Address by Minister for Labour Affairs Dara Calleary at the MacGill Summer School, July 24^th 2009

“The Potential of an All-Island Economy”

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Cross-border relations have never been better. Indeed, the changed atmosphere in terms of political discourse on these islands is one of the reasons we face into these challenging economic times with a sober sense of hope. In tackling the budgetary difficulties of twenty years ago, any politician suggesting that North/South cooperation might have a role to play would have been derided for their naivety and mocked for their optimism. The NO of that era has given way to an Obama style YES WE CAN attitude to tackle the problems of today.

Today, many of the men and women who got to know each other only as negotiators for peace – often to a backdrop of violence and recrimination – now meet as elected representatives to discuss where to build our roads, how to protect our children and what we can do to improve our broadband and energy services. Where once politicians North and South read about their differences in the newspaper, today they will pick up the phone, argue the options, and agree plans to the mutual benefit of all those we represent. For that is the nature of what has been achieved in the North and throughout the island of Ireland: the victory of dialogue over distrust, what the journalist and writer Frank Millar has termed a “triumph of politics”. We should be careful never to forget how far we’ve come and at a time when politics and the institutions of politics are suffering from a certain lack of confidence.

Please permit me to diverge a little from today’s topic and reflect on one of the issues that has dominated McGill week in Donegal, the impact of certain elements of our Labour policies in the state at the current time.

Industrial relations developments in the Republic and Northern Ireland continue to reflect elements of diversity as well as uniformity. It is just one hundred years ago since tripartite bodies were first established in Britain and Ireland in 1909 for the purpose of establishing minimum wages and other conditions for employees in certain low-paid and vulnerable employments. Problems of low wages and of unfair deductions applied to homeworkers engaged in knitting, embroidery and lace-making here in Glenties provided some of the political impetus for these social reforms. The poor employment conditions of many Donegal women engaged in this work was highlighted by Edwardian labour inspectors and in the stories of Patrick McGill and the testimony of Paddy The Cope

These wage-fixing bodies, which became known as Wages Councils, ceased to exist in Great Britain and in Northern Ireland in 1993. A decade earlier the Thatcher Government had also repealed the Fair Wages Act which permitted collective agreements to be extended to cover all employers within a particular sector. This brought to an end the means of making these sectoral agreements legally enforceable, along the lines of the Registered Employment Agreements established in the Republic under the Industrial Relations Act, 1946. It is hardly surprising, however, that industrial relations institutions and practices in the Republic have followed a different course of development over the past half century. Both Registered Employment Agreements and Joint Labour Committees – the counterparts in Ireland of the UK’s former wages councils – continue to operate here alongside more recent reforms, such at the introduction of the National Minimum Wage in 2000.

I would contend that it is time to consider whether an individual employer should be entitled to submit a claim to the Labour Court that for economic reasons he is unable to meet the terms agreed by Joint Labour Committees and under Registered Employment Agreements. The Government is committed to bringing forward legislation to modernise and strengthen these systems.

It may be necessary, however, to “re-balance” the existing mechanisms while providing at the same time for their continued effective operation in the face of renewed legal challenges. This would only bring both the Joint Labour Committee and Registered Employment Agreements systems into line with the procedures already established here under the National Minimum Wage Act, 2000. A reform on these lines would contribute to protecting employment in situations where employers are faced with severe economic challenges. It would also be a step towards unifying, simplifying and clarifying the complex structure of our industrial relations institutions in the Republic.

I referred earlier to how far we have travelled. A sign of that is The Comprehensive Study on the All-Island Economy, launched by the British-Irish Inter-Governmental Conference in October 2006, setting out an ambitious range of strategies and collaborative actions aimed at maximising the competitive advantages of the island. Since restoration of the Northern Ireland Executive in May 2007, the Government has engaged constructively with Northern Ireland Ministers to agree a range of initiatives designed to boost economic activity on the island and eliminate market failure arising from the existence of the border.

We are working hard now to deliver on our shared priorities through the North/South Ministerial Council and in a range of other contacts between key decision-makers on the island. We are fortunate, in doing this, to have excellent North/South bodies like Tourism Ireland helping to brand the island so successfully overseas. And the role and strategic importance of Inter Trade Ireland, has never been greater, as it seeks, with our support, to ensure companies North and South are able to take advantage of the economic opportunities close to home in a period of global turbulence.

We are putting our money where our mouth is too, even in these difficult times. At our first North South Ministerial Council meeting following restoration of the Executive two years ago, we pledged £400 million (pounds) to upgrade the A5 road to Derry and Letterkenny-for, which there was substantial progress this week-, and the A8 road from Belfast to Larne. And at another NSMC Plenary meeting earlier this month, our fourth since restoration, Ministers agreed the details of a first Government contribution of €9 million towards preparatory work, as well as procedures for future payments. We are firm in our conviction that an integrated and connected island will have the best opportunity to fulfil its undoubted and enormous potential.

We are also working to build an “Innovation Island”, one that is on the cusp of cutting-edge research and development. We are looking forward to discussing our plans for this “Innovation Island” with our Northern Ireland Executive colleagues and examining whether, together, we can make this vision a reality at home and a recognised brand abroad. In our increasingly inter-connected world, the brightest minds on both sides of our border must be given every incentive to collaborate in order to compete. That is why the Government and the Executive are each providing unprecedented sums for cross-border research and innovation, ensuring companies in both jurisdictions can make use of research excellence anywhere on the island.

We are now beginning to see the fruits of all island cooperation in R&D. Significant progress has been made to date under the All Island Innovation Voucher initiative. It is very heartening, also, to learn of the steady flow of collaborative research projects that are being approved for funding under the Innovation Fund. In November last, ten programmes, involving research collaborations between Queens University Belfast, the University of Ulster and internationally recognised research centres in the South were approved for funding of £14.5 million by a panel whose members are representative of both jurisdictions. The projects approved will cover a wide range of priorities including Future Energy Systems, Mobile Information and Communication Technologies, Major Chronic Diseases and Infections, Functional Foods, Nutrition and Bone Health, and Safe and Traceable Food.

In addition to the above developments, the potential for further North South research collaboration continues to be realised through the US-Ireland R&D Partnership. Under this partnership, the governments of the United States of America, Ireland and Northern Ireland are working together to advance scientific progress by awarding grants for research on a competitive basis in the thematic areas of Diabetes, Cystic Fibrosis, Nanotechnology and Sensors. The US- Ireland Research Partnership offers us an excellent model of collaborative research for mutual gain, with great potential to generate innovations to the marketplace and lead to improvements in health promotion, disease prevention and healthcare.

We are collaborating to maximise our combined drawdown under the EU’s Seventh Framework Programme, a €51 billion (euro) funding programme designed to promote research and innovation cooperation between Member States. Our Government has set a target of €600 million in funding over the programme’s lifetime and we hope as much as possible of this can be drawn down by entrepreneurs and university researchers in both parts of this island.

InterTradeIreland, the North South trade and business development Body set up under the Good Friday Agreement, is working to identify and to help realise opportunities to increase economic activity through increased levels of North/South trade and business co-operation. Their role is to encourage and support North South co-operation to the mutual benefit of the two economies.  The impact of the worldwide recession means that it makes sense that we work together on this island to optimise the use of the economic resources that are at our disposal, transforming North/South economic collaboration into a source of mutual competitive advantage.

There is enormous potential to expand our ‘green economy’, jointly harnessing our wind and ocean reserves and delivering energy security for the generations to come. We must build on the outcome of the all-island grid study launched last year and examine how, together, we can meet our ambitious targets for renewable energy and reductions in carbon emissions over the decade ahead. And, in all of this, we will be inspired by our success in delivering a Single Electricity Market for the island, a remarkable feat which has brought efficiency savings and enhanced competition to the benefit of consumers North and South.

I passionately believe that this is an area that should be exploited on all island basis and that we should work to remove any barriers to progressing the development of our island as the alternative energy hub not just of Europe but of the World. Our shared wind and tidal resources are unmatched, I have spoken alreadyof our commitment to the development of an innovation island-by matching the natural resources with the innovation, we can achieve much.

As well as exploiting new opportunities I feel that we have an obligation too - an urgent and compelling obligation - to explore ways in which we can save money by working together. We have made a good start on this – patients in certain border areas can now access GP and cancer services in the other jurisdiction, for example – but there is so much more we can do together to provide closer and more accessible public services. And we must open our eyes as well to non-contentious and mutually beneficial ways in which we can pool our budgets, our talents and our time. If, for example, we are each trying to deliver a message about obesity or suicide prevention or road safety or any one of a number of issues, it surely makes perfect sense to sit down together, agree a campaign and save money by delivering a coherent message.

There is a growing realisation that in facing the challenges of our increasingly globalised world – whether those challenges are environmental or economic – we are stronger when we share, and weaker when we work alone. And I know we also share a common ambition: to be part of an innovative and dynamic all-island economy, one that attracts investment, encourages our own entrepreneurs, and provides jobs. We all want our society to provide safety, security and quality public services. Now is the time to put our shoulders to the wheel.

The North West of Ireland has seen its fair share of challenges which have hampered growth in the past. The level of co-operation in this region is, in many ways, an excellent illustration of what co-operation between our two jurisdictions must be about.

In particular, I welcome the progress being made under the North West Gateway Initiative. At the heart of the Initiative is a simple philosophy - that the Irish Government and the Northern Ireland Executive can best address the needs of the North West in a co-ordinated joint response.

The ability of the North West to attract international and domestic investment and provide a flexible and highly educated workforce will be critical if the region is to fulfil its undoubted potential over the coming years. The North West Gateway Initiative is the blueprint to create a dynamic and prosperous region and overcome the disadvantages that the region has experienced.

The Initiative provides the context of key investment decisions and a framework for the provision of infrastructure and services on a cross-border basis. Important elements of this shared approach are an emphasis on economies of scale and the elimination of duplication.

I am pleased to note the progress in relation to Project Kelvin with the bringing ashore new submarine cable at Portrush in June. This €30 million project, to which both the Executive and the Irish Government are contributing matched funding, will greatly enhance broadband access in the region and improve upon current facilities for business, students and families throughout the North-West.

I am also pleased to note that Letterkenny Institute of Technology and University of Ulster are working together on an initiative which harnesses the academic resource of both colleges to contribute to long-term prosperity of the NorthWest. I understand that the findings of a scoping study recently published show the huge potential of the North West Gateway Strategic Alliance in providing top class higher education and research for the North West, a key component in attracting investors and high value employment. The study highlights the strong collaboration between LYIT and the UU who are building a foundation to provide higher education to cross border communities in many new ways.

Coordinated spatial planning also contributes to attracting investment, improving infrastructural connections and the provision of more efficient services. In this regard I note that a review of the Regional Development Strategy in the North is taking place concurrently with an updating of our National Spatial Strategy and common language on cross border and all-island cooperation is set to be included in both reports.

These developments, which result from our joint action, will further enhance the economic development of this region and are a powerful response to its enterprise needs.

Combining initiatives such as the Kelvin project and the North West Now programme with the planned motorway links between Letterkenny/Derry and Dublin and Belfast will remove the perception of the North West as a remote location and position the entire North West as a smart economy of the future.

It is beyond anyone’s doubt that seismic and unprecedented economic questions are currently being asked. A critical new dimension working in our favour is that, by thinking on an all-island basis, we have an increasing number of answers within our grasp. In meeting the challenges of the years to come, the Government will work with the Northern Ireland Executive and social, cultural and business leaders like yourselves to provide the investment and economies of scale that will allow this ‘Innovation Island’ and hopefully this “renewable energy hub” to emerge at the front of the international pack when the global economy recovers.

Thank you.

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