Lithuania: Role of social dialogue in industrial policies

  • Observatory: EurWORK
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  • Published on: 02 Rugsėjis 2014



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In Lithuania, industrial policies of such a kind have not been organised and implemented so far. All the existing economic development strategies and programmes (The State Progress Strategy ‘Lithuania 2030’, Long-term economic development strategy of Lithuania until 2015, Lithuanian innovation strategy for the year 2010-2020, Green Industry Innovation Programme and other) are typically of a general nature rather than addressing the development of one or another specific sector. In most cases, the Ministry of the Economy is the authority responsible for the implementation of such strategies and programmes. Business representatives are usually, and scientific circles are quite often, involved in the development of these strategies and programmes. Trade unions, however, are rarely involved in the process.

Currently, with the approach of the new Multiannual Financial Framework (2014-2020), Lithuania is formulating a Research and Innovation Strategy for Smart Specialisation. For this purpose, six priority fields were identified in 2013 and submitted for consideration by all the stakeholders. In the absence of traditions of such dialogues, the social partners seem to play a minor role in the aforementioned processes in general.

Part 1: Overall role and involvement of social partners in industrial policy in the national context1. Is there in your country currently a policy framework to stimulate investments that both create economic growth and employment? Tick Yes/No

Table 1

Policy framework

Yes

No

Economic growth

 

Employment

 

Both economic growth and employment

 

Competitiveness

 

2. Is there evidence in your country of involvement of social partners in the process of formulating industrial policy interventions? If yes, please indicate which types of involvement:

Table 2

Type of social partner involvement:

… in the formulation of horizontal (cross-sector) interventions

… in the formulation of vertical (sector-, industry- or company-specific) interventions

Sector-specific involvement

Yes: low level of involvement

Yes

Cross-sector involvement

Yes

 

Bipartite, tripartite, tripartite+, unilateral, public/private partnership?

Please indicate which, if any, of these types apply: usually only business representatives are involved

Please indicate which, if any, of these types apply: usually only business representatives are involved

3. How have social partners been involved in the industrial policy formulation process?

Table 3
 

Please indicate (X) the extent to which the different types of involvement are used, including whether this involvement is statutory:

Level of government?

Sector focus?

Specific form of social partner involvement:

Statutory/mandatory

Very common/ used in most policy processes but not statutory

Fairly common but not consistently used

Rarely used

Not used at all

National or regional?

Sectoral or cross-sectoral?

Tripartite standing committee

     

 

National

Cross-sectoral

Tripartite ad hoc committees

       

-

-

High-level groups or other multi-stakeholder committees involving other stakeholders in addition to social partners

   

   

National

Sectoral

If multi-stakeholder committees:

Please indicate which types of other stakeholders are (typically) involved: business and science representatives

Hearings

     

 

National

Sectoral

Consultations

 

     

National

Sectoral

Conferences

     

 

National

Sectoral

Other - please specify below:

             
               

4. Is there evidence in your country of initiatives that follows recommendations and development at EU-level? If yes, please indicate in which sectors:

Preparation of priority fields for smart specialisation

Green Industry Innovation Programme

5. Which types of industrial policy instruments/interventions at different government levels have social partners been involved in? Please indicate degree of involvement

3 = high degree of involvement,

2 = involvement to some extent,

1 = low degree of involvement,

0 = no involvement.

Table 4

Policy instruments:

National level

Regional level

Local level

Public investment programmes:

     

infrastructure

1

1

1

construction

1

1

1

building renovation

1

1

1

other

1

1

1

Innovation programmes

2

0

0

Support for R&D

2

1

0

Cluster promotion

3

1

1

Export promotion

3

1

1

Internationalisation of SMEs

2

1

0

Improvement of access to finance:

   

1

loan

2

1

1

loan guarantee programmes

2

1

1

venture capital funding

2

1

1

other

2

1

1

Public procurement policies

1

0

0

Tax and duty policies

2

0

0

Adapting the skills base

3

2

2

Subsidies for restructuring/ bail-out of companies in crisis

1

1

2

Social plans in case of restructuring. Training/re-training

1

1

2

Investment incentives

2

1

1

Energy efficiency/energy shift

2

1

1

Energy supply security

1

1

1

Access to raw materials

1

1

1

Prices of energy and raw materials

2

0

0

Others, please specify below:

     
       

6. Which, if any, positive effect(s) can be related to the involvement of social partners in the industrial policy process in your country?

Table 5

Positive effects

Tick (X) where applicable

Please comment briefly: How did effect manifest itself?

Speed of policy process

   

Robustness of policy initiatives

   

Relevance of policy initiatives

X

Social partners have better knowledge of the real situation and the needs of the market

Dynamism in the policy process

   

European coordination

   

Ownership of policy initiatives

   

Coherence and coordination of labour market, education, and economic policies

   

Stimulating public-private partnerships

   

Others, please specify below:

   
     

7. Which, if any, problems or challenges related to involvement of social partners in the industrial policy process have been encountered in your country?

Table 6

Problems/challenges:

Tick (X) where applicable

Please comment briefly: How did the problem manifest itself?

Increased bureaucracy

   

Lengthy policy processes

   

Lengthy bargaining processes

   

Dilution (circumvention) of parliamentary democracy

   

Problems of establishing accountability

   

Lack of dynamism in the policy process

   

Lack of culture to involve social partners

X

Social partners often are involved only ‘formally’, whereas final decisions are adopted not respecting the social partners’ views

Others, please specify below:

   
     

8. What, if anything, has been done to address these challenges/problems listed in questions 7? What was the outcome?

Table 7

Problems/challenges:

Measures undertaken

Effect positive/negative

Lack of culture to involve social partners

-

-

Part 2: Description of relevant sector examples of social partner involvement

Example 1

Name of the instrument:

Pramoninės biotechnologijos plėtros Lietuvoje 2011-2013 metų programa – Industrial biotechnology development programme for Lithuania for 2011-2013

Sector:

Industrial biotechnology

Type of instrument applied:

(use categories from question 5. Some sector policies may apply more than one instrument

Innovation programme

Timing:

(Period of implementation of instrument)

2011-2013

Operational level

National

Regional

Local

Please tick the government level and/or provide details of geographical implementation area if relevant:

   

Funding:

(Please describe the size of the instrument and detail the source(s) of funding, e.g. EU, state budget, levies, stakeholder contributions, etc.).

LTL 50 million (EUR 14.5 million), funded from state budget

Target group(s):

(please describe target group in terms of sector/industry, type of company, geographical criteria and/or other relevant characteristics)

Enterprises and research and science institutions working in the biotechnology area.

Rationale/motivation for the instrument:

(please describe the problem that the instrument should address – for instance: market failure, need to increase sector competitiveness, crisis intervention, etc.)

The aim of the programme is to accelerate biotechnology industry development in Lithuania

Policy stage

Please describe stage of involvement of the social actors i.e.

policy preparation (consultation),

policy decision (co-determination? and

policy implementation (fx. by involvement in agencies)

Social partners (business and science representatives) participate(-d) in policy preparation (consultation), policy decision (co-determination) and policy implementation stages.

Objectives of the instrument:

(please describe the objectives and any quantitative targets set for the instrument– e.g.

increased employment by X% in sector Y by 20xx

increase in sector exports by X%

increase in FDI by X%

The objectives of the programme: create materials and products from renewable raw materials using biotechnological methods; create bio-plastics and materials to produce it from renewable raw materials using biotechnological methods; create new biocatalysts and develop its application technologies; create pharmaceutical and veterinary products and veterinary products.

Achievement of the programme objectives is anticipated to add value for the products created by industrial biotechnology enterprises by up to 30%. The use of local bio-based raw materials will reduce Lithuanian imports of non-renewable resources (crude oil, natural gas and their derivatives) and increase exports of value-added products. New jobs will be created in the entire chain of adding value, from agriculture and forestry up to end-product industries. The created culture of innovations promoting closer co-operation between business and science will create preconditions for the establishment of spin-off companies.

Activities and implementation:

(Please give details on the implementation of the intervention)

Main activities of the Programme are as follows: 1. Creation of materials and products from renewable raw materials using biotechnological methods. 2. Creation of bio-plastics and materials to produce them from renewable sources using biotechnological methods. 3. Creation of new biocatalysts and development of their application technologies. 4. Creation of products for pharmaceutical and veterinary purposes. These activities are described on more detail in the Programme.

Social partner involvement

 

Type of social partner involvement:

(Bipartite, tripartite, tripartite+, unilateral, public/private partnership? – cf. qu. 1)

Social partners are represented by business only

Level of involvement of social partners involvement:

European, National, regional, local, sectoral

Sectoral

Specific form of social partner involvement:

(tripartite standing or ad hoc committee, high-level group, hearing, consultation, conferences, etc.? – cf. qu. 2)

ad hoc committee/high-level group

Timing and nature of social partner involvement:

(Please provide more details on the processes that social partners were involved in, their input, the timing, etc.)

Social partners (business and science representatives) initiated and participated in the design of the programme in 2010. In 2011-2012, representatives from business and science were involved in the assessment of applications, and in 2011-2013 I in the implementation of the programme.

Impact of social partner involvement on design and implementation of instrument:

(Please describe how/if the design and/or implementation was affected through the involvement of social partners)

Social partners (business and science representatives) in the biotechnology area played the key role in the design and implementation of the programme.

Other stakeholders involved, if any:

(please name stakeholders and briefly describe their roles)

State institutions: Ministry of the Economy – responsible authority, Agency for Science, Innovation and Technology (MITA) – implementing authority (MITA is the main governmental institution, responsible for the implementation of innovation policy in Lithuania).

Results and outcomes

 

Outputs/results:

(Please give details of the outputs/results of the intervention; e.g number of jobs created/retained, number of workers upskilled; wage increases, investment increases, increased co-operation between social partners, etc.)

Implementation of the instrument will be completed at the end of 2013. Therefore, assessment of its final results/outputs is not yet available. Interim progress reports submitted by the MITA to the Ministry of the Economy on an annual basis are not publicly available.

Assessment of effectiveness:

(Please provide an assessment of the effectiveness of the intervention - were the objectives reached? If possible, base the assessment on evaluation reports or similar)

Implementation of the instrument will be completed at the end of 2013. Therefore, assessment of its effectiveness is not yet available. Interim progress reports submitted by the MITA to the Ministry of the Economy on an annual basis are not publicly available.

Possible explanations for the effectiveness of the instrument:

(Please provide possible explanations for the degree of effectiveness achieved, including the contribution of the social partner involvement; e.g. improved bargaining process? Increased dynamism in the policy process? Other explanations?)

Not relevant

Assessment of efficiency:

Did the outputs/results measure up to the effort/resources invested? If possible, base the assessment on evaluation reports or similar)

Implementation of the instrument will be completed at the end of 2013. Therefore, assessment of its efficiency is not yet available. Interim progress reports submitted by the MITA to the Ministry of the Economy on an annual basis are not publicly available.

Possible explanations for the efficiency of the instrument:

(Please provide possible explanations for the degree of efficiency, including the contribution of the social partner involvement)

Not relevant

Example 2

Name of the instrument:

Maisto technologijos ir agroinovacijos – Food Technologies and Agri-innovation

Sector:

Food industry, Agriculture

Type of instrument applied:

(use categories from question 5. Some sector policies may apply more than one instrument

Cluster promotion

Timing:

(Period of implementation of instrument)

2013-2020

Operational level

National

Regional

Local

Please tick the government level and/or provide details of geographical implementation area if relevant:

   

Funding:

(Please describe the size of the instrument and detail the source(s) of funding, e.g. EU, state budget, levies, stakeholder contributions, etc.).

not yet known, funded from EU structural funds

Target group(s):

(please describe target group in terms of sector/industry, type of company, geographical criteria and/or other relevant characteristics)

Enterprises and research and science institutions working in the area of food technologies and agri-innovation

Rationale/motivation for the instrument:

(please describe the problem that the instrument should address – for instance: market failure, need to increase sector competitiveness, crisis intervention, etc.)

Identification of one of priority fields for smart specialisation.

This priority field seeks to tackle the main challenges related to food and agri-innovation – the lack of sustainability in the food chain, insufficiently sustainable use of biological resources in agriculture and food industry, insufficient safety and quality of food, and lack of efficiency in the development and use of raw food.

Policy stage

Please describe stage of involvement of the social actors i.e.

policy preparation (consultation),

policy decision (co-determination? and

policy implementation (fx. by involvement in agencies)

Policy preparation (consultation) stage.

Priority fields are currently identified and all the stakeholders (including business and science representatives) are invited to submit proposals for priority actions under the particular priority field.

Objectives of the instrument:

(please describe the objectives and any quantitative targets set for the instrument– e.g.

increased employment by X% in sector Y by 20xx

increase in sector exports by X%

increase in FDI by X%

Objectives of the priority field are determined by the need to ensure effective use of material and human resources, i.e. in addition to producing more foodstuffs in a sustainable manner, the diversity of public services should be increased and biological, organic, healthy and safe foodstuffs should be supplied. Furthermore, attention must be focussed on the management of resources of the interior of the earth and waste, renewable energy resources, packaging technologies, and development of non-traditional foodstuffs, balanced feeding stuffs, multipurpose fibres etc. Such a broad range of agri-research and innovation would be beneficial for the agriculture and processing sector and society at large; a due balance between production of food products and non-food products would be ensured.

Activities and implementation:

(Please give details on the implementation of the intervention)

Main activities of the priority field are as follows: 1. Modern agricultural technologies for sustainable use of biological resources. 2. Innovative and conventional food production technologies. 3. Foodstuffs storage and packaging technologies. These activities of the priority field are described in more detail.

Social partner involvement

 

Type of social partner involvement:

(Bipartite, tripartite, tripartite+, unilateral, public/private partnership? – cf. qu. 1)

Social partners are represented mainly by business.

Level of involvement of social partners involvement:

European, National, regional, local, sectoral

Sectoral

Specific form of social partner involvement:

(tripartite standing or ad hoc committee, high-level group, hearing, consultation, conferences, etc.? – cf. qu. 2)

Consultation

Timing and nature of social partner involvement:

(Please provide more details on the processes that social partners were involved in, their input, the timing, etc.)

Social partners (business and science representatives) were actively involved at the stage of submitting proposals on specific activities under the priority field in 2013.

Currently, permanent expert groups are formed. The groups will be designing and managing all the processes under this priority field of the smart specialisation.

Impact of social partner involvement on design and implementation of instrument:

(Please describe how/if the design and/or implementation was affected through the involvement of social partners)

So far, it is difficult to evaluate the impact of social partner involvement on design and implementation of the instrument.

Other stakeholders involved, if any:

(please name stakeholders and briefly describe their roles)

State institutions: Ministry of Education and Science, Ministry of the Economy, other ministries, Research and Higher Education Monitoring and Analysis Centre (MOSTA) – implementing authority (MOSTA is a state budgetary institution, an analytical and advisory body).

Results and outcomes

 

Outputs/results:

(Please give details of the outputs/results of the intervention; e.g number of jobs created/retained, number of workers upskilled; wage increases, investment increases, increased co-operation between social partners, etc.)

As the instrument is still at the design stage, it is too early to speak about any outputs/results thereof.

Assessment of effectiveness:

(Please provide an assessment of the effectiveness of the intervention - were the objectives reached? If possible, base the assessment on evaluation reports or similar)

As the instrument is still at the design stage, it is too early to speak about any assessment of its effectiveness.

Possible explanations for the effectiveness of the instrument:

(Please provide possible explanations for the degree of effectiveness achieved, including the contribution of the social partner involvement; e.g. improved bargaining process? Increased dynamism in the policy process? Other explanations?)

Not relevant

Assessment of efficiency:

Did the outputs/results measure up to the effort/resources invested? If possible, base the assessment on evaluation reports or similar)

As the instrument is still at the design stage, it is too early to speak about any assessment of its efficiency.

Possible explanations for the efficiency of the instrument:

(Please provide possible explanations for the degree of efficiency, including the contribution of the social partner involvement)

Not relevant

Inga Blaziene, Institute of Labour and Social Research of the Lithuanian Social Research Centre

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