The Minister for Finance's complacency about an inflation figure of 5.2 per cent, three times the European average, was "astounding", according to the Fine Gael spokesman on finance, Mr Michael Noonan.
The first annual wage increase under PPF was 5.5 per cent and this was subject to income tax. An annual inflation rate of 5.2 per cent would completely erode this. The trend had been upward for months and despite continual warnings from the Opposition parties, the trade union movement and independent commentators, "the Minister still stands idly by", he said.
Mr Noonan added that it was now clear this year's Budget was wrong and at the wrong time and had put severe pressure on the economy. When previous monthly increases were announced, the Minister for Finance attributed the increase in prices to rising oil prices, among other things.
That excuse was now gone, he said, because fuel-related costs had actually decreased in this month's figures and the increases were due to domestic rather than international factors.
"When the dangers of inflation were pointed out to the Minister previously, he dubbed his critics `left-wing pinkos', and the Taoiseach joined in the abuse by describing critics of the Government's economic policy as `creeping Jesuses"', Mr Noonan said.
Rising prices were now threatening prosperity. They would fuel unsustainable wage demands and reduce competitiveness unless they were reined in.
The Labour spokesman on finance, Mr Derek McDowell, said the latest increase in inflation was extremely worrying. He warned that if the Government continued to ignore the implications of increasing inflation, economic stability, which was being maintained through social partnership, would be jeopardised.
Last month's inflation figures cancelled out the social welfare increases provided for in the last Budget. This month the figures were making a serious dent in the wage increases provided for in the PPF. Mr McDowell said the latest figures were caused by increasing housing costs and food prices.
"It is time that the Minister for Finance and the Taoiseach started to take action against rising inflation before the latest national agreement falls flat on its face and our economic success grinds to a halt," he added.
The Green Party TD, Mr Trevor Sargent, said the alarming rise in inflation was linked to Ireland's loss of control over its own currency. Joining the single currency before Britain was a mistake.
His party believed the rise in inflation rates was now eating into the gains made by employees under the PPF. "We believe that a solution to the problem could be found by reducing VAT on food and clothing essentials and by introducing measures to control the exorbitant costs of accommodation," Mr Sargent said.