Kenny urged to act on pay deal

Business and union leaders have urged Taoiseach Enda Kenny to "show leadership" and call together a national forum to hammer out pay and welfare deals as the economy recovers.

The move comes after Ministers said the Government would need to make a decision on whether to return to a system of social partnership as emergency legislation was repealed and talks begin next year on reversing some public sector pay and pensions cuts.

Ibec chief executive Danny McCoy warned he did not want to see a return to the sweeping partnership deals that dominated national life from the late 1980s to the crash, but a new forum was needed to aid economic stability.

The call was echoed by the Impact trade union, which insisted reversal of wage cuts should not have to wait until the Haddington Road Agreement expires in 2016. Mr McCoy said the Government had failed to show leadership over the past six months and now needed to move in order to secure the recovery.

“The economy is growing a lot faster, showing more stretch, so I think there will be pressure for reversal of Haddington Road prior to 2016,” Mr McCoy told Newstalk.

A spokesperson for Impact said talks reversing pay cuts should begin sooner.

“Having said that, we are not hung up on it as it is possible to have a negotiation with either an individual company or the public service without having an old-style, social partnership,” the spokesperson said.

Mr McCoy said some 25% of private firms had cut wages in the crash, while most others cut overtime and bonuses. Mr McCoy said half of Ibec members were now raising salaries as the economic situation began to turn around.

The Ibec chief called on the Government to use the October Budget to alter the tax system so that people kept more pay in their pockets. He also called for the universal social charge to be absorbed back into income tax.