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Ireland recovery talks collapse Irish talks on 2m euro cuts fail
(about 2 hours later)
Talks on a national economic recovery plan for the Republic of Ireland collapsed early on Tuesday morning. Talks between the Irish government, unions and employers aimed at cutting 2m euro from public spending collapsed early on Tuesday morning.
Deputy Prime Minister Mary Coughlan told Irish broadcaster RTE 2bn euro of cuts would still have to be made. The Irish coalition cabinet is due to meet later to finalise their cutback plans.
She said it was unfortunate the government, unions and employers had been "unable to bring the matter to finality". Taoiseach Brian Cowen said he regretted not reaching agreement with the unions on cutting the public sector pay bill.
However, she added that it did not represent the end of social partnership. The unions believe proposed savings on pensions could disproportionately affect those on middle incomes.
Irish Prime Minister Brian Cowen said he regretted that it was not possible for unions to agree proposals for the reduction in the public service pay roll at the talks. The Irish government must find a further 4bn euro in savings next year.
Mr Cowen said he was grateful for the quality and the sincerity of the engagement that took place. Mr Cowen is anxious to persuade international bond markets that Ireland should retain its triple A rating and that the government is dealing with the country's financial crisis.
He said the government would consider the position later on Tuesday and would take the "necessary decisions" over fiscal adjustments.