Ireland can’t afford national pay deal, says Kenny

Fine Gael leader Enda Kenny tonight called for the national pay deal to be scrapped claiming the country cannot afford it.

And in a stinging attack on the coalition Government, the Mayo TD told his party’s national conference in Wexford that the Fianna Fáil-Green led partnership was stale, arrogant and contemptuous.

In an attempt to build on Fine Gael’s strong opinion poll showing last week, Mr Kenny detailed a series of radical actions his party would take if put in power.

“The country cannot afford the national pay deal. It is as simple as that,” he told delegates.

Mr Kenny said the deal, which provides for a pay increase of 6% over 21 months, should be put on hold for a year.

“It was negotiated in a different context with different expectations,” he said.

“Wage restraint in the short term is preferable to job losses in the long term.”

With the country’s financial system virtually frozen by the credit crunch, Mr Kenny insisted Fine Gael would act immediately to pump money into the banks.

He said foreign venture capitalists should not be allowed to step in front of the Government and take shares in the country’s biggest banks.

“Fine Gael would not be paralysed by this current banking crisis. We would re-capitalise banks now,” the Fine Gael leader said.

“The Government should take preference shares in Irish banks so the taxpayer gets a dividend from the investment, not foreign investors.

“Once that’s done, they must be told that neither they, nor their regulators, will walk away unscathed from this.

“Our nation has been damaged by their reckless behaviour. They must be held accountable. Under Fine Gael, they will be held accountable.”

Top officials from the country’s six biggest banks held talks with Finance Minister Brian Lenihan last week as they examine options to revive the sector. They will meet again next Friday.

Earlier, deputy Leader and finance spokesman Richard Bruton called for massive reform across the public service to drive economic recovery.

“Every unit that gets public money should make itself publicly accountable for its targets and its plans to those who avail of them,” Mr Bruton said.

Fine Gael also set out a series of other reforms including a mandatory 25-year sentence for murder; investment in renewable energy; investing savings from a frozen pay deal in key infrastructure; and health care reform based on need, not ability to pay.