Social partners hold first discussions on pay rises

EMPLOYERS, UNIONS and the Government began their first discussions on pay increases to apply under any new social partnership agreement yesterday.

At a brief meeting in Government Buildings, the social partners re-stated their opening positions without negotiations.

The talks on a new phase of the agreement have been under way for a month, but to date they have dealt with other issues such as pensions, agency workers and trade union representation rights. At the meeting yesterday the employers' group Ibec and the Department of Finance spoke of the difficult economic climate.

Sources said that the Irish Congress of Trade Unions maintained there was a widening gap on pay in the economy, and also that its constituency could not be expected to bear the burden for developments in the world economy.

Unions are seeking increases to cover inflation and make up for a 1.7 per cent shortfall in wages as a result of inflation under the current national pay deal.

Employers have said that proposals for a 10 per cent rise over two years, as set out by some unions, are not realistic. They have also warned of the need "to control those things that are within our control, and one of those is pay".

The talks are set to resume next week.

Asked about the Government's position on pay in the talks, Taoiseach Brian Cowen said the best way of guaranteeing improved living standards was to increase productivity.

"That is the best way to ensure that wage policy will not act in a way that puts at risk our competitiveness. We do not want an outcome that puts more jobs at risk.

"It is a question of looking at all of this in the round: the international environment in which we are operating; the challenges we face as an economy; building on the significant achievements we had on job creation over the last 10-15 years; and looking to productivity as an important criteria in deciding to what extent we can improve incomes policy."

Under the current national agreement workers received increases of 10 per cent over 27 months. Unions argue that these increases were eroded by higher-than-anticipated inflation.