Social partnership and the Irish economy - what next?

On Friday, as the chief negotiator for the Irish Congress of Trade Unions (ICTU) remarked, the government ‘changed its mind’ about a deal with ICTU which would have seen public service employees taking 12 days unpaid leave (though the reports had been ambivalent as to whether these days were to be taken during 2010 or whether they could be stretched to a number of years). Earlier in the week the parties had let it be known that a deal on this and related matters was near, and on the strength of that ICTU called off the strike that had been planned for this Thursday.

It is slightly difficult to get a clear picture of what had been on offer before it was rejected. It seems that the unpaid leave idea was being discussed (and may have been agreed), but no commentator could see how that could save anything like the sum of money needed to allow the government to cut its costs by the €4 billion needed to move the country towards economic health. In fact, the anticipated agreement was roundly criticised by almost everyone other than the trade unions themselves and the Labour Party; government backbenchers, the Fine Gael opposition, employers, newspapers all criticised the expected deal as a caving in to the unions that would fail to deliver the necessary savings.

It seems from recent developments that there is now an appetite in the country to get the national finances under control. It seems unlikely to me that a return to planned strikes will work well for the trade unions. And given events this week, the question must arise as to whether the social partnership model will survive here. In fact, social partnership was vital in the last period of Irish economic regeneration in the late 1980s, as it produced industrial peace and far higher levels of productivity throughout the 1990s and the early years of this decade. It worked because the diagnosis of all the parties, including government, employers and trade unions, was on the whole similar and the solutions were widely accepted, even where they were bound to be painful. There are few signs that these attitudes still prevail today, and so it seems increasingly inevitable that social partnership will not provide the government with cover as it moves to recreate our economic model.

I have a suspicion – which may turn out to be wrong – that this breakdown in talks will re-ignite militancy in some trade union circles, and that there will be pressure to return to demonstrations and strike action. If this happens, it will produce very little public sympathy, I suspect, and may do long term damage to the trade unions. I hope this is not how it goes, as Ireland continues to need a resourceful and intelligently led union movement. Or at least I still think so.

[Via http://universitydiary.wordpress.com]