The Irish Congress of Trade Unions (ICTU) has welcomed the measures to curb house prices contained in the Government's action programme. However its housing spokesman, Mr Fergus Whelan, said more radical measures are needed.

The general secretary of the Civil and Public Service Union (CPSU), Mr Blair Horan, said yesterday the Government had recognised for the first time "that supply in itself will not resolve the housing problem".

Responding yesterday to the programme, Mr Horan, who represents more than 10,000 low-paid clerical civil servants, said that more "demand-side measures to help lower to middle income groups and curb speculation are necessary".

He also warned the Government not to become complacent about house price trends in the first quarter of this year. At between 13 per cent and 17.4 per cent, they were still far ahead of average wage growth of 5 per cent.

He particularly welcomed proposals to exempt first-time buyers from stamp duty and to increase them for investors. This was something the CPSU and SIPTU advocated in a joint report on housing in 1998.

Mr Horan said house-buyers needed additional help through mortgage repayment subsidies and fixed-interest loans.

At the same time, excessive profiteering from land and house building should be curbed by a "windfall profits tax", the reintroduction of certificates of reasonable value and compulsory purchase.

Elsewhere, the Consumers' Association of Ireland (CAI) said the Government's moves were a "small, uncoordinated step in the right direction".

The CAI said that at last the Government had recognised the role land speculation had played in the current housing crisis.