Ireland needs to instigate greater tax and social welfare reform, according to the latest report from the Organisation for Economic Co-Operation and Development.

The report, which shows that Ireland remains top of the league for economic growth, predicts a pickup in European economies and stresses the need to cut unemployment across the region.

It forecasts 7.7 per cent growth for Ireland last year, falling to 6 per cent this year and 5 per cent in 1997. This would keep Ireland as the fastest growing OECD economy for all three years.