After Partnership 2000 - preparing for a new era

The debate on what comes after Partnership 2000 has already begun within the trade union movement. Its origin was not in last year's disappointing budget, this year's rows over public-sector pay or any other single issue. It has been born out of a growing realisation that the current type of national agreement is too inflexible, too old-fashioned to meet the demands of a modern and booming economy.

The very fact that the debate has begun already is an indicator that negotiations on a successor to Partnership 2000 will be very different from what has gone before. Normally, discussions among trade union leaders on what they want out of a new agreement only begin to take shape a few months ahead of the deadline.

Another unusual aspect of the current discussions, which began last month in Galway, is that the starting point was a survey of trade union members and what they expected from their organisations. Wages were well up the list of priorities, but so were other issues like job security and more consultation over change.

"There is an intensive consultative process going on," says the Irish Congress of Trade Unions general secretary, Mr Peter Cassells. "The 10-year strategy adopted in 1987 is now up for fundamental review."

He accepts that the ICTU bought into a new national agreement at that time as a survival strategy, not just for the trade union movement but for the State. Employment rates were falling, especially in manufacturing, which had been a bastion of trade union membership, emigration was rising and living standards for those still at work were falling. Congress outlined its own priorities in a document entitled "Ireland 1990 to 2000". The time is now ripe for a post-mortem on it.

"My approach is that the strategy adopted then did work," says Mr Cassells. "It worked well in some areas and badly in others. The growth achieved in the economy was extraordinary, given the circumstances in which the strategy was devised."

On the jobs front employment has grown dramatically and involuntary emigration ceased. As for living standards, these have increased from around 50 per cent of the EU average to significantly more than it in most parts of the Republic.

But two big areas where the strategy failed were tackling low pay and making significant inroads into social exclusion.

Rather than simply returning to the attack on these, and other outstanding items on the ICTU agenda, Mr Cassells argues that it is time to review them in the new economic climate of boom rather than crisis. He agrees with the Taoiseach, Mr Ahern, that a new 10-year plan is needed to look at things like economic infrastructure and he also believes that the rate of change in the human dimension of the economy is so fast that a shorter term, five-year plan is also necessary.

The agenda would include a fairer sharing of the benefits of growth, not just to reward employees for participating in workplace modernisation, but to enable the establishment of a social wage that guarantees a minimum standard of income for everyone.

Such a view may take some selling to workers in the private sector, who are becoming increasingly disillusioned with wage restraint, while business clocks up record profits. There is also growing disillusionment with what one trade union leader described this week as "the new apartheid", of public versus private sector pay negotiation.

The regional secretary of Ireland's second largest union, Mr Michael O'Reilly of the ATGWU, is one of the strongest and most consistent opponents of national agreements. But leaders of predominantly private sector unions which voted for Partnership 2000 are also becoming increasingly disillusioned.

Mr Jerry Shanahan, acting general secretary of MSF, says that the Budget must deliver not only for the low paid but middle to high income earners on PAYE. Most of his own members would earn between £25,000 and £35,000 a year. He points out that there is a massive budget surplus this year, which means that "all tastes can be catered for".

"There is a growing argument for a separate agreement for the private sector," he says. "It has experienced so much change in technology and levels of productivity that national agreements have proven too restrictive.

"The public sector has basic increases and facility for special claims. That facility should exist for the private sector as well."

The concerns of his members, in order of priority, are further tax cuts, greater freedom to negotiate local pay increases, more commitment from employers towards partnership and full consultation in the workplace and, finally, union recognition.

Mandate represents shopworkers who are at the opposite end of the private sector pay spectrum to MSF's highly skilled and professional membership. The general secretary, Mr Owen Nulty, says his members have no principled objection to national agreements but they feel doubly betrayed by Partnership 2000.

He contends that not only did the Minister for Finance, Mr McCreevy, not provide decent tax breaks for the low paid in the last budget, but low paid workers in the private sector saw public service workers and higher paid groups in the private sector do disproportionately well under the agreement. While senior civil servants enjoyed pay rises of 74 per cent in the first decade of national agreements and the average industrial wage rose 56 per cent, shopworkers saw their wages increase by only 32 per cent.

If this year's Budget fails to target the low paid, Mr Nulty says, the Government "can kiss goodbye to any new deal". Most of his members earn less than £10,000 a year and Mandate is calling for total tax exemption for anyone earning less than £200 a week.

Percentage increases are meaningless for most Mandate members and Mr Nulty says that a new agreement would have to offer a significant flat rate increase to benefit the lower paid most. He supports the approach of IMPACT, the largest public service union, which has suggested that the first 1 per cent of any new pay deal should be converted into a lump sum and paid as a flat rate increase across the board. This would work out at around £4 a week for every PAYE worker in the State. However, Mr Nulty says a higher proportion of any percentage increases would need to be converted to make the increases meaningful for his members.

Mr Cassells believes the circle can be squared if trade unions are willing to look at a number of options. He believes that these range from another standard national agreement, to one with a strong overall framework that has greater flexibility for local bargaining, to a looser framework that contains general guidelines for pay negotiation.

At the far end of the spectrum there could be sectoral pay bargaining, not just for public and private sectors, but for vocational groups, such as construction workers, the retail trade, nurses and local authority workers. In extreme circumstances, there could be a return to "free for all" bargaining.

However, he does not see either of the extremes: a continuation of the existing type of national agreement or a "free for all" as viable options.

Mr Cassells believes that the scope of further tax cuts to compensate for low pay rises is almost gone, unless people are willing to countenance serious erosion of public health, education and other services. Other routes forward must be found. To some extent that means liberating workers from the traditional strait-jackets that collective bargaining has imposed on them.

"My sense of it is that the how is as open for debate as the issues," he says. "Instead of looking at the system and how it can be tweaked a bit more, we have to look at radical solutions." He sees partnership playing a key role in this process. "The last thing we need is to get into a sterile debate about national agreements, or no national agreements.

"One thing we'd be pushing hard is the notion of the worker as stakeholder and the need to change company law to reflect that, especially now that companies more and more depend on workers to be more flexible. Workers' rights should be put on a par with shareholders."

Mr Cassells believes unions will have to learn to "let go" in some respects. "We put a whole lot of restrictions in place on what employers and employees could do, or not do, and quite rightly in some cases, to stop exploitation of employees. But we may now need to look at ways of dismantling or removing those restrictions.

"The modern work is as much a challenge for us as for the government or employer."