Patrick McGarty: Ireland should adopt a European social partnership model

The next government must take on the vested interests. We cannot have a stable, continental-style welfare state funded by US-style tax rates, says Patrick McGarty.

NOW that the political auction is over, and that the political parties are attempting to form a government, let us reflect on how the people voted.

Sixty-six TDs in the incoming Dáil are left-leaning, with the remaining 94 either centrist or of indiscernible political leanings. In many of our neighbouring, European countries, coalition governments, constituting many disparate groupings, have provided economic and social stability. We should follow their lead.

The election was decided by voter concern about health, housing, and the broader body politic. The politicians, as they always do at election time, had told the voters that they would spend to solve these problems. What was lacking was a commitment to reform dysfunctional systems of governance.

An aversion to change, vested interests, mass bureaucracy, and little accountability within our system of public administration have contributed to bad planning and bad policymaking.

A lack of political will has fostered costly, inefficient, and un-coordinated services, which exacerbate the struggles faced by many families across Ireland.

Irrespective of whatever government is formed in the coming weeks or months, the challenge will be, in the words of former tánaiste Michael McDowell, to “become radical or redundant”.

Let’s now see who has the political courage to take on the vested interests across the public and private sectors.

With darkening economic clouds appearing on the horizon, in the form of decreasing corporation tax, uncertainty over the outcome of EU/UK trade negotiations, and possible impending trade wars, the next government should enact a social partnership model similar to the one that has contributed significantly to the economic and social stability of many of our European neighbours.

Unfortunately, Ireland’s brief experiment with social partnership, in the Celtic Tiger years, did not follow a European model, and, instead, offered wage moderation in exchange for tax cuts.

A properly constituted social partnership forum would be populated by government, business interests, farming organisations, trade unions, and civil society groups and would follow the lead of our European counterparts.

A measure of the health of our body politic is whether our society is capable of rationally debating issues with a view to finding common purpose.

Across many European countries, there is a collectivist culture, with all members confronting the reality of the marketplace and the wider problems facing civil society.

European-style social partnership focuses on the need to create a decent society, where a rational and evidence-based approach is taken to finding solutions to the main, pressing issues.

Mutual respect is the hallmark of such an arrangement, with objective economic and social research and analysis facilitating the process.

A new model of social partnership would enable issues such as private and public sector pay to be determined by independent human resources consultants and not by sectional interests, whose aim is to copper-fasten existing pay and conditions.

Europe’s economic growth model is based on a prevailing social contract that offers wage moderation in exchange for the construction of a welfare state, with the associated tax requirements accepted as part of the package.

The choice for Ireland is to decide on finding the appropriate balance of tax rates and effective public services.

Put simply, we cannot demand a European-style welfare state funded by US-style tax rates. Solutions to unbalanced regional development should also be considered by looking at European models of local government.

Internationally, we all know that competition is global, that investment favours scale, and that urbanisation is common.

Unfortunately, what makes Ireland different is the scale of the skewed growth and the weary acceptance of its inevitability.

It is not global competition that initiated movement east, but Ireland has one of the most centralised systems of government in Europe.

Regions don’t exist in any meaningful way, and Irish local government is the weakest in the EU.

With a Republic of Ireland/Northern Ireland border poll likely to happen in the coming years, is the time not right to consider proper regional government for the island?

Instead of having 31 powerless local authorities built on an outdated, 19th century model of public administration, is the time not right to consider real, powerful alternatives?

The major social and economic changes that are facing Ireland suggest that there is a real need for alternative public policy solutions, which can ameliorate the worst effects of impending change.

As longstanding members of the European Union, let us start by examining evidence-based best practice of wider European societies to find solutions.

To do this, political courage and maturity will be required by any new government, by opposition parties, but, most of all, by the Irish people.

Dr Patrick McGarty is a senior lecturer in public policy at the Institute of Technology Tralee.