Saturday 24 February 2018

Gilmore fury at suggestions to cut pay further in public sector

'New agenda' from former ECB board member Jurgen Stark making Government's job more difficult, Tanaiste says

Sarah Collins, in Brussels

Tanaiste Eamon Gilmore has hit back angrily at suggestions that public sector workers should be forced to take further pay cuts, pledging to honour the Croke Park agreement.

Mr Gilmore said remarks by the former ECB executive board member Jurgen Stark made the Government's job more difficult.

Germany's Mr Stark, who acted as the bank's chief economist, said in an interview that pay levels in the Irish civil service ranked with Greece's at the top of the EU table and should be "corrected".

"Individuals -- in this case an individual who has now resigned from the post -- inventing new agendas for where the Government should be going is not helpful, and I think frankly doesn't understand, or doesn't appear to understand, the connection there is between what we are doing to implement the programme and the commitments that we have domestically," Mr Gilmore told reporters in Brussels yesterday.

He said the troika of European Commission, ECB and IMF officials judged Ireland a "model" for the implementation of the bailout deal and had not asked the Government to do more.

"The troika have not asked us for the kinds of measures Mr Stark has suggested," he said in the fringes of a meeting of EU foreign ministers.

"We have an agreement, we have a programme with the troika, we're implementing it and we're going to continue to do that," he said. "We haven't been asked by the troika to go beyond it and we don't intend to go beyond it.

"People have to know where they stand," he went on. "We're honouring the Croke Park agreement, and we're going to honour it and we're going to work it," he said.


Mr Gilmore said the Government would also be sticking to its guns on privatisations, despite an IMF request that it consider raising €5bn through asset sales rather than the €2bn proposed.

"We have never agreed to €5bn," he said.

The EU had said that it expected Ireland to come in under target on the deficit this year -- at 10.2pc of GDP rather than the 10.6pc promised -- and to hit a target of 8.6pc next year, as long as the economy did not take a further nosedive.

In a report on public finances published yesterday, the European Commission said that while the Government's growth forecasts were "plausible", it was still at a high risk of failing to keep spending in check over the long term.

"Achieving sufficient primary surpluses over the medium term and further reforming the Irish social security system are necessary to improve the sustainability of public finances," the report says.

Commenting on the report, EU economics chief Olli Rehn prescribed more austerity for Europe's weaker economies, predicting that aggregate debt in the 27-member bloc would rise to 83pc of GDP by 2012 without extra cuts and tax rises.

Ireland's debt to GDP is predicted to reach around 118pc next year, twice the EU's 60pc limit. "In a period of high and still increasing debt levels in EU countries, ensuring the sustainability of public finances is a prerequisite for enduring economic growth and job creation," Mr Rehn said.

"Member states facing market pressures must continue to deliver on reaching their fiscal targets, and take additional measures if needed."

Irish Independent

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