Introductory Remarks
I am delighted to be here this morning with you, together with my colleagues, the Tánaiste, and the Minister for Finance, at this Plenary meeting under Sustaining Progress, as our minds turn towards the achievements during the lifetime of the agreement as a whole and the prospects for the future.
At the outset, I would like to record my appreciation to you as the social partners for the key contribution you are making to the development of our economy and of our society.
The Programme for Government set out an agenda for all strategic areas of Government activity aimed at building a fair society of equality and opportunity and of sustained prosperity for everyone. I want to make very clear the Government's continued strong commitment to pursuing Ireland's economic and social prosperity through the process of social dialogue and partnership. We have now had 6 national partnership agreements since 1987 and are due to begin negotiations on a new agreement towards the end of this year.
One of the almost daily realities of life now in Ireland are the visits by delegations from all over the world - from governments, social partner organisations, independent research bodies and journalists - who are trying to understand the basis for the remarkable Irish experience over recent years. And ours is indeed a success story. Sometimes, we are almost afraid to acknowledge the full extent of success lest in some way we tempt fate. As a result, much of our local commentary on the performance of the Irish economy focuses on the risks, the downsides, the un-met goals and the, no doubt many, areas of policy and performance where there is room for improvement.
I believe, however, that we should recognise and celebrate what has been, and continues to be, hugely successful about Irish society. I take great pride in the fact that we now have an unemployment rate which is less than half the European average, especially that we have such a low rate of long-term unemployment. It is a real achievement that we have almost 2 million people at work, including nearly 200,000 people who have moved here from overseas to find employment and to make their contribution.
While I totally sympathise with those affected by periodic congestion in check-in at our airports, I recognise that it reflects in part the very high proportion of Irish people who now enjoy frequent foreign holidays and that 300,000 of our citizens own property abroad.
I know that there is much to be done in catching up on the severe infrastructure deficit which we have inherited from the past. But I also recognise the huge improvement in people’s working and living conditions as a result of the completions of projects such as the Luas, and the new inter-urban motorways, which are continuing to be developed around the country.
We now have a phenomenal rate of housing output, with the 10th successive year of record construction. While there is significant un-met need across all sectors of housing, it would be wrong not to recognise the organisational and logistical, not to mention construction, expertise which has enabled this dramatic increase in the quantity and quality of our housing stock to be achieved.
Our social services too have developed beyond all recognition compared to years gone by. Of course, there are many un-met needs. Standards of provision in many cases fall short of the world-class levels to which we rightly aspire. But it would be wrong, equally, not to recognise the dramatic increases in spending and in personnel resources now deployed within our health and education systems, for example. More people have readier access to life-enhancing medical and surgical procedures than ever before.
We have a clear strategy to deal with the problems experienced in our accident and emergency departments and we have created new organisational structures to manage the record resources more effectively.
We have created an entirely new legislative, planning and service delivery framework to meet the needs of those with disabilities. Here again, perhaps our public debate has focused too much on aspects of our approach to the needs of those with disabilities which have been criticised, instead of recognising the very substantial and even radical changes which are being made.
While creating record numbers of jobs and making them accessible to as many people as possible is the primary way of guaranteeing the living standards of our people, we have also made very substantial strides towards improving the living standards of those who are unable to work for their own living. Record increases in social welfare rates have brought us much closer towards our shared aspirations for dignity and comfort on the part of those in receipt of the lowest rates of social welfare, as well as those in retirement.
As you can see, I believe that those who come to inspect the Irish miracle have not come in vain. There is something dramatic about what we have achieved together over the last 18 years, but especially in the last few years. This is equally evident in the vitality of our economic base.
Whether in the high-tech investment projects operating at the frontier of new technology, or in the more traditional manufacturing or innovative start-up sectors which have developed significant strengths in niche markets, or in the international services sector where, as in financial services, whole new industries have been created and re-created through flexibility and ingenuity, or whether in the modernisation of our agriculture and food production systems – right across the economy, we find examples of highly competitive, well managed and forward-oriented enterprise.
And it is, of course, only through maintaining and renewing repeatedly that enterprise base that we can enjoy the living standards which have developed over recent years and extend them more fully to those who have yet to get their full share of the benefits of a successful economy and society. And we must not be complacent about this. The pressures of globalisation are relentless. The rise of new industrial powers in China and India, in particular, as well as the dynamic created within the European Union through the membership of new, young, well-educated and dynamic States, and the relentless pace of change in technology and its application, make us all subject to a relentless competitive pressure.
Government and the public service are not immune from that pressure, either. We need to operate a regulatory environment which is both effective and proportionate. That is why I put such emphasis on the Better Regulation agenda and a more evidence-based approach to policies which, directly or indirectly, create burdens for businesses and citizens. We need to be flexible and ready to adapt our legislation and other regulations so that they can become, in themselves, a source of competitive advantage.
We need, in our fiscal policies to be responsible, not only by balancing the books, but by prioritising for investment those areas which will sustain and increase our capacity for long-term growth. I am proud of the fact that we are investing more than twice the European average in our infrastructure and that we are addressing ambitious goals to improve our public transport and other infrastructure needs for the decade ahead.
I believe that, through decentralisation and other measures, the Government has an obligation to continue to pursue regional balance, not only in the interests of sharing the benefits of prosperity on an equitable basis around the country but also to address directly the problems of congestion in the Dublin region.
Public policy must also provide the human resources for the future. Our investment in education at all levels, but especially in the high-demand sectors at third and fourth level, are critical in that regard. So too is investment in our research infrastructure, which, through Science Foundation Ireland, delivers world-class research teams and research capacity to the Irish education system and to Irish industry.
More generally, our public services need to be managed and delivered with true professionalism, fully in tune with the demands of a modern society. That means they must be as efficient as possible, deploying people and technology to best effect. It means that we must be flexible in how needs are identified and be willing to re-visit our priorities, dropping those that no longer require the same level of attention in order to be able to respond to new problems.
We need to ensure that the costs of delivering these services represent as small a burden to the productive sector of the economy as they can, while recognising and valuing those who, through the public service, make a vital contribution to the competitiveness of our economy as well as to the quality of our lives.
In rehearsing these challenges this morning, my purpose is to underline the fact that we are all in this together. This is not a challenge for Government alone, nor the responsibility of employers or trade unions, or indeed of farm organisations or the community and voluntary sector in isolation. The plain reality is that unless we are all engaged and operating from a common understanding of where we are, where we are going and the challenges which must be faced, then none of us, alone, can be successful.
In the midst of deep crisis in the 1980s, it was that insight which enabled a new approach to managing our shared destiny to be developed. The sense of crisis may be gone, but the challenges, as well as the opportunities, remain. It is for that reason that the social partnership process, which we review here this morning, remains highly relevant.
It is perhaps more apparent to visitors from outside than to many of our local commentators that this process has been at the heart of Ireland’s success. It is, of course, not to be taken for granted. It requires genuine effort and wisdom on the part of all of the social partners. It places particular challenges before the Government, to lead this process effectively, while continuing to take our own, independent decisions in those areas that are, necessarily, the prerogative of any Government, and for which Governments, uniquely, are accountable.
Working together in Partnership
The central mechanism through which we have worked together is social partnership. Through the partnership process, we have helped to ensure that the policies of Government and the efforts of the social partners create the right environment for sustainable economic and social development. Over the past eighteen years, if we have learned anything, it is the lesson that shared analysis of the issues and problem-solving approaches have paid dividends to this small country.
A Strategy for the Future
In this context, an analysis of the issues and challenges that we will face in the future is currently taking place within the NESC. Their Report will be published in the autumn and will set the context within which negotiations on any new social partnership agreement will be undertaken. Their analysis will take account of the pressure of globalisation, the increasing role of services, the implications of migration and the role of productivity in supporting living standards. It also needs to analyse how economic progress and policy change can further reduce poverty and inequality, create a sustainable system of social protection and improve the overall quality of life.
The pace of economic restructuring is accelerating. Enlargement of the European Union, and the dynamic growth of economies like China, represent a significant external challenge. While people, business and Government itself must be flexible in facing the challenge of change in this era of globalisation, flexibility alone is not enough. We all need a measure of security if we are to have confidence in the future. That security is possible when we work together and when our national system is seen to work.
Special Initiatives
One of the innovations under Sustaining Progress was the agreement on a number of Special Initiatives. They have proven, I believe, to be a very effective way of focusing resources on particular areas of concern. Undoubtedly, as we go forward, there are lessons to be learned from the experience of implementing these Initiatives – lessons about what kind of areas to focus on, how many Special Initiatives to focus on and what mechanisms we might best use to approach them. There is certainly plenty for Government, and the Social Partners, to reflect on as we look beyond Sustaining Progress.
I welcome, in particular, the progress made on Affordable Housing. As Des Geraghty’s report shows, we are well on track to achieve our goals in this area. The Government’s decision to establish the Affordable Housing Partnership shows our determination to succeed at the earliest possible date in attaining our target.
Pay and the Workplace
Ireland must be competitive at all levels, including wages. How we go about setting wage levels is critically important for stability and growth in our economy. This remains a critical issue at the heart of our partnership process. It will absorb appropriately large amounts of energy when we begin our negotiations later this year.
For this morning, I merely wish to emphasise that we can best protect high incomes by setting wage growth at a sensible and affordable level. It is important that we do not undermine the job creation capability of the Irish economy or our international attractions as a place to work and to invest. This is the context in which a successor to the current agreement must be considered.
Conclusion
I am aware that many of you have put in place special arrangements to consider your approach to negotiations on a new agreement. With this in mind, I will be writing to you in the early Autumn to formally initiate talks on a successor to Sustaining Progress.
The future of the social partnership process is in the hands of all of the partners, together. I have no doubt about its continued relevance to meeting the challenges that we face. The challenge I want to pose to you today is how together we can continue to develop and evolve our model of social partnership to meet the new challenges that we jointly face.
I believe social partnership’s own record of success in underpinning our economic and social transformation represents the best argument for its continuation. The challenges we now face are different to those of 1987, but they are no less complex and meeting them successfully is no less important.
ENDS
14 th July 2005