Minister for Finance Paschal Donohoe has said that he will not do anything to “unravel” the Public Service pay agreement.
“This is an agreement we have to maintain,” he told RTE’s Today with Miriam show.
The Public Service pay agreement is the way to deal with “all the risks” and has to be maintained, he said.
The Minister said that he is prepared to engage with all the unions involved and that his department is engaged in discussions on a continuous basis.
He said: “We will find the right way of dealing with our public service unions.”
He also defended the increase in VAT in the hospitality sector saying it was important to find other tax sources rather than being totally reliant on corporation tax.
Mr Donohoe said he accepted the point made by the Fiscal Council on the need for caution and not to be overly reliant “on one tax head”. He said that was why he had increased VAT.
He also defended comments by the Taoiseach Leo Varadkar on Thursday when he said people would not go hungry because of Brexit. Mr Varadkar had been answering a question about the country’s ability to access and provide food in the event of a hard Brexit.
He said that tone was important and that the Taoiseach had been trying to reassure citizens about the country’s ability to access food.
Mr Donohoe was adamant that there would not be a hard border on the island of Ireland and that the Government was determined to have a low-friction trade deal with the UK.
He said: “That’s why the backstop is so important.”
He said that there was a lot of diplomatic activity ongoing and that the backstop was something that the British government also wants.
“The backstop truly is an insurance policy,” said Mr Donohoe.
When asked about the possibility of a Cabinet reshuffle in the summer, Mr Donohoe said his “appetite, conviction and determination” to do the job well “only grows”.