|
|
|
|
JOINT COMMITTEE ON EMPLOYMENTProceedings of CommitteeWednesday 23 July 19921.The sixth meeting of the Committee took place in private at 2 pm in Room G2, Kildare House. 2.The following Members were present:- Deputies Ger Connolly, Mary Coughlan, Seamus Cullimore, Síle De Valera, Frank Fahey, Brian Hillery (Chairman), Liam Lawlor, Dr Jim McDaid, Ruairí Quinn, Pat Rabbitte, Sean Ryan, Emmet Stagg, Pearse Wyse; Senators Martin Cullen, Brendan Ryan and Pat Upton. Apologies for inability to attend were received from Deputies Mary Coughlan and Mervyn Taylor. 3.The Minutes of the Meeting of 15 July 1992 were agreed. 4.Draft Report The Chairman brought forward a draft report, which was read as follows:- Paragraphs 1 to 8, inclusive agreed to. Paragraph 9 was read as follows:- “The reasons for high unemployment are complex and inter-related but the Committee feels that some of the main factors are readily identifiable. These include:- -a much faster rate of potential labour force growth in Ireland compared to other countries because of high birth rates in the past and increasing participation of women in the labour force; this means that we have to create more jobs here than in other countries simply to prevent unemployment from rising -total employment growth has been disappointing; labour shedding in our relatively large agricultural sector and industrial restructuring since EC membership are part of the explanation but the link between aggregate economic growth and total employment in Ireland is weaker than in other countries -more generally, trends in labour market conditions in other countries, particularly in the UK, have always had a key influence on the unemployment level in Ireland through migration flows.” Amendment proposed (Senator B. Ryan) “After ‘labour force growth’ to insert ‘over the rest of the decade’.” Amendment agreed to. Amendment proposed (Senator B. Ryan) “After ‘compared to’ to insert ‘that expected in’.” Amendment agreed to. Amendment proposed (Senator B. Ryan) “After ‘this means that we’ to insert ‘will’.” Amendment agreed to. Amendment proposed (Deputy Rabbite) “After ‘EC membership’ to insert ‘including the weaker performance of the indigenous sector’.” Amendment agreed to. Paragraph, as amended, agreed to. Paragraphs 10 and 11 agreed to. Paragraph 12 was read as follows:- “The Committee, in the course of its work, has been conscious of the budgetary pressures which are faced by Government given the high debt/GNP ratio and the need to bring this more into line with that in other countries. The requirements of Economic and Monetary Union reinforce the need for budgetary discipline. Aside from these constraints, the Committee is of the view that maintaining a low level of borrowing, consistent with a reduction in the national debt/GNP ratio, is an important element in establishing a macroeconomic environment conducive to economic growth and employment expansion. The Committee wishes to make clear, therefore, that its proposals should be implemented within the budgetary limits which the continued pursuit of these policies implies.” Amendment proposed (Deputy Quinn) “To delete the final sentence.” Amendment agreed to. Paragraph, as amended, agreed to. Paragraph 13 was read as follows:- “Aside from appropriate macroeconomic policies, there is also a need to ensure that sectoral and others policies pursued by Government are consistent with the need to maximise employment. A range of policies impinge directly or otherwise on the labour market. While the Committee has not examined these areas in any detail, it re-iterates that it is vital that taxation and other policies are consistent with the need to secure the fastest possible expansion in sustainable employment. In short, policy must be employment favourable.” Amendment proposed (Deputy Quinn) “After ‘While the Committee has not’ to insert ‘yet’.” Amendment agreed to. Amendment proposed (Deputy Stagg) “To delete the final sentence and substitute the following:- ‘There is a need to continuously assess the employment impact of these policies’.” Amendment agreed to. Paragraph, as amended, agreed to. Paragraph 14 agreed to. Paragraph 15 was read as follows:- “Both providers and the intended beneficiaries of all measures applied at present, in particular those which contribute to the creation of jobs and the alleviation of unemployment, would benefit from much greater consistency, coherence and co-ordination in the planning and delivery of these measures. The Committee does not consider that a reduction in the number of measures per se should be the primary objective. What it does recommend is that, (1) all measures respond to clear overall complementary national objectives, (2) there is no duplication of funding on offer or services provided, and (3) the maximum employment return is achieved from the resources invested.” Amendment proposed (Senator B. Ryan) “After ‘greater’ to insert ‘simplicity,.” Amendment agreed to. Amendment proposed (Deputy Stagg) “After ‘maximum’ to insert ‘employment.” Amendment agreed to. Paragraph, as amended, agreed to. Paragraph 16 agreed to Paragraph 17 was read as follows:- “In relation to the EC dimension of its work, the Committee has interpreted its role as having two related elements: the elaboration of an Irish position on employment policy at EC level and the consideration of issues affecting employment at national and local level, which are influenced in a particular way by developments at EC level. Unemployment is undoubtedly a major problem at EC level with 12,833,000 people unemployed in the twelve member states or more than 9% of the EC labour force. About half of the unemployed have been unemployed for a year or more (long-term unemployed). Political concern at EC level is evidenced by a number of comprehensive resolutions by the Council of Ministers on long-term unemployment in particular.” Amendment proposed (Senator B. Ryan) “After ‘force’ to insert the following new sentence:- ‘In contrast to this the unemployment rate in the US is under 7%.’ Amendment agreed to. Paragraph, as amended, agreed to. Paragraph 18 agreed to. Paragraph 19 was read as follows:- “The considerable rationalisation of Irish industry in the last decade should see Ireland well placed to maximise the benefits of the internal market. An ESRI projection suggests that completion of the internal market could lead to around 36,000 additional jobs by the year 2,000. While the net employment effect will be positive it is likely that gains and losses will be unevenly spread across sectors. Completion of the Internal Market cannot, in itself, be expected to narrow the income disparities between regions in the EC, let alone bring about convergence. In recognition of this, the Single European Act and the Maastricht Treaty both contain provisions aimed at reducing the economic and social disparities between regions. The weakest economies need assistance and investment to improve their competitiveness and help them move towards more modern and efficient structures, rather than ongoing passive transfers.” Amendment proposed (Senator B. Ryan) “To delete ‘While the net employment effect will be positive,’ and substitute ‘While the ERSI projection is for a positive net employment effect,’.” Amendment agreed to. Paragraph, as amended, agreed to. Paragraph 20 agreed to. Paragraph 21 agreed to. Paragraph 22 was read as follows:- “As the largest single international trading bloc, the EC has power to place employment on the agenda at a number of international fora in pursuit of the Maastricht Treaty objectives of balanced and sustainable economic and social progress, including a high level of employment.” Amendment proposed (Deputy Rabbitte) “After ‘fora’ to insert ‘. It should begin this process by promoting an integrated industrial policy within the Community’.” Amendment agreed to. Paragraph, as amended, agreed to. Paragraph 23 agreed to. Paragraph 24 was read as follows:- “Of particular concern is the fact that, to date, policies and programmes to create employment have not given rise to net employment growth in indigenous industry; instead there has been a decline. This has happened because indigenous firms have been unable to increase sales to the extent needed even to maintain their employment. While the wide-spread introduction of new technology during the period helped to ensure the continuing viability of many Irish firms, it was also a contributory factor in job losses. Policies and programmes have been based primarily on providing finance for investment projects. State spending, of £670 million in grants alone was incurred in the period from 1981 to 1990 with the objective of increasing the numbers employed in indigenous firms. This does not include expenditure of many hundreds of millions more of public funds, in the form of EC aids, of tax expenditures and of the administrative and other costs of State bodies. But the number employed by all Irish-owned firms actually fell by 28,000. Employment in those Irish-owned firms to which the grants were paid declined by 2,000 jobs between 1980 and 1990.” Amendment proposed (Senator B. Ryan) “Before ‘technology’ to insert ‘new’.” Amendment agreed to. Amendment proposed (Deputy Rabbitte) “To delete ‘State spending of’ and insert ‘Out of a total expenditure of £1.6 bn in State spending, some’” Amendment agreed to. Amendment proposed (Deputy Rabbitte) “To delete the final sentence and substitute the following;- ‘While employment in foreign enterprises, which were in receipt of grants, rose by 9,000 between 1980 and 1990, employment in those Irish-owned firms to which the grants were paid declined by 2,000 jobs.” Amendment agreed to. Paragraph, as amended, agreed to. Paragraph 25 was read as follows:- “It is clear from the above that policies for industrial development must change to assist indigenous firms to build their capacities to compete and to sell at home and abroad. To maintain competitive advantage in international markets there will be a continuing need for product upgrading and innovation by Irish firms. The main concentration of State support should therefore be in assisting existing Irish firms to improve their capability in areas such as marketing and design, technology, and management skills, and in supporting the establishment and development of new Irish firms. This is the only realistic way of ensuring the long-term success of the industrial sector in generating wealth and employment. Unless Irish firms can retain a competitive edge, not alone will they be unable to create new jobs, but existing jobs will be lost through closures.” Amendment proposed (Senator Cullen, Deputy Fahey) “Before the first sentence to insert the following:- ‘In the time available to it, the Committee has concentrated on industrial development and its potential for job creation. It will also be examining the internationally traded services sector and tourism in its future work and at the vital role of research and development in wealth and job creation’.” Amendment agreed to. Amendment proposed (Deputy Wyse) “After existing Irish firms’ to insert ‘, including small firms,’.” Amendment agreed to. Paragraph, as amended, agreed to. Paragraph 26 was read as follows:- “The role of the multinationals in creating jobs in Ireland is unboubted and will continue to play a significant role in the future. The creation of an economic environment to encourage foreign enterprises to retain and utilise a greater proportion of their profits in the Irish economy, especially on job creation, is an area which merits examination. Existing links between multinational enterprises and indigenous firms should be maintained and developed and new linkages established.” Amendment proposed (Deputy Rabbitte) “To delete ‘undoubted’ and substitute ‘substantial’.” Amendment agreed to. Amendment proposed (Deputy Rabbitte) “To delete ‘The creation of an economic environment to encourage foreign enterprises to retain and utilise a greater proportion of their profits in the Irish economy, especially on job creation, is an area which merits examination.’ and substitute the following:- ‘Given the high level of profit repatriation by these companies - estimated at £2.5 bn in 1990 - the creation of an economic environment to encourage foreign enterprises to retain and utilise a greater proportion of their profits in the Irish economy, especially on job creation, is essential.’” Amendment agreed to. Paragraph, as amended, agreed to. Paragraph 27 was read as follows:- “It is equally important however that the broad range of factors (taxation, infrastructure, education and training) identified among the 60 recommendations in the Culliton Report as having a direct bearing on industrial development are reflected in a coordinated policy framework and programme. The Committee would, therefore, urge the Government to take decisive action to ensure early implementation of these recommendations. The Committee will return to this in the Autumn to establish progress in this area.” Amendment proposed (Deputy Rabbitte) “To delete ‘The Committee would, therefore, urge the Government to take decisive action to ensure early implementation of these recommendations.’ and substitute the following:- ‘The Committee would, therefore, support the broad thrust of these recommendations.’” Amendment agreed to. Paragraph, as amended, agreed to. Paragraphs 28 and 29 agreed to. Paragraph 30 was read as follows:- “A recurring theme identified as an obstacle to greater success in Irish business, and particularly among smaller firms, is the near impossibility in obtaining seed and venture capital. It is clear that some action is needed to improve this situation.” Amendment proposed (Deputy Quinn) “To delete ‘difficulty’ and insert ‘near impossibility’.” Amendment agreed to. Amendment proposed (Deputy De Valera) “To delete the final sentence and substitute the following:- ‘It is clear that urgent action is needed to improve this situation, particularly for women entrepeneurs.’” Amendment agreed to. Paragraph, as amended, agreed to. Paragraph 31 was read as follows:- “The Committee is strongly of the view that an “Equity for Jobs” Fund of £10m should be set up as a matter of priority, with a particular emphasis on the venture and development capital needs of indigenous industry. It will be essential that the provisions of the Fund are attractive to individual as well as institutional investors. The Committee believes therefore that the State should ensure that the rate of return from the Fund should be in line with returns from alternative investment possibilities and calls on the Minister for Finance to bring in appropriate financial incentives to this end.” Amendment proposed (Deputy Lawlor) “After ‘end’ to add the following:- ‘in the next Finance Bill.’” Amendment agreed to. Paragraph, as amended, agreed to. Paragraphs 32 to 34, inclusive, agreed to. Paragraph 35 was read as follows:- “The Committee believes that there is considerable potential for job creation by the commercial State Companies and local authorities through imaginative use of their resources and expertise.” Amendment proposed (Senator Cullen) “Before ‘resources’ to insert ‘available’.” Amendment agreed to. Amendment proposed (Deputy Stagg) “After ‘expertise.’ to insert the following:- ‘This has been impeded by a lack of equity capital. As part of its Autumn work programme, the Committee intends to establish what further possibilities exist in this area.’” Amendment agreed to. Paragraph, as amended, agreed to. Paragraph 36 was read as follows:- “The performance of some commercial State Companies in recent years has been impressive by any standards and gives a clear and encouraging indication of the potential here. For example, TEAM Aer Lingus employs in excess of 2,000 people in aircraft maintenance. Airmotive - an Aer Lingus subsidiary - has grown since 1980 to its current employment level of 600 people in aircraft engine maintenance. A joint venture between Aer Lingus and the ESB - Toptech - established in 1989 to substitute imports of plastic components for the computer industry now employs 100 people itself and has facilitated employment expansion in other companies in the plastic moulding business. As part of its Autumn work programme, the Committee intends to establish what further possibilities exist in this area.” Amendment proposed (Deputy Lawlor) “To delete the final sentence.” Amendment agreed to. Paragraph, as amended, agreed to. Paragraphs 37 to 40, inclusive, agreed to. Paragraph 41 was read as follows:- “There are two main lines of approach here, direct employment-type schemes and the employment subsidy approach. Direct employment-type schemes offer paid work to unemployed people while subsidy measures are also operated to encourage employers to employ persons on the Live Register. The main direct employment scheme is the Social Employment Scheme (SES) which offers paid work to participants on a part-time basis for a twelve month period. The Committee is of the view that there are problems with the operation of the scheme, which it intends to pursue with the Department of Labour and FÁS in the autumn. Nevertheless, in general terms, it is a useful scheme which can assist the long-term unemployed. In this context, the Committee awaits with interest the review and development of SES being undertaken in the context of the PESP Area Based Response to long-term unemployment and also intends to pursue this further in its Autumn work programme.” Amendment proposed (Deputy S. Ryan) “Before ‘problems’ to insert ‘severe’.” Amendment agreed to. Amendment proposed (Deputy Quinn) “After ‘Labour’ to delete ‘and FÁS’ and substitute the following:- ‘,FÁS and the social partners’.” Amendment agreed to. Paragraph, as amended, agreed to. Paragraphs 42 to 44, inclusive, agreed to. Paragraph 45 was read as follows:- “The Committee recognises the importance of a skilled labour force to increase productivity and competitiveness and the need to equip unemployed people to take advantage of new employment opportunities. The Committee notes the relative lack of in-company training in this country and the introduction of the Job Training Scheme which attempts to tackle this deficiency. Efforts should continue to increase the uptake on this scheme. As regards training for the unemployed, the Committee is of the view that all vocational training activity should be properly targeted with independent approval and certification and that the training effort is co-ordinated with the activities of the industrial development agencies. The Joint Committee will be looking at the training area in greater detail in the Autumn.” Amendment proposed (Senator B. Ryan, Deputy Rabbitte) “To delete ‘The Committee notes the relative lack of in-company training in this country and the introduction of the Job Training Scheme which attempts to tackle this deficiency.’ and substitute the following:- ‘The Committee notes the inadequacy of in-company training in this country and urges employers to invest substantially in training as an essential ingredient in creating and sustaining jobs. The Committee notes the introduction of the Job Training Scheme and regrets the poor uptake to date.’” Amendment agreed to. Paragraph, as amended, agreed to. Paragraphs 46 to 51, inclusive, agreed to. Paragraph 52 was read as follows:- “The Committee intends in its future work programme to:- -consider how a general EC employment policy can be developedin the context of economic and social cohesion and the industry policy provisions of the Maastricht Treaty -explore the potential for a co-ordinated economic growth strategy to increase wealth and employment in the EC -consider the development of EC-wide programmes to tackle long-term unemployment, bearing in mind the social dimension of EC policy -examine the experience of structural fund expenditure in the current round of funding with a view to establishing how these funds and the Structural Funds post 1993 can have maximum impact and flexibility in supporting job creation and tackling unemployment and, in particular, long-term unemployment in Ireland -develop new proposals designed to channel existing resources into the provision of employment opportunities for unemployed persons -look at the social welfare system and how it impacts on employment and on the unemployed and at issues related to the integration of the tax and social welfare systems -continue its work in the area of training, employment and education measures for the unemployed, focusing on issues such as allowances for persons on training and employment schemes, and the further development/rationalisation of programmes -look at the development of the Area-based response to Long-Term Unemployment -examine the potential of work-sharing -make further recommendations on financing for industry -establish whether further employment creation initiatives can be identified for the commercial State Company and local authority sectors.” Amendment proposed (Deputy Lawlor) “To delete ‘- and concentrate on the Structural Funds post 1993 to see how these can have maximum impact and flexibility in supporting job creation and tackling unemployment and, in particular, long-term unemployment in Ireland’ and substitute the following:- ‘-examine the experience of structural fund expenditure in the current round of funding with a view to establishing how these funds and the Structural Funds post 1993 can have maximum impact and flexibility in supporting job creation and tackling unemployment and, in particular, long-term unemployment in Ireland’ Amendment agreed to. Amendment proposed (Deputy S. Ryan) “After ‘authority sectors’ to insert the following:- ‘, including joint venture possibilities with the private sector.’ Amendment agreed to. Paragraph, as amended, agreed to. Appendices 1 to 3, inclusive, agreed to. Report, as amended, agreed to. Ordered: To report accordingly 5.Adjournment The Committee adjourned at 4.15 pm. _____________________ Dr Brian Hillery, TD Chairman July 1992 |
||||||||||||
|
|||||||||||||
