TAX INCREASES will have to be implemented to cure our current economic difficulties, the finance minister Brian Lenihan told the ardfheis yesterday.

"Tax increases have to be part of the solution... But there can be no return to the bad old days of 64% tax rates," said Lenihan.

"There is much ill-informed comment about taxation. We constantly hear that somebody else should pay. We all have to pay."

Lenihan predicted that even though Ireland was the first country into recession, he hopes we can be the first country out of it.

He also warned: "we Irish are natural sceptics. We tend to wallow in our ills and beat ourselves up", and reminded us that we should take solace from Jean Claude Trichet's acknowledgement last week that Ireland has the capacity to work its way out of the acute downturn.

"Sean Lemass along with Ken Whitaker rescued the country from the abyss in the late '50s, Ray McSharry did it in the late '80s. Now, we must measure up to our responsibilities. Our determination must be to do what is right for the country," said Lenihan.

Defence minister Willie O'Dea recalled previous árdfheiseanna when he poked fun and ridiculed the opposition parties. Not this year.

"While they remain the policy-free entities they have been for the past decade, there has been enough negativity and petty politic bickering," said O'Dea.

He suggested that we should all move away from negative comment and work together towards economic recovery.

Back from a visit to members of the defence forces in Chad last week, O'Dea complimented the Irish troops and said: "The pride they take in the work they do and in the fact that they do it under an Irish flag is an uplifting antidote to the cynicism and pessimism we sometimes hear back at home."

Education minister Batt O'Keefe, stressed: "Our future Irish competitive strength will depend on our ability to foster a culture of ideas and innovation and in our capacity to translate these into high value jobs." However, he warned:"Education cannot be looked at in isolation from the economic realities facing this country."

Tánaiste Mary Coughlan stressed the importance of job creation as the bottom line for economic recovery and said her department is working on a range of measures to halt the jobs crisis.