Rory O’Donnell, NESC Director, on Irish compromises
Mariek de Valk
These are tough times for the National Economic and Social Council of Ireland. The crisis is making it hard to get its members to see eye-to-eye. But according to Rory O’Donnell, Director of the NESC, the Council almost always manages to adopt its recommendations unanimously. What’s the biggest problem that Ireland is facing right now? “The Irish economy experienced explosive growth after 1993. It was known as the ‘Celtic Tiger’. But this year we’re in freefall. And we’ve fallen far, much farther than the Netherlands, for example. The National Economic and Social Council has drawn up a rescue plan. We’re making recommendations in five areas: stabilising the banking system; retrenchment in public spending; restoring Ireland’s economic competitiveness; practical measures helping people at risk of losing their job, income, savings and pensions; and finally, restoring Ireland’s reputation.
Coming up with this plan was by no means easy. The hardest part was getting the parties to agree on income policy. The Government doesn’t have much loose change, and so it had very little to offer the social partners. But we ultimately succeeded in reaching a compromise, because everyone felt the need for a comprehensive, national approach to the crisis.”
The NESC consists not only of employers, trade union representatives and independent experts. Its members also include senior officials from government departments. Does that work?
“The Council is indeed not that far removed from the Government. The chairman of the Council is the secretary-general of the Department of the Taoiseach (the Prime Minister of Ireland). That can sometimes lead to a bit of ambivalence, but it has never really caused problems. It certainly doesn’t prevent the parties from criticising the Government’s medium to long-range policy.
We add a footnote to many of our reports stating that the secretary-general of the Department of Finance absented himself from the discussion on tax-related matters. That avoids putting him – as the custodian of the government budget – into a perilous position if the Council should have an opposing view.”
Do the social partners also conclude agreements with one another? “Normally speaking, the Department representatives attend all the meetings. This is the first time that the social partners are negotiating on wages. The trade unions are in great difficulty at the moment, because the Government is being forced to take all sorts of unpopular measures without their backing, for example cutting back on the generous public service pensions.
Unionisation among public servants is at an extremely high level: 100 percent, as opposed to only 20 percent in the private sector. That low figure is because many Irish work for American multinationals, in hospitality, or in retail, sectors in which the unions scarcely play a role. The difference with the Netherlands is that Ireland does not have a mechanism for declaring collective agreements binding on an entire sector. So the Irish unions don’t have to contend with free rider behaviour. Non-unionised employers may adhere to a collective agreement voluntarily, but the crisis is making them less willing to do so.”
What is the added value of the NESC for Ireland?
“The Council certainly makes a difference, but there are ups and downs. 1986 was a year of crisis and a turning point. For years, the Government had been incapable of taking decisions, but then the Council came up with a new strategy based on an agreement with the social partners. That increased the Council’s influence enormously. Since then, there have been other social partnership agreements.”
Why are there NGOs on the Council? “When the Council was founded in 1973, the membership consisted of representatives of employers, trade unions, farmers, government departments and independent experts. But in 1986, the year of the first social partnership agreement, the community and voluntary organisations protested at being excluded, because they claimed to represent a major cross-section of society. A second council was set up for them that operated alongside the NESC; it focused on such issues as social exclusion, poverty and unemployment. That council was disbanded in 1997 and the NGOs involved became members of the NESC at that point. Their role in the NESC differs from the part they play in other organisations, where they have moral leverage but do not represent anyone.
Right now we’re looking at how we can include environmental organisations in the Council. We’re doing that at the urgent request of the Green Party, which is part of Ireland’s Government coalition. If they are included, meetings are going to be more difficult. My fear is that they will become nothing more than a platform for stating positions, rather than a forum for genuine debate. It’s already difficult with just 31 members.”
Social and Economic Councils Worldwide
Social and economic councils or organisations like them are active around the world. The councils that operate in Europe consult one another regularly. In addition, there is a worldwide federation of social and economic councils, known as the AICESIS. Its aim is to promote knowledge-sharing among councils worldwide and to encourage the establishment of social and economic councils in other countries.
How do all these different councils work? Part 1: the National Economic and Social Council of Ireland (2009). |