Politicians must face up to the fact that social partnership has contributed to the scale of the problem in the public finances, writes Stephen Collins
SOCIAL PARTNERSHIP is widely credited with a decisive role in the creation of the prosperous Ireland of the 1990s and the early years of the 21st century. The question now, though, is whether social partnership is capable of responding to the awesome nature of the economic challenges ahead or whether it has turned into a millstone around the country's neck.
While Taoiseach Brian Cowen has nailed his colours to the mast of social partnership in the search for solutions to the economic crisis, politicians in all parties are getting increasingly worried about the apparent veto over necessary corrective action being wielded by unelected forces.
Labour's Senator Alex White reflected that mood in the Seanad before Christmas when he queried why the Government had presented its economic renewal plan to the social partners before either house of the Oireachtas was informed of its contents.
"One would pinch oneself on what passes for democratic debate and scrutiny in this country because the Government goes to the social partners in the first instance and not the Houses of Parliament," he said.
Senator Eoghan Harris made the same point: "It is ridiculous to have the Taoiseach and the Minister for Finance meeting the social partners today. The only reason he should be meeting them is to tell them he will not be giving the agreed pay increases because the country has not got the money."
He argued cogently that the economic crisis was already far deeper than the political system or media seemed to appreciate. "We do not still measure the extent of this crisis. We should be talking about a national government, war-time measures and states of emergency. No economy in Europe is as exposed as Ireland's."
The fundamental issue is that it is the duty and responsibility of our politicians to face up to the appalling nature of the economic crisis and to govern with the common good as their fundamental concern. Politicians are elected to govern; social partners are not.
"The point about democracy is that we are elected by the people and can be thrown out by the people if they don't think we are up to the job," said one senior political figure. "The social partners are not accountable to the electorate but they have acquired far more power than almost any elected politician. This negation of democracy will have to be brought to an end."
Of course it will be far better for the country if the social partners go along with the measures required to bring the public finances under control so that industrial strife can be avoided. The problem, though, is that social partnership itself has contributed to the scale of the problem in the public finances. Those involved have a vested interest in ensuring that the problem is approached in a way that serves their own interests, and not necessarily the common good.
For instance, as the Economic and Social Research Institute pointed out in its recent bleak quarterly report, salaries in the public service are about 20 per cent higher than in the private sector. And this is before the priceless assets of job security and pensions, vastly in excess of comparable ones for PAYE workers in the private sector, are taken into account.
This enormous imbalance between the pay and conditions of PAYE workers in the private and public sectors is a direct result of social partnership. It has been connived at by all concerned, including the employers' body, Ibec. With pay freezes and pay cuts already being implemented for private sector workers, this imbalance will become ever more pronounced unless urgent action is taken.
Those who point out the problem are often accused of demonising public servants, but the fact of the matter is that unless it is faced up to honestly, bitter tensions will inevitably develop between workers in the two sectors.
Most public servants are not faceless bureaucrats but teachers, nurses or gardaí who do a vital job, often in very difficult circumstances. Most of the bureaucrats, too, are committed to doing the best job they can for their country. But that doesn't alter the bottom line that in comparative terms they have much better pay and conditions than the rest of the workforce, who foot the bill.
The Government is clearly hoping that the trade union leaders will be open to an agreement not only to defer next year's pay round, but to accept the need for pay cuts in the months ahead. The Government may also try and reduce the numbers in the public service but, as the ESRI has pointed out, pay cuts are preferable to job cuts in the current circumstances.
The Taoiseach made it clear he expects a deal with the social partners by the end of January. He has invested a great deal of his political capital in operating through the partnership process and has resisted pressure to ditch it at this time of national crisis. A real test of trade union leadership will be whether they can respond in a way that takes genuine account of the truly desperate state of the public finances.
If the union leaders don't respond in a positive way the Taoiseach and his Ministers will simply have to act regardless. The Government has a duty to all citizens of the State and cannot shirk fundamental decisions for much longer if it wants to protect the country from far worse consequences in the long term.
The Taoiseach and his Ministers could do worse than read the words of advice quoted in Dermot Keogh's biography of Jack Lynch, that were given to the government of Seán Lemass in 1965 by the great TK Whitaker during an earlier economic crisis.
"The economic situation is more serious than we have been admitting officially. We have deliberately not been too pessimistic in public for fear of undermining confidence and also in the hope that as the months went by things would show a sufficient turn for the better. This hope is not being realised - indeed, it was not soundly based - and we now have to increase the corrective measures. We should also, without being alarmist, be more forthright about the nature and extent of our problems. We would be deluding ourselves if we continued to make reassuring comments on their temporary nature . . . There is a basic difficulty of a more lasting character and it is time we did something more effective about it."