This week's announcement by the Tánaiste, Ms Harney, that the Government has decided to allow full freedom of access to the Irish labour market by nationals from the applicant EU member-states with effect from May 2004, is likely to revive the debate on immigration, which has ebbed and flowed throughout the past year.
IBEC welcomes the Government's decision and believes that the provision of a safeguard mechanism during the transition period (a total of seven years up to 2009) provides reasonable protection in the event of a severe downturn in the labour market. The confederation also acknowledges the need to create a specific offence for both an employer and an employee, where employment is entered into in the absence of a requisite permit, which will also be dealt with in the forthcoming Employment Permits Bill 2003, announced by the Tánaiste.
There can be no doubt that, in recent years, Ireland has had one of the most liberal regimes in the world in relation to immigration - a new phenomenon for the Irish economy as it was only in 1995 that the number of people coming into the State outstripped those leaving.
With the worsening economic climate, it is appropriate to take stock of where we are in relation to immigration. As IBEC has consistently stated, Ireland does not have a comprehensive immigration policy. Although there has been some consultation on elements of such a policy, there has been a lack of urgency and cohesion in progressing what is now a very important plank of public policy.
From a business perspective, there are major concerns that a number of recent decisions in relation to work permits and related systems will be detrimental to economic development and will impact adversely on Ireland's competitiveness.
In the first instance, Ms Harney suspended the Intra Company Transfer Scheme in October 2002. The system was suspended because of concerns regarding the abuse of the system by certain employers (which IBEC in no way condones).
In the interim, although transfers have been facilitated on an ad-hoc basis, many employers have been told they will have to apply for work permits in respect of such transfers and these can take months to be processed. In today's global economy, it is a fact of economic life that individual and groups of employees are transferred within corporations - often with very little notice - to undertake particular projects or assignments.
For many decades, the ease of doing business in Ireland has been a core value of industrial policy and difficulties in transferring (legitimate) employees undermines this advantage.
In this way, immigration policy has a direct link with competitiveness and we should benchmark against those countries competing with us to attract and retain skilled mobile labour. Many countries are taking action to attract skilled workers and it is essential that a replacement Intra Company Transfer Scheme is put in place immediately.
The second area of concern for employers was the recent announcement by the Tánaiste that work permits will not be issued when it is determined, on the basis of experience and local labour market analysis, that appropriate skills exist in sufficient quantities.
IBEC acknowledges that employers should give preference to Irish and European Economic Area nationals, where possible, but it is concerned about how these new arrangements will operate at a local level. The credibility of any immigration system depends on the transparency and appropriateness of criteria used to process applications. Guidelines should be drawn up as an immediate priority indicating how the decision announced by the Tánaiste will be implemented at a local level. They should also confirm an appropriate appeals process.
IBEC welcomes the Tánaiste's announcement that, where specific skills are determined by FÁS and the Department of Enterprise, Trade and Employment to be in short supply, the existing requirement to advertise the position locally with FÁS over a four-week period may be dispensed with.
The FÁS Irish Labour Market Review 2002 indicates that, notwithstanding poor short-term employment prospects, the medium-term outlook for the economy is much more positive and that an increase in employment over the six years to 2007 is forecast at approximately 190,000 - a 10 per cent increase. The report also acknowledges that net immigration will continue, although at a lower level than in recent years.
It is clear that a number of demographic changes will impact on labour supply. For example, while there were 74,000 18-year-olds in 2000, by 2012 there will be only 47,000. Equally, there is only limited scope to increase female participation in the labour force as Irish participation rates have already exceeded the EU average in a number of age groups - notably among younger women.
Given these trends, net migration will continue to be a feature of the Irish labour market for the foreseeable future, underlining the need for long-term planning from a public policy perspective.
It is not possible for anyone to be absolutely certain about what will happen in the political, economic or social arenas over the next few years. It is imperative that our national immigration policy and its implementing measures, statutory or otherwise, are flexible in nature and are able to change course in line with internal and external developments.
Immigration policy can act as a competitive tool and it is important that we benchmark ourselves against those countries that are competing with us to attract highly talented and skilled mobile labour. The right mix of measures to ensure that our system is competitive and effective needs to be adopted.
Jackie Harrison is director of social policy with IBEC
