Social partners no closer to re-engaging on recovery plan

TRADE UNIONS and employers have said that they are no closer to re-engaging with the Government on negotiations for an economic recovery plan.

Unions and employers were given a briefing on the state of the economy by officials in the Department of Finance yesterday.

The move represented the first formal contact between the Government and the trade unions since the collapse of talks on an economic recovery programme a month ago over the proposals for the controversial pension levy.

However, Government sources described the briefing as an information meeting and maintained that it did not signal a formal re-engagement in talks.

Sources who attended the meeting said officials told the social partners the Government faced having to make cuts of €2.5 – €3 billion this year over and above the €2 billion which had been envisaged at the time of the recent talks in January.

Sources said the officials had forecast that there would be a reduction of 4 per cent in GDP this year and a further fall of just under 1 per cent next year.

They said that the Department of Finance had predicted increases of low single digits in subsequent years. However, sources cautioned that the Government figures had been drawn up over one month ago.

The director general of employers’ body Ibec, Turlough O’Sullivan, said last night that there were no indications of a resumption in talks between the Government and the social partners on an agreed economic recovery programme.

Trade union sources also maintained that while informal contacts between the parties were continuing that there were no immediate prospects of talks recommencing.

The Irish Congress of Trade Unions said that there was a need to build a broad consensus approach for tackling the economic difficulties facing the country.

Mr O’Sullivan said that Ibec would be making a submission to the Government in the weeks ahead on the new budget to be delivered in early April.

This is expected to include controversial proposals such as the introduction of means tests for welfare benefits.

It is expected to argue that the country cannot afford universality.

Ibec is also expected to call for the abolition of the Seanad and a reduction in the number of Ministers of State.