The Minister for Public Expenditure and Reform has said the economy is growing because Fine Gael was able to get the public finances under control and repeated that the Lansdowne Road agreement is "the only game in town".

Paschal Donohoe, the former transport minister, took over the Department of Public Expenditure and Reform from Labour's Brendan Howlin, in the formation of the coalition government.

Speaking on RTÉ's Today with Sean O'Rourke on Thursday, he said there was no flexibility on the amounts involved in the Lansdowne Road agreement.

“It is € 844m over three years, these are significant contributions. It has to be viewed in the context that we have other needs that have to be met.”

He said the Lansdowne Road agreement “is the only game in town for how we reconcile the needs of our country for additional services with the need to fairly reward people who pay for them.”

He said he acknowledged “the huge contribution” of public servants to the recovery that is underway.

“Civil and public servants in 2014 worked over 260,000 more days than they did in the previous year, the wage bill went down 20 per cent, and the number of people in public service went down ten per cent.

“But I’m not just responsible for the wages that people are paid. I’m also responsible for the services our country needs. I’m responsible, through and with Ministers Coveney and Harris, for how we respond to the challenges we have in our health service, housing, all of which need to be funded too.”

Mr Donohoe said the Government is making its way through the first year of a three year agreement and that the vast majority of unions, and many, if not most civil and public servants, have voted to be part of the agreement.

“I will continue to engage with representatives of unions, but all of it has to be inside the framework that while we do have an economy that is now growing again - it is growing because one of the things we have been able to do was get public finances under control and we have to continue to do that.”

Later on the Pat Kenny Show on Newstalk, he said he had not sought the portfolio and that he felt his background in business and economics and experience as transport minister would all help him considerably in his new role.