Partnership Necessary to Tackle New Challenges - Tánaiste “Technology and Competitiveness Key to Non-Inflationary Growth” - Harney

“Social Partnership has provided a stable framework which has enabled Ireland to achieve the highest level of economic growth in the OECD throughout the 1990’s. As a result we have witnessed a larger increase in living standards than that achieved in any comparable period in Irish history with average income levels now approaching the EU average”, said the Tánaiste Mary Harney today (Thursday 23rd March, 2000) when she addressed the IBEC Conference on “Technology: Everybody’s Business” in Dublin Castle.

“On the day on which the social partners vote on a new Programme for Prosperity and Fairness it is appropriate to reflect on the role that partnership has played in the past and will play in the future”, said the Tánaiste. "Recent success must not be allowed to induce complacency as there are many new challenges which have to be addressed in the context of partnership. Ireland now has virtual full employment and is facing a situation where the labour force will not grow at the same rate in this decade as it did in the last. As a result policy will now be concerned with measures to boost supply of labour and increase overall productivity. This will involve addressing issues that are relatively new to us such as framing a proactive emigration policy, introducing new measures which encourage people to participate in the labour force and encouraging technology and innovation across all sectors of the economy”, the Tánaiste added.

In the past decade while productivity has grown prodigiously in the modern export orientated sector its growth in the sheltered domestic sector (both public and private) has been disappointing. Unless we can raise productivity in these sector our ability to achieve non-inflationary growth and maintain international competitiveness will be threatened.

Addressing the theme of the conference “Technology: Everybody’s Business”, the Tánaiste said that indeed technology is everybody’s business since it is only through the widespread adoption of modern technology, particularly Information and Communications Technology, that Ireland can achieve a high level of productivity growth and establish itself as a fully developed economy. However, experience has shown that business in the sheltered sectors will only adopt the latest technologies if they are exposed to the spur of competition and if the costs of using these technologies, e.g. telecommunications tariffs, are internationally competitive.

The Tánaiste said that the Government is committed to the use of competition policy to spur productivity growth. “While we recognise that many of the factors that contribute to inflation such as oil prices and the weakness of the Euro are outside its direct control, the Government is determined to tackle domestic inflation by ensuring that previously sheltered sectors are exposed to the winds of competition either by way of full market liberalisation or by a pro-competitive regulatory regime that puts the consumer first. The significant reduction in Telecoms costs as a result of liberalisation show what can achieve and we recognise that more needs to be done in this area particularly in the unbundling of the local loop which is critical to reducing the cost of internet access”, the Tánaiste added.

The Tánaiste also announced that she is currently reviewing the resources available to the Competition Authority in the area of enforcement so as to ensure that infringements of competition are vigorously pursued.

In addition, the Tánaiste outlined the measures being implemented by the Government to ensure that Ireland remains at the forefront of developments in eBusiness and in particular indicated that the new Electronic Commerce Bill has been drafted and will be considered by Government next week. “This legislation will be the most advanced and comprehensive of its kind and will provide business with a solid base to underpin their participation in the internet economy”.