THE Taoiseach says intensive efforts are being made to reach agreement with the trade unions and employers on a successor to the Programme for Competitiveness and Work.
Much will depend on how much progress is made during informal talks between key negotiators over the weekend. If they fail to achieve significant movement, the talks could break down when the formal sessions resume on Monday.
Speaking as he left the EU social partners' summit in Dublin Castle last night, Mr Bruton said: "I have a feeling that the gap between the two sides is not as wide as some reports would suggest. There is a very serious effort being made to reach an accord.
"All of the partners have very strong reasons to reach an agreement." He believed the social dialogue was still working effectively.
Meanwhile, at the Irish Small and Medium Enterprise conference in Killarney, the general secretary of SIPTU, Mr Billy Attley, said there was "not a hope in hell of any fourth programme, if lessons are not learned about some of the shortcomings of the third programme. Both Government and employers proved to be too greedy for their own good".
His view was echoed by union sources close to the current talks. They say that employers are approaching issues "as if they were old style pay negotiations".
There is a feeling among unions that if a radically new agreement cannot be reached they would be better off returning to a "free for all". They feel it might serve as a better environment for talks at a future date, in which their acquiescence would not be taken for granted.
While much media attention has focused on the issue of public sector pay in recent days, there are still unresolved problems over how tax cuts will be shared. The Government has not advanced beyond £900 million, and the employer organisation, IBEC is still looking for about £150 million of this in tax relief for business. The unions are looking for net PAYE tax cuts of £1 billion in any new agreement.
Over the weekend key negotiators from the ICTU, IBEC and the Government are expected to meet informally with the talks chairman, Mr Paddy Teahon, to discuss the agenda for Monday's meeting. If progress is not made during these preliminary sessions, the talks could break down.
Besides private sector pay, local bargaining, minimum pay and social inclusion are the other issues likely to be addressed at the weekend.
In a separate development, the CIE unions are to consider a request from the Labour Court to defer strike action from December 6th. The court heard details yesterday of the dispute between the unions and company over the latter's refusal to pay the latest phase of the PCW.