The Government wants to avoid industrial action over the stalled public-sector pay talks amid calls for unions to be "flexible".

SIPTU deputy general secretary John King has accused the Government of refusing to re-engage with the Workplace Relations Commission (WRC) to deal with the increasing cost of living.

Public sector pay talks between the Government and unions collapsed last month after the Government's offer of a 2.5% pay increase this year and next year was rejected. Unions claimed that this increase did not do enough in the face of ever-increasing inflation.

Mr King claimed that as far as the unions are concerned, the Government is still "reflecting" on their position and if no agreement is reached by August's end, unions will ballot for industrial action.

But Public Expenditure Minister Michael McGrath said yesterday that the Government is not refusing to re-enter negotiations, but there will need to be "movement from both parties" if an agreement is to be reached.

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"Both sides have to be flexible and stretch themselves as far as possible within certain parameters," he told RTÉ's Morning Ireland.

Mr McGrath said there are constraints on what can be offered and they will not be chasing inflation.

"We recognise that the living standards of public servants are under real pressure as they are of course for people on fixed incomes and private sector workers as well.

"That is why there is a willingness on the part of the Government to enter negotiations once again," he said.