Finland: Role of social dialogue in industrial policies

  • Observatory: EurWORK
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  • Published on: 02 Wrzesień 2014



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Part 1: Overall role and involvement of social partners in industrial policy in the national context

Industrial policy is in this context used in its broader sense as…

those policies that have an impact on the cost, price and innovative competitiveness of industry and individual sectors, such as standardisation or innovation policies, or sectoral policies targeting e.g. the innovation performance of individual sectors.

The policy instruments are then defined as the method or mechanism used by government, political parties, business or individuals to achieve a desired effect, through legal or economic means.

Industrial policy initiatives are often undertaken unilaterally by the government but other forms may include social partners in different constellations, including:

  • bipartite initiative (a common approach by the social partners);
  • tripartite initiative (the social partners in tandem with the public authorities);
  • tripartite+ initiative (the three stakeholders in combination sometimes with other civil society players such as NGOs, research centres or qualified figures);
  • public-private partnership initiatives (one social partner and the public authorities); and
  • unilateral initiatives by a single social partner

1. 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

Yes

 

Employment

Yes

 

Both economic growth and employment

Yes

 

Competitiveness

Yes

 

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

Yes

Cross-sector involvement

Yes

Yes

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

Both bipartite and tripartite involvement

Both bipartite and tripartite involvement

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

 

X

         

Tripartite ad hoc committees

 

X

         

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

X

X

         

If multi-stakeholder committees:

Please indicate which types of other stakeholders are (typically) involved:

Hearings

X

X

         

Consultations

X

X

         

Conferences

X

X

         

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:

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

3

3

1

construction

3

3

1

building renovation

2

3

0

other

     

Innovation programmes

2

2

1

Support for R&D

1

3

2

Cluster promotion

2

3

3

Export promotion

3

2

1

Internationalisation of SMEs

2

1

1

Improvement of access to finance:

     

loan

2

1

0

loan guarantee programmes

0

0

0

venture capital funding

0

0

0

other

     

Public procurement policies

0

0

0

Tax and duty policies

3

0

0

Adapting the skills base

3

2

2

Subsidies for restructuring/ bail-out of companies in crisis

2

1

1

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

3

1

3

Investment incentives

2

1

1

Energy efficiency/ energy shift

1

1

1

Energy supply security

1

0

0

Access to raw materials

0

0

0

Prices of energy and raw materials

1

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

X

One of the important purposes of social partners’s involvement in the industrial policy process is to prevent the straining of relations between social partners in the labour market. They facilitate political debate about what should be done in society.

Relevance of policy initiatives

X

Social partners influence legislation as well as other economic and social issues through their representatives. Representatives work in various committees and working groups. They also act as experts in employment-related issues.

Dynamism in the policy process

X

 

European coordination

   

Ownership of policy initiatives

   

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

X

Aside from regular national bargaining, cross-industry agreements on specific issues — such as training, employment, health and safety, and bargaining rules.

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

X

At least, this kind of cricisim has been stated that the involvement of social partners is increasing some bureaucracy.

Lengthy policy processes

X

Same as above.

Lengthy bargaining processes

   

Dilution (circumvention) of parliamentary democracy

X

In Finland, the strong role of social partners has also been seen as a problem. The power of social partners is sometimes called ‘out-of-parliamentary power ‘. SPs use political power, but are not themselves in the same way under the democratic control than the parliament.

Problems of establishing accountability

   

Lack of dynamism in the policy process

   

Lack of culture to involve social partners

   

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

Finnish daily newspaper Helsingin Sanomat recently published an extensive analysis of the use of experts in parliamentary hearings. According to the report, over the past 15 years representatives from trade unions, businesses and employers’ organisations have been invited to parliamentary committees more than 6,200 times. However, the report states that parliamentary committees hear from employers’ and businesses’ representatives around twice as often as they do from representatives of trade unions.

In most cases, experts used at hearings of parliamentary committees come from the Confederation of Finnish Industries (EK). The second most popular organisation at hearings is the Central Union of Agricultural Producers and Forest Owners (MTK) and the third is the Federation of Finnish Enterprises (SY).

The report has generated substantial discussion about lobbying.

Some key policians have stated that most parliamentary committee meetings should be open to the public.

 
     

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

This section aims to identify examples of policies targeting specific sectors and involving social dialogue. Among the industrial policies treated in the previous section in question 5, please select 2-3 examples which represent significant industrial policies in your country and describe the policy instruments used and the contribution of social partners to the shaping of the policy and the outcome of their involvement.

The selection of examples should be guided by the following criteria:

  • importance of the sector to the national economy;
  • level of government support to the industry; and
  • best practice of social dialogue in the country.

Please provide references to key sources.

Example 1

Name of the instrument:

Työmarkkinajärjestöjen tuottavuuden pyöreä pöytä; the Joint Round Tabel of Productivity

Sector:

All sectors

Type of instrument applied:

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

 

Timing:

(Period of implementation of instrument)

Since 2007 so far

Operational level

National

Regional

Local

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

X

   

Funding:

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

Joint Round Table of Productivity

Target group(s):

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

In 2007, the government set up a joint round table on productivity including all stakeholders in the Finnish labour market. So the “target group” is the entire Finnish economy.

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.)

Its aim is to promote cooperation between the country’s labour market organisations regarding issues such as productivity and quality of working life in Finland.

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)

Mostly policy preparation and proposals.

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%

Not so specific objectives, but the Joint Round Table of Productivity will take initiatives concerning productivity and quality of working life development. The forms of action include annual seminars in which the rewards are tied to the workplace productivity of co-operation. The Round Table Secretariat publishes an annual review of current issues.

Activities and implementation:

(Please give details on the implementation of the intervention)

 

Social partner involvement

Trade union side: the Central Organisation of Finnish Trade Unions (SAK); the Finnish Confederation of Professionals (STTK) and the Confederation of Unions for Professional and Managerial Staff in Finland (AKAVA).

The employer side: the Confederation of Finnish Industries (EK); KT Local government employers; State Employer’s Office, (VTML) and Church Employers (Kirkon työmarkkinalaitos, KiT).

Type of social partner involvement:

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

Tripartite

Level of involvement of social partners involvement:

European, National, regional, local

Sectoral

National

Specific form of social partner involvement:

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

Tripartite standing: National development networks connect experts, researchers, service providers and workplaces interested in the subject. Companies and public organisations can participate in the activities of such networks, in accordance with their own schedules and needs

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.)

Continuing

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)

Joint analysis and reports

Other stakeholders involved, if any:

(please name stakeholders and briefly describe their roles)

 

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.)

Achievements laid down in the development strategy, along with the state of working life, will be monitored in Finland through a range of methods, for example a new monitoring tool currently under preparation.

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)

 

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?)

 

Assessment of efficiency:

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

 

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)

The most important fact of the Joint Round Table of Productivity is that it is a permanent body offering forum for social partners in handling issues concerning industrial policy.

Pertti Jokivuori, University of Jyväskylä

COM(2010) 614 An Integrated Industrial Policy for the Globalisation Era Putting Competitiveness and Sustainability at Centre Stage. EC 2010

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