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Wednesday 27 August 2014

Public-sector pay deals were Bertie's biggest flaw, says Micheal Martin

Fiach Kelly Political Correspondent

Published 27/09/2013 | 12:14

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Former Taoiseach Bertie Ahern
RTE's Sean O'Rourke with Micheal Martin
RTE's Sean O'Rourke with Micheal Martin

FORMER Taoiseach Bertie Ahern’s “greatest mistake” was his “unquestioning faith” in the social partnership process of pay deals, according to Fianna Fail leader Micheal Martin.

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But Mr Martin said “as a leader of government and cabinet” Mr Ahern “achieved a lot”, adding the Good Friday Agreement was his greatest achievement.

Mr Martin said there wouldn’t be a peace deal if it wasn’t for Mr Ahern’s “zeal” and many more people would have died without his efforts.

The Fianna Fail leader also defended the controversial blanket bank guarantee as the “least worst option” available to stop a banking collapse.

But in an interview on RTE Radio’s ‘Today with Sean O’Rourke’ he was pressed on Mr Ahern’s record in power.

And Mr Martin said of his former leader’s faith in social partnership: “It was fine in ‘87, the model was never adjusted.”

Mr Ahern was one of the architects of the social partnership process, and negotiated the first deal as Minister for Labour in 1987.

The pay agreements which fixed wage levels have been criticised since the crash, particularly the process of benchmarking.

Benchmarking was meant to link private and public sector wages, but was compared to an ATM for public sector workers.

The public sector wanted to be paid the same as the private sector, but without the same terms and conditions, while retaining their job security and pension entitlements.

Mr Martin claimed this was his main concern, and said he “would never have been an advocate for the massive tax reductions that happened”.

He also said there was a view before the crash “there would be this soft landing which never materialised”.

Mr Martin was in Cabinet when the bank guarantee was introduced five years ago, and said it has since been proved that allowing banks fail and burning bondholders will not be entertained by the European Central Bank (ECB).

“The ECB post-Lehmans were not supporting (letting banks fail) or any bondholders being burned.”

He also said the banking inquiry may throw up some more new details.

“We may learn something. I suspect, in terms of the banking issue, we will learn a lot.”

Mr Martin said he would have “major problems” going into power with Sinn Fein, while not ruling it out, and added the civil war split between Fianna Fail and Fine Gael is long gone.

However, he did not comment on any possible coalitions Fianna Fail could enter after the next general election, saying his party is not in that space at the moment.

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