IBEC propose ten-point plan to cut inflation

IBEC is proposing a ten-point plan to cut inflation, which is currently running at two and a half times the EU average.

The Employer’s body says the plan should be co-ordinated through the Taoiseach, the Minister for Finance and Enterprise over the next two years. IBEC’s Director of Economic Affairs, Brian Geoghan, says there are a number of things that can be done straight away.

"Government should immediately set an inflation target of 2% and should act in an co-ordinated way to achieve that. Unions should begin to think with that target through which pay be negotiated.

"If we do not do that we will find ourselves in a wage price spiral with wages and prices overtaking each other. Competition needs to be strengthened."

Government Ministers have been given a deadline of Friday to come up with cuts of a further €100m in public spending. Ministers have been warned that cuts will be imposed on their Departments unless they find more savings before they rise for the summer recess.

The move is seen as a determined attempt by the Finance Minister Charlie McCreevy to show a budget surplus by the end of the year.