LABOUR leader Eamon Gilmore proposed a third rate of income tax for high earners and claimed Ireland can by brought back from the "edge of the economic cliff".

Addressing delegates at his party conference in Mullingar last night, Gilmore said: "We Irish are resilient and creative and we will not be defeated by the mistakes of the past or the greed of the few. The economy that Ruairí Quinn handed on was thriving and competitive, and it can be again."

He claimed that Labour has a plan to deal with the crisis and: "The first thing we need is a sense of national direction."

The most popular political leader in Ireland aligned himself with Barack Obama and said: "We need new progressive political leadership, which I hope is now coming from the Democrats in the United States, which will come from Labour in Ireland and from our sister parties in Europe."

He concurred with the government and said: "Difficult decisions will have to be taken on taxation and spending." But he added: "The public finances can only be restored to order by getting people back to work."

Job creation is a key tenet of Labour's economic recovery plan and he proposed a Graduate Work Placement Scheme and said employers' PRSI should be cut for at least 18 months, where a new job is created and filled by someone who has been unemployed.

He said the party recognised that taxes had to increase and would publish our pre-budget statement next week, and "our tax proposals will include a third rate of income tax for the highest earners".

He attacked Fianna Fáil for the way they "have nurtured the culture of crony capitalism which has now sunk the hopes and aspirations of a generation.

"The fifth of June is important because it gives every adult in this country an opportunity to make a statement which is stronger and louder than any protest. An opportunity not just to vote in protest against a bad government, but to call for a fresh start and a new future by voting for the Labour Party."