COMPETITIVENESS WILL be key to Ireland weathering the economic crisis, Dr TK Whitaker, author of a seminal 1958 report on the Irish economy, said yesterday.

"I think the crucial thing is to keep competitiveness and, if we manage to remain competitive, we'll get through because demand will restore itself in good time," he said, adding that the State's competitiveness could be destroyed if there is too high an increase in incomes because of the rise in the cost of living.

"This is something inevitable that the community as a whole has to bear," he said.

Ahead of Minister for Finance Brian Lenihan's assurance that Irish banks remained stable, Dr Whitaker remarked that he did not deem such a declaration essential. "That's the sort of assurance you shouldn't give until it's absolutely necessary," he said.

On future economic expansion, Dr Whitaker said the way to achieve this was to concentrate on higher value-added activities.

"It is only if we are educated, skilled and enterprising enough to produce goods and services commanding a high margin of gross profit or 'added value' that we can expect high and rising living standards," he said.

Dr Whitaker was speaking at an economic conference held to celebrate the 50th anniversary of his Programme for Economic Expansionpolicy document, which is credited with paving the way for Ireland's current economic model and for encouraging the move away from protectionism towards free trade.

At the event, Mr Lenihan paid tribute to the document, saying it "set us on the path to becoming the successful, sophisticated economy we are today" and that the report "remains highly relevant as a vision for our future".

In his presentation, Dr Whitaker recalled how he welcomed working on the report during his tenure as secretary of the Department of Finance, as it was an escape from the pessimism, or "inverted Micawberism", usually associated with the department. He also revealed that the reason the document was called a programme, rather than a plan, was because of "fear and distrust of the Russian type of planned economy" at the time.

Of the Republic's initial failure to be accepted into the European Economic Community in 1961, and its eventual accession in 1972, Dr Whitaker said: "In retrospect, it can be said that [Charles] de Gaulle did us a good turn in blocking our entry until we were much better prepared for membership."