Energy challenges, latest on Collective Bargaining, & international outreach
The latest CEO Update from Danny McCoy to Ibec membership
Earlier today I had the privilege of delivering an address at the MacGill Summer School, where I outlined that the underlying Irish business model remains strong and can deliver growth despite emerging inflationary challenges. A delicate balancing act from policymakers is required for this year and next however, to ensure a sustainable path to recovery.
Energy security and affordability is quickly emerging as a major challenge for industry, particularly looking ahead to winter 2022 and into the early months of 2023. These issues were at the heart of much public discussion this week, as we saw the European Commission announce on Wednesday a proposed voluntary target for EU countries to cut their gas use by 15% until March 2023. However, such a target could be made mandatory in the event of Russia cutting off gas supplies to Europe or if the voluntary target is not met.
The business community recognises and supports the need to show solidarity with EU Member States that are most exposed, and for all sectors including industry to play their part and conserve energy where they can.
In Ireland, while we are not without risk, we are less exposed because of the diverse supply of gas we import through the UK, coupled with our own Corrib supply, and emergency cooperation agreements and planning between Ireland and the UK. The real issue for businesses this winter will be affordability. Prices are going to continue to increase, especially if Russian gas supply drops, which could lead to self-rationing, operational, and liquidity issues.
Over recent months, Ibec has been lobbying and engaging with Government on the need for a grant support scheme to help businesses through this challenging period. Other EU countries are already doing this. We need to follow suit as soon as possible to protect our enterprise base and our capacity to compete internationally. We are actively engaging with Government on the specifics of such a scheme, and urging that it be delivered in a timely manner to help the businesses that require it the most. I will keep you abreast of these engagements as they develop.
This month we have also seen Ireland’s voluntarist industrial relations framework came into sharper focus as the Parliament of the European Union announced that MEPs will vote in September on rules to improve the adequacy of minimum wages in September during the plenary session held in Strasbourg. This follows the provisional political agreement last month between the presidency of the Council and European Parliament on the new rules, in which EU countries will be required to promote collective bargaining on wage setting. This Directive, if passed, will necessitate a new approach to our voluntarist industrial relations framework in Ireland. The Táinaiste, in March 2021, established a working group under the Labour Employer Economic Forum to examine the adequacy of Ireland’s existing structures and that work is nearing conclusion. Once again, I will provide ongoing updates of Ibec’s engagements in this forum.
Finally this week, I leave you with a link to the Summer 2022 edition of Ibec’s Europe & Global Focus, which reflects on several important anniversaries in the near 50 years of the relationship of Ireland and Irish business with the EU, as well as overviewing the latest Ibec international engagements from Dublin, Brussels, Prague, Geneva and more.
As always, if you have any queries please do get in touch.