Social Pacts in Ireland: Sustaining Progress: Social Partnership Agreement 2003-2005

Period: 2003-2005

Negotiating parties: Nineteen organisations (farming organisations, community and voluntary organisations, trade unions, employer and business organisations) and government

Goals of the pact:

To seek, in an integrated way, to reinforce Ireland’s consistent policy framework approach and to implement and deliver policy outcomes developed under the Programme for Prosperity and Fairness (PPF).

Matters agreed:

• Special initiatives - priority programmes
  • Housing and accommodation
  • Cost and availability of insurance
  • Migration and interculturalism
  • Long-term unemployed, vulnerable workers and those who have been made redundant
  • Educational disadvantage – literacy, numeracy and early school leaving
  • Waste management
  • Care for children, people with disabilities and older people
  • Alcohol/drug misuse
  • Inclusion in the information society
  • Ending child poverty
• Macroeconomic policy
  • Developing a new anti-inflationary initiative
  • Management of public expenditure
  • Fair tax system facilitating economic and employment growth
• Fairer distribution of economic development
  • Improvement of physical and social infrastructure
  • Promotion of sustainable development through ensuring the right balance between environmental, economic and social aspects of development
  • Adaptation to a changing society (knowledge-based economy and society, lifelong learning, entrepreneurship, etc.)
• Delivering a fair and inclusive society
  • Dealing with poverty and promoting social inclusion (National Anti-Poverty Strategy, dealing with pensioner poverty)
  • Structural reform of the health services, addressing health inequalities
  • Improving employment equality
• Pay and related issues
  • 3% increase of basic pay for the first 9 months of the agreement
  • 2% increase of basic pay for the next 6 months of the agreement
  • 2% increase of basic pay for the final 3 months of the agreement
  • The statutory minimum wage was increased to EUR 7 per hour with effect from 1 February 2004.
  • Improvement of statutory redundancy pay terms
  • Extending and deepening of partnership at the workplace
  • Enhancing supply of affordable housing
  • Anti-inflationary initiative (tripartite parties work together to help exert downward pressure on inflation over next 18 months)
  • Enhancement of information, consultation, employee representation and employer/employee dialogue
  • Further development of worker representation: change in the “right to bargain” provisions of the Industrial Relations Act 2001
• Workplace Relations and Environment
  • Implementation of several EU Directives
  • Deal with the gender pay gap
  • Review of maternity, parental and adoptive leave
  • Better workplace childcare
  • Promotion of equal opportunities at the enterprise level
  • Improvement of workplace learning
  • Improvement of health and safety at work
  • Promotion of improvements in the coverage of pension schemes
  • Integration of migrant workers
• Public service pay and related issues
  • Promotion of modernisation and flexibility
  • Maintaining a stable industrial relations climate
  • Establishment of a voluntary code of practice on dispute procedures
  • Public service pay pause of 6 month to be followed by pay increases of
    • 3% from 1 January 2004
    • 2% from 1 July 2004
    • 2% from 1 December 2004
• Delivering quality public services
  • Modernisation of civil services
  • Improvement of customer services
  • Improvement of the processes of making laws and regulations
  • More training of civil servants to enhance performance
  • Improvement of equal opportunities in the public service
  • Promotion of team work
  • Promotion of atypical working arrangement (worksharing and term time working)
  • Modernisation of human resource management practices
  • Addressing skills shortages and strengthening recruitment practices
  • Improvement of performance management
  • Modernisation of the health service
  • Modernisation of the education sector
  • Modernisation of the local government sector

Procedures:

• New mechanisms for engagement with the social partners in relation to a wide set of government policies are proposed, including the establishment of a Steering Group for the Agreement, representing the government and each of the social partner pillars, with overall responsibility for the management of the implementation of the agreement.
• The National Implementation body will meet monthly or otherwise as may be agreed to ensure delivery of the stability and peace provisions of the agreement.

Background: Despite serious reservations about the renewal of social partnership agreements in a less benign economic climate, the new pact was reached in January 2003 and ratified by social partners in March 2003.

The economic conditions in Ireland in 2002 deteriorated and the prospect for 2003 have not been encouraging. Relative to the impressive success in the previous decades, economic growth is lower and consequently labour market conditions have deteriorated.

Comments: The content of agreements such as the new anti-inflation initiative reflect the less favourable economic climate. Unlike five previous agreements, the new programme does not have a formal commitment to further tax reductions. The Irish tax rates are some of the lowest in the EU, which limits scope of fiscal incentives to boost the economy.

Full text of the agreement