Labour shortages and a lack of affordable housing are seriously threatening the Republic's economic boom, according to the National Competitiveness Council. In its annual report, published yesterday, the council says the Government must move swiftly if it wants to underpin the boom.

The council was set up by the social partners under the last national wage agreement. Its role is to provide an input into Government policy in the area of competitiveness, primarily by benchmarking the competitiveness of the economy.

Mr Brian Patterson, the chief executive of Waterford Wedgwood in Britain and chairman of the council, says that "the actions required have been identified and broadly agreed. What we have to do now is undertake these actions swiftly and successfully". The most serious constraints on economic growth include skill and labour shortages. Inadequate transportation infrastructure and public transport are also identified by the council, along with the lack of affordable housing and gaps in the telecommunications infrastructure. Among the measures recommended to combat these problems are an easing of the labour and skill shortages by introducing an appropriate immigration policy, facilitating the return to work of the unemployed and encouraging female participation in the work force.

There should also be a significant investment in education and training to ensure lifelong learning and in-company training, says the council. These measures would have the additional advantage of maintaining the social partnership, which the council believes is central to the competitiveness of the enterprise sector.

The overall stance on fiscal policy (taxation and public expenditure) should support the control of inflation, says the council.

However, it stops short of supporting the recent call by the Irish Congress of Trade Unions for cuts in indirect taxes to bring down inflation.

It calls for the Government to set medium-term targets for widening the tax base to take in capital and property taxes. In the area of infrastructure, the council says it is important that the national development plan be implemented on time.

It backs the deregulation of public transport, which it argues will produce a better service and boost the numbers using public transport.

The shortage of affordable housing should be addressed as a matter of urgency, not least because it affects the mobility of the workforce, according to the report.

Remedial measures suggested by the council include additional staff and resources at planning bodies including An Bord Pleanala.

It encourages the use of public private partnerships to provide more serviced land and higher housing densities.

The issue of whether developers are hoarding serviced land should be examined, as should the possibility of the local authorities compulsorily purchasing land to ensure availability.

This issue is already being addressed in the third review of the housing market by Peter Bacon and Associates, which is being carried out for the Government.

The council believes the powers of Ms Etain Doyle, the telecommunications regulator, should be enhanced in order to ensure that Irish telecommunications costs are competitive. The report notes that local calls in Ireland are among the most expensive in Europe.