mr president i would like to thank honourable members for this opportunity to dispel some widely held misunderstandings regarding the irish programme
the s d group's question that gave rise to this statement raises honourable members concern that certain economic policy conditions set out in the memorandum of understanding of the economic adjustment programme for ireland are in legal conflict with article one hundred and fifty-three five of the treaty
that paragraph excludes the adoption of provisions in the field of pay under article one hundred and fifty-three that is in the field of social policy
however the economic adjustment programme for ireland is not a social policy programme and is not adopted under article one hundred and fifty-three
it is a financial assistance programme set up together with the irish government to restore domestic and external confidence and remove the harmful feedback loops between the fiscal and financial crisis
therefore it is grounded in article one hundred and twenty-two two of the treaty which allows for union financial assistance if a member state is seriously threatened with severe difficulties caused by exceptional occurrences beyond its control
the role of the mou is to specify the economic policy conditions that serve as a benchmark for assessing the irish policy performance during the financial assistance programme
the member state has full ownership of these economic policy conditions and their implementation
these conditions are commitments of the member state that are undertaken by the state itself
it is not eu action in the respective fields
indeed many of the conditions such as the minimum wage reduction were already included in the irish government's national recovery plan that was published on twenty-four november twenty ten before the start of the programme
the aim of the conditions relating to labour market policy is to create jobs and to avoid long-term unemployment in ireland amongst the most vulnerable groups
the minimum wage reduction is part of this wider package of measures and needs to be seen together with activation policies and efforts to modernise the benefit system
when evaluating the reduction in one of the highest minimum wages in the european union it is for instance the second highest in the eurozone and although there was significant wage adjustment in the economy with the minimum wage in common with wages in general in ireland falling by three in real terms in two thousand and eight followed by a rise of zero point three in two thousand and nine it should be noted that most of the labour market adjustments took the form of job losses
in fact the minimum wage cut only restored the status quo prevailing before one january two thousand and seven i
e
before the crisis
the other condition mentioned in the question is an independent review of sectoral collective bargaining
the motivation of the review is to discuss the fairness and efficiency of employment conditions for both employees and employers across sectors
i would like to highlight the fact that ireland has a long-standing tradition of tripartite consultation on economic and social policy and that the successive pacts between the government and the social partners since the nineteen eighties have been widely recognised as major factors in the success of the irish economy
the review is an opportunity for the social partners to voice opinions and shape policy and its announcement was welcomed as such
i am fully confident that the review will be carried out by the irish government in a way that recognises the importance of social dialogue includes all the social partners and complies with community law
finally the conditions in the memorandum of understanding with regard to structural reform are not only about the labour market
they also contain important measures to open up product markets such as overly regulated sectors and professions
these reforms could have a major effect on customer prices and productivity which support the purchasing power of households
