ILO is a specialized agency of the United Nations
ILO-en-strap
Governing Body

GB.274/12 and Corr.
274th Session
Geneva, March 1999

TWELFTH ITEM ON THE AGENDA

Report of the Committee on Employment
and Social Policy

Contents

  1. ILO policies and activities concerning vocational rehabilitation
  2. Progress report on preparations for the Second ILO Enterprise Forum
  3. Effect to be given to the resolution concerning youth employment, adopted by the Conference at its 86th Session (June 1998)
  4. Preparations for the International Consultation concerning Follow-up on the World Summit for Social Development
  5. ILO participation in major international conferences on employment issues
  6. Employment activities of the ILO in the context of economic crises

1. The Committee on Employment and Social Policy met on 15-16 March 1999 and was chaired by Ms. Sarmiento (Government, Philippines). The Employer and Worker Vice-Chairpersons were Mr. Katz and Mr. Ito respectively.

2. The Committee had the following agenda:

  1. ILO policies and activities concerning vocational rehabilitation.
  2. Progress report on preparations for the Second ILO Enterprise Forum.
  3. Effect to be given to the resolution concerning youth employment, adopted by the Conference at its 86th Session (June 1998).
  4. Employment activities of the ILO in the context of economic crises.
  5. Preparations for the International Consultation concerning Follow-up on the World Summit for Social Development:
    (a) Country employment policy reviews;
    (b) Other activities.
  6. ILO participation in major international conferences on employment issues (including meetings organized by the ILO).

I. ILO policies and activities concerning
vocational rehabilitation

3. Introducing the Office papers,(1)  a representative of the Director-General (Ms. Stoikov, Chief of the Vocational Rehabilitation Branch of the Employment and Training Department) gave a presentation with the use of overhead projection. The question involved three main issues: why the ILO should be committed to the issues concerned; what the ILO proposed to do; and how it proposed to do it. Underlying the entire disability and substance abuse programme was the core belief that the ILO must focus on people's abilities, not their disabilities. By focusing on abilities, all people can reach their full potential and can, thus, achieve financial independence, dignity and self-esteem.

4. Many people with disabilities had achieved greatness. Nevertheless, many still had objections to the integration of people with disabilities into the social mainstream and especially into the labour market. The three most common objections and their answers indicated why the ILO must be involved in this field.

5. The first objection -- that only a limited number of people were involved -- was not based on facts. The WHO estimated that some 10 per cent of the world population was affected by mental or physical disabilities. United States figures showed that one in ten had an alcohol problem. The impact was not just on individuals but also on their families and communities.

6. The second objection was based on the assumption that the cost of supporting those with disabilities could not be significant. However, the real cost was overwhelming, and not just in terms of human suffering: there was a strong correlation between poverty and disability and substance abuse, placing such people among the poorest of the poor. The resulting costs were not only staggering but were also increasing: Canadian estimates placed the time lost due to chronic disabilities at 14 billion Canadian dollars per annum, and the total cost of substance abuse had risen from 31 billion to 71 billion Canadian dollars in a four-year period. In the United States alcoholism caused over 10 per cent of accidents at work, and the two largest programmes providing assistance to people with disabilities had grown by 59 per cent in the last ten years to 6.3 million working-age people. In most cases, a lot of money was spent to keep people out of work rather than investing in their social and economic inclusion.

7. The final objection questioned the concern for the employment of people with disabilities when others are out of work. Simply put, everyone had the right to work. The Vocational Rehabilitation and Employment (Disabled Persons) Convention, 1983 (No. 159) stated clearly the right to equality of opportunity and treatment. Powerful lobby groups were requesting governments and employers' and workers' organizations to remove artificial barriers to employment for those who could and wanted to work. For these reasons the disability movement had been dubbed "the last civil rights movement of our century".

8. The disability and substance abuse programme was intended as a vehicle for change, striving for equity in access to work, quality of the type of work made available, and increased job opportunities. The foundation of the programme comprised three elements: information and research tools, technical cooperation projects and labour legislation and the promotion of Convention No. 159. The activities that permeated all efforts included a strong media strategy, the building of strategic alliances, a fund-raising strategy, concentration on prevention, mainstreaming, ensuring sustainability and non-discrimination. Future activities would focus on the development of a code of practice for the management of disability issues, a targeted programme for the next biennium, and in 2002 and beyond a comprehensive global programme. The ILO promoted productive, freely chosen work for all men and women: it could not accept anything less for persons with disabilities.

9. The Chairperson proposed that discussion on the item be divided into two, so that issues concerning the training and employment of people with disabilities be discussed at the current session, and that issues concerning workplace alcohol and drug prevention be discussed separately during the November 1999 meeting of the Committee. It was so decided.

The training and employment of people with disabilities

10. Referring to the presentation and the papers submitted to the Committee, the Worker Vice-Chairperson supported the efforts made to rehabilitate people with psychological and physical disabilities based not only on the cost implications, but for humanitarian concerns for their quality of life and the need to foster self-sufficiency and pride in these populations. He singled out paragraphs 11 and 14 of the Office paper, concerning new areas for future activity, in particular the heavy burden of mental disorders, natural disasters and disabled populations suffering from the after-effects of armed conflict, especially in Africa.

11. The Workers' group had discussed the ILO's need to do all that was necessary so that the number of people with disabilities did not increase in the world, and injuries and accidents could be limited through the work of the Office. They supported the activities and plans for the future of the two subprogrammes, and felt that the issues of disability and substance abuse needed to be treated separately, as they are enormously different in terms of implementation. The prevention of drug abuse needed to be reinforced by encouraging the agricultural sector not to grow the crops used. This was relevant today in the context of the disputes in the banana industry, where small growers were moving towards planting marijuana as an alternative lucrative crop due to competitive and trade pressure from large companies in the area.

12. Regarding the necessary funding for the disability programme, it was unclear where the funding of an expanded programme would come from, although a model based on the IPEC approach, as outlined in the paper, would be suitable. He fully endorsed the vision for the disability programme, as stated in paragraph 31 of the Office paper of November, leading to a comprehensive, ambitious but executable programme, and wholeheartedly supported the strategies as described in the paper. The Workers' group supported the broad thrust of the programme and hoped that a pilot programme supporting the employment of those disabled through armed conflict in Africa would be implemented soon.

13. The Employer Vice-Chairperson expressed his displeasure with the poor planning and scheduling of the Subcommittee on Multinational Enterprises that had caused his delay. He supported the decision to postpone the discussion on drug and alcohol prevention until November, as it needed to be addressed in a different way from disability.

14. He congratulated Ms. Stoikov on her very impressive presentation and offered the full support of the Employers' group. The disability programme had the potential to become a productive and impressive part of the ILO's activities and he was convinced that it would eventually rank alongside IPEC, making a worldwide difference on disability issues. Referring to the strong impact of the disability movement in the United States on the quality of life of people with disabilities, he gave his own example of an individual using disability-friendly public transport. Employers' organizations were also producing new and innovative ways of using the talents and energies of people with disabilities.

15. He cautioned, however, that the need for treatment of persons suffering from mental disabilities, in particular depression, needed to be fully understood when considering continuing employment. The definition, nature and effect of stress and stress-related disorders needed to be fully studied in terms of employment. On a microeconomic level, psychological disorders should not be considered in the same way as physical disabilities, and needed to be treated differently. He expressed strong support for the programme.

16. The representative of the Government of Sweden praised the presentation for its use of presentation technology and its content and clarity. He wholeheartedly supported the disability programme as outlined, and emphasized that the goal of including people with disabilities in the socio-economic mainstream was essential to success. He also recommended that mainstreaming should start with the ILO, and its principles be applied within the Office in the recruitment and retention of persons with disabilities. Referring to paragraphs 33 and 34 of the November paper, he reiterated Sweden's support for the strong guiding principles and a comprehensive approach to prevention, mainstreaming and sustainability and the creation of available services, health care and accommodating environments. The importance of securing the backing of workers and employers, as well as using allies in civil society in promoting long-lasting programmes for persons with disabilities, was acknowledged in creating "win-win" situations.

17. As regards the national components of the programme, he asked how programmes at this level could be monitored through reporting systems. The United Nations Standard Rules on the Equalization of Opportunities for Persons with Disabilities should have been discussed in the Office paper.

18. The representative of the Government of Japan praised the presentation of the programme and stressed that disability issues were very important for his Government. He hence endorsed the ILO programme for vocational rehabilitation in view of the high level of expertise that it would bring to this field. Based on the experience of Japan, he stressed the strong need for coherence between the medical, social and vocational programmes that governments adopted, and the intensity of cooperation that was needed to take a comprehensive approach. Different approaches may be needed depending on the severity of the disabilities. Whenever financial independence was possible through inclusion in the workforce, that should be pursued. However, different policies may need to be considered, encompassing welfare and sheltered employment in the case of severe disabilities. In particular, specific measures and additional resources may be needed to target persons with psychological disabilities.

19. He warned that governments needed to protect the rights of disabled workers especially in times of economic crises, when very often these populations are among the first to lose their jobs and therefore their livelihoods.

20. The representative of the Government of Germany stated that he had seldom seen and heard such an impressive and lively presentation. He agreed with all the previous comments in endorsing the programme, and appealed to all donor countries to give their special support to the programme, especially in developing new, important technical cooperation projects as presented in paragraphs 7 to 10 of the supporting document. The employment needs of persons with disabilities from countries emerging from armed conflict was a vital area for concern. In addition, the link with the World Summit for Social Development needed to be strengthened, and in particular he recommended close cooperation between the appropriate units in the Office in developing the disability expertise to be used in this context. He echoed the concern of the representative of the Government of Sweden that the United Nations Standard Rules on the Equalization of Opportunities for Persons with Disabilities should have been mentioned.

21. The Chairperson pointed out that the United Nations Standard Rules were mentioned in the table concerning important events in policy development on page 4 of the November paper.

22. The representative of the Government of the United Kingdom strongly supported the concept of mainstreaming and the development of a code of practice. Preoccupation with disability issues was high in her country, as disability benefits had quadrupled over the past 20 years. Her Government had been working very hard on disability issues, in particular unlawful discrimination as covered by the Disability Discrimination Act. A task force on the application of the Act had been set up that dealt with recruitment, job retention, promotion, housing, the working environment and the availability of goods and services. The main goal was to ensure assistance to the disabled population before they drifted into social exclusion. Disability issues were viewed as important in the United Kingdom, and the Minister of Education and Employment was himself blind.

23. The representative of the Government of India expressed full support for and pledged cooperation with the five-year project on drug and alcohol workplace prevention and community-based rehabilitation, discussed in paragraph 10 of the supporting document. He emphasized the need to explore further cooperation on disability issues between the ILO and India in the light of its Persons with Disabilities Act of 1995. Special attention would be paid to persons with visual, hearing, speech and locomotive impairments. Several measures had already been taken to provide institutional arrangements and to support vocational rehabilitation. Efforts in prevention, detection and intervention in favour of persons with disabilities were being made, and suitable delivery systems for goods and services were being studied. He appealed to the ILO to actively assist in the efforts that his country was making to provide training and employment so that greater progress could be made.

24. The representative of the Government of the United States said that a compelling case had been made for careful scrutiny and consideration of this programme in the context of overall strategic concerns and budget priorities. His Government was pleased that the Office had established connections with the President's Task Force on the Employment of Adults with Disabilities, and he looked forward to future exchanges and activities involving the two organizations. The United States concurred with the ILO's vision and strategy that a comprehensive vocational rehabilitation programme must offer educational and vocational choices in a mainstreamed environment, provide access to health and required related services, promote equal opportunity to similarly qualified individuals in securing work, and encourage more and higher quality work opportunities for individuals with disabilities. He agreed with the Government of Sweden who had noted that the ILO should be a model employer by serving as an example in the recruitment, hiring and promoting of individuals with disabilities. He encouraged other member Governments and international organizations to do the same.

25. The representative of the Government of Canada appreciated the presentation and the documentation. In addition to the formal justification laid down by international labour standards and the ILO's constitutional mandate, there were three major reasons why the Organization should address the issue of training and employment of people with disabilities, and why it needed to increase its attention in this area: the large size of the target group; the economic implications of their exclusion from the labour market; and the mounting political pressure worldwide for their social and economic inclusion. Her Government recognized the need for better integration of people with disabilities, particularly in the current era of increased global competition, downsizing and lay-offs. The ILO's vision of a comprehensive vocational rehabilitation programme that would foster the creation of more work opportunities, encourage higher quality work opportunities and promote equality and fairness in securing work deserved support. Lack of suitable accommodation had been identified as a major obstacle to the employment of persons with disabilities, and a number of government agencies were in the process of collecting data on government-wide expenditure on disability-related issues. Many federal departments and agencies were expected to volunteer detailed expenditure data on accommodation, special equipment, programmes, policies and other disability-related items. Such data should be available by the end of September 1999. The Office was also encouraged to ensure access and to provide accommodation for persons with disabilities within the ILO itself.

26. Canada was also pleased to be one of the eight countries participating in the ILO international research project on job retention and return-to-work strategies for disabled workers. She looked forward to the results which would assist in the forthcoming five-year review of Canada's Employment Equity Act. The Canadian Government supported the point for decision in paragraph 74 of the main document, recommended that the Governing Body endorse the programme's further development and expansion of activities in the context of contributing to the programme and budget's Strategic Objective No. 2, creating greater opportunities for women and men to secure decent employment and income.

27. The representative of the Government of Spain fully supported the ILO's goal of investing in the inclusion of workers with disabilities to return to work. A very strong social conscience was present in his country that was eliminating many barriers. Spanish legislation required enterprises to recruit 2 per cent of their workers from the disabled population: this was compulsory and was monitored by the labour inspectorate. In addition, an autonomous non-governmental organization in Spain was extremely active in employment matters concerning persons with disabilities: the ONCE, the national organization for the blind whose activities were funded by tax-exempt proceedings from a national lottery, was an example of state-NGO cooperation on disability issues.

28. The representative of the Government of Senegal stressed that action needed to be taken based on humanitarian and human rights considerations, as well as on the important cost implications. The integration of persons with disabilities in countries emerging from armed conflict was a great concern for African countries, and one that underpinned economic sustainability and durable peace. Promoting the employment of persons with disabilities would in the long run contribute to the reduction of poverty, an extremely important need in the African context. An organization in Senegal promoted the inclusion of persons disabled as a result of war into the mainstream, and targeted technical cooperation projects could be initiated between his Government and the ILO to further enhance the work being done in his country.

29. The representative of the Government of China regarded the training and employment of persons with disabilities as one of the most important tasks ahead for the ILO. In addition to the promotion of employment, he commended the new areas for future activity, in particular assistance to the war disabled and those affected by natural disasters. His Government attached great importance to developing activities for training and employing persons with disabilities, and his Government had ratified Convention No. 159 and was active in its implementation. In addition, specific provisions and legislation were in place in his country to protect the rights of workers with disabilities. China fully endorsed the ILO's vocational rehabilitation programme and the action plan presented in the document.

30. The Worker Vice-Chairperson asked whether a different paper would be prepared for the November meeting in which substance abuse prevention was to be discussed. While many governments had legislation concerning the recruitment of a minimum number of persons with disabilities, these laws were often not enforced. He expressed hope that more efforts would be made by governments to ensure compliance.

31. Ms. Stoikov stated in reply that a short update would be prepared for November, but that the material already presented should be sufficient. She thanked all speakers, on behalf of the Vocational Rehabilitation Branch, for their endorsement of the disability programme.

II. Progress report on preparations for the
Second ILO Enterprise Forum

32. Introducing the Office paper,(2)  Mr. Hultin (Assistant Director-General) provided additional information on preparations for the Second Enterprise Forum. The overall theme would be "Enterprise competitiveness, corporate citizenship and the employment challenge in the twenty-first century". The Forum would provide an opportunity to exchange views and experience between the participants and would facilitate an exchange of views between the ILO and the enterprise sector.

33. As regards the Forum's structure, the opening session would be followed by a "scene-setting" session where major future challenges to enterprises would be reviewed by a leading business consultant and social development thinker, Mr. Charles Handy. Three parallel sessions would follow: the first on "human resource-based competitive strategies", the second on "corporate citizenship and social initiatives", and the third on "tapping the employment potential of small business". In the third parallel session, there would be a focus on women's entrepreneurship, youth entrepreneurship and the quality of jobs. In each session two to four enterprise case studies would be presented along with complementary input from high-level resource persons.

34. Referring to the work carried out by both Workers' and Employers' groups and the Bureaux for Employers' and Workers' Activities in the Working Group, he expressed his appreciation for their excellent collaboration. Work was now shifting from the conceptual and design phase to practical preparations. In addition to the summary of proceedings which would be prepared, it was also planned to put together a forum publication that would contain high-quality written contributions from persons interested in the subjects under discussion. In this connection he invited contributions from ILO constituents and from others through them. The Working Group had decided to charge participation fees for non-ILO constituents on account of the limited budget available. Lastly, he emphasized the need for continuing cooperation with constituents in the preparation of this important event.

35. The Employer Vice-Chairperson recalled that the very active participation of the Workers' and the Employers' groups in preparing for the Forum was the result of criticism of the First Enterprise Forum received from the Workers' group. Some misgivings had been expressed during the Employers' group's discussions, where some had felt that the pendulum had swung too far since the First Forum towards more traditional ILO concerns. While the First Forum had been considered a definite success from the business community's point of view, the question remained as to how the business world would view the second. He wondered if it would not be better to bring together the three themes of the parallel sessions in separate plenary sessions. The discussion in such a session might focus on what enterprises could do to improve efficiency and competitiveness, in which case employment would follow as a logical consequence. If it were to be an enterprise forum, it had to be of interest to business people. The employment growth of small businesses could not be addressed in isolation, and in fact it was often the result of structural adjustments by large enterprises through such measures as outsourcing and the breaking up of large enterprises into smaller units.

36. The Worker Vice-Chairperson recalled that the Workers' group had expressed grave concern about the Second Enterprise Forum when it had been proposed initially. It has been felt that the First Forum had been too business-oriented without adequately reflecting ILO principles. Based on this view, the secretariats of both Employers' and Workers' groups, together with the Bureaux for Employers' and Workers' Activities, had discussed and agreed to make the Second Forum more tripartite. Quite contrary to the view of the Employer Vice-Chairperson, the Workers' group considered that the pendulum had not swung far enough and that the upcoming Forum would still be very much in favour of employers. However, in view of the considerable efforts by the Working Group to ensure a balanced approach reflecting ILO concerns, the Workers' group would be ready to support the Forum even though there was still room for improvement.

37. The Workers' group agreed to have the three parallel sessions and expressed particular interest in the theme of corporate citizenship. He queried whether this would be the only session where the Workers' views would be presented. The issue of corporate citizenship had been much discussed at the recent World Economic Forum in Davos, where the United Nations Secretary-General had emphasized the importance of core ILO standards, particularly freedom of association and collective bargaining. He hoped that the Second Enterprise Forum would prove a good opportunity to draw attention to these issues. Tripartite cooperation and participation would be crucial to the success of the Forum, as well as other similar arrangements.

38. The Employer Vice-Chairperson said that he had not meant to prejudge or criticize the Forum preparations, and expressed the hope that the concerns expressed earlier would prove unfounded. He reminded the Committee that the event was meant to be a forum on "enterprise" with employers' and workers' participation, and that workers benefited where enterprises prospered, and vice versa. The key consideration was that the ILO should contribute directly to enterprises and thereby benefit all parties. He had no doubt that corporate citizenship was an important issue in the minds of many business people, but this should not be the major focus of the Forum.

39. Mr Hultin thanked speakers for their comments and continued support for the Forum. The intention was to provide an opportunity for "cutting-edge thinkers" on business and senior-level business managers to interact with ILO constituents. He hoped that what had been put together with inputs from the Working Group would meet this expectation. On a previous occasion it had been agreed that, for practical purposes, parallel sessions would have to be organized. However, there would be a plenary session where the summaries of the discussions of all the parallel sessions would be presented and general conclusions drawn. In response to the query by the Workers' group, he explained that it was foreseen that, where possible, business cases would be represented from both management and workers' perspectives. He gave the example of ongoing discussions with Volkswagen, where it would hopefully be possible for a joint presentation to be made by management and worker representatives on human resource strategies. There would be presenters from the Employers' group in the session on corporate citizenship and social initiatives. The session on tapping the employment potential of small business was still being finalized and would have room to reflect the various comments made by the Committee.

40. The Worker Vice-Chairperson welcomed Mr. Hultin's explanations. He requested that, since this would be the last opportunity for the Committee to have discussions before the Forum, the Working Group should make every effort to make the Forum a success for all constituents.

III. Effect to be given to the resolution concerning
youth employment, adopted by the Conference
at its 86th Session (June 1998) (3)  

41. The representative of the Director-General (Mr. Sengenberger, Director of the Employment and Training Department), answering a question raised by the Employers' group concerning the conclusions of the OECD/United States Government Conference on "Preparing youth for the 21st century" that had taken place in February 1999 in Washington DC, stated that a press release had pointed to the ineffectiveness of youth employment programmes. This was an overly pessimistic conclusion: recent OECD research on youth employment and unemployment had largely confirmed the results of ILO research. Both organizations agreed on the importance of the overall state of the labour market in influencing youth employment and unemployment. He noted that the forthcoming ILO report "Youth employment in a global perspective" showed that decreasing the minimum wages for youth would not significantly enhance young people's employment prospects. The OECD had come to the same conclusion in a recent issue of its Employment Outlook. At the OECD meeting, experience from Canada and the European Union was reported that showed youth programmes to be effective under certain conditions.

42. Presenting the ILO's work on youth employment, he referred to the Action programme on youth marginalization, which targeted disadvantaged youth. A report was expected in October 1999, and it would give particular attention to certain difficulties and unintended effects of employment programmes, such as the displacement of older workers. A web page on youth employment had been placed on the Internet(4)  providing access to publications, employment indicators and information on best practices for promoting youth employment. It also provided information on employers' and workers' organizations and NGOs working on employment issues. The Key Indicators of the Labour Market (KILM) project would also provide broad information on youth employment indicators. The ILO had actively participated in the second and third sessions of the World Youth Forum of the United Nations System. The third session had taken place in Braga, Portugal in August 1998 and had been followed by the First World Conference of Ministers Responsible for Youth in Lisbon. Youth employment was an important priority for employers' and workers' organizations, and the ILO had been working closely with the International Organization of Employers (IOE) and the International Confederation of Free Trade Unions (ICFTU) on this issue. Youth employment was a crucial issue in the Programme and Budget for 2000-01.

43. The Worker Vice-Chairperson stressed the importance of institutional protection to combat youth unemployment. It was crucial that the tripartite constituents work together. He recognized the importance of youth unemployment and expressed concern about the fact that there were no signs of improvement. He urged the ILO to address this issue and noted that it was not addressed with sufficient clarity in the Programme and Budget proposals for 2000-01. He asked how much money had been invested in youth and how much support this work would have in the future. The strategic objectives in the programme and budget did not pay enough attention to youth. It was crucial to develop recognition of the importance of youth unemployment. The 1998 Conference resolution concerning youth employment had to be translated into concrete action. The ILO's report on Youth and employment in a global perspective supported the views of the Workers' group. Youth unemployment was a very serious problem in Africa, and young people who could not find a job would be drafted into the army. This had, of course, very serious consequences. The International Consultation concerning Follow-up on the World Summit for Social Development in November 1999 should include youth in its agenda.

44. The Employer Vice-Chairperson stressed the importance of youth unemployment. The Employers had discussed this issue and had heard presentations from different countries on successful youth employment programmes. The youth unemployment problem was not so much due to "inadequate aggregate demand" but to "inadequate aggregate employment" and that the youth unemployment problem was linked to the general unemployment problem. He said that OECD research concluded that differentiated wages for youth helped to promote youth employment. Youth employment correlated with skill levels, and generic skills were crucial also as an important component of basic education that prepared young people for the new world of work, in which several changes of career would be the norm.

45. He also stressed the important role of apprenticeship programmes. The key to their success was the flexibility. Job creation meant promotion of entrepreneurship and decreasing taxes and obstacles faced by young people so that they could start their own business. Part-time and fixed-term contracts were useful ways of getting young people into employment.

46. Mr. Boussat (Employer member) stressed the seriousness of youth unemployment in France and mentioned recent measures to combat it. The youth labour market in France had an intake of 700,000 young people (ages 18-24) a year. The present Government planned to create 700,000 jobs for young people within five years, 350,000 in the public sector and 350,000 in the private sector. Some 158,000 of these jobs had already been created in the national police, schools, hospitals and local communities. However, employers did not agree with the artificial creation of jobs by the Government, and had concerns about what would happen after the five-year period of the scheme.

47. Mr. Anand (Employer member) emphasized the importance of small and medium-sized enterprises (SMEs) in the promotion of youth employment, which was very high in developing countries and rapidly increasing. More focused attention was needed in countries such as India, where there was not even a ministry of employment. Propaganda would not solve the problem.

48. The representative of the Government of Italy stressed that youth unemployment was a key issue for his Government. There was a need to integrate youth employment policies with each other and with education policies. Improving education levels improved the elimination of child labour. The Braga Action Plan, the Lisbon Declaration, the European Employment Guidelines and the International Labour Conference resolution on youth and employment were all very positive developments to combat youth unemployment. He emphasized the importance of paragraph 48 of the ILO's Programme and Budget for 2000-01, operational objective 2(e) and its focus on youth employment.

49. The representative of the Government of the United Kingdom stressed the high level of youth unemployment (12.2%) in the United Kingdom, twice as high as the general unemployment rate. "New Deal" programmes provided skills and work experience during working lives. They targeted young people (ages 18-24); the long-term unemployed; single parents; the disabled; and partners of unemployed people. The programme for young people had a duration of 16 weeks, and during this time the young unemployed person and an adviser developed a New Deal Action Plan that would help the young person find a job. In order to qualify for this programme it was necessary to have been unemployed for at least six months. However, disabled people could join earlier. The United Kingdom Government had supported subsidized jobs and self-employment.

50. The representative of the Government of France expressed hope that youth employment would have a high priority in the Programme and Budget for 2000-01, even as an InFocus programme. It was important to ensure the quality of the jobs offered to young people, and jobs had to be developed in new areas such as environment and community services. The French National Programme of Action had proven successful in providing a new start for young people. There was cause for concern for marginalized youth and the need to bring them closer to the labour market.

51. The representative of the United States Government pointed to the correlation between youth unemployment and adult unemployment. However, there was no necessary causality involved. Many of the reasons for adult unemployment were the same as for youth. Those who had problems in finding their first job would be more likely to have problems in the labour market in their future lives. Concerning the conclusions of the OECD/US Conference, he cautioned against any pessimistic interpretation of its conclusions: the outcome should be seen more as a recognition of what had not worked.

52. The representative of the Government of India underscored the importance of macroeconomic measures to address youth unemployment. Economic policies were often more focused on the promotion of economic growth than employment. The ILO should discuss youth unemployment problems with the multilateral financial institutions.

53. The representative of the Government of Swaziland stressed some of the consequences of youth unemployment such as drug abuse and criminality, and noted the important role that technical cooperation could play to solve this problem. He emphasized the negative impact of these consequences for the important tourism industry.

54. The representative of the Government of Japan said that youth unemployment had increased dramatically in the last few years. She noted that, in the past, Japanese companies used to employ young people so they could develop their careers in the companies. Companies had offered low wages and training to their young workers. Young people now left their jobs more frequently than before in order to find better ones. The ILO resolution on youth employment was relevant, especially the paragraph concerning the need to cooperate with other international organizations.

55. The representative of the Government of Senegal noted that Africa was highly concerned about the youth unemployment problem. In Africa youth employment was crucial to social stability. It was important to enhance the skills of young people, and in Senegal a national survey was being undertaken to identify the skills needed. The social dimension of development could not be overlooked.

56. The Employer Vice-Chairperson was particularly alarmed at the fact that in the United Kingdom and in most of Europe youth unemployment was at a level twice as high as the general unemployment rate. There should be an incentive to employ young people, against the normal play of labour market forces. For example, in the United Kingdom a joint recommendation of the social partners had suggested that workers under the age of 18 should be excluded from the minimum wage. Youth unemployment was a moral problem of particular concern, with serious economic and social consequences, and special importance should be given to youth unemployment in marginalized sectors. Employers should permit flexible forms of employment as incentives to hire young workers.

57. The representative of the Government of the United Kingdom pointed out the two main reasons why in the United Kingdom minimum wages for young people were lower than for adult workers: it encouraged employers to hire young people and it discouraged young people from leaving education.

58. The Worker Vice-Chairperson stressed the need to be cautious about lowering the minimum wage. Once lowered, it would be difficult to reinstate it at its previous level. The Workers' group could not accept this policy.

59. Mr. Sengenberger thanked speakers for a fruitful and interesting discussion. Most of the national cases presented had been discussed in the ILO's forthcoming report on youth employment. The ILO was very concerned with the problem. As a rule, youth unemployment was twice as high, and in some countries even three times higher than the general unemployment rate. It was not yet possible to predict exactly the level of resources that would be invested in youth employment activities in the 2000-01 biennium. In reply to the Employer Vice-Chairperson, he asked whether employers were ready to provide training to young people on short-term employment schemes.

60. The Employer Vice-Chairperson replied that in a dynamic market workers were not tied to companies, and that workers with indefinite contracts could also leave their jobs if they found a better offer. Knowledge-based workers had a strong bargaining position in demanding training to advance their skills. Therefore the length of the contract did not necessarily influence the decision of an employer to provide training, although companies would like to ensure that they got appropriate return on their training investments.

61. The Committee recommends that the Governing Body request the Director-General --

IV. Preparations for the International Consultation
concerning follow-up on the World Summit
for Social Development

62. A representative of the Director-General (Mr. Sengenberger, Director of the Employment and Training Department) introduced the Office paper.(5)  The purpose of this tripartite consultation would be to take stock of international experience and ILO activities undertaken to give effect to the goal of full, productive and freely chosen employment with full respect for basic workers' rights, enshrined in Commitment 3(a) of the Declaration adopted by the World Summit for Social Development. The consultation would assess this progress in the light of prevailing international conditions. The assessment would be instrumental to the ILO's participation in the Special Assembly of the General Assembly on the implementation of the Copenhagen agreements, scheduled to be held in Geneva in June 2000.

63. The Office paper described the progress made in two main areas: country employment policy reviews (CEPRs) and regional consultations. Eleven CEPRs had already been completed or were in progress, and a synthesis report was being prepared. A series of regional consultations concerning follow-up on the World Summit had been held, and the conclusions of these tripartite meetings would be reflected in the report being prepared by the Office for the International Consultation. Tripartite meetings had been held for the Asian region (Bangkok, January 1999); Central and Eastern Europe (Budapest, January 1999); Africa (Abidjan, February 1999); and one was planned for the four Western European countries for which CEPRs had been prepared in Geneva in March. A meeting was planned for September 1999 for countries in the Arab region.

64. The Employer Vice-Chairperson cautioned the Office, in connection with the summary conclusions from the regional consultations (paragraph 21), against simply repeating arguments raised in favour of slowing down trade liberalization and structural adjustment. Such arguments were reminiscent of the infant industry protection arguments that had been discredited in a series of discussions and meetings throughout the 1980s. Those meetings had provided opportunities to review the record since the 1987 High-Level Meeting from a substantive, not ideological, point of view and had drawn the conclusion that the process of liberalization and adjustment was inevitable. The most effective strategy to deal with the social costs of adjustment was to implement specific social protection measures rather than slow the pace of adjustment.

65. Substantial evidence from many parts of the world had demonstrated that countries that had slowed liberalization in order to protect jobs and favourite industries were enduring very high unemployment rates, while countries that had opened up their economies and had liberalized trade had had the best record on employment. There was similarly wide recognition of the important role of a proper regulatory framework and other microeconomic measures. It was important to mitigate the social pain of adjustment and transition by instituting social protection measures rather than by slowing the adjustment process and postponing reaping the benefit of improved employment performance.

66. The Worker Vice-Chairperson stated that the Workers too would raise some questions regarding the content of the conclusions, and recognized that they reflected the genuine concerns that participants had raised at those tripartite meetings. Regarding the preparations for the International Consultation, he thanked the Office for its efforts to stimulate debate on the important question of how each country could pursue full employment with full respect for workers' rights. It was important for the content of the CEPRs to be reflected in the International Consultation. In particular, it would be useful if those summaries could report directly the views of the participants and the action taken by countries regarding ratification of the Declaration adopted by the World Summit for Social Development. The summaries presented in the Office paper were not entirely satisfactory, as there was little reference to that Declaration. At the Asian meeting, which he had attended, most countries had expressed support for the Copenhagen Declaration even if they had not implemented it. Regional conferences were worthwhile exercises, but the ILO could have defined more clearly the critical issues involved in follow-up as an ILO exercise. More uniform agendas for the regional consultations would have facilitated comparison between regions on the critical aspects of the Declaration, while still allowing full recognition of important region-specific issues. The regional consultation in Budapest had been a success, resulting in a quality report prepared by the Office, which was an excellent basis for tripartite discussion. Significant economic stimulus was needed to create new jobs, which must be stressed in addition to institutional and policy responses to unemployment. To assure good quality as well as quantity of jobs created, it was essential to invest in high technology industries and maintain national educational systems. Decisive national policies were needed to regularize economic activity and deter tax evasion. Promotion of foreign direct investment should be accompanied by efforts to improve transparency and reduce short-term capital volatility. Further efforts were needed to increase the job creation capacity of domestic capital accumulation, including by fighting corruption.

67. As regards the Special Session of the General Assembly, the Asian financial crisis had painfully exposed how countries had neglected the social aspects of development. The number of persons living in dire poverty and alienated from society had been increasing, especially among women. The social impact of the crisis had led to belated recognition of the value of the World Summit for Social Development and should lead to renewed commitment by governments and international institutions to assume responsibility for dealing with the problems of globalization. It had reminded the world of the importance of equity in the development process, of effective market regulation, of strong social institutions such as free trade unions, of respect for fundamental human rights and core labour standards, and of the importance of the specific role of the ILO in working with other international organizations.

68. Many of the elements identified to give effect to the commitments of the Social Summit were needed as part of a recovery strategy for the economic and financial crisis. In particular, more appropriate levels of financial resources should be committed to development and greater emphasis placed on the role of the ILO alongside the IMF and the World Bank.

69. While the Workers were clear that there would be no renegotiation of the Commitments entered into at the Social Summit, it would be necessary to provide concrete timetables for their implementation and to take into account the lessons of the financial crisis. This would require renewed commitment to supporting the ILO Declaration on Fundamental Principles and Rights at Work and implementing its follow-up mechanisms, undertaking measures to respond more effectively to economic crises, and implementing specific measures to address the employment needs of particular groups, with priority attention to women as well as youth, indigenous peoples and the disabled. The Commitment to eradicate poverty should be the subject of substantive debate and work leading up to the June Special Session. During this time the World Bank would be preparing its World Development Report for the year 2000 on the theme of poverty and development. The ILO should make a full contribution to its work on this topic. The measures which governments should commit themselves to implement even before the Special Session included maintaining the purchasing power of minimum wages during periods of economic crisis, targeting anti-poverty policies to the poorest and most vulnerable groups, implementing appropriate fiscal policies and respect for trade union rights as a means of improving the distribution of the benefits of economic growth, and addressing the poverty of persons working in rural areas, in the informal sector, and under precarious employment arrangements. The year 2010 should be set as a worldwide deadline for the eradication of absolute poverty.

70. The representative of the Government of Japan welcomed the progress report. She recognized that there were high expectations for the ILO's leadership in follow-up on the Social Summit and welcomed the role of the regional consultations in the preparation of the Office documents. She also concurred with the observations made by the Worker Vice-Chairperson on the discussions at the Bangkok consultation, which she had attended, as well as with the summary of those tripartite discussions provided in paragraph 17 of the document. The Asian and Pacific region had taken the ILO Declaration as a basis for further follow-up work on the Social Summit, in particular giving greater recognition to the need for continued investment in human capital. The conclusions from the regional consultations should be incorporated in the documents prepared for the International Consultation, and the regional conclusions should be broadened into an international perspective on progress made in implementing the Copenhagen Commitments. She also expressed the hope that the ILO would take a significant leading position regarding contributions to the United Nations Special Session.

71. The representative of the Government of the United Kingdom asked whether the Office paper referred to the ILO's role in follow-up on Commitment No. 3 of the Copenhagen Declaration, as the ILO's work was pertinent to several other Commitments in the Declaration. She hoped that the work in preparation for the International Consultation would cover all areas of ILO activity contributing to follow-up on the Copenhagen Declaration. The programme and budget proposals stated that the ILO planned to hold a World Employment Forum in the year 2000. She wondered how that Forum would be related to the ILO International Consultation and to the General Assembly Special Session. Finally, she asked whether the ILO was involved in the work the World Bank was undertaking in preparing General principles for social policy and whether there would be any discussion of the ILO's contribution to that effort.

72. The representative of the Government of the United States echoed the questions raised by the previous speaker. He also expressed the hope that expectations for the ILO's contribution to the Special Summit would not exceed realities. The series of papers being prepared would put ILO work into the larger framework of the UN's work on these important topics. He reiterated pleas that had been made earlier for excellence in carrying out this work, which merited the highest quality of analytical attention. The papers should be circulated in a timely fashion so that the Committee could provide comments.

73. Mr. Mansfield (Worker member) stated that the conclusions of the regional consultation held in Abidjan reflected the opinion of the representatives of the region that caution needed to be exercised in implementing adjustment and liberalization programmes and in assessing their effects in Africa. Social protection measures needed to be put in place before embarking on rapid reform or trade liberalization. Core ILO Conventions should be ratified before economic reforms were implemented. These conclusions should not be surprising: of the 55 representatives at the Abidjan meeting, 21 were from governments, 18 from employers' groups and 16 from workers' groups. The conclusions thus reflected tripartite discussion and views. The conclusions raised legitimate questions about the advisability of rapid adjustment, especially in view of the consequences seen elsewhere, especially in the transition economies of East and Central Europe. In the Russian Federation, according to the World Employment Report, more than 35 per cent of the entire population was living in poverty, as compared to 8 per cent ten years previously. This was an indictment of the rapid pace of economic change in the Russian economy and a reminder of the importance of putting in place policies to ensure social justice as well as economic growth. The comments at the Abidjan meeting reflected concern about the adverse social consequences of rapid liberalization. The CEPRs carried out in the four European countries could provide examples of economic reform combined with social justice. The synthesis report should prove particularly interesting as it considered how reform ought to be carried out in order to protect the community within which it took place.

74. The Employer Vice-Chairperson stated that it was obvious that trade unions had no monopoly on the clamour for trade protection. Important sectors of employers had supported protectionist pressures, but this was not the sort of collaboration between the social partners that could be commended to countries struggling to achieve greater prosperity. If the Office paper accurately reflected the views expressed by employers at the African regional consultation, there was all the more justification for his proposal for the reviews to be completed in the Governing Body so as to provide a central and guiding view. This should be guided by conclusions drawn from long-established research and discussion. He agreed with the Workers that appropriate social protection measures must accompany economic adjustment policies, and that it would be best if countries implemented the ILO Declaration on Fundamental Principles and Rights at Work when implementing adjustment strategies. However, if countries were to overcome their current difficulties, they should not slow down the adjustment and reform process. The consensus achieved in the 1980s on the importance of the three-legged stool of stabilization, liberalization and structural adjustment, including privatization, remained valid. In the Russian Federation enormous mistakes had been made in privatization, not so much in terms of the speed of the switch to a market economy but in the limited voucher technique of privatization. Mistakes committed there did not justify embracing or promoting a more protectionist adjustment strategy. Protectionism would lead to prolonged unemployment and misery, whereas the problems entailed in a proper adjustment strategy would be short-lived and could be mitigated by measures of social protection.

75. The representative of the Director-General (Mr. Sengenberger, Director of the Employment and Training Department) thanked the Committee members for their comments. In reply to the Government of the United Kingdom, he confirmed that the ILO's contribution to the Special Session of the General Assembly in June 2000 would include a review of its activities on several Commitments of the Copenhagen Declaration, and not only to Commitment No. 3. The International Consultation would focus on Commitment No. 3, in particular on employment and the way employment policy could be best used to confront poverty. Other items would also be prepared for the ILO's input to the Special Session. The relation between the World Employment Forum and the International Consultation, the Special Session and other upcoming meetings was not yet clear because its objectives and content were still under consideration. The precise purpose and agenda of the Forum would be clarified as the Office finalized the Programme and Budget for 2000-01. He would give a more complete explanation in November.

76. The representative of the Government of Sweden requested further information on the question raised earlier about the involvement of the ILO in discussions with the World Bank on its General principles for social policy.

77. Ms. Hagen (Deputy Director-General) confirmed that the ILO was involved in this work being carried out by the World Bank, that the Office had reviewed drafts that the World Bank had provided, and that she expected discussions to continue with them.

V. ILO participation in major international conferences
on employment issues

78. The Worker Vice-Chairperson welcomed the documentation. Regarding the section on the G8 Conference of Ministers of Labour (Washington DC, 24-26 February), he referred to the Chair's conclusions of that Conference and in particular to paragraph 11, and welcomed the importance given by the G8 ministers to the new ILO Declaration on Fundamental Principles and Rights at Work. There was a need to improve the lives of workers and strengthen the ILO's capacity in the area of social safety nets and the IPEC programme. He welcomed the Chair's conclusions on strengthening tripartism and the involvement of unions and employers in improving labour standards. The promotion of collaboration with other organizations, including the World Trade Organization, was most welcome, as was the request that labour ministers should inform their minister colleagues responsible for trade of the conclusions of these discussions. Paragraph 16 of the Chair's conclusions reporting on increased collaboration between the ILO and the international financial institutions (IFIs) was positive, and the Workers' group looked forward to the discussions at the 1999 Conference on this item. The G8 ministers of labour had rightly attached importance to the role and function of the ILO.

79. As regards the Dakar meeting, he congratulated the Office on its work on the Action programme on employment and structural adjustment and the role of the social partners. The report of the meeting in Dakar indicated that it was possible for employers, workers and governments to formulate consolidated policy recommendations and elaborate on the need for capacity-building among the social partners to deal with economic reform issues. Through such seminars the Action programme provided a valuable contribution to the objectives of the ILO in terms of mitigating the social consequences of adjustment policies.

80. The Employer Vice-Chairperson stated that he had been present at the G8 Conference of Labour Ministers and was almost totally in agreement with the points made by the Worker Vice-Chairperson, especially regarding the importance the ministers had given to the role and function of the ILO. The statement by Mr. Thüsing presented at the G8 Conference on behalf of the International Organization of Employers should be circulated to the Governing Body. Nevertheless, he had some reservations with regard to paragraph 12 of the Chairperson's conclusions regarding codes of conduct. He welcomed the emphasis in the Chairperson's summary of the rapid response capacity of the ILO.

81. The representative of the Government of the United States also underscored the prominence given to the ILO by the G8 ministers and reiterated his agreement with the call in the Chair's conclusions for increasing collaboration between the ILO and the international financial institutions. He looked forward to the discussions at the Conference for more detailed proposals.

82. The representative of the Government of India welcomed the paper provided by the Office. The new Director-General, Mr. Somavia, had stated that the Declaration on Fundamental Principles needed to be dealt with through promotional efforts. However, any element of conditionality should be avoided. He supported paragraphs 9 and 10 of the Chair's conclusions. However, he had some reservations regarding paragraph 15, as this paragraph could imply linking labour standards to trade policy. It read as follows:

83. The representative of the Government of the United Kingdom, who had attended the G8 Conference, stated that the new Director-General had given very candid replies to all the questions by the ministers. She confirmed that the G8 Conference did not underestimate what the ILO had agreed to in respect of the ILO Declaration on Fundamental Principles and Rights at Work, and no minister present at the G8 meeting wanted to undermine the importance of the Declaration.

84. The representative of the Government of Egypt was generally satisfied with the presentations by both Mr. Hansenne and Mr. Somavia at the G8 Conference. As regards the Chairperson's conclusions, he stressed the need for enhanced technical assistance, as indicated in paragraph 13. It should be clear that paragraph 15 reflected the conclusions of the G8 ministers and that the ILO should not be led by what had been stated at the G8 Conference. The wording in paragraph 15 should not be interpreted as any form of new conditionality on trade. He wondered whether paragraph 15 was intended to reiterate paragraph 4 of the conclusions of the WTO Ministerial Conference of December 1996 in Singapore. He supported paragraph 4 of the final document of the Singapore meeting, which had asked the ILO and WTO secretariats to collaborate. However, Egypt was opposed to proposals by certain developed countries trying to put labour standards on the agenda of the Third Ministerial Meeting of the WTO to be held in Seattle.

85. The representative of the Government of Swaziland noted the increased collaboration between the international financial institutions and the ILO, and welcomed the importance attached to human capital formation in the Chair's conclusions of the G8 meeting.

86. The representative of the Government of Mauritius indicated that certain developing countries were faced with highly volatile markets, and special assistance was needed to deal with the problems created by globalization for workers in the most severely affected countries.

87. The representative of the Government of Sweden was aware of the position of the Governments of India and Egypt in the debate. However, the most important outcome of the G8 Conference was the importance the ministers had attached to the ILO and the work done by its Governing Body. This was in his view due to the good work done by the officials of the ILO and also to the success of labour ministry delegates from the G8 countries in convincing their colleagues in other ministries of the importance of the ILO's work.

88. The representative of the Government of China agreed with the representatives of India and Egypt on paragraph 15, and also objected to the suggested link between standards and trade.

89. The representative of the Government of Bangladesh urged that paragraph 15 should not be interpreted as providing a social clause, and he supported the statements by the Governments of India, Egypt and China. He welcomed in the Chair's conclusions the recognition of the need to create better safety nets in the context of the global crisis, and this was an important role for the ILO.

90. The representative of the Government of Germany agreed with the remarks by the Government of Sweden and noted the reservations of certain groups regarding the Chair's conclusions. Paragraph 15 did not differ from the Singapore text: it was clear and in the spirit of the Singapore Declaration, and nothing more should be read into it. The reference in Mr. Somavia's speech to Mr. Kofi Annan's address in Davos was highly appropriate.

91. The representative of the Government of Mexico welcomed the statement by the new Director-General at the G8 Conference. Paragraph 15 of the Chair's conclusions was not in line with the statement by the new Director-General that non-conditionality was the key to the promotional success of the Declaration, and it should in no way be interpreted in any way different from the Singapore Declaration.

92. The representative of the Government of France welcomed the recognition of the links between the ILO and the international financial institutions, and noted also the importance given to tripartism. She observed that the Copenhagen Declaration had clearly established that not only standards but also employment creation had to play an important role in the improvement of living standards.

93. The representative of the Government of Italy also welcomed the importance given to the ILO's work and function at the G8 Conference. He welcomed paragraph 11 of the Chair's conclusions concerning the ILO Declaration on Fundamental Principles and Rights at Work.

94. Mr. Brett (Worker member) was pleased to note that in the G8 documents the ILO had emerged as a very relevant and credible organization with solid support. As regards the reaction of some members to paragraph 15, he did not read anything more into paragraph 15 than the Singapore Declaration. The discussions on the Declaration should be closed, as the Declaration had been adopted. The important question was how to implement the Declaration and how the WTO and the ILO should work together.

VI. Employment activities of the ILO
in the context of economic crises

95. The representative of the Director-General (Mr. Sengenberger, Director of the Employment and Training Department) suggested two main aims for the discussion of this agenda item and the Office paper:(6)  first, to provide the Committee with an update on the nature of the current world economic crisis and inform it of the action taken by the ILO to assist member States in coping with it; secondly, to engage in a broader discussion of how the ILO could and should respond more effectively to economic crises in the future. The Committee's views and guidance on what should be the key concerns and priorities for ILO action would be helpful as the ILO looked ahead and planned its future work. He drew attention to the central issues in the paper: understanding the global economic crisis; the Office's response in terms of policy prescriptions and policy instruments; and examining strategic and operational options for the ILO's role in dealing with economic crises in the future.

96. The term "global economic crisis" should be taken to mean a sudden and substantial contraction of output and employment in one or several regions which had a negative contagion effect on economic activities in other regions. Forecasts were made of reduced global economic growth and loss of investor confidence in individual markets, leading to a downward spiral for local economies causing the bankruptcy even of healthy enterprises, massive job losses in the formal sector of the economy and expansion of the informal sector. The indicators of the social impact of the current crisis were alarming: one in every four jobs in the formal sector of the Indonesian economy has been lost, and an additional 20 per cent of the population now lived in poverty. The Republic of Korea has seen a nearly fourfold increase in the unemployment rate, estimated in February 1999 at an unprecedented 8.8 per cent. The contagion effect could be seen in economic stagnation in Japan, economic crisis looming in Brazil, further contraction of output and employment in the Russian Federation and Ukraine, and a one-third cut in the IMF's forecast global economic growth rate for 1999. Beyond these sobering statistics, the social effects of the crisis were also seen in some places in forced migration, the devaluation of vocational skills, degradation of working conditions, increasing social exclusion and growing social unrest.

97. Economic crises could originate in a variety of ways. The Office paper dealt mainly with financial crises due to sudden reversals in the direction and volume of capital flows and consequent changes in real economic activity. But economic crises could also result from persistent problems of economic adjustment, political conflict and natural disasters. Regardless of origin, there were certain principles which guided ILO policy in dealing with economic crises:

To create this environment, action was needed at all levels of policy-making: devising economic stabilization policies; investing in employment-intensive sectors; improving infrastructure; maintaining social dialogue to contain inflation and instituting new programmes targeting the development of small and micro- enterprises and the adaptability of enterprises and workers.

98. The review of recent ILO operations at the country level provided examples of ILO assistance in all forms of response. At the policy level, the ILO had advised countries on restructuring and provided technical assistance on vocational training and retraining and other active labour market policies. In response to the immediate need for jobs, the ILO had implemented employment- intensive works programmes for infrastructure development. In response to the hardship caused by loss of income and lack of social protection, the ILO had provided expertise on instituting administrative and financial systems for social protection provision. In response to inadequate employment opportunities, investment and entrepreneurship, the ILO had advised governments and the social partners on the development of enterprises, cooperatives and self-employment schemes. In response to concerns that the adjustment burden may fall hardest on women, the ILO had provided advice on special targeted programmes for women and comprehensive policy responses to gender bias.

99. Various options were open for the ILO to implement a rapid response facility, as envisaged in the strategic outline document for the 2000-01 programme and budget. The purpose of this facility would be to improve the ILO's capability to provide valued assistance to countries at risk of economic crisis or trying to work their way out of them. While it was clear that a major effort in this area would require a substantial commitment of resources, it was also evident that a strategy would have to be formulated to guide the allocation of resources so as to use them most effectively:

100. The review of the causes of the recent crisis and of the response made by the ILO at both headquarters and field units was a useful starting point for formulating a strategy for future ILO efforts. Appropriate choices had to be made of strategic and operational options. In making these choices, it was necessary to reconsider the ILO's role among cooperating and competing international agencies.

101. The Employer Vice-Chairperson expressed full support for ILO action in each of the areas outlined. Despite the difficulty of coming to grips with this issue in a brief statement, the discussion should serve to strengthen the Committee's determination for renewed and more intense collaboration between the Office and constituents on future action. Obviously, it would be necessary to examine the causes and try to distinguish them from symptoms. The Office paper prepared under the fourth item on the Governing Body's agenda concerning the ILO's response to the Asian financial crisis(7)  was impressive and uncharacteristically candid in its admission in paragraph 44 that on the very fundamental issues of policy it was difficult at this stage to draw any firm conclusions from the policy debate. That debate was of course taking place not only in the ILO, but also between senior figures in the World Bank and the IMF.

102. As regards forecasting crises, the experience of the Asian financial crisis underscored how difficult this might be. As pointed out in the same Office paper, alarm bells had not sounded beforehand because most of the macroeconomic fundamentals had seemed sound. Professor Paul Krugman had however voiced warnings some time before the onset of the crisis, predicting the end of the so-called Asian miracle by pointing out weaknesses in the macroeconomic strategy followed by a number of the countries concerned: in his thesis, countries that were primarily production platforms, simply adding inputs, had not formed a solid base for sustained development. His view had been borne out by the statement in the Office analysis on the decline in productivity of both capital and labour. His observations on the real economy had prompted his cautionary note, although he had not predicted the severe nature of the end of the economic miracle, which was hopefully only temporary.

103. As that Office paper correctly showed, the crisis had been kindled by problems in the financial sphere, not macroeconomic policy per se. The absence of adequate financial regulatory schemes had not been so much a deliberate policy failure but a matter of poor judgement. Welcoming a large influx of capital into weak banks, some of which had ties to government officials, and inadequate regulatory systems, lent itself to crony capitalism, over-extension, and a dependence on short-term capital which fled at the slightest threat. It was important to recognize that there were enormous differences between countries within the region regarding the effects of the crisis. In the Republic of Korea, the role of the chaebols and their close relationship with the Government and the banks was unique in the region. By contrast, the financial crisis had a much more limited impact in Singapore, the Philippines and Hong Kong, China, only two of which were notable for their very strong regulatory mechanisms. In Eastern and Central Europe, alongside the disaster in the Russian Federation and Ukraine, there was the example of Poland, which boasted the highest growth rate in Europe and a steadily decreasing unemployment rate, now comparable to those in several Western European countries. While it had several persistent problems ahead in its continuing restructuring, Poland was an economic miracle relative to some of its neighbours, notably the Russian Federation, Ukraine and Belarus.

104. In addition to the difficulties inherent in anticipating such crises, it should be recognized that the ILO was not alone in making such analyses. While the Employers agreed that serious analysis was needed, the Organization should work with other institutions and research centres to perfect its own analysis and to incorporate the best available work carried out elsewhere in its own forecasting efforts. Mr. Sengenberger's ideas for analysing these issues in the future were very interesting and very persuasive, and the Committee could learn from the Office papers the main areas of work that comprised the ILO response thus far to the crisis.

105. The first main area of concern was social protection. The Chairperson's conclusions at the G8 meeting regarding social protection as a necessary component of adjustment strategies was also relevant to the discussion of the ILO's response to economic crises. There had been long-term agreement among all constituents on the importance of work on social protection measures, but the Organization had yet to come to grips with the issue. The Office needed to do more to move beyond recommending one ideal social security system, the kind of system that was typical in Western European countries. When this issue had arisen in earlier discussions in the Committee, some European colleagues had made the point that their countries could no longer afford these systems, so how could the ILO prescribe them to developing countries or to countries in transition to a market economy? Instead, the Office was urged to take up social protection issues as part of active labour market policy. There was a relationship between social protection and active labour market policy, on which the Office had produced interesting research, but there were also potential pitfalls in active labour market policies, especially if they were not treated as temporary measures. The ILO would not want to promote policies that could lead to repeating the problems that had become apparent in some countries, such as Sweden, where persons oscillated between participation in active labour market programmes and social security programmes. This could happen especially when unemployment benefits proved a disincentive to seeking employment. Although this issue had already been recognized earlier by the Committee, an effective Office contribution to resolving it was still lacking.

106. Work on employment-intensive investment was one of the most interesting and exciting programmes of the Office, but it seemed to be relegated mainly to Africa and least developed countries and may not be appropriate to areas such as heavily industrialized southern Brazil or other areas of industrialized countries that had been experiencing high unemployment due to factory closures. The Employers would support further development of the potential evident in employment-intensive public investment programmes. ILO work on employment services was also relevant to its response to crises.

107. The discussion of tripartite dialogue on economic crises recalled similar discussions in the past: the Office made the point that, if tripartite institutions had been stronger in the countries hit hardest by the Asian financial crisis, then perhaps some of the moral hazard and crony capitalism could have been controlled or mitigated. The Employers would welcome further elaboration and evidence on this point. The Office certainly had strengths in these areas, greater than those of other organizations, but he wondered whether it would be possible for the ILO to attain a rapid response capacity, as the United States Secretary of Labor Alexis Herman had suggested at the recent G8 Ministerial Meeting. The Employers were somewhat dubious, particularly within the confines of a zero growth budget. Several questions should be raised. What would a rapid response capability imply? What would be the destination of such forces, when crises reached global proportions? Could staff be redeployed from Geneva to the field to deal with emergencies? How could an active resource capacity be developed using the assets identified? The international organizations individually lacked such capacity. It might be developed in cooperation by the World Bank, IMF and UN agencies, with each organization doing what it knew best. What was missing was the tight coordination to produce not only an active response but an integrated policy response. The other institutions had the money, the ILO had technical assistance and policy advice to contribute, as did other organizations. Should a crisis response centre be established to coordinate activities more actively than the ACC? This would go beyond the occasional inter-agency seminar that was typical of such collaboration at present.

108. Ms. Sasso-Mazzufferi (Employer member) thanked Mr. Sengenberger for his excellent presentation and the Office paper. In particular, paragraph 16 provided a very impressive account of the ILO's response to the weak employment situation. One important aspect of this response was the promotion of tripartite dialogue. She emphasized the potential for work and progress that the social partners could initiate themselves, in particular to counter crisis situations. In Italy, social dialogue was very important and had led recently to progress in promoting social peace, countering inflation, and establishing tripartite and bipartite programmes in the area of vocational training. A recent tripartite Social Pact for Development and Employment had been signed by the Government and the social partners, and she summarized the most important chapters of this long and complex paper. A new aspect of this Pact was that there would be joint efforts with local authorities. It was at the local level that the reasons for unemployment and the needs for new investment could best be identified. National legislation to implement the Pact committed the Government to consult social partners before adopting legislation on social matters and employment policy so as to bring down the social costs of employment, to make new investments in social and physical capital, and to work more in harmony with local authorities. Italian employers and trade unions considered the Pact a positive development and it was hoped that it would be a cornerstone for more rapid social progress.

109. The Worker Vice-Chairperson thanked Mr. Sengenberger for his presentation and for the Office paper. In general, ILO activities were seen by the Workers as lacking sufficient force to dampen the negative effects of the financial crisis. In the current crisis in Asia, the negative effects of short-term, near-sighted investment pointed to the need for more concerted international cooperation to restrain such harmful flows of international capital. A second general concern was the impression that too often ILO activities were limited to two parties: the Office and governments, and that tripartism was not being fully exercised. This concern was greatest among members of the Workers' group from the Russian Federation and other CIS countries, who were also particularly concerned that without sufficient tripartite oversight the funds contributed by workers to social security programmes were being misused by governments and the resources for social security measures were shrinking.

110. The Workers hence welcomed the discussion on ILO activities to confront the social costs of economic and employment crises. Employment was one of the four strategic objectives identified for the next programme and budget, and it appeared that it was being considered as the highest priority. The Workers' group was painfully aware of the importance of employment. However, the three strategic areas of employment, social protection and social dialogue must be supported by the ILO Conventions, in particular core labour standards. Whether the terms "decent employment" or the conventional term of "productive and freely chosen employment" were the best descriptors of the type of employment that the ILO should be promoting, the vital concern should not be over semantics but over how the ILO could help create adequate levels of quality employment based on the first strategic objective, i.e. the Declaration on Fundamental Principles and Rights at Work. Discussions on employment that had lost sight of this fundamental objective would not be tolerated by the Workers.

111. It was important that the deliberations on this item provide an impact on the upcoming Symposium on the Social Impact of the Asian Financial Crisis. The Symposium could be expected to focus on such questions as why the financial crisis occurred, the seriousness of the unemployment situation and inadequacy of the social safety nets and the response made by the ILO as well as by the international financial institutions and by national governments. As regards the relationship between the ILO and the international financial institutions, throughout the 1980s and 1990s the ILO had consistently expressed its views on the Washington consensus on structural adjustment. New questions were now being asked about the Washington consensus, such as those raised during the G7 meeting of 1998 when the ILO had been called upon to play a central role in the reconstruction programme for the Asian financial crisis. The Chairperson's conclusions of the G8 meeting stated that poverty elimination and employment creation in a globalized world should be achieved with the ILO at the centre, cooperating with the other international organizations. He welcomed this conclusion and encouraged the Office to work aggressively to exercise influence over the IMF and the World Bank, and develop closer communication and contacts with the WTO.

112. Finally, the Workers noted that in the last section of the Office paper (paragraph 102), future ILO interventions of this nature were to be "articulated within an integrated national policy framework towards crisis management and economic and social recovery". The paper stated that this could best be achieved where tripartism was promoted. The Workers strongly supported this conclusion. It was also evident from the concluding sections of the paper that the Office considered that the positive impact of the various projects and different forms of ILO intervention could be further enhanced. The Workers would also support the Office recommendation that "future technical cooperation assistance be designed within a coordinated framework and packaged as a high impact strategy".

113. Supporting the statement by the Worker Vice-Chairperson, Mr. Mansfield (Worker member) stated that how the ILO could make a valued contribution to overcoming the crisis would be one of the factors determining its relevance in the years ahead. The Workers' group endorsed the comments by Mr. Somavia at the recent G8 meeting, which were relevant in view of the belief that globalization, while inevitable, was out of control in terms of its effects on ordinary people and its deleterious effects on social standards. The ILO needed to act on two fronts. First, there was an outstanding need to build new international institutions to better manage the international financial markets, which had emerged as a substantial cause of the destabilization of national currencies and economies. This would be vital to help prevent the reoccurrence of such crises in the future. As a respected former Governor of the Reserve Bank of Australia had stated, the global economy could be likened to the Internet where everybody was connected but nobody was in charge. This view was also expressed by the financier George Soros who had grave concerns about the future of the global financial system in the absence of a global regulator. In the introduction to his recent book, he had noted that the development of the global economy had not been matched by the development of a global society. The financial system today was global in scope, but political systems were still national, and this was a fundamental cause of the instability occurring in the financial system in many countries.

114. These points underscored the need for the ILO to work to apply its mandate on employment and economic development by joining with other international institutions to devise new mechanisms that would provide a better balance between market forces and government intervention and build stable economies and financial systems that would be capable of preventing violent swings in financial markets in the future. The Workers noted the importance of the reference in paragraph 106 of the Office paper to the need for the ILO to help design growth policies that would also help achieve equity and social justice.

115. The second major area of ILO response should be a range of detailed initiatives to assist countries affected by the financial and economic crisis. ILO initiatives were needed across a range of areas: promoting employment-intensive infrastructure programmes, whose endorsement by the Employer Vice-Chairperson was seconded by the Workers; assisting with the introduction of social security systems and social protection systems; developing training and retraining systems; promoting social dialogue and the adoption of core labour standards; providing information on active labour market programmes and the collection of statistics on the labour market; promoting job creation programmes and taking account of the effects of crises on groups such as women, migrant workers and others who could be particularly disadvantaged. The specific programmes of ILO activity in particular regions and countries would need to take account of the prevailing circumstances. There was no single universal formula that would apply worldwide. However, the Workers were seriously concerned over the statement in paragraph 90 that it was difficult and often impossible to assess the impact of ILO initiatives on the overall crisis experienced by a given country. The Workers trusted that this did not mean that specific initiatives were not being assessed in terms of their effectiveness. Greater effort needed to be made in terms of qualitative assessment relating to ILO initiatives in response to the financial crisis, with results being reported back to the Governing Body, in particular on how funds were spent and their impact in the affected countries. He emphasized the need to promote core labour standards, in part as a means of restraining the tendency of some countries to engage in social dumping, whereby they sought to promote economic growth at the expense of other countries through the gross exploitation of labour and the downgrading of human rights and labour standards. Paragraph 52, describing ILO activities in Cambodia, stated that this effort presented an opportunity to express concern over the lack of respect for core ILO standards. The ILO should make special efforts to secure the ratification of fundamental labour standards in countries where major programmes of assistance were being implemented.

116. The Workers would give strong support to employment-intensive initiatives. In November 1998 the Workers' group had criticized cuts in budget and staff in this area and he again called for the restoration of resources for ILO activities for employment-intensive work. This area was particularly important in the light of the estimates of the potential for 1 million jobs to be created in Thailand, as noted in paragraph 44, and in the light of the evaluation in Appendix III to the Office paper that this approach generated three to five times more jobs with 60 per cent less foreign exchange than an approach which utilized the high level of technology commonly applied in industrialized economies. The Workers would encourage greater efforts by the Office to help governments design and implement social security systems. In paragraph 107 there was reference to the miracle growth economies, particularly in Asia, where some countries had boasted annual growth rates of 8 to 10 per cent sustained over a number of years. But there had been a fundamental failure in some of those economies in that during their strong economic growth period they had not initiated social security or social protection systems to protect their population in times of economic crisis. The Office was in a position to work with the social partners to help build social protection schemes.

117. The Workers' group retained their significant reservations about the manner in which the International Small Entrepreneurship Programme (ISEP) was being implemented and the manner in which other technical cooperation projects concerning enterprise promotion had been implemented. The paper stated that these projects were implemented with local partners, including trade unions. However, an assessment made by the Workers' group based on communications with trade unions in countries where these projects were being implemented, concluded that they were not being involved in or consulted on the design or implementation of these projects. The Workers had in the past expressed their reservations about micro-financing activities in industrialized countries and the lack of consultation at ILO headquarters about the orientation of this programme.

118. The Workers' group called on the Office to attach high priority to promoting social dialogue. In a number of countries affected by the financial crisis, the organizations representing workers and employers had been the subject of repression by governments and had in the past been excluded from social dialogue. Considerable ILO resources would be required to build up the capacity of organizations representing workers in order to enable them to participate fully in the process. The ILO should publicize the human cost of the economic crisis as part of its campaign to promote social dialogue.

119. He endorsed the positive results that could be achieved from the introduction of active labour market policies, as outlined in paragraph 25, and would support action by the ILO to encourage their application in other countries affected by the financial crisis. Paragraph 103 referred to action by the ILO in regard to the informal sector. The Workers would emphasize that the most important action in this area would be to promote the conversion of work in the informal sector to freely chosen, quality productive work in the formal area of the economy.

120. The Workers' group objected to the negative references to public employment services in paragraph 36 of the Office paper. The experiments cited where employment services had been privatized were still too recent to be evaluated adequately, and the Office should refrain from praising these as yet unproven initiatives: there had been complaints about decreased services provided to unemployed persons by the privatized Australian employment services, whereas there had not been a decrease in the rates of long-term unemployment.

121. The ILO must work on both preventing financial and economic crises and providing post-crisis assistance, and strong emphasis must be placed on prevention in the future. The principal work of the ILO should be about avoiding crises and averting their high social costs, rather than mopping up after them. As to the question of the type of programmes required, there was probably no single approach that would be effective in all cases, and it was hence important for programmes to be flexible and able to respond appropriately and adequately to challenges as they arose or were anticipated. Work in this area should be among the highest priorities for the work of the Office.

122. The representative of the Government of Egypt was impressed with the analysis presented and agreed with others that the ILO was well placed with its tripartite structure to promote social protection and employment and to redress the inequities that had followed from the turmoil in financial markets. He also agreed with the opinion expressed by Mr. Katz that a comprehensive approach was needed to confront unemployment in South-East Asia and to contain the spread of the crisis to other parts of the world. He reminded the Committee of important work done by UNCTAD in analysing the repercussions of the financial crisis, particularly on trade and development, and in which unemployment problems featured prominently. The WTO had also carried out useful work on the effects of the financial crisis on growth rates in various countries. Their analysis showed that even in those countries that maintained the economic fundamentals, their economies were seriously affected through trade and lower worldwide growth. He welcomed the assistance contributed by the ILO and future work that would be carried out, referring in particular to the prominence of employment promotion in the strategic objectives and InFocus programmes outlined in the budget proposals. The repercussions of the turmoil in financial markets had been high on the agenda of the Ninth Summit of the Group of 15, held in Jamaica in February 1999. The Communiqué adopted by the leaders of the G15 had put special emphasis on the work of the ILO and the central role it should play in launching a comprehensive employment strategy, which he, as Chairman, had communicated to the former and current Directors-General of the ILO. Summarizing their conclusions about the role of the ILO, the Group of 15 called upon the ILO to launch a comprehensive long-term employment strategy during the Governing Body and at the International Labour Conference in June. The purpose of the strategy should be to stimulate employment creation in all developing countries. The consensus on emphasizing employment objectives stemmed from the recognition within the ILO that unemployment was not only an economic waste, but led to social degradation, ill- health, social unrest, lower self-esteem, insecurity, and resistance to technological change, among other negative repercussions. The employment strategy would be founded on the adoption and implementation of a number of measures: the Declaration and Programme of Action adopted by the World Summit for Social Development, which identified needs of developing countries with respect to education, vocational and technical training, and mobilization of resources for economic development; the internationally agreed target levels of official development assistance; the twin objectives of assuring funds for social development and the alleviation of the foreign debt burden; mobilization of budgetary and extra-budgetary resources by the ILO, and strategies for promoting self-employment and entrepreneurship and for strengthening micro-, small and medium-sized enterprises as they provided the bulk of employment in both the formal and informal sectors of the economies of developing countries.

123. The representative of the Government of Slovakia thanked the ILO for its effective and efficient help in addressing unemployment problems in Slovakia and neighbouring countries, as mentioned in paragraph 29 of the document. Unemployment remained very high in Slovakia -- about 16.5 per cent -- and new programmes to be implemented under Strategic Objective No. 2 would be most appreciated, particularly in providing support for enterprise development. His Government would encourage the ILO to continue its work in providing exchanges between countries of experience and information on dealing with this problem, as well as activities to improve employment in the informal sector and increase job opportunities for young workers and disabled workers.

124. The representative of the Government of Malaysia commended the Office for its efforts. The ILO's limited resources had been spread across many areas and countries, but the monitoring and evaluation of these activities, referred to in section V of the paper, seemed insufficient. This aspect was important to ensure that the way in which the Office used its resources resulted in a multiplier effect far beyond the initial target. He requested reports on impact assessment to be made available to constituents. The wide dissemination of these reports among countries facing similar problems within the region could be part of a proactive approach to avoiding their repetition.

125. The representative of the Government of Italy expressed particular appreciation for the identification of the main elements of the ILO response, in paragraph 16. In times of crisis, the functions of the ILO in the areas of research, information and technical assistance came to the foreground. It was clear that crises could be of various types depending on where they occurred. Given the economic interdependence between countries, it was clear that the repercussions of a crisis, wherever it originated, could affect a large number of other countries. He approved the conclusion by the Director-General on the need for a rapid intervention capability, although there were many questions concerning how it would be organized and implemented, but the introduction of the concept was welcome. It was particularly important to focus on prevention, through vocational training, the establishment of social protection systems and systems of tripartite dialogue which could be activated when crises explode. In reply to some of the questions raised by Mr. Sengenberger, he noted the limited resources and that it is impossible to cover all fields of crisis. The ILO must stick to its functions and mandate, which were universally acknowledged. Coordination with UNDP and the international financial institutions was extremely important so that the ILO could concentrate on social problems. Intensive measures would be better -- the ILO should intervene in particular where the situation was worst. Policy packages could also be effective. It was important to maintain the important role to be played by the social partners, as indicated in paragraph 96.

126. The representative of the Government of Pakistan in particular appreciated the role of the ILO in employment generation and particularly in youth employment. Of the four strategic objectives, most emphasis should be placed on employment. This did not mean that the other objectives should be neglected. Full utilization of human resources in the developing countries in gainful production held the key to development. The Government of Pakistan had taken great strides in areas promoted by the ILO. The assistance provided by Mr. Sengenberger and by the Director of the ILO Islamabad Office had been much appreciated in launching this work. However, closer collaboration through the Active Partnership Policy and concrete measures of assistance in these vital and high profile programmes were still needed. A string of skill development and training centres had been set up the federal Government, provincial governments and even by employers throughout Pakistan. The ILO should help identify a wider variety of projects that could be taken up profitably by individuals. It should also guide local lending institutions on the financial limits up to which various types of projects or industries in specified areas should be financed. Dealing with these problems should be included in ILO programmes to promote entrepreneurship and self-employment so as to avoid wasteful investment. In addition, the ILO should help set up marketing channels for goods produced in this sector. He also requested additional help from the Office in assessing the potential scope for using employment-based techniques in Pakistan's extensive programme of highway construction.

127. The representative of the Government of the Republic of Korea said that the ongoing crisis provided proof that economic and social policies and objectives must go together. International efforts were essential to tide over the current financial crisis, which posed serious problems in the global community. Special emphasis should also be placed on identifying activities that could be adopted or facilitated at the regional level so as to encourage in-depth debate on the difficulties encountered by each country or region in the process of implementing employment policies.

128. The representative of the Government of Swaziland welcomed new ILO initiatives to strengthen social protection in sub-Saharan Africa. All countries in the region were looking forward to this and the increases in the budget. While the objectives of poverty alleviation and employment generation were being addressed, the issue of social justice could not be neglected pending the resolution of such problems. The time had come to extend social protection systems to all those in formal as well as informal, casual or seasonal employment categories as recognition of basic workers' rights and in conformity with the ILO Declaration on Fundamental Principles and Rights at Work. The ILO special programme on Strategies and Tools Against Social Exclusion and Poverty (STEP) was highly supported. It was hoped that the Office and its field staff would soon mobilize resources to meet this challenge. Job creation was a key need in addressing Africa's social problems and social development, and was seen as the basis for alleviating poverty while reducing child labour. Its potential for reducing disease and contributing to better health was great. Its contribution to the reduction of crime and drug abuse was evident. He appealed to Members not to forget that the era of colonial rule was over, and so too was the language of colonial administration. African countries were now partners and cooperated both as developing and developed countries: the term "underdeveloped" did not reflect the realities or dynamic nature of their development efforts, but tended to alienate good relationships between developed and developing countries.

129. Mr. de Arbeloa (Employer member) said that among the important problems for countries in the Americas was the weight of external debt. Along with problems in the areas of employment and poverty, this problem posed a major danger to emerging democracies. These problems must be addressed immediately and in a realistic manner. No new solutions would be found in the form of new standards or systems of social security that had failed to produce results in other countries. Some problems such as gender and child labour were not of such great significance in the countries of this region. It was important to support the implementation of fundamental rights, and to ensure social dialogue and tripartism. The multidisciplinary teams should provide technical cooperation and training to ensure greater employment and greater flexibility of employment. He encouraged the promotion of small and medium enterprises as sources of employment for skilled and unskilled workers.

130. The representative of the Government of Japan paid tribute to the Office paper. At the ILO there were two important roles to be played: the promotion of employment and standard setting. To analyse this in the context of an economic crisis was very useful. Section IV of the Office paper, which described the technical assistance and policy advice that had already been provided, was particularly interesting. Section III (paragraph 16) was very important, but the fourth indented item referred to the ILO Declaration on Fundamental Principles and Rights at Work and the Tripartite Declaration on Multinational Enterprises and Social Policy. The paragraph described building support for an open global trading system by removing the threat of social dumping. The purpose of these Declarations was to promote the ILO principles that had been put together on the basis of a consensus among ILO constituents. Any statement linking them with trade issues could open the door to unnecessary argument and would therefore be inappropriate. Section VI could be supported by all, but one point should be added, concerning research and analysis carried out at the ILO. Research on what had happened as a result of the economic crisis and what were the causes had already been carried out by the ILO and by other organizations. What would be needed now was analysis and research studies looking to the future. Two types of analysis were needed. Countries that had been plagued by the economic crises had adopted socio-economic policies that the ILO needed to evaluate. Secondly, many of those countries had now entered the recovery process, during which governments should do a number of things in the area of social and labour market recovery. Research should target the question of what the ILO could do in this stage of the process.

131. The representative of the Government of the United States briefly described the priorities of his Government during the current period of great turmoil in the global economy:

The United States had earmarked $17.9 billion in additional funding for the IMF. He expressed agreement with paragraph 103 in the Office paper which pointed out that progress towards social justice, freedom and security could not be appropriately assured on a sustainable basis without economic growth and recovery. He expressed some frustration with the Office tendency to describe ILO policy input but then fail to examine its effect or outcomes. More information was needed about the actual effects of ILO programmes.

132. The representative of the Government of India endorsed the views expressed by the representative of the Government of Egypt on behalf of the Group of 15 and supported the suggestion that the ILO, within its mandate, should launch a comprehensive employment strategy. In order to pursue this strategy, the ILO should conduct studies and prepare documentation to facilitate discussion in the Governing Body and the International Labour Conference and to promote appropriate policies and programmes. He supported the ILO's involvement in promoting the cause of homeworkers in India and looked forward to further fruitful cooperation on this important area of the unorganized workforce. The ILO needed to pursue closer dialogue with the Bretton Woods institutions, not only in the area of crisis anticipation, but also in order to promote further recognition of its concerns in the design of policies to generate employment.

133. The representative of the Government of Canada appreciated the efforts to reflect the gender impact of the social consequences of the crisis. During the discussion of the programme and budget, her delegation had supported the proposal for an ILO rapid response capability to deal with similar crises. However, in reply to one of the questions raised by Mr. Sengenberger, she expressed the view that ongoing ILO programmes of a preventive nature should be the priority for the Organization. A number of elements could be identified as essential to the success of future ILO activities: the ILO should remain focused on activities that furthered the strategic objectives; it should maintain dialogue with the social partners; it should monitor and evaluate the impact of the services delivered; it should collaborate with international financial institutions and other UN agencies; and it should allocate adequate resources to these tasks to developing the required technical and institutional capacity to carry them out.

Geneva, 22 March 1999.

Point for decision: Paragraph 61.

1. GB.274/ESP/1, referred to here as the "supporting paper", and GB.273/ESP/3, postponed from the 273rd Session (November 1998), referred to as the "main paper".

2. GB.274/ESP/2.

3. GB.273/ESP/7 and GB.274/ESP/3.

4. http://www.ilo.org/public/english/60empfor/polemp/youth/index.htm.

5. GB.274/ESP/5.

6. GB.274/ESP/4.

7. GB.274/4/2.


Updated by VC. Approved by RH. Last update: 26 January 2000.

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