Minister for Finance Brian Cowen has said that any wage increases agreed at the national pay talks should be benchmarked against the rate of wage growth in other EU countries, in order to protect Ireland's economic competitiveness.
Speaking at the launch of the Institute of Bankers' School of Professional Finance in Dublin today, Mr Cowen said Irish wages had grown more than 2.5 times the average euro zone rate over the last three years.
Claiming that "a cost base which is out of line with competitor countries would undermine economic potential," Mr Cowen said that "pay awards must be benchmarked against our competitors to support the maintenance of Ireland's international competitiveness and the long-term durability of our economic performance."
"The bottom line is we need to be very careful about not putting ourselves in the position of seeking to award ourselves wage rises now that would undermine our competitiveness ... We want to maintain jobs and we don't obviously want to end up in a situation where we kill off jobs," he said.
Government, employer bodies and unions resumed direct negotiations in Dublin this month on a new national partnership deal. It is widely believed that union negotiators will be demanding annual pay increases of up to 6 per cent to cater for both cost-of-living and productivity increases.
Additional reporting: Reuters
