In 1987 Ireland faced a crisis in its public finances. A crisis that was similar to our current economic woes. The representative interests of trade unions, employers and government successfully negotiated a Programme for National Recovery. It developed a consensus amongst the primary stakeholders of labour and capital in how to tackle national socio-economic problems. With no institutionalised tradition of centralised bargaining, Ireland developed a consensus based approach to decision making amongst the new ‘social partners’. This was a unique moment in the approach to governmental decision making in the state. It was an institutional innovation born out of a crisis. A communicative turn in public policy.
Many commentators have been deriding the government for using social partnership to steer Ireland out of the crisis that we now face in 2009. It seems to me, however, that the government has shown leadership through governance. This is a positive move. It is often argued in Human Resource Management literature that progressive managers lead by facilitating. Involving those in decisions that are most likely to be affected by them is a strong, and effective, democratic principle. Taking decisions without consulting the main stakeholders will inevitably lead to difficulties in implementation. The states capacity to implement the proposed €2 billion cuts has been substantially increased by involving the social partners. It has also provided the space for the trade union movement to influence finance policy, particularly in relation to taxation.
If anything social partnership should have become more embedded in national socio-economic governance over the past 20 years. The department of finance (particularly under Charile McCreevey) worked autonomously from the social partners. The legacy of finance policy in government is now obvious for all to see. Perhaps if the decisions around finance became central to social partnership we would not be back managing a crisis. All of this highlights the importance of the method adopted to make socio-economic decisions. Inclusionary decision making and problem solving are essential elements of policy making. It will be interesting to see another programme for national recovery can be negotiated in 2009.