Is social partnership now damaging the ecomony?

[Purple]

I'm no fan of social partnership, I should say that before I comment further. The main reason I am not is because in my view it is undemocratic.
My gripe here is different. In another thread a link was given to rte.ie where David Begg was quoted as saying "Arriving for the meeting, ICTU General Secretary David Begg said that it was now clear that inflation averaging 5% was a long-term phenomenon, which was eroding wages".
Mr Begg is a smart man, why does he choose to ignore the much more important point that 5% inflation will wipe out our economy in a matter of a few years?
Why does he suggest that the best course of action is to further damage the economy by handing out even bigger pay increases to his members?
With these sort of blinkered agenda from one of the vested interest groups at the table what chance have we to address the loss of competitiveness in our economy?

 

[room305]

Why does he suggest that the best course of action is to further damage the economy by handing out even bigger pay increases to his members? With these sort of blinkered agenda from one of the vested interest groups at the table what chance have we to address the loss of competitiveness in our economy?

I too agree that the process is undemocratic as the opposition parties are not represented (while unelected union leaders are). I am surprised they are not more vocal about this.

As for why they have such a blinkered agenda? Most unions behave in this manner. They operate for the good of their existing members and wider concerns are of little import. When faced with a decline in competiveness of the US automobile industry, UAW fought long and hard to prevent GM relaxing pension rules for new employees. They are now no longer the world's number one car manufacturer and it is quite possibly only the super-easy money era in which we find ourselves that sees the company continue to stave off bankruptcy. Ditto Ford.

The ICTU are adopting a similar attitude. What they are advocating is essentially a price/wage spiral. This will lead to a continued loss of competiveness, less investment, fewer jobs and directly penalises those of us unlucky enough not to be able to harangue our employers into providing such an increase.

 

[nelly]

I wish i was benchmarked against my public sector friends who do exactly the same job.

 

[ubiquitous]

Should this thread be moved to The Great Financial Debates? I think it is an important debate.

 

[nelly]

Don't think you need bother move it as it was started at 10am and by 1 there are only 3 replies.

 

[polaris]

The unions are doing their job which is to promote the interests of their members.

It's the duty of the elected government to promote the interests of the entire population of this country. If ICTU wants to renegotiate the last wage agreement then it is the duty of government to resist this pressure if it is deleterious to the economy as a whole.

 

[Purple]

The unions are doing their job which is to promote the interests of their members.

It's the duty of the elected government to promote the interests of the entire population of this country. If ICTU wants to renegotiate the last wage agreement then it is the duty of government to resist this pressure if it is deleterious to the economy as a whole.

I agree, hence my first post

 

[efm]

To echo what polaris and Room305 said - David Begg would say that wouldn't he because that's his job. He is tasked with getting the best return for union members. If he were to say that in order to reduce wage inflation the ICTU recommends a 5% CUT in wages he would be hailed as a prophet by the employers groups, and the government, and promptly fired by his union!

To be fair this sort of rhetoric is the preamble to the negotiations - he is setting out his starting position, probably with the expectation that at the end of negotiations he will agree to a 3.5% increase over 3 years (or something like that) ie he's setting a target and will negotiate down.

It is then up to the government to determine what it is willing to pay for generally stable industrial relations in the economy vs adding to the wage/cost spiral. (I think one could debate whether we have a stable industrial relations environment in this country or not but my personal impression is that we do, when compared to other EU countries - I have searched briefly for stats to back up this impression but haven't found any)

 

[efm]

I agree, hence my first post

I'm confused - maybe I'm missing the point in your initial post?

Your first post seemed to imply you didn't know why David Begg was making such statements

Mr Begg is a smart man, why does he choose to ignore the much more important point that 5% inflation will wipe out our economy in a matter of a few years?

The unions are doing their job which is to promote the interests of their members.

Why does he suggest that the best course of action is to further damage the economy by handing out even bigger pay increases to his members?

The unions are doing their job which is to promote the interests of their members.

With these sort of blinkered agenda from one of the vested interest groups at the table what chance have we to address the loss of competitiveness in our economy?

It's the duty of the elected government to promote the interests of the entire population of this country.

Is your point that Begg et al are too short-term in their outlook and that while their members might gain now they will ultimately loose in the long run?

 

[ubiquitous]

Should this thread be moved to The Great Financial Debates? I think it is an important debate.

Don't think you need bother move it as it was started at 10am and by 1 there are only 3 replies.

Not surprising really, given that users like myself who mainly access AAM pages via the search facility won't be aware of most LOS discussions. That's why I suggested this thread be moved.

 

[z108]

Don't think you need bother move it as it was started at 10am and by 1 there are only 3 replies.

Well maybe those of the AAm members who are represented by David Begg dont wish to comment ?

I think the original post is perfectly valid by the way.

 

[Purple]

I'm confused - maybe I'm missing the point in your initial post?


Is your point that Begg et al are too short-term in their outlook and that while their members might gain now they will ultimately loose in the long run?

My point is that the government that we elected to run the country has diluted it’s power, and by extension the power of the people, by shirking it’s responsibility and forming a committee to carry out it’s duty to run the country. The other members of the committee are vested interest groups like IBEC and SIPTU who do not act in the national interest but rather represent the interests of their members.
This committee could be of benefit if we had strong leadership from the government but the man at the top it the ultimate prevaricator and pleaser and so the interest groups have an effective veto on major government decisions.

 

[xavier]

"Ah but sher don't I have a few quid in me pocket and sher isn't Bertie a grand fella."

That would seem to be the response from the people on this subject. We work so they can play with our money and so long as we have some money we don't care what goes on.

 

[contemporary]

we need to change the way we measure inflation, mortgage interest should be removed from the calcuation as should tabacco and alcohol

 

[shanegl]

For the purposes of measuring the increase in money supply, yes, we have the HICP for that which is significantly lower, but still well above the EU average.

I think there still needs to be a measure of how costs are increasing for the average punter though.

 

[room305]

we need to change the way we measure inflation, mortgage interest should be removed from the calcuation as should tabacco and alcohol

I think measuring a rise in the "average" price of goods is a somewhat impossible and pointless task. After many years of trying to do this and the introduction of numerous hedonic adjustments and multiple different inflation measures with varying focuses there is still no generally agreed upon way of doing so.

That said - why remove alcohol and tobacco? I would remove mortgage interest too, it seems a strange inclusion (why not credit card, or overdraft interest as well?). Possibly it should be replaced by a rental cost calculation.

 

[efm]

This committee could be of benefit if we had strong leadership from the government but the man at the top it the ultimate prevaricator and pleaser and so the interest groups have an effective veto on major government decisions.

Ah yes...the joys of living in a democracy!

So are you say saying actually the issue with Social Partnership is NOT the unions or the vested interests but rather the governments inability to manage the process to get what is best for the country as a whole?

 

[wolfspeed]

I'm no fan of social partnership, I should say that before I comment further. The main reason I am not is because in my view it is undemocratic.

In what way do you think social partnership is undemocratic?

The Government, representing the people of Ireland as well as being an employer are represented at all levels of national social partnership? So in what way is that undemocratic?

Social partnership is a very functional way of reaching national wage agreements, which would have to be negotiated at local level enterprise in its absence.

The vested interests that are mentioned are very much balanced, ie ICTU and IBEC ensure both workers and employers are represented at wage negotiations.

We still have a Government who take final decisions and spending commitments agreed have to be voted on in the Oireachtas in order to come into effect.

Don't see what the problem is

 

[shanegl]

You mean the workers who are part of ICTU right?

Because I'm not represented by any union and neither are many other people.

 

[nelly]

In what way do you think social partnership is undemocratic?

The Government, representing the people of Ireland as well as being an employer are represented at all levels of national social partnership? So in what way is that undemocratic?

the government does not represent the whole of the employed people in ireland because only those who are in Unions recognised by employers are paid partnership increases.
If i join a union my employer will not recognise it and it will not be able to negociate on my behalf for an pay increase, if i am to get one.