Profitable companies should have the option of sharing profits with employees as an alternative to pay rises under any new pay deal, Fine Gael Enterprise Spokesman Leo Varadkar TD told a meeting of Young Fine Gael delegates at the Fine Gael Ard Fheis today (Saturday).

“Last September, IBEC and the unions negotiated an 18 month pay agreement for the private sector. Since then, the economy has slid into a deep recession, unemployment has soared, businesses are closing down and we have moved from inflation to deflation for the first time in a generation. This means the National Pay Deal was dead on arrival. IBEC’s weekend olive branch and the decision of the unions to call off Monday’s strike action presents the opportunity to agree a new pay deal. This opportunity must not be lost.

“To bring about recovery, the Government must stabilise the public finances by reducing borrowing, and restore competitiveness by bringing costs back into line with our competitors. Any new pay deal agreed by the social partners must honour these objectives and not avoid them.

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We gather today during difficult times for our nation. Since we last met in Wexford, less than five months ago, 100,000 people have lost their jobs. That’s roughly one person every two minutes. Unemployment in Ireland now stands at 11%, the third highest in western Europe. Twelve years ago, when this party left office, it was at 10% and falling. Every week, we welcomed the creation of 1,000 new jobs.

In little more than two and a half years, Fine Gael in government reduced unemployment by one third. And by rebuilding that economic model, we can do again.

This year, Ireland will borrow €18 billion just to pay our bills. We have the biggest Budget deficit in the eurozone and one of the biggest in the world. Economists, the ESRI and other learned institutions divide that deficit into structural and cyclical parts. A cyclical deficit of about €6 billion caused by the international financial crisis. And a structural deficit of about €14 billion that was created here at home.

Delegates, the structural deficit is the Fianna Fáil deficit, caused by a decade of mismanagement, profligate spending, waste and unsustainable tax policies.

In government in the 1990s, Fine Gael closed the last Fianna Fáil deficit and balanced the Budget for the first time in a generation. And by rebuilding our public services from the bottom and rebuilding our tax system from the top down, we can do it again.

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