The outgoing president of influential lobby group IBEC today urged the social partners to be prepared to take some pain as they attempt to strike a new deal.
After Congress warned it was not willing to accept a pay freeze, Maurice Healy signalled the two bodies are on course for a clash as negotiations intensify.
“All of us should be prepared to take some pain in making sure our small open economy is enabled to protect the gains we have made over the past several years,” Mr Healy said.
Earlier Congress issued a 10 point plan designed to rescue the stumbling economy including a radical move to cut VAT, freezing public transport fares and more powers for consumer bodies.
Congress chief David Begg said: “Wages in Ireland are not driving up inflation - that is being done externally by higher commodity prices and interest rates.
“As such, opportunistic calls for a wage free are a non-starter.”
Mr Healy, who is to be replaced today as president of IBEC by chief executive of oil giant Maxol Tom Noonan, outlined areas of reform.
“The interests of every man, woman and child living in Ireland depend on us competing successfully on the world stage,” he said.
“It is a matter of keeping our eye on the ball. We need a sensible and moderate pay agreement; we need to embrace change much more speedily in the workplace; we need public spending to be tightly controlled.”