The president of the Institute of Certified Public Accountants in Ireland (CPA) yesterday expressed concern at the recent announcement by the Tβnaiste, Ms Harney, that she would revisit the Government's policy on migrant workers if the numbers on the live register start to rise.

Speaking at the conferring of CPA membership on newly qualified accountants, Ms Bernadette McGrory-Farrell said that such action would have a detrimental impact on the competitiveness of Irish firms by keeping the cost of labour artificially high.

"It is only a few short months since we were running national campaigns to entice Irish emigrants to return to work in Ireland, as well as encouraging Irish businesses to employ skilled and unskilled workers from eastern European countries. It is these workers who have kept Irish businesses operating when Irish workers couldn't be sourced. It would be a mistake to over-react now at the first sign of a slowdown," said Ms McGrory-Farrell.

"Rather than closing Ireland to foreign workers and keeping the price of labour high, consideration should be given to opening up the market further to foreign workers in order to maintain a more cost-efficient labour market."

Ms McGrory-Farrell said recent job losses were forcing a natural rebalancing of the State's "current stagnant and overpriced" employment market, which should help smaller companies in particular to regain a competitive edge.

But Small Firms' Association director Mr Pat Delany said the Tβnaiste was right in her assessment.

"The policy implications of not using available labour supply in Ireland that has been made redundant would be silly in the extreme and we should look to home first," he said.

"To suggest that foreign labour, by implication of the fact that it is foreign, is going to be cheaper is nonsense. Market forces have to apply. Anyone working in the Irish economy is entitled to the rate for the job."

IBEC's director of enterprise, Mr Brendan Butler, said his organisation would not support a position of bringing foreign people into the country to pay them less than Irish workers.

"If that's the argument, I would fundamentally disagree with it," said Mr Butler. "If what this lady is saying is that bringing in loads of people from abroad softens the market and people get paid less, I wouldn't support that. "

Mr Butler said the system of issuing work permits was already strict.

But he said the increase in the number of work permits granted this year indicated that some sectors and employers were still suffering from staff shortages. Any restrictions on migrant workers could push up wage costs for these employers, he added.