Belfast Telegraph

Saturday 22 November 2014

Needy should not have to pay for sins of the greedy

As Northern Ireland comes to terms with the full scale of the spending cuts, Conall McDevitt proposes a social partnership solution

David Cameron and George Osborne are ideologues on a mission.

They say they want to drag Britain back from the brink. In fact they are going to make the poorest pay for their 'savings' and push hundreds of thousands over the brink.

They are also putting the UK's - and especially Northern Ireland's - economy at serious risk of plunging deeper into recession.

By definition those who use public services most will be most hit when public services are cut.

The least well off are paying for the crimes of the bankers and greedy who pushed the UK into its deepest recession for a generation.

Here's the proof: when you exclude tax differences the top 20% lose least today. The brunt of capital and resource cuts hit the middle 40% highest. Working families are quite literally paying for all this.

The Tories should have declared war on want last month. Instead they have declared war on those who have least.

Northern Ireland will feel the brunt of these cuts head on.

The trade unions are right to challenge them and it is regrettable that a war of words has already broken out between the Finance Minister and the Irish Congress of Trade Unions. The Tories want to divide us here so they can change our society and shrink our public services. No party here wants that. In fact the CBI in NI doesn't even want that. That's why we should move now to establish a formal social partnership in Northern Ireland.

We need Government, employers, trade unions and the voluntary sector to sit down and agree a programme for regional recovery; one which protects public services and does not sacrifice public servants to feed anyone's ideology.

The coming months will be a real test for our politics. Can we do something brave and unite our public representatives and civil society or are we to allow our ancient and internal divisions to get in the way of the real need to unite in constructing a new approach to economic planning in our region?

Social partnership played a huge role in turning around the fortunes of the Republic's economy in the 1980s. Public finances were out of control with the national debt at about 140% of GNP. Falling growth rates were leading to record levels of unemployment.

The Irish Congress of Trade Unions proposed a way forward based on agreement between the Government and the other social partners. The aim was, through a national consensus, to plot a way out of economic difficulties. A Programme for National Recovery was agreed. It was a three-year agreement which provided for wage increases limited to 2% per annum.

In return for wage moderation there was a series of measures to stimulate employment, to broaden the tax base, to permit lower taxation of workers' earnings, and commitments to improve social protections.

This pact and successive national agreements were highly successful and are credited with being the major factor in the transformation of the Irish economy which became the fastest growing economy in the OECD.

Subsequently, five further three-year pacts were agreed, each building on the success of the previous and attempting more ambitious targets for economic growth.

The time has now come for a similar approach here in Northern Ireland.

We need to radically reform how we a plan our public finances and manage our economy. Social partnership could provide a very effective way of doing this.

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