Lenihan: Costs and wages must be cut

FINANCE Minister Brian Lenihan warned yesterday the strength of the euro against sterling requires wage cuts and cost reductions if the economy is to grow out of its malaise.

“Our real problem is that we’re in a strong currency area and with the depreciation of sterling we have to take adjustments and reduce our wages and our costs... so that we remain competitive,” he told Reuters.

His sentiments were endorsed yesterday by employer bodies, but they condemned him for doing very little to tackle those issues that are having such an impact on Irish firms selling into Britain.