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What they said then… The private sector and social partnership April 28, 2011

Posted by WorldbyStorm in Economy, Irish Politics, The Left.

For some time, given the now almost monolithic consensus on the economic right that social partnership was a bad thing (and this is distinct entirely from the critiques from parts of the left), I’ve been intrigued as to what was said at the time.

My memory was hazy, but I thought that generally there was a different consensus during the period of the mid to late 1990s and early to mid 2000s that social partnership was a positive for the economy, a consensus that was shared by most, if not all.

Apologies, some of the links below are behind pay walls. Still, the quotes will give a flavour of the times…

In 1996 IBEC released a report entitled Social Policy in a Competitive Economy which accepted fully the broad parameters of social partnership. As Padraig Yeates wrote in the Irish Times at the time:

SOCIAL Policy in a Competitive Economy is the most political document ever produced by the Irish Business and Employers’ Confederation. After decades of unsuccessfully trying to stem the tide of social legislation in Ireland, employers are saying, that they are prepared to embrace the “social market”.

If they cannot beat the powerful array of interest groups that have made issues like equality, social exclusion and unemployment central to Government policy, then the employers intend joining it; in the hope that by doing so they will have a more effective say in how those issues are addressed in the future than they have ever had in the past.

In fairness to IBEC, which was only founded in 1990 out of an amalgamation of the old Federation of Irish Employers and the Confederation of Irish Industry, it has been showing an increased awareness of social issues in recent years – especially through its contributions to the National Economic and Social Forum. NESF, which was expected to be little more than a talking shop, has helped nurture the practice, as well as the theory, of social partnership.

In 1997 Partnership 2000 was introduced.

There’s no direct quotes that I can find from ICTU or IBEC on the matter, but plenty of indications that it was accepted from the time the social partners agreed it in November 1996. Indeed as Mark Brennock noted as early as April 1997 the Government was quick to ‘implement’ non-pay elements on foot of a meeting with both ICTU and IBEC.

From March 2000 and the Programme for Prosperity and Fairness . Padraig Yeates noted:

The Irish Business and Employers’ Confederation has accepted the Programme for Prosperity and Fairness. The new agreement was accepted without being put to a vote yesterday afternoon, after business leaders heard the outcome of the ICTU special delegate conference.

Even the Progressive Democrats were in on the act.

Meanwhile the Taoiseach, Mr Ahern, and the Tanaiste, Ms Harney, have welcomed acceptance. Mr Ahern said it would allow further progress on a wide spectrum of issues. Ms Harney said our success must not induce complacency over the many new challenges to be addressed “in the context of partnership”.

And what of IBEC’s feelings on the matter?

Yesterday’s meeting of IBEC’s general council was not open to the media but it is understood that some representatives of labour-intensive sectors expressed concern about their ability to absorb costs.

IBEC’s director-general, Mr John Dunne, said later that the PPF held out “the promise for all of us that we can plan into the medium term, as individual businesses and as an economy”. Clearly, he said, “if we are to benefit from this `certainty’ it is of paramount importance that the terms of the new agreement be fully adhered to in both the public and private sectors.

“Ultimately, increases in living standards are only sustainable through increases in productivity. The new agreement clearly recognises this reality.”

And the Small Firms Association?

The Small Firms’ Association, which is affiliated to IBEC, has also accepted the PPF. Its chairman, Mr Kieran Crowley, said the decision was “the right choice for everybody”. Irish business and workers could move forward and face the challenge together.

Indeed in this love-fest there was only one dissenting voice:

However, the Irish Small and Medium Enterprises’ Association said “the universal championing of consensus and the political drift towards the centre are stifling individualism and innovation”.

Sustaining Progress was introduced in 2003. What was the consensus about it and social partnership in general? John Downes wrote in the Irish Times in 2003 that:

The Irish Business and Employers Confederation also believes that partnership has generally been good for the economy, although it does have concerns.

“Social partnership has served the country well,” says Mr Brendan McGinty, director of human resources with the organisation.

“It has provided a road map as to how the economy should be managed through a consensual approach. From a business point of view, it has worked well on balance. But a central issue is competitiveness, so that policies don’t undermine jobs.”

Now, none of this is to pretend that IBEC wasn’t critical of aspects of the agreements. For example in the early 2000s they were strongly critical of bench-marking.

For instance in relation to Sustaining Progress consider this:

IBEC, the employers’ body, also ratified the deal by a “majority vote” – it declined to give a breakdown – at a meeting of its national council, following consultations with members throughout the State.

It said members had become disillusioned with the previous partnership deal, the Programme for Prosperity and Fairness, and that Sustaining Progress offered “a new beginning”.

But the same is true of ICTU in relation to an array of issues during the same period too. At their vote on the agreement the following occurred:

Union delegates voted by 195 votes to 147 to endorse the agreement, Sustaining Progress, at a special conference of the Irish Congress of Trade Unions in Dublin.

The result was closer than expected because about 35 delegates mandated to vote “yes” had, apparently, left the meeting before the show-of-hands vote was taken.

In other words both elements of this supposed partnership had their own difficulties with it, both conceptually and in practice – and reading that particular report it would seem the unions were much much less entranced with the process than employers.

That they overcame these difficulties or marginalised dissent is a different – and intriguing – issue.

This is, of course, a superficial scan. There’s much more to be done, as for instance examining the press releases from IBEC, SFA and the prodigal son of the employers – ISME.

But the current rhetoric would make one think that the private sector were near unwilling participants in a process which they saw as uniquely flawed when the truth was, if one takes public statements as indicative, if anything quite the opposite.

They might have been critical of aspects of it, but engage they did and time after time.


1. Aidan R - September 20, 2011

Indeed, employers would never have participated in the national agreements if it did not enhance their profitability. Despite the total inconsistency that comes out of the ESRI these days, they have completed research that the national agreements enhanced the competitiveness of the MNC sector. The FDI sector, predominately non union were total free riders on the process.

In terms of how ICTU managed to keep all affiliates on board (there has always been tension between private, general and vocational unions in the public sector). It was quite simple – they increased the democratic procedures. Research (and central to my thesis) has shown that when union confederations adopt a process of one person one vote it empowers the median conservative member. Unions with less internal democracy tend to be more militant as it empowers the organised few.

So, ICTU ran referendums on the national agreements which made it difficult for vocational interest groups such as the TUI to affect macro outcomes. In negotiating T16, SIPTU recommended acceptance because of the employment rights legislation gains that would affect private sector employees. Many smaller public sector unions rejected it because they were unhappy with the pay increase in a context of growing inflation.

The general point is that ICTU secured acceptance and acquiescence for twenty three years because of the internal democratic voting. Affiliates could rject the national agreements but because of majority voting they tended to accept the general outcome, The problem was that it turned Irish unionism into a tri-annual wage referendum.


CMK - September 20, 2011

This doesn’t ring true to me. Or at least my interpretation of the above, which is ‘one member, one vote = middle of the road/conservative union policy’ versus ‘less internal democracy = more militant unions’, doesn’t correlate with my experience of union ‘democracy’.

My understanding is that most union votes have an absolutely abysmal turnout of probably less than 30% in most instances. Where ‘one member, one vote’ is in place union leaders know full well, given the likely low turnout, that they only have to mobilise a small section of the membership that supports their line and they’ll win the vote. They then use all of the union’s resources to push the membership to vote for their policies/agreements etc. So, I’m not sure how one can be sure that the ‘median conservative voter’ has been empowered when the majority of union members have not voted one way or the other. Perhaps you’ve controlled for that. Perhaps the median conservative is more anxious to preserve the status quo and so will vote regularly in ballots.

On the other hand, the militant members (that means ‘Left wing’ really) are usually outside of the leadership structure and hierarchy and must make a much greater effort, with less resources, to try and make headway. Often failing narrowly. Having seen leadership positions voted through on a 20% turnout by a handful of votes it’s hard to find any real ‘democracy’ at work, particularly when it’s an open secret that X cohort were mobilised by the leadership to secure the outcome they desired.


2. Alan Rouge - September 20, 2011

Does anyone read comments on old-er threads? I think many things are worth revisiting…

Anyway, further to Aidan’s point there’s a decent-ish piece on “Why Screwing the Unions Screws the Entire Middle Class” (pertains mainly to USA)



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