How Ireland can Build Back Better Using the Economic Stimulus Plan

How Ireland can Build Back Better Using the Economic Stimulus Plan

Now that the incidences of COVID-19 have greatly decreased, due to the collective efforts of the Irish people, the new Government is rightly starting to focus on ‘renewal and recovery’. In his acceptance speech as Taoiseach, Micheál Martin stated that the COVID-19 pandemic “is the fastest moving recession ever to hit our country and to overcome it we must act with urgency and ambition… to secure a recovery to benefit all of our people”.

One of the first major actions of the new Government will be to unveil a major stimulus plan for the economy. There is a growing consensus that we need we need swift and transformative system change to address the many crises we face, that we can’t go back to the old ways of doing things.

Despite all the pain this crisis has caused, it presents a unique opportunity to put us on the path to a more sustainable, just and feminist future. A just approach to tackle underlying multiple inequalities. A sustainable approach, using the “doughnut economics” approach developed by Oxfam, to ensure that we live within the Nine Planetary Boundaries – scientific “tipping points” that focus directly on environmental wellbeing. And a feminist approach to challenge patriarchal structures and put women’s leadership front and centre. History has shown that gender inequality holds back progress on economic performance, health, wellbeing, environmental protection and social progress. The security and stability of our nations literally depends on the status of women.

The response to COVID-19 so far has shown that we are able to mobilise collectively on a huge scale. It is making the impossible possible. It is revealing that what truly matters is human lives. It has forced us to reconsider what is essential to keeping our economies and societies functioning, and is shedding a light on the role of care in terms of our healthcare, nursing care and childcare systems. Yet many workers in the care sector are still paid poverty wages.

The crisis has also highlighted the important role of low-wage workers in terms of the provision of essential goods and services. Most importantly, it has revealed the vital role women play in our economy, despite the unequal rewards and recognition they receive. A study of essential workers by the ERSI has found that the majority (almost 70 percent) of essential employees in Ireland are female. This trend is replicated worldwide, with more than 70 percent of healthcare workers worldwide being female. If not all heroes wear capes in this crisis, most cape-less heroes are women – their voices and considerations should now become central to how we plan for the future. The stimulus plan for the economy must not be gender blind and needs to take the above considerations into account.

In stimulating the Irish economy, we need to make sure that it works for everyone. A recent report by Oxfam noted that Ireland has the fifth-largest number of billionaires per capita in the world. Overall, the world’s 2,153 billionaires own more wealth than the 4.6 billion people who make up 60 percent of the entire population of the planet.

The global value chains of numerous businesses operating from Ireland often involve exploitative working conditions, gender discrimination and violence; violations of trade union and workers’ rights; corruption and tax evasion; land-grabs and evictions of indigenous peoples and local communities; and violent attacks on human rights and environmental defenders.

Oxfam’s Ripe for Change report exposed the economic exploitation faced by millions of small-scale farmers and workers in food supply chains. Our surveys of people working in supermarket supply chains found that a large majority struggle to adequately feed their families. Women bear the heaviest burden – overwhelmingly concentrated in the least secure and lowest-paid positions in food supply chains, shouldering most of the unpaid work on family farms, and routinely denied a voice in positions of power. Our modern food system is built on squeezing women’s labour hardest of all.  While frontline supermarket workers in Ireland have been rightly recognised as essential workers during the COVID-19 crisis, the essential labour of workers who actually produce our food through global value chains remains hidden.

Although some businesses and financial institutions are already taking steps to meet their responsibility to respect human rights and the environment in their global operations, too many others are linked to serious abuses. At present, there is no legally binding business and human rights regulation to stop this exploitation and abuse – this needs to change. Voluntary measures have failed to prevent abuses and are simply not strong enough. A recent report published by the Centre for Social Innovation at Trinity Business School in Dublin, Business and Human Rights in Ireland: Benchmarking compliance with the UN Guiding Principles, paints a very poor picture of Irish company engagement with business and human rights. 

The corporate world also has a huge impact on sustainability. Every decision can affect the most vulnerable people and ecosystems. It can threaten livelihoods and exacerbate poverty. For example, the fast fashion industry has shaped the way that we consume clothes. Due to overconsumption and lack of regulation we are buying vast amounts of low-quality textiles. Not only are these garments unfit for long-term use, they cannot be recycled, resulting in a worldwide waste problem that is detrimental to the environment. The wages and working conditions of clothes producers in countries like Bangladesh, who are usually women, often fall well below basic human rights standards. Textiles have been identified as one of the waste streams with the highest untapped potential to implement circular practices. Throwaway fashion is unsustainable and is stretching the planet’s resources beyond its limits. Every year Irish people dump 225,000 tonnes of clothing – a huge waste of water and energy considering that it would take 13 years to drink the amount of water needed to make one t-shirt. 

It is therefore welcome that support to the circular economy features strongly in the Programme for Government. The circular economy concept brings a holistic perspective to the lifespan of a product from design, material choice, sustainable production processes, product use, reuse and recycling. Circularity benefits the environment and helps to fight the climate crisis. It also generates innovative and sustainable economic opportunities. Oxfam Ireland works with a wide range of companies committed to sustainability. These business partnerships directly improve the lives of millions of people worldwide by making it easier to keep excess stock out of landfills. The economic stimulus plan needs is a good place to start to develop the potential of the circular economy in Ireland.

The nature of Ireland’s planned economic stimulus should underpin a new social contract between people, governments and the market – one that radically reduces inequality, gender inequalities and lays the foundations for a just, equal and sustainable human economy that works for all throughout their lives.

The European Commission has provided guidance for any State Aid to private businesses through a Temporary Framework that includes a ban on payment of dividends and share buybacks and an obligation for large companies to report on their investments in terms of commitment to the Paris Agreement and digital transformation. This week the Commission added to these guidelines by recommending that states do not support companies with links to the EU’s tax haven list. It is important that Ireland introduces these minimum conditions. However, it can go a lot further.

Priority must be given to supporting small businesses who have the least ability to cope with the crisis. Bailouts of big corporations should be conditional on measures to uphold the interests of workers, farmers and taxpayers, and to build a sustainable future. For those corporations receiving company-specific assistance, financial support should take the form either of interest-bearing loans or of the government taking a stake in the company. Governments should ensure proper oversight of all bailouts, including being represented on boards, to prevent corruption and mismanagement.

The response to the COVID-19 crisis has also shown the incredible power of government-led solidarity and collective action. While governments have started to act decisively domestically, international solidarity has yet to materialise on a grand scale. After the financial crisis of 2008, few lessons were learned. A decade of austerity and failed economic policy has undermined our societies and led to the rise of dangerous right-wing nationalism, a regression of democracy and a violent backlash against feminist movements. It does not have to be this way.

We can rebuild a better world. A fairer world. A more sustainable world. One that radically reduces the gap between rich and poor. One where we do not jeopardise the lives of our children and future generations. One where the richest pay their fair share to contribute to collective solutions to the challenges facing humanity. One where feminist principles are central. One where governments are held accountable by their citizens and where we are all enabled us to take action to stop climate breakdown. Together we can learn the lessons from this unprecedented crisis, to build a more human economy and a fairer world.

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