Bank in brass neck wage cut call

Speaking in response to the Central Bank Quarterly Bulletin, local Deputy Seán Crowe TD said that they had a brass neck calling for wage cuts considering their lack of oversight and nonchalant attitude contributed to the economic mess that the country is in. Crowe said that their solution would further depress consumer demand, contribute to further stagnation of the local economy and impact negatively on the potential for job creation.

Deputy Seán Crowe said:

“The Central Bank has some brass neck suggesting wage cuts in worker’s salaries considering their lack of oversight  and nonchalant attitude to regulation in the past.

It is simply wrong to suggest that further cuts to wages in the public and private sector will assist economic recovery. Their misguided claim that wage cuts will boost competitiveness and in turn assist recovery doesn’t stand up to scrutiny. Any such move would further depress consumer demand, contribute to further stagnation of the local economy and impact negatively on the potential for job creation.

“The domestic economy is in the doldrums and still clearly in recession. All Consumer indexes show that spending continues to fall. The only thing that further wage cuts will actually achieve is to further damage the domestic economy. Such a move would lead to more unemployment and act as yet another barrier to social and economic recovery.

“The Central Bank made this recommendation on the same day as they revised downwards their growth projections for 2012 from 0.7% to 0.5%. The primary reason for this decline is the lack of cash in consumer’s pockets and the government misguided policies of austerity.

“There is conceivably a cogent an argument for reductions in highly paid public sector workers and some extra taxes for very high earners, there is simply no justification for across the board wage cuts. This short-sighted approach would push more families into financial hardship, greater poverty and impact negatively on the local economy.”