A civil servant appointed on a salary €50,000 above a government-imposed pay cap has called for wage moderation in the public sector.
Stefan Gerlach, deputy head of the Central Bank, warns Ireland's high cost of living seriously restricts competitiveness. He says improving competitiveness is a precondition to returning to growth and slashing the debt burden.
The Swedish economist courted controversy when appointed in December 2011 when it was revealed that he was being paid €50,000 over the €200,000 salary cap.
Mr Gerlach told the Eurosystem Competitiveness Network Meeting in Dublin: "Wage moderation must occur in the public sector, not only to improve the budget balance, but because this can also influence wage costs in the private sector, and this has indirect competitiveness-improving effects."