Ahern warning on pay demands as partnership talks begin

Taoiseach Bertie Ahern has warned unions they will have to be realistic about pay demands in the new round of partnership talks to ensure Ireland remains competitive on a global scale.

Taoiseach Bertie Ahern

Speaking at this afternoon's plenary session at Dublin Castle of the talks on a successor to Sustaining Progress, Mr Ahern accepted that the negotiations between unions, employers and the social partners will be difficult.

Mr Ahern said the past six social partnership deals have played an "important if not pivotal role in Ireland's dramatic economic and social development" in the past two decades. He said the talks should focus on competitiveness and flexibility.

"This is a simple reality that must guide us in the talks, not least when it comes to matters of pay," he said. "We have to price ourselves and position ourselves in a very challenging market, and we have to do that sensibly."

However, Mr Ahern warned against sacrificing workers' rights and health and safety standards just so Irish businesses can remain competitive.

"I have made it very clear that the Government does not wish to see a race to the bottom in the Irish labour market; and our progressive record on employment, real take home pay and working conditions shows that we mean what we say."

He said he believed the majority of employers were "fair-minded", and he was confident that agreement could be reached on a an approach to employment standards "that will be balanced, effective and fair".

The Government is hoping to secure a three-year deal before the talks deadline of St Patrick's Day. If an agreement is reached it will maintain an unbroken sequence of partnership programmes since the first was negotiated in 1987.

The Irish Congress of Trade Unions (Ictu), which had delayed participation because of concerns over exploitation and the displacement of jobs, decided yesterday at a meeting of its executive council to enter the negotiations.

Speaking in advance of the talks, Ictu General Secretary David Begg said Ictu would use the talks to highlight the issues of protection of labour standards, exploitation and labour market reform.

"Opening a labour market of two million people to one of 70 million and maintaining that labour market virtually unregulated, are mutually exclusive options," he said. "The consequences are exploitation, displacement and social dumping."

He reiterated Ictu's opposition to the EU Services Directive, which he said could undermine any hard-won agreement in the Dublin Castle negotiations.

Mr Begg also insisted the talks must address Ireland's serious social deficits, saying Ictu would table a number of proposals aimed at addressing the issue, including changes to the health system; the establishment of a proper "care infrastructure" for the elderly, children and the disabled; education; pensions and the semi-state sector.

The country's biggest union, Siptu, also insisted that labour protection issues be addressed before it agreed to enter negotiations. General president Jack O'Connor has said that "substantial progress" must be made on measures to tackle exploitation of migrant workers and the displacement of jobs before the union will negotiate on other issues, including pay.

But the main employers' body, Ibec, warned that it would be "very difficult" to reach agreement with unions on their demand for tighter labour market regulation. Ibec maintains that a flexible labour market was essential if Ireland is to remain an attractive location for foreign investment.