Mr. Philip O'Connor:

A variety of issues have been raised. I will try to focus on a few of them. Deputy Murphy raised the issue of active inclusion and encouraging engagement. Of course we encourage engagement. What is important is that we keep in mind what active inclusion is about. It is not solely about encouraging people to engage with labour market services in order to regain access to employment, rather it is about having proper income supports in place, engagement with a positive system of supports which will assist people into appropriate training or employment and quality services. Without any of these three aspects, all of which have been stitched into national policy with the development welfare state and various other things, what one has is a system that punishes people with poverty where activation is not successful. While we understand the need to relativise benefit payments and so on, including for very young people coming into the system and to incentivise involvement in training, the reduction in welfare benefits for young people up to the age of 25 years, which includes large numbers of people who have families or are living in family homes, was out of court. This will drive people into poverty.

As pointed out by Senator Reilly, recent data on the growth of employment shows a less than impressive improvement in the employment rate among young people. A lot more needs to be done. We are all waiting with bated breath for the youth guarantee that is supposed to come into play at the same time as the cuts in benefit rates for young people. Unfortunately, the experience in this country is that while the punitive bits will be efficiently implemented, we will have to wait until the new year to see what shape the supports which are supposed to make available appropriate and quality training provision will take. We are not confident that the same level of determination will be applied in that regard. However, hopefully it will be.

The issue of in-work poverty was raised. I do not have the figures with me for averages across the EU. These figures vary enormously. Mr. Donohoe made the point that a foothold in the labour market can lead to a better, stronger and more secure foothold in the labour market. However, people who often acquire a very tentative foothold in the labour market remain in that situation. We have seen a growth in zero hour contracts and, in the retail sector in particular, an increasing level of precariousness of employment. We do not see a trend towards this type of work becoming more stable or long term. We need to monitor the pattern of precarious employment. The Mandate trade union produced a well researched report on the growth of precarious work in the retail trade two or three years ago. We are not seeing improvements in this area or in some other sectors. In-work poverty in an issue, in particular in the area of precarious work. Often what precarious work means is a mix of people who are partly reliant on welfare but are gaining access to employment of a part-time nature, often scattered over a week, with which the welfare system often cannot cope. There is a decreasing level of income in these particular categories.

We are also seeing, although in other European countries rather than here yet because immigration is such a recent phenomenon, people being encouraged into self-employment. While this is often a good thing, it often also leads to incredible levels of in-work poverty because in many small businesses which produce the income of only one person there are nine or ten members of a family working long hours to produce that income. This has been shown to be a grave problem in terms of the ghettoisation of immigrant populations in several European countries.

On the issue of indicators, an Irish initiative which secured the social clause of the Lisbon treaty was meant to maintain supervision of convergence of social standards across Europe along with macroeconomic aspects. It is an area in which there has been little progress. An element of member states are retaining sovereignty over their rights to governance social standards. There may be something in that. It has also been the promise of EMU that we would have convergence not only of economic performance but of social standards and the standard of living across the EU.

There is also the convergence in equality rates and quality of life rates. None of these aspects appears in the indicators at all except where they relate solely to involvement in employment or the labour market. Even if it is in a soft context, we would certainly like to see a policy of common standards for income levels and involvement in labour market participation. As Deputy Byrne mentioned, the unemployment threshold was ruled out as a possible indicator recently, but there should be guidelines for acceptable thresholds for poverty, unemployment and so forth. They must be stitched into the social dimension of economic and monetary union.

Deputy Byrne raised the question of the role of the National Economic and Social Council. The council has played an incredibly positive role over the past 20 years and particularly in producing national policy. In the background there was always some hard bargaining on salary and wage levels, etc., which gave an air of realism to what the council said about other matters. Where it is rooted in the realities of bargaining around such issues, its pronouncements on social policy and development of our systems tend to have real aspects to offer. We regard the council as a very valuable vehicle, although the question of whether the structure should be reconsidered is another matter.

Our bottom line is that we must return to the principles regarding common minimum income systems across Europe. The idea of a Europe-wide unemployment benefit system does not seem realistic, but there must be a level at which people's entitlements are transferable. This would apply if we wanted to increase labour mobility in any meaningful way. There must also be a move towards equalisation of the principles underlying social protection systems. It cannot be the case that in Poland people cannot exist on welfare rates, and if economic and monetary union is to be a real rather than just a macroeconomic process, instead of a social process, we must move to common principles behind social protection systems. That is regardless of the levels at which country's economies diverge. I hope that answers some of the points raised.