents in the world will not convince the ordinary people of the country, whatever about convincing ourselves in this atmosphere, that things are actually under control and proceeding according to some kind of plan, because all around them they see a fair amount of chaos. For one person the chaos might be measured by the fact that he or she cannot make postal communication at all with loved ones across the water and perhaps has to do without news or much-needed money that they might normally be getting from abroad. There are the minor irritations of not being able to find out what is going on to the very major difficulties facing business without postal or telephone service. That would amount to a crippling of efficiency in both the private and public sectors. That represents a fair amount of chaos and a crisis situation.
Having been unable to make contact with anybody in the post, they then come out to their front door and trip over the dustbins which were put out a week before in the hope that the dustbin men might come along and collect them. If it is a fine day the heart rises at the thought that the rubbish will be collected today, but it is not the right fine day so it is not collected. A lot of rubbish lying around the roads creating a health hazard and encouraging rats also amounts to chaos and crisis.
The plan we need is one which will make all the other plans work. We need the acquiescence and co-operation of the workforce in the general striving for progress. That is the plan that seems to be the great minus factor in all the documents we have been getting which in the industrial relations area amount to pious aspirations which are wrecked by industrial chaos. A commission on industrial relations will not solve our immediate problems. We would have to wait too long for their report.
I should like to dwell for a moment on the possible reasons for the use of the strike weapon. Very often it seems as if it is used as a first recourse rather than as the very last resort. Turning to management, they seem to be taken quite by surprise when trouble breaks out in industry. That is totally ridiculous because management are supposed to be looking to the future and anticipating what is going to happen. That is what management is supposed to be about. Working conditions and job dissatisfaction may be an area causing trouble. Has that sort of concept got priority in the management of public and private companies? I would say that no Member of this House has ever done the job of a corporation refuse collector and I would not willingly contemplate doing it, particularly in the atrocious weather conditions we have had this winter. I certainly would not like to do the job of postman in all weathers and I do not know if anybody in this House has done this job. Postmen may be harassed by quite malicious animals and also malicious people. Bus drivers are often struck in the most frightfully depressing traffic in Dublin in unmoving lines, at unsocial hours which are common to a lot of the areas where industrial trouble starts. Bus drivers are responsible for the safety of a great number of people and are abused by a great many people. We should have an in-depth examination of working conditions and job satisfaction in the areas where strikes are occurring with such frequency and such devastating effects. People spend most of their waking hours at their work and a lot of the work of these groups that I have spoken about is at best dull and repetitive, and at its worst it is dirty and actively unpleasant. In some cases it may be injurious to health either in the short or the long term. Progress has been made in improving conditions but we still have people working in unnecessarily bad conditions. But however lowly they may seem, these jobs are vitally important to the running of society and this should be recognised and the people doing them should be given assurance of that importance.
There is a very quick public disapproval of strikers when trouble breaks out, but I would urge people to think carefully. There was a certain breakthrough in the last bus strike when the people realised the kind of wages the busmen were expected to bring home to their families after working a very long week in a responsible job at very unsocial hours. I found out recently that in Russia if there is any talk of real trouble in a factory or problems among the workers, the manager is fired. There is not very much about the Russian system that I admire, but management are supposed to be managing and the reason management are not out driving the buses or pushing the letters into the post boxes is that they are supposed to be using their heads in their offices and at IMI courses with the aim of making the job of producing the goods and delivering the services both viable and profitable.
A generation of Irish and British managers have lost contact with workers. I make a plea here for a fresh look at industrial trouble in all sectors particularly in those where we seem to have increasingly frequent strikes with consequent frequent serious disruption of ordinary life. Managers sitting in heated and insulated offices with secretaries answering phones, making tea and generally keeping reality away from them and not working on Saturdays and Sundays have a very different lifestyle from that of the men and women dealing with reality. The lot of the bus driver or the postman is analagous to that of the ordinary housewife who is in the heat of the day doing all kinds of jobs with nobody to insulate her from any aspect of management of her household or her children. Managers are far too insulated from reality.
A person whose waking hours are spent in work which he considers to be boring, valueless and actually unpleasant may be compensated to some extent by more money. Money may not improve working conditions but it can give a feeling of being worth something and that a job has some value.
A good look at the factors, apart from pay, which are causing great trouble in these jobs could lead some distance along the road to a solution. The EEC have a very fine institution who investigate living and working conditions, but they are slightly isolated out in Cabinteely and I have not heard anything about them since they were started with a great fanfare of trumpets. Let us ask them to do a very rapid study of living and working conditions in this country which seem to have produced the worst industrial troubles in the EEC, apart from Britain.
In section 1 (8) of the White Paper we are told that a study is being made of the adequacy or otherwise of unemployment statistics. I have mentioned this before and make no apology for mentioning it again. A vital omission from the unemployment statistics is the unemployment among married women in Ireland.
I draw the House's attention to a survey which was done by the EEC in 1975 called and published under the title European Men and Women. It was carried out on a wide range through all the countries of the EEC and concerned general attitudes among men and women towards a very broad range of social issues. One section dealt with the attitude of women towards working outside the home. The responses were very interesting. Married women responded as follows. Sixty per cent of all married women would, if they had the choice, prefer to work outside the home, at least part-time. Of those already working 80 per cent would prefer to work outside the home. Of those married women who do not work 56 per cent would prefer to work.
That was in 1975 and presumably the material was collated in 1974. It is beyond all doubt that there would be a big increase on that 56 per cent now. We are talking about more than 35 million people in the EEC on the whole who would like to work, who do not appear on unemployment registers and who never have appeared on unemployment registers. The major reason given by those women for not working was the great difficulty of returning to work after a break of about 10 years for childbearing and rearing. Inflexible working hours, no help at home with domestic work—that means no help from husband or children presumably and no other kind of help—and no access at all to efficient or cheap help with child minding, were the main reasons why that 56 per cent were not working, and why they had decided that their skills and training would have to be used for one job only, the job of homemaking.
The latest figure I have for married women in Ireland working outside the home is about 14 per cent, and married women amount to about 3½ per cent of the total workforce. These figures are considerably lower than those for any other country in the EEC. In this country there is an enormous unemployed group composed of married women who would very much like to work outside the home if conditions made it possible for them to do so. They may amount to about 300,000 people which is a nightmare for the Minister as he sits there juggling with his employment figures. No Government have ever contemplated this aspect, but the fact that it is a new idea certainly does not make it wrong.
This Government should have the guts to carry out a survey in 1979 of married women in Ireland to find out their real wishes about employment—or would it be too dangerous an experiment? The last survey of this nature that was attempted was done by the ESRI in 1971 and a complication in Ireland was a very large farm population where the wives were very much involved in the farm work. Of the non-farm population in 1971, 28.5 per cent of the wives would have liked to work outside the home. That was in the days before Women's Lib really got going in this country and when women were thrown out of jobs the day they got married. The marriage bar was removed only in 1973. If in 1971, 28.5 per cent of non-farm married women wanted to work, I would suggest that that figure would be up somewhere around 50 per cent now.
One of the reasons for not working which was not given in the EEC survey appeared in the Irish survey of 1971, and that was that many married women said that it simply would not be worth their while to work because of the incredibly high taxation they would face. Married working couples pay more tax in any one year than the whole farming community pay. However, we did not get a meeting with the Taoiseach, the Minister for Finance and the Minister here present to get that changed, so we are bringing the matter to the High Court.
If it is established that an enormous proportion of the married women of this country wish to work and are unable to do so, the pressures to get something real done about it will be very great. The Government should not be afraid to take the necessary steps. On the one hand is the problem of giving employment and on the other hand is a vast pool of very talented people who have been trained and educated at the expense of the taxpayers and who are wasting their resources and not putting them at the service of the country.
Even a realistic attempt to subsidise private enterprise by the provision of well-run nurseries and play groups would be a great help. The extension of the opening hours of schools so that the slightly older children could get their homework done in a supervised way at school before they come home would be of great value. I spent years when I was 12, 13 and 14 years of age doing my homework in school because children stayed in our school until 5.45. We got all our homework done in a supervised study room and when we came home the family were together for the evening and there was no hassle about homework. It seems crazy that all the schools are closing down in the middle of the afternoon when they could easily stay open for a couple of hours longer.
Part-time working and job sharing were touched on in the White Paper, but not with a view to giving more opportunities to married women. They are mentioned with a view to trying to solve the unemployment problem. There must be a completely new approach to maternity leave and paternity leave. We have not even got maternity leave yet, and goodness knows how long it will take before we have paternity leave. Mothers and fathers should be able to consider their working lives and their domestic lives as inter-related units which are not contradictory. There should not be a contradiction between being a parent, that is a mother or a father, and being able to have a career, not necessarily full time when children are young.
This country, more than any other EEC country, imposes a lifetime economic penalty on the married woman who is a mother because we refuse to recognise that she has a life after marriage apart from the bearing and rearing of children. She is penalised for carrying out the most important social function of all which is the nurturing of the next generation. The Government should show some concern for this very large economic group by launching a survey of the type I have mentioned. It could be done by including suitable questions in the limited census we are to have next year. If we tackle this kind of question now we will avoid possible grave social problems in the future which would be caused by women continuing to work after marriage, because women are determined to continue to work after marriage.
The era of the woman working fulltime in the home for 40 years after she gets married is totally gone and that should be recognised as a fact. There is, too, the iniquitous system of applying an availability criterion to unemployed married women who have young children. It is extremely unjust that a woman who is willing and available for work can be told that she is not available because she has young children, even if she brings proof that she has made arrangements for the minding of her children. It is a presumptuous and arrogant way to treat married women who are looking for work and of course it keeps them off the live register. It is an immoral way of keeping down the number on that register. This is one major fault in the unemployment statistics which I hope this inter-departmental study group will be tackling.
This White Paper ignores what is perhaps the most striking factor in the labour force in any EEC country, namely the increasing economic activity of women, and particularly married women. It is the biggest single dramatic change in employment patterns, and planning which does not include this group is not planning at all. Another aspect of married women working is embodied in a report of a conference which took place in Dublin in November 1977. It was called Women's Place in the Irish Economy Present and Future and it is the report of a large seminar which was opened by the Minister for Labour. Extremely interesting facts and figures came from the various speakers at that seminar, and one of them pointed out that we have the highest dependency rate in Europe. I quote:
In 1975 the nine countries of the European Community had an average of 145 non-earners for every hundred earners. For Ireland the figure was 174.
That is 174 non-earners for every hundred earners.
This was due largely to the number of children, but also to that of non-earning wives.
The country with the smallest percentage of married women in the work force in the whole of Europe is Ireland.
Huge numbers of people depend on an active population for social welfare help from the State. The skill and talents of the married women must be added to the work-force so as to maintain the revenue necessary if the really disadvantaged people are to be assisted. I must not be construed as trying to force the mothers out of their homes and condemning their children to a latch-key existence. I am talking about the women who want to work, who would like to combine job, home and family but who cannot. I am not talking about the woman who wishes to spend her life at home.
One of the main aims in this White Paper is to achieve full employment by 1983. Are we to understand that the efforts being made to employ special groups do not include married women? Are married women of no account? That seems to be the case. To keep able-bodied, talented people out of the work force is very bad planning.
It is not good to encourage people to retire early because thereby you are increasing enormously the number of dependent people in the country and decreasing the active population. In America the trend is now away from encouraging people to retire early, because life expectancy is increasing, thanks to medical science. The young-old, the people in their early sixties, should be encouraged to continue contributing to the economy of the country.
When the Minister and the Government are talking about young people they should keep in mind that half of those young people are female and that that female half have no intention of emulating their mothers and retiring from work on marriage. They are going to stay in the work-force and I hope that the Minister will realise that.
The Minister at the conclusion of his speech said that the Government have done what they were elected to do in tackling unemployment. The Government promised to improve the second class status of women. The omission of reference to one-half of the population from all these documents that we discuss so very carefully is simply not fulfilling any such promise. It is gross negligence. I ask that the Minister, before he brings out another White Paper or another Green Paper, will institute a study of the place of women in the Irish economy, a study which should include as one of its bases a survey of the work-force available to the economy among married women, so that in the next document we have we will get this information plus a major statement of the Government's views of the changing role of women in Irish economy.
I first must dispel Senator Hussey's cosy image of Irish management. In recent years there is no more hard-working element in our community that those who have to work in the unsheltered industries. I would be very happy to educate Senator Hussey by bringing her to one factory and discussing the matter in the context of industry. I admire her line of thought on more involvement of women, but my experience has been that when it comes to the point of responsibility they fall by the wayside. The position of management in Irish industry today is that time is completely flexible, the working hours are anything from 7 a.m. until 12 midnight and I think that, next to politicians, management are the hardest-working force within the community.
Looking back on the developments in the year 1978, I admire the consistency with which the Government have pursued their declared strategy and consolidated the framework in which debate can take place on these Green Papers and White Papers on an on-going basis so that there can be regular appraisal and reappraisal which encourage the maximum of comment from political parties, unions, farmers and the business communities. Those whom I have heard earlier in the debate, who had not the time to read the White Paper, at least had the time to read the comments in both Houses.
I wish that this more orderly approach in administration of our national affairs could be extended to influence more the members of the European Economic Community so that they adopt a more logical sequence in initiating decisions arrived at through the European Commission. If this had happened we would not have had the sense of urgency and confusion which surrounded our entry into the European Monetary System.
What puzzled me—and this affects private enterprise in the amount of time which it has had to give to the EMS—was the sense of ultimatum. I question why the members of the community did not follow the course to be taken towards monetary union outlined in the Twelfth Report on Development in the European Community. This was the adoption of the five-year action programme proposed in December 1977, the endorsement of principles outlined in the economic and monetary action programme for 1978 and the issue of directives necessary to secure implementation in accordance with the proposed time-table. Instead, when the heads of Government met in Bremen last summer, they agreed to work towards establishment of the EMS which overruled the planned evolvement of decisions logically taken at the lower level. Such an ultimatum is out of context with the planning process inherent in the reports on the developments in the European Communities which reports we debate from time to time, and I am bewildered at the motives behind such urgency.
I hope it is not too late to give a great deal more attention to the concern expressed last year by Senator Mary Robinson about the gradual diminution of the power of the European Commission and the taking of decisions outside the institutional structure, which causes processes to fall apart. The endless controversy surrounding our entry into the EMS has been a time-consuming and costly exercise in the private sector. All the progressive enterprises had begun to welcome the publication of the Green and White Papers, on which they could update their annual budgets and future corporate plans based on the macroeconomic assumptions made in such Government reports. Steady progress has been made within the framework of these reports, but the breaking of the link with sterling, together with the prospects of other vast changes due to Irish membership of the European Monetary System, made a lot of the assumptions obsolete. It is ironic that the two countries, France and Germany, which were urging the Communities rapidly to enter EMS, have been at loggerheads ever since. It seems that France is now uncertain whether it can guarantee to keep the pace. Uncertainty abounded before Christmas and Irish business and industry are still, two months later, in a dilemma awaiting clarification of the EMS and Irish membership of it. It would have been far wiser to have urged the EEC countries to come to agreement and co-ordinate economic and monetary policy to reduce the still too wide gap between the inflation rates, and to adopt an action programme advocated two years ago by the European Commission.
In debating this recent White Paper, one major problem which has not changed, is the fact that 47 per cent of our trade is still with the UK, and the competitive disadvantages still remain for many of our Irish manufacturing industries. I must remind the House that the refusal of Britain, a massive net importer of food, to devalue its green exchange rate adequately has meant that British consumers have been heavily subsidised by the rest of the community. Our agricultural exports have blinded us to the fact that food manufacturing and food processing industries in this country are greatly weakened with our entry into the EEC, because of our proximity to Britain, while exporting to Britain becomes more and more difficult, due to the increasing cost disparities.
I should like to refer to what Senator Whitaker mentioned—the improvement in the real income of 25 per cent in our country, in comparison with nil in Britain over a period of seven years. It is my experience that our basic pay, in many areas, is currently approximately 25 per cent above British competitors. Furthermore, Britain appears to have no intention of ending its temporary employment subsidies; they are now referred to as permanent employment subsidies.
As somewhat reluctant members of the EEC, British manufacturers, despite all their industrial relations problems, find it easier to exploit the commercial opportunities of exporting to its nearest and easiest market, Ireland, whilst our exports to Britain become more and more difficult, due to the increasing cost disparities. We have a major problem in the food industry as long as we have to tolerate the anomalous position which allows food processors in the United Kingdom to use their special home market arrangements as a favourable springboard for exports to us and other EEC countries.
One of the most alarming aspects of the list of Ireland's top companies, published by Business and Finance early this year, is the astonishing absence of manufacturers. It would appear that only a handful are engaged in manufacturing, and let us face it, outside the agricultural community, we are a nation of distributors and retailers. This is an opportunity which the British combines have been quick to catch on to, viewing our buoyant economy from across the water. We are very much aware of the problems of the Irish shoe and textile industries, which can be further undermined by more recent announcements of changes in control in the distributive sector. We will not have to face the problem of a rapid revolution taking place in the Irish grocery trade.
We have shown a certain naivety in our admiration of the British Government for not imposing exchange controls during the current transition period. Why should they? The balance of trade is in their favour and they are far too clever to make it more difficult or complicated from their end. In the same way, we should beware of the Brits bearing gifts. There will, naturally, be a great deal of lip service from British retail combines willing to buy Irish products. Even if there is a certain amount of sincerity in their intention, the commercial facts will overrule their business intentions and will indicate that many Irish manufacturers cannot compete with British manufacturers under the existing disadvantageous cost variations.
As far as the multi-national companies operating in this country are concerned, there has been a gradual rationalisation of their Irish operations, in view of the disparity in costs, quite sensibly from their point of view. Check Out magazine has recently highlighted an example of another food manufacturer having exploited the “Buy Irish” campaign, and being now well poised to service from Britain its well-established and highly advertised market.
I repeat what I said in a previous debate, that the Irish consumer is entitled to know the country of origin of the product he or she is buying. Irish television is dominated, not only by British programmes, but by commercials advertising British-made products. I advocate, once more, that our Irish Goods Council should insist that the Irish consumer has the right to know where these products, which they are being encouraged to buy, are manufactured. In a previous debate I illustrated that, in Canada, every advertiser on television and in the press has to insert an overlay of the country of origin of the goods.
Just as Paddy Lane has incited the farmers, "If you do not shout, you will not be heard", I have a vested interest in the whole problem of protecting jobs within the Irish food industry. I feel it is my duty to alert the Oireachtas Members to the grave impact of what is happening in the Irish distribution trade.
Every debate on the EMS has highlighted the necessity to ensure, in order to protect jobs, the short-term allocation of much of the transfer of resources to those indigenous Irish industries with high added-value and high labour content—the textile industry, the shoe industry, the food processing industry, all of which are essential generators of wealth in this country. I am delighted that the Chief Executive of CTT, Scan Condon, supports the policy that the £70 million which Ireland will receive in interest subsidies and grants must be used temporarily to protect the competitiveness of Irish exports, to Britain in particular, while these anomalies exist. In the past these indigenous enterprises have promoted the welfare of the people of their own accord, without the social services and benefits that are now available and have contributed to the economic and social betterment of all parts of the community. They, therefore, must be given sufficient support to continue their active participation in the creation of future prosperity. The survival of all our industries, in free trade conditions, depends on the solution—and I think this has come out very clearly in this debate—of problems in the field of industrial relations in order to maintain a worthwhile share of the home market and to be able to continue to export and keep our nation economically independent.
I agree with the Minister that Irish industries must be able to produce marketable goods at costs that are competitive in the EEC. Apart from the disparities I have mentioned, we cannot do this without a realistic, sound income structure at home. Failure to secure such a structure must damage the Government's objectives, particularly that of reducing our inflation rate to the projected 5 per cent at the end of this year. One blatant lesson that we can learn from 1978 is that incomes increased far faster than envisaged, with the consequence that employment increase was somewhat below target and inflation was slightly above target. One must appraise this situation if one is to control conditions during 1979, particularly, also, as 1978 represented the year of the greatest one-year improvement in living standards since 1968, and included the carry-over factor of the move to equal pay.
We are forewarned about the growing proportion of personal spending on imports. January statistics highlight this trend, which needs urgent corrective action. One would like to see more justification from the Irish Goods Council of their policy in this context. The recent Macra na Feirme survey, for instance, highlighted the fact that shelf space given to Irish food in shops did not match the consumer preference for Irish products.
Senator Whitaker mentioned that there was a need for an education process. I support this, and suggest that part of the funds of the Guaranteed Irish Campaign be switched to an educational programme emphasising the effects which different sections of the community can have on the performance of others, and how selfish actions can put in jeopardy their own jobs and the Government's aim of faster economic growth, lower inflation and full employment.
It is alarming, as many Senators have mentioned, to witness the industrial relations scene at the moment and the converging influence of those in sheltered jobs in the public sector who fail to understand the enormous short-term difficulties which excessive demands will create for those in the unsheltered sector, and for the weak on social and unemployment benefits. As I mentioned in the debate on the ESB Bill, unless some moderate solution is found in relation to pay demands of the public sector, there is little hope of Irish manufacturing industry matching such demands, or being able to pay the increased overheads which will materialise and still survive in freer competition with other EEC countries. In reply to Senator Harte a continuation of this attitude certainly makes it more difficult for the private sector, in competition, to increase employment. It is absolutely vital that our public services operate more efficiently; otherwise, they add to industrial and other costs and inflationary pressures are increased.
The White Paper refers to training and mobility within the public sector. I suggest that there should be a period of secondment to the private sector to gain some practical experience of the cut and thrust of the day-to-day problems which confront the unsheltered sectors of our economy. In fact, I would hope that the training could be a two-way process, in that there would be an exchange of employees from both sectors at different levels, in order to inject revitalised thinking and experience into now highly structured sectors.
During the Christmas Recess, Deputy Michael O'Leary had the courage to admit he was wrong when he was Minister for Labour to give the nation a bank holiday on New Year's Day. I would make a plea on behalf of manufacturers that, in future years, this holiday be in some way incorporated in the Christmas holiday period, which has become far too prolonged and leads to a lethargy towards work. I would hope that, if New Year's Day falls on a Saturday or Sunday, the previous Friday would be allocated as a holiday, rather than the first Monday in the new year. We are going to be in difficulty in this coming year when New Year's Day falls on a Tuesday. Who is going to turn up on the Monday? Momentum is lost as we enter a new year, following the prolonged Christmas holiday period.
I must congratulate the Minister on his stamina and his confident style and various points of view. As head of a ministry, he projects a personal example to our community—whether one agrees or disagrees with him—of the type of unselfish commitment of which this country needs a great deal more, in the running of both private and public enterprises and union affairs.
I welcome this White Paper as an affirmation of the Government's intention to continue declaring its plan for economic development and to invite dialogue and discussion on the means selected to achieve its objective.
On this whole subject, in the past I looked at a lot of individual politicians and saw them as projecting a grossly exaggerated picture of their own importance. You notice this particularly in the years before becoming a politician. The politician takes credit for everything good that happened, dissociates himself from everything that is not good news and a large number of them, to advance their reputation, behave in a parasitic sort of way. I saw the hard centre of political life as outside that sort of behaviour—certainly, I would never have associated Governments with it. As time goes on—and I am not being party political in this, I am laying the blame on all of us—I notice that there is more and more of this sort of behaviour in the whole political world, with more and more politicians, whether they be in Government or in Opposition, trying to cash in on what is happening rather than trying to direct the trend of events or the course of affairs.
During the term of office of the Government that went before this one, I used to have a bad conscience about the whole question of planning. For a period I believe there was genuine neglect. In spite of the economic turbulence of their years in office they should have made an effort to prepare some sort of programme. I did not completely accept that the job was so difficult as to be almost impossible. Nevertheless, when I look at some of the White Papers and Green Papers published in the past and at what is being done today, I am still convinced that most of what we are talking about is not genuine economic planning. I am still convinced that what we call targets are only forecasts, that there is no genuine effort to carry through the logic in these documents to the area where its philosophy or policy is actually translated into economic happenings.
The present situation is that we have almost every section of the community grabbing at each other's throats in an effort to take more of the national cake or get more out of the national kitty. Those who are not engaged at present in that struggle are just waiting in the wings to become involved when they see how the battle will end, when they see whom the winners are and when they make up their minds on how to pursue their strategy.
I see the Government acting more in the nature of a referee in the middle of the whole business. I should not, at the moment, describe the position of the Government as a referee, but more like a fool in the middle. This is the role the Government seem to be playing when, in fact, they should be in the driver's seat. We politicians, generally, have brought this on ourselves. As an example, for years I watched Government Ministers addressing these benches and expressing fears, worries, concerns, views and ambitions on so many things. Now the Government have changed and those people are still around but not a single word is heard. What happened to their concern? Where are all the causes that they so ardently believed in? Where are all the plans that they were waiting to put into operation? They never say a word. The public could be convinced that we are playing games here, and I think they are convinced. We are told that, as the Opposition, it is our duty to oppose. I do not believe that. It is our duty to expose, if necessary, to offer assistance when necessary, and to be as constructive as possible. Nobody expects us to do anything but be unreasonable and demanding, and to frustrate all the Government's attempts.
On the other hand, nobody expects the Government to do anything but avail of every little political opportunity, and to have somebody setting out the figures showing the success of last year's economy. I am completely convinced that the Government, rather than seeking to justify their plans and policies of two or three years ago, should be looking to the future and forgetting, as all of us should forget, the lines taken in the past—what we said would or would not happen—and genuinely seeking to prepare plans that will have some meaning to the average citizen in the future.
I have said this many times before and it is no harm to say it again. There is a serious obligation on all politicians to become more constructive. I used to think the Government ran the economy but I remember saying, from the other side of the House, when we had a debate on Estimates, that I did not genuinely believe that, if things went entirely right, the Government should take credit for it. The budget is the making or breaking of the future economic scene. However, many factors and circumstances that affect our economic wellbeing are genuinely outside the Government's control and it would fit us better to try bringing more of these things under our control, rather than seeking to take credit for things which just happen.
The whole political area is being brought into disrepute by the fact that we are elected to represent different sections of the community. There are people in this House who represent, or are supposed to represent, agricultural interests, vocational interests, trade union interests and so on. In the other House there are people who have an obvious mandate to represent people. Yet, when important questions arise it is not these Houses that are consulted, it is not the Opposition, nor, from my experience, is it the backbenchers in the Government party. No matter who is in power, the people I see coming out of Kildare Street, out of the offices of the Ministers and of the senior civil servants, are the various pressure groups. I do not see the representatives of backbenchers' committees, or the representatives of special committees with special interests in the various economic activities. I see the pressure groups being represented and being asked for their opinion. In the end, I see the mark of the pressure groups on every economic measure and decision taken by the Government.
I would much prefer to see a situation in which I, as the representative of a particular interest in the community, and other people with a special expertise in that area, could say to the Government that the measures taken or the plans proposed are wrong, that we could get an honest hearing; that our views, if reasonable, would be listened to.
The truth is that our views are not listened to; instead, we have decisions by outside pressure groups. This Government and past Governments are so busy reacting to the pressures of those people with muscle that they have no time or energy to listen at all to reasonable, objective proposals put to them by people in the mainstream of political life. If we are here to represent certain sections of the community, why are we not listened to? The whole process has entirely broken down. Parliament is becoming entirely irrelevant in the whole business of running the country.
The Fianna Fáil Party happen to be in the driver's seat at the moment and we are in Opposition. We must all get a grip on ourselves and ask ourselves if we intend to proceed with the development of the democratic system we have joined, or if we intend to allow this opportunity to slip away. Are we to play a fool in the middle of the different groups attacking each other and tearing and fighting for every available bone and scrap, while we play games in here? Are people beginning to laugh at us? I feel very strongly about that. Looking at this programme for national development I see the areas about which I know something and see the plans and proposals which have been made. I try to relate them to what is actually happening on the ground.
I have personal experience of having been involved in community and local or personal activities which improve life, to some little extent, in the society in which I live. Absolute strangers have come into my county to attend a dinner dance, and have stood up and counted out our community's achievements, the achievements of individuals, as part of the success of a political party. I have heard both parties take credit for jobs created by individuals listening to them, while those politicians were probably in bed or reading the morning paper. It is absolutely frustrating and annoying to see politicians behave in this way. The whole business of politics will lose its relevance unless we grow up and start to relate the work we are doing and the things we are saying to what is actually happening.
I have looked at this White Paper in the area of agriculture. I have asked myself how is it going to affect me as a farmer, my neighbours and the industry in my area? I searched through it for some evidence of something that will actually change things and cannot find a single thing. Again, we have the pious hopes, we have the emphasis on what has been achieved, largely because of our membership of the Economic Community, and because the agricultural community, those with the means to do so, seized on that opportunity and made very good use of it. Beyond that I fail to see the hand of Government in the whole process of development. I hear talk about the farm modernisation scheme and its cost to the Exchequer, just a recounting of things as they are, nothing at all for the future. The introduction of a more attractive revised directive would emphasise the issue of finding whatever additional Exchequer resources may be required to implement it. I do not know what it means. It does not say that there are any of the things that the agricultural community require for their further development. Performance related payments have been talked about but there is no indication of whether money will be available to pay these or whether what it is being proposed is to withhold some of the grant assistance that is already being given in the hope that if it is withheld a better performance may be forced out of people.
I do not think the Government will solve anything by leaving them short of the required capital or the capital that would normally have come to them in the form of grants and doing this in an effort to force them into making more progress. There is no honest proposal in that. We have had all this before. We had the farm incentive bonus scheme; it was dropped and replaced by the present modernisation scheme.
There is a lot of talk about the modernisation scheme. The White Paper refers to this and says it is being looked at by the Government with a view to making it suit better our agricultural conditions. The average farmer does not mind how he is classified, whether he is called commercial, development or transitional. What counts in all this is the assistance, something that will boost his morale, education, some means of increasing his confidence or actual cash to make it easier for him to develop. We have been talking for four or five years about the technicalities of this scheme, something the average farmer knows nothing about. The only thing we can offer in this White Paper is that we will make the modernisation scheme more attractive and more suitable to conditions here.
If we want to develop the area of agriculture—it is not the most popular thing to say—the first thing we need is education. There is no word about that in this White Paper. One-third of all farmers have expressed interest in the advisory service. The service is not capable of dealing with that number of farmers, not to mention all the farmers who could possibly make progress.
We have the evidence of the small farmer incentive bonus scheme that intensive advice and a little financial assistance can go a long way towards rapidly increasing agricultural production.
Ten years ago a Fianna Fáil Government recognised the need to modernise the agricultural advisory services. At that time Deputy Blaney was Minister for Agriculture. He requested the general council to set up a committee to advise him on this. That committee was set up and at the time I was chairman. We reported after a year. Another Minister took his place and it was still talked about. Deputy Clinton came along and he prepared a Bill. He had it ready and practically working when he left office. Deputy Gibbons was not satisfied with it for his own political reasons. I will not debate at this stage or at any other stage in favour of one Bill against the other, because I think that in the end this is largely a political battle. At the present time, under the pretext of improving the whole advisory service, anything that is being done is in order to honour political promises made for the satisfaction of a few a number of years ago. The reorganisation of the most vital element in the area of agricultural development is held up for a full ten years. At the moment we still have not achieved a situation in which the agricultural advisory service know where they are going or can settle down to the job they have undertaken. There is no evidence whatever that when the new body are formed any extra finance will be available to them to provide a better service.
We have a brief reference to the drainage and land improvement scheme in the west, which of course is no credit to the Government but entirely due to the fact that we succeeded in getting £20 million from our friends in Europe. This is very welcome. The truth is that the Government, while pretending to give more money for the drainage and improvement of land in the west, have actually reduced their own contribution. Originally the Government, under the modernisation scheme, paid 50 per cent and 60 per cent, without any limit being imposed on the amount of money which might be invested in the reclamation of an acre of land. Under the present scheme they have reduced their commitment to 35 per cent and have imposed a limit. We can argue that the money which was given by the EEC to improve the structure of agriculture in the west is not actually being passed on and that the Government have availed of the opportunity to spend it on whatever else they like, social welfare or anything else. I do not know where it is being spent but it will get lost in the budget.
If we cannot regulate our financial affairs and the affairs of our economy so that we will be able to make the necessary investment in infrastructure, industry and agriculture, particularly in the underdeveloped regions, we should resolve that whatever we get through our membership of the EEC grants, through the EMS bargaining, the regional fund or however else it comes is spent on development and that it is not used in the budget to finance promises made before the last election. I do not mean to be politically motivated in this. I honestly believe that all Governments should make a genuine effort. I will not deny that in the past regional fund moneys were lost in the same way by the previous Government of which I am a supporter.
There is no mention of what is to be provided to promote the tourist industry. Some people in County Leitrim have taken the initiative and provided housing schemes. They have invested their own money and sought assistance. Selfcatering accommodation has been provided in which tourists, particularly from the Continent, are very interested. This housing accommodation has given employment during its building and the creation of amenities around it. No financial assistance can be made available. Nobody in the Department of the Environment is interested in this whole area of development. Yet, we are told that, if increased tourist traffic comes, it will be the direct result of the plan we are discussing here today.
I first became a member of a local authority 12 years ago. Local authorities at that time had a lot of power in relation to health, housing, home assistance, roads, collecting and levying rates at their will. They have very little power today. The taking away of power from local authorities was bad enough, but taking away from the local centres functions which they enjoyed in the past is much worse.
We are talking now about decentralising. We have set about deliberately taking away from every local authority every function they had in relation to giving grants for new houses. County councils no longer have any function in this at all, and it is the same in regard to reconstruction grants and group water schemes. Opportunities for employment are being taken from the local office in the county town and transferred to the Department of the Environment in O'Connell Bridge House.
The White Paper devotes a small chapter to the whole idea of decentralisation. If the Government genuinely meant to decentralise why should one Department be pursuing one objective—the centralisation of everything—while money is being spent to decentralise in other areas? One cannot forget, particularly with the introduction of new schemes, that new offices and new sections in Departments are being set up to deal with them. For instance, the disadvantaged areas scheme, which was set up in the past few years, is giving a good deal of employment in Kildare Street. Yet this scheme deals exclusively with the west. Every file which is looked at and examined in that office is sent from one of the offices in one of the 12 western counties. Why can such offices not be established in the areas they are meant to serve?
A well-meaning agricultural adviser called to my house recently and talked to me about the whole question of the future of the disadvantaged areas scheme. There is no mention of it in the White Paper, but there are rumours that it will be increased. He told me he had been going out telling this farmer and that farmer what exactly he should be doing and without any consultation or warning he will be made a fool of by a Department which announces a new scheme which will make the things he has been advising people to do for the last year appear ridiculous. When we talk about planning these are the things we should be talking about and not debating figures which, in the end, the average citizen does not understand. One could debate the live register for a month. It is always above the ordinary man's head. If these facts and figures are published in the newspapers every day for 12 months the average citizen will not understand or know anything about them.
The White Paper mentions transport. My area has had a lot of development and a great increase in demand for building materials, sand, gravel and so on. I have seen a situation develop in which every quarry, every sand and gravel merchant and everyone engaged in this industry in all of the Border regions, have lost their competitiveness. Most of them have gone out of business because their transport costs are so much higher than their competitors' in the North.
I recall doing some figures for an industry that employed 25 people engaged in provender milling. I found that it cost £40,000 more to set oneself up with the transport equipment to do that job in County Leitrim than in County Fermanagh. That is too big a burden for an industry to bear. Far too many industries in the Border regions have suffered as a result of this policy. Something must be done about it in the near future.
I see some reference to the new Nítrigin Éireann Teoranta plant which is being completed in Cork Harbour. This reminds me of an undertaking that was given by the Government to the agricultural community when the plant was first set up in Arklow some years ago, that nitrogen would be available to farmers at world prices. I have noticed in recent years that the price of nitrogen here has been consistently higher than it has been in any part of the UK. It appears that this industry, in which so much State capital has been invested, cannot produce the goods at a competitive price.
The problem goes further than that. There seems to be some sort of agreement between our semi-State body and foreign companies to keep up the price of nitrogen on the Irish market. In other words, our semi-State body have conspired with outsiders to fleece Irish farmers for the price of their fertilisers. For that reason, other companies are not prepared to sell their nitrogen at the same price as they sell it at home. They are taking a higher price on the Irish market. They do not want to upset the boat. Their business is so profitable that they are happier to make do with a small share of the business and keep it very profitable, but the agricultural industry is suffering. Irish industry has found itself to be in an intolerable situation where, on the one hand, we are expected to compete and sell things at the right price, but on the other hand, we are being taken advantage of by semi-State bodies who will not give us the quality of service we need nor supply us with goods at the right price.
With regard to infrastructure in the west, I know that for people living in the west, whether they are trying to make social contact or carry on business with Dublin or the east, life on the roads has definitely become dangerous. The development of our roads has been falling down for a number of years. While I know the figures indicate a small increase in the volume of work being done on our roads this year, I am convinced that the service that is available to the ordinary road users is inferior to that which was available to them last year.
The situation is bad enough at local level where we have turns on roads where people have been killed in the past six months, where accidents happen every week. I know of one turn that could be straightened out with an investment, perhaps, of £3,000 and cars worth £25,000 have been broken up on that turn in the past two years. As a county councillor, I have to say to my neighbours: "There is nothing I can do about it because there is not one shilling to spend on that turn. We have not the power to collect that money from rates."
Last Saturday night, somebody told me a boy was killed outside his house last week. He said: "The turn is still there. Is there anything that can be done about it?" I had to say to him: "There is nothing I can do about it because we are at the limit of the amount of rates that the Government will allow us to raise. We have no more money and we are not even able to maintain the roads in their present condition."
That is the situation in regard to infrastructure in the west. If I or anybody else carries out any sort of development, the local authority have no power, no matter how good the cause is, to extend any sort of amenities to that area because they have not got the money. In the past the county councillors could look at any situation that arose, judge it on its merits and if they so desired, they could run a deficit on the following year's rates. They could make a decision to raise the money by any means they so decided and carry out the necessary development. That power is gone. In the whole context of planning for our future, we should try to give back the power to the local authorities to provide the infrastructure and the necessary developments to accommodate industries and other activities that are taking place in their areas.
On the question of wage agreements, I was interested to hear Senator Whitaker speak on this. I was glad to hear him express some reservations about the whole idea of national wage agreements decided according to a particular formula and paid to everybody. Five years ago when this idea seemed to be working well, and when our example was held up to the people in Britain as a good one, I said I did not think it was a good idea because it removed from the whole wages scene the element of people being paid a decent return for their own efficiency and competency generally.
I know this will create problems in relation to the public sector—how does one measure productivity and so on— but whether it creates this sort of problem or not, we cannot proceed to develop a wages policy which does not take into account the performance of individual industries and the various sectors. We cannot, for the moment or for the foreseeable future, get away from the fact that people are not equal. If people want a particular standard of living, if they want to provide themselves with security for the future, if they are prepared to make the necessary sacrifices, to work hard and to learn about their business, they are entitled to be paid according to the effort they put into it. The Government would do well to consider carefully the whole idea of the different sectors demanding a particular increase every year regardless of their performance.
On the question of labour relations, it was interesting to hear Senator Hussey say that in Russia they sacked the manager if there are labour relations problems. Is that not related to what we have heard? There are no such things as bad soldiers, there are only bad generals. There is a lot in this. I honestly believe that many of our industrial problems are not directly related to the financial return people are getting for their work but to the whole attitude of management and staff together.
People, generally speaking, are prepared to be reasonable. There are quite a lot of politicians masquerading as trade union leaders who are bent on the destruction of the system, not all of them but a number of them who are actually mischief makers. Similarly a lot of mischief has been made by employers who demand standards from their employees that they are not prepared to live up to themselves. If we, in Government and politics demand standards and sacrifices, we will have to show by our own actions that we, too, are sincere in what we mean and that we genuinely know what we are talking about.
We used to hear a lot of talk about regional policy, but we do not hear very much talk about it any more. It is interesting to note that, while we hear about the unemployment rate, in the country in general, we do not hear those figures broken down according to the different regions. The unemployment rate in the western seaboard, in areas like Leitrim and Donegal, is twice as high as it is on the eastern seaboard. Any plan or programme for national development should take this into consideration. I do not believe that the Government have to set up a commission, a study group or anything else in order to develop a regional policy which will take into consideration the special needs and problems of people in the less advantaged areas. This is not being done except in one or two cases where it has been done with available assistance from the European Economic Community. This is regrettable. While we have unemployment in an area like County Donegal at 8 per cent higher than in Wexford, Dublin and Meath that is a genuine cause for concern and should be included in whatever plans for national development are being made.
As usual Senator McCartin has stimulated me. It is important that we recognise that target setting is part of planning, and setting optimistic targets is part of planning. If one can harness one's resources around those optimistic targets there is a higher probability one will achieve them. Very often the very fact that one identifies them enables people over whom one does not have direct control to arrange their resources accordingly. I do not think we should be worried about differentiating between targets and forecasts in that regard. If they turn out exactly as figured, then great. If you miss them by some small amount or you beat them by some small amount well and good. I am put off when we get a flight from that.
I have in front of me not only the White Paper but also the Economic and Social Development, 1976-1980, the time of the Coalition Government. The following quotation is one of pessimism:
Plans cannot ensure future growth and prosperity. As the past has shown, the best-laid plans can too easily be frustrated by selfish attitudes and actions on the part of sectional or minority groups. While this paper, therefore, indicates the broad lines of policy which the country should follow it does not contain a detailed blueprint for action over the next five years. That must await acceptance by the broadest sections of the community of the necessary disciplines and dedication to future growth without which the prospect of full employment must recede into the indefinite future.
We will always have sectional interests in a free democracy. They will always want more for themselves. I believe it was Professor Charles McCarthy in Trinity College who said that one of the difficulties in the Irish nation is that we have not learned how to live with growth. I believe we are getting another dose of that now, but to say that one would wait until people settled down before one would plan, one could hand it over to a child then. We need intelligent, creative planning which looks into the options, identifies the few which look as if they can pay off and will get acceptance in a democratic community, and then get on with it. That gives a sense of purpose to society. That is what the White Paper has done.
This nation, looking on it as a company competing in a world market, must be competitive. We must always underline that. That means competitive in costs of production. These costs are not just wages and salaries costs. They are all costs. Managers have got to be good and productive. The recent report of the NESC outlines the problems of Irish management. Whatever I say in this contribution I am not missing that. It has been underlined by two people from the institute where I spend some of my time.
Competitiveness is essential. We must ensure that any development of awards for the social partners and the stake-holders in our various operations grow at a rate that will not make us uncompetitive, which means we must monitor what our neighbours are doing. Monitoring what our neighbours are doing is not just monitoring what the United Kingdom is doing. It means monitoring what all other countries, particularly countries of the EEC, are doing. That has become even more relevant and important with the development of the EMS structure. We will hear more of this as time goes on.
A number of Senators have adverted to incomes policy in this debate. I have always said, in various articles I have written and so on over the years, that we cannot and should not have income increases related to the inflation index. The consumer price index is an indication of what is happening as a result of various policy decisions taken across the nation. It is an output; it is not an input. The danger is that people are trying to forecast what the consumer price index will be. They will then add to their forecast whatever they think will be the real growth and say: "That is the growth in income that we require". That is a formula for disaster because it is assuming, if one takes a pessimistic view of it, that something is going to happen before it does, and then making it happen. It is a formula for determining inflation, not curtailing it.
I have a few figures on this and I hope I can get them across fairly simply. Between 1965 and 1977 the weekly earning figure went up by 5.31 times. It went from 100 to 531 using that as an index. In the same period, the income of the non-agricultural sector went up by 5.4 times. The gross national product in the same period went up by 5.4. As a result of all the industrial relations negotiations, all the bickering that goes on and all the rhetoric, what happened was that incomes more or less increased in line with the current market value of the gross national product. The volume increases in the gross national product in that time, which is the direct real increase, was 1.57 times.
It is interesting to note that over that period of time the consumer price index went up by 3.3 times. I am not saying that the consumer price index always outdistances the growth in the gross national product. It does not. But, unfortunately, at particular periods it can go mad. If one decides on a policy of relating incomes increases to CPI, one will send the incomes all over the place. In 1974, the various quarterly increases in the CPI were 4.7, 5.5, 4.6, 8, 6, 7.3 and 6. Now I am up to 1977. It came back to 4, and last year it was back to 1.7. As the Minister said, he is averaging 1¼ or whatever is the compound effect of the 5 per cent figure. There is no way one can tie a logical incomes policy to that instability. Surely the answer is to try to make sure it does not come up by linking the increases to increases in the monetary value of gross national product; but not at the monetary value of gross national product, which is built on an inflation rate not the targeted one. The figures one comes up with must be somewhere between the real growth rate in volume and the figure which is the desired monetary value of GNP, given whatever assumptions one is making about one's inflation rate. These have been targeted by the Government and they are known.
The National Economic Social Council comments on development for full employment show a projection of GNP. The projection of GNP for 1979 is 7.15 billion which represents a 13 per cent change. The Minister may say I should not be quoting figures of this kind because they are from the NESC and not from the Government, but they are published figures. They are figures which the trade union negotiators can look at the same as I can. When I hear a figure of 40 per cent being suggested or when, as I saw recently, a British-based union, the ASTMS, comes up with a figure of 20¾ per cent—reading the report I could not see the basis for it—it is only right that public figures like ourselves who attempt to understand these things should say it and say it straight. That is what I did as far as the ASTMS policy is concerned.
I am not saying that British-based unions are the cause of this. The attitudes that underline the industrial relations situation in Britain will overlap into us because of the bombarding that we get from their television stations and newspapers. But, on top of that, if we are linked to them through the trade union system, it is also natural that the British-based Irish unions would, without realising it, take up some of these attitudes. We cannot afford them in a situation where we are running our economy more sensibly than we ever did before. We are achieving real growth and increases in employment. Industrialists and entrepreneurs know that there is some reward for their investment and for their efforts. All that is happening. We do not want those other attitudes imported here by chance. People like myself should not be afraid to say it. At one time food ships came up the Liffey and helped Irish workers. I am not saying that good things did not come from the UK. But bad things came from it as well. There were also other ships that came up the Liffey that we did not want.
The message is this. If you are going to operate in this country, operate under our terms, take into account the kind of philosophy we have, the kind of growth we want, the level of targets we are suggesting and the mechanism we are suggesting for their achievement. Work along with those and everybody will be welcome. It is very easy to have discussions on matters like this with people like Donal Nevin and Matt Merrigan. It is a different matter when one has to do it with an Englishman.
There is an underlying logic which can be followed. We must stay competitive. We have to learn how to live with growth and not all want to catch up with everything we think we have lost in the past the first time it appears around the corner. We cannot have certain sections of the trade union structure saying they have to catch up because relativity has opened up, given that it is declared ICTU policy to have higher increases for lower paid workers with which everybody agrees. If they get them, then one cannot go back and redress the balance by closing relativities again. Either we accept the policy or we do not.
I welcome the recognition in the White Paper of the requirements of the inner city. Some other Senators have spoken about the areas that they live in. The area I work in, Dublin North-Central has many problems. I am not altogether happy that all of the Government's policies are dead in line to deal with them. A lot has been done in terms of money made available for youth employment projects and new types of industry on a pilot basis. An interDepartmental committee, for which the Minister is responsible has been set up to look at this. We all hope that the committee will put forward recommendations which will help alleviate the bad situation which exists in the inner city.
Senator McCartin spoke about the unemployment rate in the west being higher than that in the east coast. It all depends on what part of the east coast one is referring to. Some parts of the west coast managed to retain their employment numbers successfully, even in bad times, while in the inner Dublin area unemployment went up on average by almost 25 per cent. In certain areas, according to reports, it is in excess of 50 per cent. That would be dealt with in the same way as the regional problems of the west. It is interesting to recall when we were talking yesterday about the Údarás na Gaeltachta Bill that it was the work of Gaeltarra Éireann which managed, in a population of 70,000, to increase employment, from 1965-1977, from 750 to nearly 5,000. That happened because there was a concentrated effort by one agency focusing on the problem. I hope that we will have a concentrated effort in the inner city as well to clear up the mess that is under our noses which we are inclined to forget about as we drive through the city to our various suburban homes.
The other aspect I should like to refer to is the danger of accepting national figures and applying them to isolated problem areas. There is not a sufficient rate of house-building in the inner city areas. The sooner the authorities, the Department of the Environment, Dublin Corporation and so on, recognise that small clusters of houses built in derelict areas of the inner city, not the big 100 and 200 schemes, is what is required to revive the inner city the better. I would like to see a little more of that. Things are going well. There are improvements but we would like to see a lot more.
When we were discussing the White Paper last year, there was a certain pessimism in the Opposition benches about our borrowings and what was going to happen to them. We had long speeches about the extent of our foreign borrowings, how they were going to drag us down and so on. The factual out-turn of the year's trading shows that the foreign borrowings in our Exchequer borrowings are of the order of £20 million or £30 million out of a total of something like £810 million. When we discussed it at that time I made some rather two-pointed remarks about some of the contributions. I said that it was all very well to be pessimistic and then to say afterwards: "I am glad things worked out all right," or if they did not work out all right, to be able to come back and say: "I told you so". In order to run the country one must set challenging but realisable targets. That is what we did last year and that is what the White Paper is setting up as a challenge for the coming period.
I welcome this opportunity to discuss the Government's White Paper: "Programme for National Development 1978-1981".
The Minister and a number of Senators referred to the rather sensitive question of targets and forecasts. The Minister made some distinction between the words. I do not intend to enter into that treacherous minefield. I will leave it to those with a specialist interest in and command of the language and with, I hope, some memory of what Lewis Carroll said about words.
I should like to respond to Senator Mulcahy's opening affirmation that the Government's duty is to set optimistic targets because this is a way of ensuring that there will be a concentration on trying to achieve those targets. To some extent, it is important to move forward and try to create the kind of climate and objectives which will help us to surmount the very real problems which we are aware of and which have changed significantly in the last few years. It is appropriate that the Government set targets. But, if we adopt the approach of Senator Mulcahy, which appears to be the approach of the Minister and the Government, of making the targets so optimistic in some areas that they are no longer the credible targets on which the country moves and assesses itself, then it is a rather dangerous area. I have been struck by the extent to which some of the targets in the Government's White Paper are not taken seriously by industry. That is serious because it points to the credibility of politicians about which Senator McCartin spoke with great sincerity and feeling.
I am talking about certain targets, for example, that the rate of inflation would be 5 per cent. Industry is anticipating an inflation rate closer to 10 or 11 per cent. I do not say that with any pleasure. I wish it was realistic to think that the rate of inflation would be 5 per cent. There is a very sharp divergence between what appears to be the realistic assessment of those involved in trade and industry and the Government's target. On the figure of 6½ per cent growth, the main body of objective opinion appears to be that it will be 4 or, at most, 5 per cent. There is room for leeway and, if the Government do not reach the full targets that are set, it is fair enough. There are two consequences of setting targets and repeating them over and over again when they lack a basic credibility. First, they undermine the political credibility of a Government and, secondly, they raise false hopes, particularly in young people. By repeating again and again the achievement of full employment in the way in which the White Paper does, there is a danger of creating a social problem. It is extremely important to realise the nature of the problem. We now have an exciting new situation where we have a rapidly expanding and growing population and the challenge of absorbing in the next decade another 500,000 citizens whom we must educate and ultimately provide jobs for.
To suggest, as the White Paper does, that the target is a relatively easy one to achieve in the sense that it is one that can definitely be achieved on the basis of the strategy being put forward with its emphasis on private enterprise and incentives to private enterprise to create employment, is dangerous. The reality is that private enterprise is not in the business of expanding employment. There is an overall decline in industrial jobs. The whole problem of advancing technology is that there is a movement away from the creation of jobs in the industrial sector through private enterprise in that sense. As a people, we must realise the immense challenge which we face, in a community sense, of absorbing for the first time a young and growing population. We must realise that we have great advantages in our natural resources, in our potential and in the developing state of the economy. We have a higher growth rate than other countries of the European Community. We must harness growth in a much more conscious way. We cannot do it on the basis of the strategy which is adopted and supported by the Government.
There are a number of identifiable problems about the present strategy of relying so substantially on jobs being created by private enterprise. In the White Paper the jobs target is revised downwards by 10,000, but nevertheless, the main emphasis is still on private enterprise. The Government have launched a very substantial capital intensive campaign to attract foreign enterprise to locate in Ireland. We are seeing a pattern which appears to be getting worse and which is very worrying. That pattern is to attract major industries from outside, multinationals, and foreign owned and run industries, to locate in Ireland and create employment by using this country as a base from which to export and benefit from the export tax relief. The people they employ are, to some extent, those made redundant in other sectors of industry—for example, traditional Irish industries which failed to compete in certain instances in the larger EEC context. There is a substitution of people who were employed in Irish industry who moved to the new industry attracted here by a very competitive package of incentives. This creates employment and can be entered in statistics. It can be referred to by the Government. As Senator McCartin said, the Government and politicians are very quick to congratulate themselves on the achievement of some target of employment creation.
I am not against the attraction of foreign industry or the giving of incentives to business concerns to locate industry here. But the present pattern and trend are disturbing because too much industry here is now foreign owned. The growth in the industrial sector is based too much on capital-intensive, foreignowned industry locating here for the purposes of export. The jobs created are not necessarily long-term or related to the Irish environment. A lot of the raw material is imported and the goods manufactured benefit from the export tax relief. We need to be aware of the danger of industrial landlordism, which is equivalent to the landlordism which was a problem here in the past. We need to wake up and realise that it is extremely important that our productive uses and forces are in Irish hands and under Irish control and that we create, through our own efforts as a community and through the incentives which we provide, employment for our people.
For that reason I and other Members in the Labour Party find it disappointing that this White Paper once again appears to turn away from the proposal for a national development corporation. That is one way of ensuring the creation of jobs for our people. The White Paper is almost dismissive of this on practical grounds although it does not spell out why this is so. The Minister, in his reply, should develop Government thinking a little further. That would be helpful, because it is the clearest divide in principle between the Labour Party and the trade union movement, and the Government's present strategy. It is a key issue on which to seek clarification.
Paragraph 4.32 of the White Paper states:
The Irish Congress of Trade Unions in their response to the Green Paper also emphasised the important role which the State-sponsored sector could play in contributing to increased industrial development. In this context Congress advocated the establishment of a National Development Corporation. The Government are in agreement with Congress on the need for an expanded development role for the State. However, the Government are of the opinion that, for the moment, for practical reasons, the best way to realise the developmental potential of the State-sponsored sector is with the aid of the Industrial Development Consortium rather than through the efforts of a National Development Corporation. Such a Corporation would take a considerable amount of time to establish and develop to the extent that it could exercise an effective industrial development role. The structure of the Consortium allows it to adopt immediate and flexible approach towards encouraging and assisting the development of State enterprises while allowing them the degree of autonomy necessary to function as commercial bodies.
The White Paper goes on to say that the Government will be influenced in their views by the increased powers given to the IDA.
As I understand it, the Industrial Development Consortium is really a link between senior civil servants and those working in State-sponsored bodies. It lacks the potential to develop the resources of the State in a commercial sense and create employment for our people. The reasoning is very hard to understand: that, for practical reasons, it would not immediately provide substantial new jobs. Other chapters and sections in the White Paper refer to measures which the Government will take which they know will not result in jobs in the short term but which they hope will provide jobs and advantages in the 1980s. Therefore, if the Government's argument is that the establishment of a National Development Corporation will not this year provide substantial jobs, they are probably right. It is something that has to be given more than six or 12 months to develop in a very positive way. It is an alternative approach to solving what the Minister rightly focussed on as the major problem—that of creating and providing employment in Ireland for Irish people in an entirely new context, not in a context of growth.
We have had growth and will benefit from the growth in the economy over the next few years. We can differ about the size of the growth, but it is there.
We have an entirely new situation, which is the challenge of absorbing a very fast growing and young population. The difficulty of the overall economic strategy adopted by the Government, with its very substantial emphasis on private enterprise and incentives to capital-intensive industry from outside to locate here, is that it is not going to provide the strong base at home which will be necessary to prevent the economy from suffering from cyclical problems. We see the enormous problems that are created when a large plant like Ferenka closes. It is not the appropriate strategy to adopt for a country with the vulnerability in energy which Ireland has. The whole subject of energy is dealt with rather briefly in the White Paper, although there is a reference to the fact that we are very vulnerable, that we import 80 per cent of our energy and that we have adopted the kind of strategy which is very intensive in energy use. The only answer that the Government appear to be prepared to put forward is that they are at a stage of considering the question of a nuclear energy station. Paragraph 4.5.1 of the White Paper states:
...serious examination is being given to the feasibility of, and need for, a nuclear energy station.
We had an advance on that at the recent Fianna Fáil Ard Fheis when the Minister for Industry, Commerce and Energy made it clear that there would be a public inquiry on all aspects of the decision before the decision is taken. This is absolutely vital because we are not just talking about the important environmental and safety aspects but about an economic strategy.
Debate adjourned.
The Seanad adjourned at 5 p.m. until 2.30 p.m. on Wednesday 7 March 1979.