We welcome this opportunity to discuss with the Ministerial Council some of the key messages that TUAC takes from the OECD Growth Project. We have played an active role in the development of the project, and see it as an opportunity to have an important policy discussion on how economies can take the “high road” to attain sustainable growth, higher productivity and higher employment. 

The project has reinforced the fact that if Information and Communications Technology (ICT) is to be used effectively OECD countries have to invest far more in human capital such as skills and competencies as well as in the social institutions, such as unions, which give workers a voice in managing change. If we get this right, social and economic objectives can be mutually reinforcing. To put it crudely, social policy need no longer just be concerned with how to “distribute the pie” but can actually “make the pie bigger”. This, historically, was also the OECD’s original vocation, namely to link economic development and social progress.

With regard to government policy, one lesson that we feel is neglected in the growth report is the importance of maintaining macro-economic policies that achieve the highest level of sustainable growth. This is crucial to set in motion higher investment, faster productivity growth, increased use of new technology and higher employment. Given the present context of rapidly deteriorating growth prospects that is a very important lesson, particularly for a key meeting of Finance Ministers. 

 A further priority for governments must be to invest in education and training, especially ensuring that there is widening access to high quality education. This means, as the Report recommends, that teachers must receive decent remuneration and the teaching profession must be re-motivated. That will cost money.  But it is important to remember the slogan that I once saw on a bumper sticker in New York “if you think education’s expensive try the cost of ignorance”!

We also have to put in place effective systems of lifelong learning that create a general entitlement to lifelong learning. In my own country, Belgium, we have negotiated sectoral agreements with business to ensure that firms do not under-invest in workers’ training. We have established sectoral training funds to overcome the “free rider” problem. My colleagues in the Netherlands have adopted similar approaches, which seem to be working. In some countries such as the UK unions themselves are providing direct training and access for adult workers to higher education systems. Workers who have dropped out of the formal education system may be suspicious of going back to school or even admitting to their employers their educational weakness but we find that they will trust their unions. That is why some companies and governments also are signing partnership agreements with unions to provide training. It is interesting that the US ICT firm Cisco Systems have signed such an agreement with the United States Communications Workers’ Union (CWA). Our conclusion for governments here is that you must actively encourage such partnership approaches.

It is also important to go beyond just looking at human capital and, as the report does, show the significance of social capital in managing change in the labour force. It is significant that the Report’s policy conclusions recognise the need to give workers a greater voice. For most workers, unions are and must be their “voice”. There is plenty of evidence now appearing that shows both that changing work organisation is a key to higher productivity, and that new forms of work organisation are more widespread and that schemes of worker involvement are more effective when unions are involved. Our recommendation to business here is “be flexible” as we are, don’t hide behind “management prerogative” and let’s discuss how we can jointly empower workers as some, but too few, good companies have done. Our recommendation to governments and the OECD is examine and publicise good practice. Be prepared to offer incentives and disincentives to ensure socially acceptable change. Make full use of the OECD Guidelines on Multinational Enterprises to start social dialogue at all levels, from the boardroom to the shop floor.

Finally we must avoid the destruction of social capital that exists at national level. Too many OECD countries have seen a continuing rise in inequality with large numbers of people below the poverty line. A growing number of the young unemployed in OECD countries are in households where no-one works, they are detached from the labour market and excluded from society. So, even within OECD countries, we have to stop the social divide being re-enforced by a digital divide between the knowledge-poor and the knowledge-rich. When I look at our membership in TUAC I see that many unions are radically changing to ensure that we represent knowledge-rich workers and ensure that they are well-rewarded, but also act to bring the excluded into the knowledge-society. This must be supported by active government policy.

To conclude, Chair, there are also choices of which competitive strategy to follow. One route which I would call "the low road" leads to greater inequality and more fear. It creates corporations consisting of a small elite of entrepreneurs on the fast track, and the rest are casual labour. This is not acceptable.

The other path seeks to maximise the benefits of markets but to temper their excesses with social institutions. It reconciles a capitalist economy with a decent society. That leads to a future direction of OECD policy work to deepen the analysis of social capital and, particularly, the role that trade unions can play as the workers’ voice.

Thank you.