Ahern to seek inflation meeting with ICTU and IBEC

The Taoiseach is seeking a meeting with the Irish Congress of Trade Unions (ICTU) and business group IBEC to discuss inflation after the new Government is formed.

In a statement this afternoon, Bertie Ahern said we are now entering a challenging time for our economy, and measures to curb inflation must be discussed.

He said we must focus on restoring competitiveness and tackling inflationary pressures across all sectors.

The rate fell from 5.1% to 5% in May.

Turlough O'Sullivan, Ibec director general, warned it was critical not do anything that will add further to inflationary pressures.

"Government must keep firm control on the prices charged by the public sector for the services it delivers, while unions and employers must adhere strictly to the pay terms of Towards 2016," Mr O'Sullivan said.

"Working through the processes of social partnership represents the best way to tackle Ireland's inflation problem. Recent history has shown us that wages following inflation ultimately erodes the competitiveness of business and the living standards of individuals."

Meanwhile, Siptu president Jack O'Connor called for negotiations on a successor to Towards 2016 to be brought forward.

He said new talks were needed to protect living standards and job security by bringing in measures to help reduce the high rate of inflation.

"The implications for the next pay agreement cannot be long-fingered," the union leader warned.

Meanwhile, the Consumers’ Association has given the news that the annual rate of inflation dropped slightly a lukewarm welcome.

Michael Kilcoyne of the Consumer's Association said the Irish inflation rate is still more than double the European average.

“It's nothing to start cheering about,” he said. “In fact, it just shows that we're still so out of line that some drastic action needs to be taken”.