Bertie Ahern (Dublin Central, Fianna Fail)

The work on employment contracts is 90% complete, but not on the overall deal. If people are reasonable on the other issues, we can reach agreement. There are some issues related to employment contracts on which employers have moved a long way, as have the relevant Departments and agencies. These are issues that involve the Department of Social and Family Affairs, the Revenue Commissioners and the CIF. People must be reasonable and must not look for the impossible from employers, who can go a long way but cannot do everything. We can get most of the problems resolved.

The pensions report has been published and it will take some years to resolve the issues surrounding annuities and so on. The Government is prepared to work on the issues. There may be difficulties with some employers, who have their own responsibilities. This refers mainly to private sector staff rather than staff in the publicservice.

Regarding inflation, we have seen recently the issues concerning energy. According to the EU harmonised index, our inflation rate is 2.7% compared with 2.4% for the EU as a whole, so we are not that far ahead. In so far as we can deal with issues that have proved in the past few yearsto bring down inflation, we have beensuccessful.

While issues arise on the non-pay side, there is no need to go into them. In all discussions, different pillars raise different issues. By and large, the issues pertaining to agriculture can be resolved as part of an overall deal based on the successful negotiations completed by the Government last December on the financial perspectives, which were finally ratified by the European Parliament last week. However, we must take account of other expenditure issues in the context of the Estimates and other demands. These issues cannot be taken in isolation but must be discussed within the process of considering the Estimates and other issues.

The biggest issue before us concerns pay. It would be wrong of me to breach the confidentiality of the talks but the lines between the positions of employers and unions are not meeting and, at present, they do not appear likely to meet. Things can be done and ways found to deal with it but that will depend on whether the sides are prepared to get agreement and win support on these issues and see it in their interest to do so, while at the same time sustaining the strength of the economy and continuing to increase employment. These issues must be taken into account. It is not just a question of fixing on a figure for a period of close to three years or for a shorter period. We must sustain the economy while also allowing it to continue to grow successfully rather than outprice ourselves, lose competitiveness and damage exports, which will ultimately affect investment and employment.

The scale always remains the same and I urge all sides, and employers and trade unions in particular, to consider this, as people have had to do in previous rounds, and to try to find a resolution. A huge amount of effort has gone into it and they should be careful about moving away from social partnership to a period of free collective bargaining in which there will be some winners but lots of losers and difficulties. If that happens, all the other issues raised by Deputy Kenny fall by the wayside because all six agreements have had the same basis that nothing is agreed until everything is agreed. All the work we successfully carried out would come to naught and very little would be implemented in the forthcoming period. Many of the issues which would improve rights and protections for workers, including the important issue I raised earlier pertaining to immigration, on which we have worked out a good, although not perfect, package, would fall by the wayside to the detriment of workers.

There is more in this world than pay issues and, certainly, there is no way that people can be underpaid based on what we see happening here and in other countries. I hope we can resolve these issues. I have no question about the effort, commitment and time given by the people on all sides who have worked on this but, ultimately, everyone must compromise to reach a deal. We need to do that very soon.

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