The battle lines for a protracted battle between the Government and the public service unions are being drawn. The confirmation by the INTO general secretary, Mr Joe O'Toole, that he will be serving a new pay claim on behalf of 20,000 teachers once the Garda dispute is resolved was the opening shot. In response the Taoiseach, Mr Ahern, warned that the preservation of the "partnership approach" with public and private sector workers could be put at risk if employees decided there was more to be procured in terms of pay increases and "we end up with a whole new raft of claims".
In truth, the national teachers' demands are entirely predictable. In spite of the attempts at camouflage, it is abundantly clear that the pay deal on offer to the Garda strayed well beyond the terms of Partnership 2000. Rank and file gardai are being offered a pay increase of over 13 per cent including a payment under Partnership 2000 and two per cent against future productivity. It is likely that this will be sufficient to settle the force's pay grievances. But peace has been brought at a price: a Pandora's Box has been opened and the Government's entire public pay strategy is under threat. Public service unions representing nearly 100,000 workers in the civil service, local authorities and the health sector are waiting and watching the gardai and teachers.
There will be those who might argue that the Government is well placed to meet significant fresh pay demands. The economy is enjoying a record and sustained level of growth. The buoyancy in Government finances is unprecedented. Against this background, more money for teachers (who have played such an important part in building a widely admired educational system) and other public service workers might not appear unreasonable.
It is also the case, as Mr O'Toole says, that Partnership 2000 and its predecessor the Programme for Competitiveness and Work (PCW) were largely negotiated against a less favourable economic backdrop. In recognition of our changing economic circumstances, Partnership 2000 made provision for a review clause from next year.
But all of this must be set against the potential long-term damage to the economy if the guiding policy principles that have underpinned our economic boom - wage moderation and economic and social solidarity - are cast to one side. The harsh reality is that a return to leapfrogging claims - as various groups of both public and private sector workers press competing pay demands - would trigger inflationary pressures, damage our international competitiveness and threaten our continued economic growth. Inflationary pressures are growing: a host of recent figures indicate that the annual inflation rate is set to exceed 3 per cent, amid fears that the economy could be overheating.
It is to be hoped that the Government will be able to mollify the public service trade unions by increasing personal allowances and widening the standard rate income tax band in the Budget. The alternative, a return to a wage free-for-all, is unthinkable.