O’Connor Looks For ‘social Dividend’ From The Crisis

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The 125,000-strong Dublin demonstration in defence of jobs and wages on February 21
The 125,000-strong Dublin demonstration in defence of jobs and wages on February 21

SIPTU General President Jack O’Connor has called for a Social Dividend to tackle the lack of adequate occupational pension coverage in return for trade union co-operation in tackling the economic crisis.

In a major policy speech delivered in Limerick at the weekend, in advance of the resumption of talks on a national recovery programme, O’Connor, who is also a Vice-President of the Irish Congress of Trade Unions (ICTU), said tens of thousands of workers either have no occupational scheme at present or are in schemes threatened with insolvency.

Such a scheme would provide them with a worthwhile reward for sacrifices now to save the economy.

‘We are now faced as a society with the biggest negative adjustment since the foundation of the State’, he said.

‘This is the stark reality and to this extent we agree with the analysis offered by the government and the employers’ organisations.

‘However, after that we part company in a very dramatic way, because we approach the crisis, as is the case in respect of virtually everything else, from a diametrically opposite perspective.

‘The issue turns on the prioritisation of interests. Which comes first – the interests of shareholders or those of the stakeholders – that is, the citizens of Ireland?

‘We opt for the latter and insist on a Social Dividend in return for co-operation in this time of crisis.’

Commenting on the NAMA (National Asset Management Agency) proposition, he argued strongly in favour of nationalising the banks instead.

‘Unfortunately, while we in SIPTU are vehemently opposed to this socialisation of recklessly accumulated risk, it is now clear the government will not be dissuaded from proceeding with it.

‘Their approach is determined by the same outlook which elected for speculation over sustainable development back at the end of 1990s.

‘It is an outlook which is not necessarily inherently corrupt in itself.

‘It simply sees no alternative economic strategy other than dancing to the tune dictated by high finance.

‘The question which realistically presents for us, and it will continue to be the case for as long as the vast majority of our people vote for the centre-right parties, is whether or not we can extract some kind of Social Dividend from the implementation of an otherwise objectionable policy.’

He went on to say that, ‘Whatever State entity emerges will become the largest single property owner in Ireland.

‘In a country where ten per cent of our housing lies idle because of unrealistic asking prices and where there are well over 55,000 families on the local authority housing lists, there is an obvious and urgent need to ensure that this housing stock is utilised to eliminate homelessness and not left to rot.

‘At least there would be something to show for past folly.

‘It would be unforgivable if the end result of the housing boom was the demolition of houses and apartment blocks that fell derelict because no one could be found to occupy them at artificially inflated prices, while millions of euros of public money is allocated to rent subsidies.’

O’Connor quoted from a letter he received from a SIPTU member in SR Technics, ‘who has lost his job and his pension after 45 years with the company.

‘So here we have the appalling vista of trade union members and citizens of our country deprived of the meagre retirement income they have spent all their lives paying for.

‘While they and their families, as PAYE taxpayers, simultaneously assume the burden for billions of euros of debts which were recklessly accumulated by those at the top of the banking system as a result of the policies pursued by government.

‘But the dismal circumstances currently prevailing offer the opportunity to address this critical problem.

‘However it would involve a radical change of outlook and mindset on the part of government, entailing a citizen/stakeholder rather than an exclusively shareholder-based response.’

He went on to say: ‘It is now clear that the defined benefit pension system is unsustainable and there is an urgent need to create a new universal pay-related pension paradigm.

‘We envisage a PRSI-based, [national insurance-type] mandatory mechanism.

‘We recognise that this can only be developed incrementally over time.

‘However, we insist on an interim arrangement to address the crisis faced by union members who have paid for their pensions throughout their lives and who will receive little or nothing in the end.’

O’Connor outlined various suggestions put forward by the trade union side in the national talks, which envisaged using pension funds – on the basis of a guaranteed level of return – to offset foreign borrowing.

He also said unions would be amenable to discussing ideas put forward by the Construction Industry Federation along similar lines, regarding the public capital programme.

Outlining SIPTU’s strategy he said it was necessary to ‘recognise the reality that the majority of our people habitually vote for the centre-right parties and that consequently the policies followed by government will reflect that outlook and value system.

‘The challenge confronting us is to mobilise the capacity to leverage a Social Dividend from these dismal circumstances.

‘In practical terms, that is why we conducted a national ballot for a mandate to wage an ongoing industrial campaign across the country if it becomes necessary (and incidentally, we in SIPTU at least obtained an overwhelming mandate from our members).

‘But equally it also means being innovative and pragmatic and finding ways through which we can adapt the policies pursued by the government and the employers so that they also serve socially-desirable ends.’

As readers can see, O’Connor agrees with the government that ‘We are now faced as a society with the biggest negative adjustment since the foundation of the State.

‘This is the stark reality and to this extent we agree with the analysis offered by the government and the employers’ organisations.’

This conception is the Achilles heel of the Irish trade union bureaucracy. They do not consider that there is any other solution to the crisis of Irish capitalism other than a ‘negative adjustment’ in the living standards of the masses, allied, of course to the principle of ‘fairness’.

Their agreement on this perspective means that they have no solution to the crisis except trying to trade off the creation of a ‘new universal pay-related pension paradigm’, a so called ‘Social Dividend’ for the acceptance of all of the other massive cuts that the government is making.

The Irish trade union leaders will find out that there is no ‘Social Dividend’ available from this capitalist crisis, except that the masses will realise that capitalism is ruined and must be replaced by socialism.

In fact, if the working class is to have any living standards at all, Irish capitalism and its coalition governments will have to be overthrown and replaced through a socialist revolution with a workers state which will constitute the basis of a socialist society.

For this to happen an entirely different, revolutionary leadership must be built up to lead the working class forward over the politically dead bodies of the trade union bureaucracy.