Delegates to the Siptu conference in Cork are expected, later today, to defer a decision on entering talks involving a new social partnership agreement.
This tactical approach has been designed to exert maximum pressure on the Government to inhibit, or to prevent, the displacement of Irish workers by cheap foreign labour. It also reflects the increasing strains that partnership agreements have been subjected to in recent years.
As the largest trade union in the State, any decision by Siptu concerning a new pay agreement is likely to have a defining effect. And while attitudes are still generally positive within the union, strong anti-partnership sentiments have been expressed at the conference. Some delegates viewed national agreements as a hindrance to trade union recruitment - membership has fallen within the private sector - and an impediment to effective industrial action. The issue of benchmarking and the special treatment of public sector workers is likely to contribute an element of internal friction to the debate.
The Taoiseach, Mr Ahern, has been making reassuring noises aimed at the trade union movement in recent weeks. He was particularly outspoken in rejecting the decision by Irish Ferries to offer voluntary redundancy or reduced pay and inferior conditions to its 543 seafaring staff. Yesterday in the Dáil, he told employers that the accession of new EU states did not give companies a green light to replace Irish workers with cheaper labour. Apart from such admonishments, however, it is difficult to see what can be done. For the Government would be extremely reluctant to introduce controls on EU workers from Poland and eastern Europe at this time.
Obvious tensions are developing in Irish society, driven by foreign competition. Irish wages now rank fourth highest of the major industrial economies and there is a need to become more competitive and productive. There are worrying indications of delay in moving up the value-added chain, however, and the bulk of newly-created jobs has been low paid. That is all the more reason why we must continue to invest heavily in education, research and development, while improving our transport and communications infrastructure.
The need for wage moderation will be central to any negotiations on a new partnership arrangement, if Ictu members decide to embark on that process later this month. And while it would be extremely difficult to differentiate between public and private sector pay in those discussions, the Government will have to grasp the nettle of public service reform and productivity in the subsequent benchmarking process, due to be completed in 2007.
Pay in the public service is now well ahead of private sector incomes. And security of tenure and wage-linked pension entitlements have taken on a particular importance as companies like Irish Ferries move aggressively to reduce their wage costs. If the social partnership model is to survive, employers will have to make a significant contribution.