THE TAOISEACH met union, business and community leaders earlier this month to seek their engagement in the development of economic recovery plans. As the economic crisis worsened by the day, Mr Cowen said the recession had cut Government income to 2005 levels while spending was at 2009 levels. This means Government spending is running 30% above income.
In the weeks up to the end of January, discussions between the social partners will dig deeper into the detail of what needs to be done to get an appropriate rescue plan agreed.
IMPACT general secretary Peter McLoone, who has been calling for a social partnership approach to the downturn since last summer, welcomed the Taoiseach’s commitment to partnership, although he said it would be challenging for everyone including workers and their unions.
Contrary to speculation before the meeting there was no discussion of, or proposals for, a renegotiation of the recently-endorsed national pay deal, under which most public servants are due a 3.5% increase in September 2009. But IMPACT leaders believe that if the economic indicators – including inflation - keep heading downwards, speculation about pay, pensions and other public service costs is likely to continue. IMPACT general secretary Peter McLoone said incomes policy was bound to feature in the discussion and that this would present “enormous challenges.”
Social partnership played a big role in turning the ailing 1980s economy around. At that time unions placed a huge emphasis on saving and creating sustainable jobs, and a similar approach is likely now.
But Peter McLoone said things looked even tougher in 2009 than 20 years ago. “Irish infrastructure and skills levels are far higher, but the sheer scale of the global downturn and the collapse of the financial system mean we’re in new territory. It’s impossible to see how we can simply return to the old way of doing things,” he said.
Later in December, the Government launched a document called ‘Building Ireland’s Smart Economy’, a framework for sustainable economic renewal. This was done in the usual fanfare of publicity but in truth it doesn’t contain much detail about how the key objectives will be reached. The objectives are:
stabilising public finances and improving competitiveness, supporting those who become unemployed, and supporting Irish business and multinational companies;
investing heavily in research and development, incentivising multinational companies to locate more R&D capacity in Ireland, and ensure the commercialisation and retaining of ideas that flow from that investment;
implementing a ‘new green deal’ to move us away from fossil fuel-based energy production through investment in renewable energy and to promote the green enterprise sector and the creation of ‘green-collar’ jobs;
supporting high-value innovation of products and services that will create hundreds of thriving Irish companies and associated employment;
developing first-class infrastructure that will improve quality of life and increase the competitiveness of Irish business.
Read the full document HERE
