Ahern demands wages be kept low

BOSSES and workers should keep prices and wages down to maintain the nation’s competitiveness, Taoiseach Bertie Ahern demanded yesterday.

In a speech to the American Chamber of Commerce in Ireland Mr Ahern fired a shot across the bows of the social partners as they continue their negotiations on a new national pay deal.

“Ireland is one of the world’s great trading nations. Our external competitiveness is a critical factor in determining our economic potential,” he said.

“Given the volatility we have seen on the foreign exchanges over the past few years, it is vital that we do everything within our power to protect and enhance our competitive nature.

“That involves defending and underpinning our corporate tax regime through budgetary common sense. It also requires restraint in the setting of prices and wages.

“Wage and consumer price inflation rates moderated from excessive levels in the past two years. We must now work to ensure that they remain at levels which do not undermine our ability to earn a large part of our national income from the outside world,” he said.

Mr Ahern said Ireland’s growth looks set to exceed levels which would previously have been regarded as optimistic.

“That said, we are not going to see a return to the hectic pace of activity which characterised the late 1990s and opening years of the new millennium. As a consequence, we must keep this changed growth profile in mind when making demands for higher Government expenditure, more tax cuts or higher wages.

“In this context, social partnership is critical. Nobody who has given any serious consideration to the drivers of Ireland’s economic transformation can do anything but believe in partnership.

“It is incumbent on all of the social partners to recognise that its success has always involved engagement and compromise. At its core, it has always been about the subsuming of sectional positions in the national interest. I look forward to it continuing to contribute to Ireland’s success over the coming years.”

Earlier in the day Mr Ahern officially opened Intel’s Fab 24 Plant in Leixlip, Co Kildare, where he said the importance of Intel’s investment, both to Leixlip and to Ireland as a whole, cannot be overstated.

“Overall, the Intel impact is currently valued at over €400 million a year to the Irish economy. It has created a demand for world-class infrastructure and services; it has spurred a surge in technology learning and innovation; and it has acted as a catalyst for other high-tech investment in Ireland,” said Mr Ahern.