Union leader says pay rose too much in boom

Fri, Nov 27, 2009, 00:00

PAY LEVELS increased disproportionately during the Celtic Tiger era and there is now some scope for them to be adjusted but only on an incremental basis, Irish Congress of Trade Unions president Jack O’Connor has said.

At an Ictu jobs summit in Dublin yesterday, Mr O’Connor said pay and other costs in Ireland needed to be examined but that any adjustments should be in line with the appreciation of the euro against sterling and the dollar.

“There is a need for a much wider and objective debate on pay rather than just simply spinning and point-scoring,” he said. “The boom has disproportionately increased pay and pay costs here as against competitor countries.

“Ultimately you would adjust this incrementally . . . You can look at the facts and readjust it over time without dealing the economy another blow.”

Mr O’Connor said recovery should be centred on a national agreement that would extend beyond the Government’s proposed timeline by three years. This, he said, would serve as a sign of Ireland’s capacity to overcome its economic difficulties.

Mr O’Connor said both Government and union plans for recovery would involve taking a gamble and that the two sides should meet somewhere in the middle to take an each-way bet.

Negotiations between trade unions, employers and the Government continued yesterday, with sources saying concrete developments on any agreement were unlikely this side of the weekend.

Ictu general secretary David Begg told the summit that the development of a national emergency plan on jobs was the “only sustainable way” to tackle the economic crisis and drive recovery.

Mr Begg challenged the Government to apply “the same vigour and ingenuity” to job creation as it had to saving banks and cutting spending. He said the unemployment figure of over 400,000 was the root of the current fiscal crisis and that by tackling the jobs issue the Government would lay the foundations for recovery.

Mr Begg proposed that three key initiatives be adopted immediately to improve employment prospects; the introduction of a short-term working programme based on successful models operating in countries like Germany; the establishment of a national recovery bond targeted at filling gaps in public infrastructure; and a single body to maximise job creation in the area of green enterprise.

Rory O’Donnell, director of the National Economic and Social Council, told the summit the solution to Ireland’s economic difficulties could come from combining ideas and action at three levels.

First, he said, a vision of the kind of society and economy that Ireland wishes to become in the decades ahead needed to be found.

Second, knowledge and ideas on key aspects of economic and social development should be promoted. Finally, there needed to be practical policy development, compromise and implementation, based on the experience and capabilities of a wide range of people.

“The depth of Ireland’s problems and the need for immediate further responses meant that any protracted wrangling over vision and principles would, correctly, be viewed with suspicion as strategic rather than principled behaviour,” Dr O’Donnell said.

“Indeed, the severity and complexity of the crisis is such that practical policy development and compromise will have to be multi-annual, involving a sequence of actions, sacrifices and rewards.”

He said the country faced immediate decisions on fiscal, economic and social aspects of the crisis.

“In this context, the most concrete requirement for an integrated, nationally supported approach is that a response to the social and economic aspects of the crisis be embedded in fiscal policy in the coming months and years.”