The Minister for Defence has rejected claims that morale in the Defence Forces is extremely low and that there is a poor public perception of the military.
Mr Smith was reacting to findings of two surveys which were discussed yesterday at a conference of the Representative Association of Commissioned Officers (RACO) in Kildare.
RACO president Comdt Con McNamara criticised the Department of Defence and the Defence Forces for not budgeting for a public relations campaign to improve the forces' image.
"Young people in Ireland know little or nothing about the workings of the Defence Forces. Some are unaware we even have an Air Corps, according to the survey.
"The Department of Defence has no media campaign to recruit and the public relations office has no budget. This, coupled with the impact of the hearing claims issues and the disillusionment of serving personnel, paints a bleak picture."
Comdt McNamara said there was uncertainty "from one government to the next" about how the Defence Forces should evolve. RACO general secretary Comdt Brian O'Keeffe said the view that there was inadequate consultation about the change process went right through the ranks.
"Officers want to feel that their views are valued. These are military professionals. If their views are not being taken on board you can have the best plan in the world but it is going to fail. The view of the plan itself is that it is workable, but there is widespread criticism of the way the change process is being handled."
According to sources in RACO, around 90 per cent of the 1,260 officers surveyed said morale was poor or very poor. It is also understood to have found that 94 per cent of officers felt the process of consultation over the changes was inadequate, and a similar high percentage felt change was being imposed and they did not feel "partners in the process".
Commenting on the RACO suggestion that a decline in applications to join the Defence Forces was due to its poor public image, Mr Smith said: "In many sectors of our expanding economy, employers are reporting labour shortages. It would be naive in the extreme to expect that the Defence Forces could remain insulated from this.
"There is nothing remarkable in a decline in the level of applications for enlistment. On the contrary, it is frankly unfair to seize on what is obviously an attribute of a booming economy as a symptom of a shortcoming."
The Minister referred to the "huge burden" being shouldered by the taxpayer to cover the £200 million cost of compensation claims for hearing damage and the early retirement scheme for the Defence Forces.
"There have been no cutbacks whatever in the remainder of the Defence vote. In the real world, this deal is as good as it gets. I am surprised therefore that this enormous additional expenditure has apparently been taken completely for granted and almost denigrated by implication."
He said the pending claims by 10,000 serving and retired Defence Force members for compensation for alleged hearing damage "hangs over us like a sword of Damocles". He rejected the implication in the RACO survey that the implementation of the changes in the Defence Forces was being mishandled or without consultation with officers.
He said the implementation plan for the changes in the Defence Forces - reducing it in strength from 13,000 to 11,500 and changing the brigade structure - was "essentially sound".
The Chief-of-Staff, Lieut-Gen Gerry McMahon, rejected the suggestion that officers had been ignored or excluded. "The officers are the people working on the plan. Most officers in the Defence Forces are members of working groups working on this plan and its implementation."
He said there had been "messaging" on the electronic bulletin boards and seminars. He said RACO had refused to attend some seminars.