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National Wage Agreement Cop-Out

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Minister Martin's reported willingness to consider opt-out clauses in future national wage agreements for exporting businesses is a bit rich coming from a minister who had more pay rises in recent years than most people in the private sector have had hot dinners.

This cop-out would allow the public and non-traded sectors which are immune to economic realities and real competitive pressures to continue to enjoy unsustainable pay increases. As a consequence our national competitiveness would be further reduced and with corporate tax rates within the EU likely to converge we would see an eastward flight of investment from Ireland. In these circumstances, the only solution may be to abandon the euro and revert to a floating Irish pound. This would improve competitiveness but at the expense of higher prices and interest rates.

The bottom line is that if national agreements are not suitable for the traded sector then they are inappropriate for everyone.

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This page contains a single entry by Brian published on April 29, 2007 5:17 PM.

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