Tánaiste Says Further Reductions in Unemployment Will Benefit the Most Deprived Sections of Society "Competition Vital to Combating Inflation" - Harney

Tánaiste and Minister for Enterprise, Trade and Employment, Mary Harney, has this morning (Thursday 27th July, 2000) said that she believes that the current unemployment rate of 4.5% can be reduced significantly. She added that the aim in bringing about further reductions must be to benefit the most deprived and marginalized sections of society.

The Tánaiste was addressing the Plenary session of the Programme for Prosperity and Fairness in Dublin Castle.

The Tánaiste said "There are 270,000 additional people at work in this country compared with when this Government assumed office. The unemployment rate has been halved and the rate of long-term unemployment has been reduced to 1.7%. The Government is determined to use all of the instruments at its disposal to ensure that inflation does not threaten this achievement or undermine our ability to make further progress."

"The challenge is to continue to implement the real structural changes in terms of labour supply, infrastructure and competition which will enable us to continue to increase employment opportunities and living standards across the board and to do so without generating inflationary pressures," the Tánaiste added

The Tánaiste also urged employers and employees to work together to achieve real improvements in living standards without endangering competitiveness.

"Across the economy workers and employers are negotiating agreements, which through gain sharing, productivity enhancing arrangements, and share option plans, enable employees to substantially increase their living standards without generating inflationary pressures and endangering competitiveness. We must look at ways to support and spread such practices," the Tánaiste said

"We must also ensure that the surge in productivity that has occurred in recent years is extended to all sectors of the economy and the benefit of such gains shared with consumers. This can only be achieved if we ensure that all sectors are fully exposed to competition such as the Government have encouraged, for example, in the area of telecommunications. We must ensure that the rules of the game serve the public interest rather than the vested interest," the Tánaiste added

The Tánaiste said that the recent rise in the Consumer Price Index must be seen in the context of strong economic growth based on a solid investment, productivity and export performance.

"Recent substantial investments by companies demonstrate a continuing confidence in the underlying strength of the Irish economy. The Government is determined to build on these strengths by implementing measures in the areas of taxation, competition and labour market reform designed to eliminate significant bottlenecks to future growth.

The Tánaiste concluded "the decline in savings in recent years has added far more to consumer demand than tax reductions. We must give serious consideration to measures that will boost savings significantly leading to short, medium and long term benefits to our society."