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Managing the boom: Negotiating Irish social partnershipin an expanding economyMichael Nye aa Department of Politics , University College Dublin ,Published online: 19 Oct 2007.

To cite this article: Michael Nye (2001) Managing the boom: Negotiating Irish social partnership in an expanding economy,Irish Political Studies, 16:1, 191-199, DOI: 10.1080/07907180108406639

To link to this article: http://dx.doi.org/10.1080/07907180108406639

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MANAGING THE BOOM:NEGOTIATING IRISH SOCIAL PARTNERSHIP

IN AN EXPANDING ECONOMY

Michael NyeDepartment of Politics

University College Dublin

Social partnership in Ireland is changing dramatically. The Programme for Prosperityand Fairness, (PPF) was negotiated in a period of unprecedented economic prosperity.Therefore, the socio-economic context in which the PPF was negotiated has severalimplications for both the structure of the negotiations that preceded it, and thesubstantive content within it. In particular, increased expectations and new actorspursuing social partnership, all of which accompanied economic expansion, heraldedthe emergence of several new issues for debate within the PPF. These emerging issuesare less familiar and less well defined. They therefore present a unique departure fromthe traditional norms of Irish social partnership negotiation. This report presents someof the findings from research in progress by Dr. Diane Payne, (UCD) and Dr. ReneTorenvlied, (Utrecht University, Netherlands), which compares the recent collectivebargaining agreements in Ireland and the Netherlands.

Beginning in 1987 with the Programme for National Recovery (PNR), Irish socialpartnership was originally little more than a tri-partite wage and tax remedy for the ailingeconomy of the 1980s. In order to decrease budget deficits and increase employment,the PNR prescribed co-ordinated restraint in both wage claims and nominal publicexpenditure (Gunnigle, 1999 p. 204). The relatively thin PNR probably does notstand up to today's heavyweight partnership standards. However, joint recognitionby Government, trade unions, and employers of the economic problems facing thenation, and the tri-partite commitment to their solution established within the PNR,mark a critical turning point in Irish industrial relations practice. This ethos of unifiedrecognition and commitment was continued in successive partnership agreements withincreasing success. Indeed, during the course of the Partnership 2000, which precededthe current Programme for Prosperity and Fairness (PPF), Gross National Product grewby as much as 8.5 percent, inflation fell as low as 1.5 percent, government accountsshifted to surplus, and immediate unemployment levels had shrunk to 6.4 percentby 1998 (NESC 1999, p. 12). In this context of economic prosperity, the PPF wasnegotiated around the principles of managing and facilitating the economic boom,rather than remedying a struggling economy. With regard to these premises, the PPFtakes an increased focus on competitiveness, increased growth, sustainability, social

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equity, and social inclusion (PPF, 2000, p. 4). In short, the expanding economy hasheralded a new era and ethos for Irish social partnership, in which the social partnersare now actively and increasingly seeking the benefits of their past restraint.

During the partnership period, as both positive economic indicators, and theexpectations for what partnership should deliver increased, the number of actors seekingto be involved in partnership negotiations rose accordingly. The key actors in Irish socialpartnership agreements have traditionally consisted of the traditional "three pillars" -government, trade unions, and employers. However, with increased expectations andmore social partnership actors, the community and voluntary platform has strengthenedits position as a fourth pillar to these agreements (NESC, 1999, p.86). This platformconsists of 22 organisations, representing such diverse interests those of elderly peopleand the rights of women (PPF, 2000, p.4). Obviously, the inclusion of such a variedgroup implies the inclusion of many new policy preferences for Irish social partnership.Furthermore, the other three pillars have their own sets of unique and distinct interestsfor social partnership, many of which directly reflect the new economic context.Therefore, the increase in actors and expectations for partnership in the expandingeconomy created conditions that made the negotiation of the PPF more difficult. This isparticularly true for those issues that reflect the newer economic orientation, or ethos,surrounding the agreement. In order to fully understand why forging consensus on theseemerging issues is so problematic, it is first important to understand how the issuesand frameworks within Irish social partnership agreements are traditionally defined anddebated.

NESC STRATEGY DOCUMENT CREATION

Issue definition, and informal negotiation for a new social partnership, begins with thecreation of a National Economic and Social Council (NESC) strategy document. Whenfinished, the NESC document serves as the broadly defined platform of issues to befurther refined and debated in formal partnership negotiations. Hence, the importanceof the NESC strategy document lies in preliminary issue definition, boundary creation,and agenda setting. The council is comprised of 31 high level representatives fromtrade unions, employers, the Department of Enterprise, Trade, and Employment, theDepartment of Finance, the Department of Public Enterprise, the Department of Social,Community, and Family Affairs, the Community and Voluntary Platform, and otheragricultural and infrastructure interests (NESC, Constitution and Terms of Reference,2000). It is important to note that the community and voluntary platform have onlybeen included formally in the NESC since 1996 (Interview Material). Therefore, theplatform's emergence in NESC not only marks their introduction as a fourth pillar toIrish social partnership, but illustrates the expansion of actors seeking to be involved inpartnership in the expanding economy.

Negotiation of a NESC strategy document begins early, commonly within 18months of the adoption of the previous agreement. Initial work and discussion for

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Opportunities, Challenges, and Capacities for Choice, the strategy document thatpreceded the PPF, began in October of 1998 (Interview material). The creation of astrategy document begins with proposals written by the NESC secretariat. An initialframework of issues, taking into account both the current economic and social needs ofthe nation, and the interests and expectations of the council members, is presented tothe council. The partners then respond, suggesting changes. This drafting and commentprocess then repeats itself until all of the parties involved are satisfied with the wordingof the various frameworks in the drafted document. In light of this focus on textualconsensus, the NESC process was defined by one interviewee as an exercise in "gettingthe wording right" (Interview material). This is an important concept, as it implies thatthe NESC procedure is focused more upon defining issues in a consensual mannerthan articulating and then defending hard-line positions. In addition, the structureand process of boundary creation in NESC has several distinct implications for futurepartnership negotiations. These are the development of close working relationshipsbetween the negotiators, the creation of issue familiarity, the creation of preliminaryissue positions, and the development of a sense of commitment to future partnershipnegotiations.

The creation of a new NESC strategy document promotes personal familiarity andclose working relationships between the council members. The individuals involved inthe NESC strategy stage comprise a relatively small group, and therefore individualactors become familiar with the negotiating styles and demeanours of their counterparts.This, in turn, allows the actors to work more efficiently and smoothly with each other infuture partnership negotiations. According to several respondents, the same individualscomprising the NESC are likely to be the primary negotiators for social partnershipagreements (Interview material). Thus, the personal familiarity bred in the NESC, andcarried into later negotiations, is an extremely important facet of Irish social partnershipnegotiation. Indeed, one respondent went so far as to indicate that agreements werepredicated upon the close working relationships that exist between the key actorsinvolved in both NESC and partnership negotiations (Interview material).

Secondly, the NESC process allows the council members to develop a sense of eachother's policy position before entering into negotiation. In deriving a sense of anothernegotiator's position, council members can judge how best to approach negotiationswith that actor on those issues. In other words, NESC allows the individual councilmembers a peak at the other players' hands before the poker game has begun.Post NESC, council members know how far they can push one another on variousissues (Interview material). NESC then, breeds not only personal familiarity in laternegotiations, but issue familiarity as well.

The preliminary ethos surrounding the NESC process also serves a unique purpose.According to one respondent, "in the NESC stage, everything is still very tentative, andtherefore, there is a tendency [among the council members] to qualify statements ofinterest with phrases such as, 'IF there is an agreement, we would be looking for the

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following'" (Interview Material). Although firm commitments are not being madeor offered at this stage, the process of preliminary issue definition in NESC doesallow the negotiator to develop at least potential issue positions for later negotiationsand to outline the tentative shape of package deals. Furthermore, the NESC allowsthese positions to be refined, compromised, or altered in a more private forum thanthat allowed in negotiations that are much more open to scrutiny by organisationalmembership and the general public.

Finally, the NESC process helps to create a sense of commitment to furtherpartnership negotiations between the council members. According to one respondent,"if employers and trade unions cannot formulate an agreement at the NESC stage,then it is highly unlikely that a new partnership agreement will be created (Interviewmaterial.) Yet the factors discussed above create conditions that are optimal forcompromise and consensus building. Therefore, once a broad framework of issuesfor future partnership is defined and created in a NESC strategy document, furthernegotiation on the finer details of those issues is more likely to take place. Increating, Opportunities, Challenges, and Capacities for Choice, the council membershad developed not only a preliminary platform of consensually defined issues to benegotiated for the PPF, but also a commitment to further negotiations. With broadconsensus on the wording and definition of the issues created, the individual councilmembers could return to their constituents with a concrete policy framework on whichto develop their individualised bargaining strategies for social partnership negotiation.Post NESC, the pillars were ready to negotiate the PPF in earnest.

PARTNERSHIP NEGOTIATION

Formal negotiations for the PPF began in November of 1999 (PPF, 2000, p.3). However,the word "formal" is somewhat of a misnomer in this case, as Irish social partnershipnegotiations are surprisingly informal affairs. Indeed, according to many respondents,agreements are more likely to be made in corridors and conveniently empty rooms withinthe Department of the Taoiseach, than in formal board rooms (Interview material). Thenegotiators for the PPF formally constitute a much wider body of individual organisationsthan those included in the NESC. However, many respondents indicated that the "innercore" of negotiators from NESC is still predominantly responsible for the majority of Irishsocial partnership negotiation1 (Interview material).

In a similar manner to that in the NESC process, partnership negotiations arecentred upon drafted proposals created by a representative from the Department of theTaoiseach. Drafted frameworks are taken individually to the respective negotiators forconsultation and consideration. This individual manner of proposal presentation allows forthe negotiators from the Department of the Taoiseach to act as the primary "brokers," ormiddlemen, between the other negotiators (Interview material). Agreements are thereforemore likely to be reached between the Department of the Taoiseach and the Irish Congressof Trade Unions, (ICTU) and the department of the Taoiseach and the Irish Business

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and Employers Confederation, (IBEC), than between IBEC and ICTU alone (Interviewmaterial). In short, this is a bilateral, rather than a direct negotiating process. However,the personal and issue familiarity, bred in the NESC, certainly facilitates the process.Indeed, several respondents indicated that, as regards the more familiar issues from pastpartnerships, such as pay and tax commitments, they had a strong sense of what waslikely to be finally agreed in the PPF, prior to entering into actual negotiation (Interviewmaterial). This finding illustrates the centrality of familiarity for Irish social partnershipnegotiation. Irish social partnership appears to be predicated upon personal familiaritybetween the negotiators and the individual negotiator's familiarity with the boundariesof acceptability for the partnership issues (Interview material). Thus, rather than blindlyfighting for concrete issue positions, negotiators are more likely to propose tentative initialissue positions that are within the bounds of what is considered negotiable by all theparties involved (Interview material). This tentative and open-ended negotiating style isalso reminiscent of the preliminary NESC process. Indeed, one respondent indicated thatagreements on a particular framework are often formulated around the idea of "mights."For instance, the Taoiseach's representative may say, "if you are prepared to offer this,[the other negotiator] might accept it" (Interview material). Two lines of reasoning wereoffered by the respondents as to the predominance of this tentative positioning style. First,articulating a hard-line position decreases both the negotiator's possible win set and thewin set of those whom she or he is negotiating with. Once a desired position is firmly andpublicly stated in open partnership negotiations, it becomes more difficult to compromisewith the potentially conflicting desires of the other negotiators on that issue (Interviewmaterial). Therefore, tentative positioning offers the negotiator more flexibility than thatallowed by absolute interest articulation. Secondly, some respondents felt that expressinginitial absolute issue positions was undesirable, in that it allowed the general public totally wins and losses upon the issues, once negotiations concluded (interview material).Obviously, no organisation was keen to be portrayed as a loser in the PPF negotiations,hence the reluctance to articulate concrete policy positions.

The process of negotiating drafted proposals also mirrors the NESC strategy documentprocess. Again, it was argued that social partnership negotiations are centred upon thepremise of "getting the wording right" (Interview material). The final drafted frameworksof the PPF are, therefore, ones in which the issues and commitments are defined andworded in a manner that is acceptable to all of the parties negotiating those frameworks.This process of creating consensual wordings has a distinct implication for the substantivecontent of partnership. One respondent, in particular, felt that the textual ambiguity ofseveral of the more hotly debated commitments in the PPF reflected the focus on acceptedwordings (Interview material). Often times, a definite consensual commitment cannot bereached, and an issue is either defined in an ambiguous manner, or earmarked for furtherconsideration or development (Interview material). In particular, this vagueness in issuedefinitions, or lack of firm commitment, seems to apply to those issues reflecting thewidening of expectations and inclusion of actors for social partnership produced by the

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expanding economy. Emerging issues seem to be more difficult to define consensually.As such, the newer and emerging issues for social partnership are characteristicallymore problematic to negotiate (Interview material). In fact, one respondent indicatedthat it was common for negotiations around the more divisive and emerging issues tocarry on into the early morning hours (Interview material). It seems that the factorsthat facilitate consensus on the more traditional issues cannot be easily applied toemerging issues. Emerging issues are less familiar and less defined in substantive NESCstrategy documents or partnership precedent. Hence, it is more difficult for the individualnegotiator to offer tentative and potentially consensual positions around these issues.

The lack of familiarity surrounding emerging partnership issues can also be appliedto emerging actors in partnership negotiations. Emerging actors may not have developeda sense of personal familiarity with the more traditional negotiators. Therefore, thecommunity and voluntary platform, as relative newcomers to the negotiating process,have not yet fully developed the close working relationships with the council membersand partnership negotiators that facilitate consensus building. Therefore, accommodatingtheir interests is more difficult (Interview material). Finally, the platform placed extremeimportance upon social welfare issues, viewing social inclusion and equity as a civil rightto all, and a moral obligation of a wealthier society to provide (Society of St. Vincent DePaul, 1999, p. 1). This moral primacy on social welfare issues further decreased the roomfor compromise and conciliation on their key interests. In light of these factors, it is nowonder that negotiations for many of the emerging and expanding issues for the PPF wereboth more difficult and less characteristic of the traditional style of Irish social partnershipnegotiations. Two of these developing, or emerging issues, are enterprise partnership, andchildcare costs.

ENTERPRISE PARTNERSHIP

Enterprise partnership according to the PPF, is "an active relationship" between employersand employees. (PPF, 2000, p. 14). In short, enterprise partnership is a micro levelpartnership between an individual industry or employer and its employees on a range ofpay and conditions issues. The PPF document contains several principles aimed primarilyat deepening enterprise partnership. In an expanding and rapidly changing economy,enterprise partnership is seen as a viable and efficient means of adapting to the needsof individual enterprises and industries (NESC 1999, p.300). Furthermore, enterprisepartnership allows those issues not agreed to in detail at the level of social partnershipto be defined and negotiated at a later date between employers and employees. Althoughenterprise partnership was formally established in Partnership 2000, this issue is still arelatively new one and therefore, the principles underpinning the framework for deepeningworkplace partnership were particularly difficult to negotiate. According to one respondent,both IBEC and ICTU were somewhat disappointed with progress towards enterprisepartnership and therefore they sought to clarify exactly what enterprise partnership was,and what it meant for both trade unions and employers (Interview material).

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REPORTS 197

Trade unions and employers have traditionally taken primary responsibility for theconduct of industrial relations practice in Ireland (Gunnigle, 1999, p.65). Therefore,enterprise partnership is a particularly important issue, in that it illustrates the impactof the rapidly expanding economy on something that is especially salient for the twoprimary actors. Because enterprise partnership can be applied to a wide range of payand conditions issues, it is no wonder that trade unions and employers had stronglydiffering desires for many of the definitions and principles underpinning it. The extremeand conflicting emphasis placed upon these issues left little room for consensus buildingor compromise between the two camps. Furthermore, the relatively recent emergenceof this issue, and its ambiguity, or lack of clear definition, in the Partnership 2000, leftlittle room for issue familiarity and boundary definition to firmly arise in the NESCaround this issue. As a result of these factors, negotiating the principles underpinning thedeepening of partnership at the level of the enterprise was extremely difficult. There wasespecially heated debate surrounding the process of negotiation for enterprise partnershipagreements.

Trade unions, as organisations representing employees, desired a model of enterprisepartnership negotiation centred upon formal union representatives. In other words, unionssought representative enterprise partnership. If ICTU had its way, all negotiations forenterprise partnership would take place through union representatives only. Employersopposed this manoeuvre however, as they saw it as an attempt by the trade unionsto restrict enterprise partnership to unionised companies only, and to create a sortof mandatory trade union recognition within those companies (Interview material). Asignificant portion of IBEC's membership consists of multinational companies, manyof whom are not unionised, or do not have a high concentration of union membership(interview material). Therefore, employers insisted upon direct enterprise partnershipnegotiation between management and employees (Interview material). The decision onthis issue reflects the textual ambiguity that often results from particularly divisive issues.Neither side won or lost on this issue, as the PPF calls for both direct and representativeenterprise partnership in the same sentence (PPF, 2000, p. 14). Due to definitionalambiguity and a lack of firm commitment in the PPF, this issue will doubtlessly arise infuture partnership negotiations, hence its extreme importance as an emerging issue.

CHILDCARE COSTS

Additional measures to address social exclusion and promote social inclusion alsoreflect the rising expectations of partnership in an expanding economy. In thisperiod of economic boom, "there has been a change in the perception of whatis considered acceptable and feasible in terms of distribution and redistribution"which is "reflected in the changing emphasis on social inclusion and equality in theIrish policy framework." (NESC 1999, p.35). In other words, we find that socialpartnership is becoming more social in an expanding economy. Economic expansioncan be conceived as a catalyst for making equality measures more efficient, which,

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in turn, justifies further social expenditure on social welfare provisions (Okun,1975, p.99). However, the emergence of increased primacy on social issues hasincreased the difficulty of social partnership negotiations. Increased social inclusionand equality commitments are less familiar territory than the economically orientedissues that have traditionally been central to Irish social Partnership agreements(Interview material).

One such area of difficulty in social policy commitments was the proposedsystem of childcare benefits. This issue is important in that it illustrates an emergingsocial welfare issue that is particularly salient for trade unions, employers, and thecommunity and voluntary platforms alike. In order to encourage higher participationin the labour force, particularly among single parents, trade unions and employersadvocated certain forms of childcare compensation or benefits. Thus, the primarygoal of trade unions and employers on this issue was generating fuller employment,and contributing to the stability of the economic boom. In short, for both tradeunions and employers, childcare costs are a labour market issue. In light of theseconcerns, trade unions and employers were looking for tax benefits for receiptedchildcare payments, in order to reduce the cost of childcare for working parents(Interview material).

The community and voluntary platform, however, took a somewhat differenttack on this issue. The platform felt that a reduction in the cost of childcare wasnot only an incentive or disincentive for work, but also, if incorrectly applied,a contributor to further inequality among the poor (Interview material). A largeproportion of the families represented by the community platform simply do notmake enough to be included in the tax system, and therefore, tax benefits forchildcare would not be beneficial for the poor. Secondly, the poor often optfor cheaper, informal, or non-receipted, childcare (Interview material). Thus, theplatform argued, the application of a tax-benefit-for-receipts system would not bebeneficial to the poor. With regard to these concerns, the community and voluntarypillars pushed for a universal childcare payment, rather than tax concessions.

When considering both sides of this debate, it becomes apparent that this issuereflects not only the drive for increased sustainability and economic expansionwithin the PPF, but also the increased expectations for equality and social inclusionin a prosperous economy. Unfortunately, this issue also illustrates the tendencyto earmark a particularly divisive issue for further consideration. No specificcommitment on childcare payments is made within the PPF. Rather, the PPFcalls for "an equitable strategy to support parents in meeting childcare needs"to be developed over the course of the PPF (PPF, 2000, p. 120). The proposal ofdirect childcare payments is mentioned, but the consideration of other proposals ismentioned as well. Therefore, this issue will assuredly arise in future negotiations,barring a firm commitment within the next year.

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CONCLUSIONS

The nature of Irish social partnership agreements and social partnership negotiationhas changed dramatically in recent years. An expanding economy has prompted bothan increase in the number of actors included in social partnership negotiations, andincreased expectations from the social partners as to what social partnership can andshould deliver. The increase in expectations and interests for partnership placed newpressures on the negotiations, making negotiation of emerging issues and policiesparticularly difficult. Whereas the more traditional issues tend to be negotiated onthe basis of familiarity and informed tentative positioning, the newer issues are moreproblematic, often exhibiting less consensual issue stances, and a lower degree offamiliarity. As the economic boom continues, it is doubtless that less traditional issuesfor Irish social partnership, such as enterprise partnership and childcare commitments,will continue to emerge and be redefined. Furthermore, as the trend towards expansion ofpartnership continues, new issues will most assuredly arise for partnership negotiation.It is therefore important that we understand the traditional mechanisms and structuresof partnership negotiations, and the factors that facilitate or inhibit consensus buildingand commitment making in Irish social partnership, in order to effectively tackle theseissues.

N'OTES

1 In all, 20 organizations were formally invited to participate in the negotiation of the PPF.A complete listing of these organizations can be found in the "Overview" section includedin the PPF document. For the purposes of this paper, "partnership negotiators' shall refer tothose individuals present in both the NESC and the PPF negotiations, as it was overwhelminglyindicated in the interviews that these individuals are the key players in Irish social partnershipnegotiation.

REFERENCES

Gunnigle, Patrick, et al. 1999. Industrial Relations in Ireland, Theory and Practice.Dublin: Gill and Macmillan Ltd.

National Economic and Social Council, 1999. Opportunities, Challenges, and Capacitiesfor Choice. Dublin: NESC.

Okun, Arthur M. 1975. Equality and Efficiency: The Big Tradeoff. Washington: TheBrookings Institution.

Society of St. Vincent De Paul, 1999. Social Policy Manifesto. Dublin: SVDP.

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