Posted tagged ‘social partnership’

Social partnership cast as villain?

December 15, 2010

It is a widely held view – and one that I share – that recent Irish prosperity was in very large part the product of the 1987 Programme for National Recovery, which was negotiated early in the third term of office of Charles Haughey as Taoiseach. This was a ‘tripartite’ agreement, i.e. between the government, the employers and the trade unions. This programme, together with the next two or so national agreements that followed at fairly regular intervals, laid the groundwork for Irish success by prompting major increases in the competitiveness and productivity of the Irish workforce. This in turn was partly achieved by bringing previously economically inactive citizens (mainly women) into the economy, generally at lower pay than that enjoyed by longer established workers.

If the 1987 agreement was a founder of the Celtic Tiger, it is the view of some that more recent tripartitie agreements have helped to destroy it. Yesterday it was revealed that a report into the Department of Finance had suggested that social partnership ‘did enormous damage to the financial system’. More significantly, it was also reported that Fine Gael’s Richard Bruton agreed with the criticism of social partnership, thereby perhaps signalling that a new government may abandon this particular mechanism.

I do not at this point have access to the Department of Finance report and so cannot judge the merits of what it is reported to be saying, but it is perhaps arguable that social partnership at some point stopped addressing economic progress and focused instead on ‘sharing the cake’ that was then still believed to be the output of the Celtic Tiger. Asa a result productivity and competitiveness declined.

It is not necessarily correct to conclude from this that social partnership las lost its purpose. It would however be fair to suggest that if it is to continue it must be re-calibrated to reflect our changed national circumstances. But there is, for me at least, no reason to conclude that we could not once again set out on the road to recovery through a social partnership agreement on the model of the 1987 Programme. However, this would have to be built on a recognition that pay and benefits and working practices that were appropriate in the apparent boom will not be acceptable now.

Public Service Agreement 2010-2014

April 3, 2010

As Irish readers of this blog will know, earlier this week the government and the social partners concluded a new Public Service Agreement, which provides for certain safeguards for public servants in relation to pay and conditions in return for acceptance of and cooperation with public sector reforms. Assuming for a moment that this agreement is ratified by the employers and the trade unions (and this cannot be taken for granted), the deal will resuscitate the idea of social partnership as the framework for national economic and social development. This will have significant implications, probably on the whole positive.

However, there are issues for higher education that will need to be looked at more closely. The agreement has a second part which contains what are described as ‘sectoral agreements’; one of these concerns higher education. This latter ‘sectoral agreement’ is worth some analysis, and I shall be returning to it early in the week. For now, however, it is worth noting that the word ‘agreement’ may itself merit some scrutiny: the ‘sectoral agreement’ for higher education was concluded without any input or even knowledge on the part of the higher education institutions. That does not necessarily mean that it is a bad document, but it may be worth asking how universities, which are autonomous institutions under statute, can have ‘agreements’ applied to them in relation to which they have had no input whatsoever.

Unrelated to the latter point, the main part of the Public Service Agreement ends with the following clause:

’28. The implementation of this Agreement is subject to no currently unforeseen budgetary deterioration.’

‘No currently unforeseen’? What on earth does that mean? I blame the Leaving Certificate.

Social partnership and the Irish economy – what next?

December 5, 2009

On Friday, as the chief negotiator for the Irish Congress of Trade Unions (ICTU) remarked, the government ‘changed its mind’ about a deal with ICTU which would have seen public service employees taking 12 days unpaid leave (though the reports had been ambivalent as to whether these days were to be taken during 2010 or whether they could be stretched to a number of years). Earlier in the week the parties had let it be known that a deal on this and related matters was near, and on the strength of that ICTU called off the strike that had been planned for this Thursday.

It is slightly difficult to get a clear picture of what had been on offer before it was rejected. It seems that the unpaid leave idea was being discussed (and may have been agreed), but no commentator could see how that could save anything like the sum of money needed to allow the government to cut its costs by the €4 billion needed to move the country towards economic health. In fact, the anticipated agreement was roundly criticised by almost everyone other than the trade unions themselves and the Labour Party; government backbenchers, the Fine Gael opposition, employers, newspapers all criticised the expected deal as a caving in to the unions that would fail to deliver the necessary savings.

It seems from recent developments that there is now an appetite in the country to get the national finances under control. It seems unlikely to me that a return to planned strikes will work well for the trade unions. And given events this week, the question must arise as to whether the social partnership model will survive here. In fact, social partnership was vital in the last period of Irish economic regeneration in the late 1980s, as it produced industrial peace and far higher levels of productivity throughout the 1990s and the early years of this decade. It worked because the diagnosis of all the parties, including government, employers and trade unions, was on the whole similar and the solutions were widely accepted, even where they were bound to be painful. There are few signs that these attitudes still prevail today, and so it seems increasingly inevitable that social partnership will not provide the government with cover as it moves to recreate our economic model.

I have a suspicion – which may turn out to be wrong – that this breakdown in talks will re-ignite militancy in some trade union circles, and that there will be pressure to return to demonstrations and strike action. If this happens, it will produce very little public sympathy, I suspect, and may do long term damage to the trade unions. I hope this is not how it goes, as Ireland continues to need a resourceful and intelligently led union movement. Or at least I still think so.

Universities and the social partners

September 23, 2009

Over the past two decades, Ireland’s economic growth and social stability has been built on the framework of social partnership. Regular negotiations between the government, the employers, the trade unions and some other interest groups have produced agreements that have regulated pay but also secured developments and changes in social and economic policy. These agreements have over an extended period maintained industrial peace – the days when Ireland could have over a million working days lost in a year due to industrial action are long gone – while also producing a huge increase in national productivity, secured largely through extending the economically active workforce to sections of the population previously outside it.

Whether this framework remains fit for purpose is something we shall discover over the next while, but for now it has also placed at the heart of national development the two main bodies representing employers and trade unions: the Irish Business and Employers Confederation (IBEC) and the Irish Congress of Trade Unions (ICTU). And this week this blog has carried interviews with the two leading officers of both, Danny McCoy (IBEC) and David Begg (ICTU). Both men are, as I hope the interviews show, thoughtful and imaginative leaders, and both also have significant experience outside the bodies they now lead. Danny McCoy was both an academic and a much respected economist in the Economic and Social Research Institute; while David Begg was chief executive of Concern, the major international aid agency.

In the interviews, both men have raised an issue that perhaps needs to be discussed more actively: the relationship of the universities with these two organisations. The universities are members of IBEC, but perhaps not prominently so; they often have to deal with trade unions in a bargaining context, but on the other hand many of the social objectives trade unions pursue are also priorities of the higher education institutions.

So where therefore, in the overall social partnership scheme of things, do the universities fit it? Are they just organisations that, in some not always definable way, are represented at national talks without ever being prominently featured? Or could they be more active participants in their own right, setting out and defending the major educational and knowledge-based objectives that must now be part of national planning? Is it time to see the universities as active participants in this national dialogue, rather than just bystanders? Is it time that the universities themselves become much more deliberately active?

Is social partnership still alive?

March 3, 2009

It is interesting to look at the speech made by by the Taoiseach, Brian Cowen TD, at the Fianna Fail Ard-Fheis (annual conference) this past weekend. One of the things I noticed is that he made no reference in it to social partnership. Later in media interviews he repeated his desire to restart talks between the social partners, but previously he had also expressed agreement with the reported view of the General Secretary of the Irish Congress of Trade Unions that such talks were worthwhile only where ‘there is a reasonable degree of confidence that agreement on all the central elements can be found’.

In the context of threatened industrial action and protests, this seems to me to be a matter of some priority. Social partnership, in the form of the Programme for National Recovery, produced the conditions in which Ireland’s economic growth of the 1990s was able to proceed; it was negotiated at a time when Ireland’s economic performance had been terrible, with low or negative growth, considerable public debt and very high unemployment and inflation.

If we are now to slip into a situation in which our recovery plans are the subject of battles on the streets, then it is unlikely that we can achieve that recovery at all, and it is certainly unlikely that Ireland will seem to anyone to be an attractive place in which to invest or do business.

Social partnership does not of course provide easy answers either, as the expectations of the various groups represented may not easily be reconcilable. It may in particular seem doubtful to some whether the trade unions could carry their members in adopting and implementing painful measures, further expenditure cuts and income reductions; those are all inevitable. But even in times such as these there is some room for government action to improve conditions for disadvantaged groups, support the build-up of skills in the national workforce and develop an agenda for equal opportunities and diversity.

We are now looking at a very threatening picture, and concerted action is needed to avoid it. Difficult as it will be, I don’t see how we can easily succeed without involving the social partners.

Social partnership

November 17, 2008

Today, the main trade union and employer organisations in Ireland endorsed the most recent outcome of national pay bargaining, Towards 2016 Review and Transitional Agreement 2008-2009. This means that the process of pay determination in Ireland, and indeed of a fair amount of social and economic policy, that has been in operation since 1987 will continue. That seems appropriate, since it is widely acknowledged that the Programme for National Recovery, designed by the Government of Charles Haughey in 1987, was in many ways that father of the Celtic Tiger. It came at a time of severe economic difficulty, and indeed during a period when there was not much optimism around – and it worked.

So will it be the same again? The key element of Irish social partnership in economic terms was that the pay restraint that it involved allowed, together with the dramatic increase in the active workforce, Ireland to maintain exceptionally high levels of productivity for a considerable period of time. While there were always some, particularly in the trade union movement, who felt uncomfortable with the main elements, these were in a minority. However, as the agreements proceeded the level of uneasiness grew – as was documented for example in this report drawn up in 2001 for the National Competitiveness Council.

In 1987 the Irish economy was a basket case, emigration was high, unemployment was soaring, and the public finances were in a catastrophic state. Clearly at this point we are entering into this new phase coming from a very different position. In 1987 expectations were low, now they have been rattled, but are still high. Furthermore, while support on both sides for this new agreement has been high, it has not on the whole been enthusiastic. We will need to find out how committed the partners are to making it work.

Social partnership made us what we are economically, or at least what we were until very recently. It has become part of the way of doing things in Ireland, part of our understanding of how we manage changing economic and social conditions. Maybe it’s good, maybe it’s bad, but it’s how we work. There is no evidence to suggest that we’d be any good at managing without it – on the contrary, there is plenty of evidence to suggest that without it Ireland becomes chaotic. Today’s decision was a good one. But what matters even more is how it works out in practice.