Public service workers must increase their productivity sharply if they are to get nearly €1 billion in extra pay under the benchmarking deal, the Taoiseach, Mr Ahern, said.
"In the current economic climate, the payment of the benchmarking awards poses a challenge for the credibility of social partnership," he said in Dublin Castle.
Addressing a plenary meeting of the social partners, Mr Ahern said public spending and public service job numbers have grown "by unprecedented amounts" in recent years.
"There is also a strong and widely held perception that this increased expenditure has not been translated into sufficient improvements in the quality and level of services.
"This must be a cause of concern for all stakeholders in Irish society but especially for those who are committed, as I am, to the public service tradition and ethos," said Mr Ahern.
However, the meeting was dominated by union anger at Government plans to reform CIÉ and Aer Rianta, recent job losses, and employers' fears about rising costs.
Mr Ahern said: "While the Government is committed to further public investment over time and as resources allow, the reality is that the answer does not just lie in increased expenditure.
"Progress also depends on increased productivity in the public service. This requires changes in how services are delivered, and how public service organisations are structured.
The Minister for Finance, Mr McCreevy, said the Government is committed to paying the benchmarking bill "but that commitment is not unconditional".
"It will meet the bill on the basis of the conditions set down in the agreement - that is, no industrial action and the achievement of real change which will improve services.
"There can be no rolling back on any of these commitments and there will be no renegotiation of them," he said.
Warning that December's budget will be unpalatable, Mr McCreevy said: "We must deal with the situation as it is, not as we would like it to be."
The Government's 2003 budget had been based upon the belief that the international economy would enjoy an improvement in the second half of the year.
"This has not, so far, shown up, so economic prospects for 2003 and 2004 are being revised downwards by most commentators," said the Minister.
The stronger euro is causing problems for exporters, and will cause more. "Unless we can price increases down to EU levels with the least possible delay we will lose jobs and growth." Public spending was budgeted to rise by 7 per cent this year, he said. "And I am determined that the budget will not be exceeded."
Public sector workers will only get the outstanding parts of the benchmarking deal if they concede extra productivity that can be clearly gauged by independent verification.