Public Expenditure Minister Michael McGrath has voiced his support for a shorter-term public sector pay deal amid concerns from unions.

The current pay deal is set to expire at the end of the year but unions have moved to initiate a review clause in the agreement over the rising cost of living.

Mr McGrath said he does not believe a three-year pay deal would be "appropriate" given the inflationary situation.

"It would appear to me at this remove that a shorter-term agreement may have more merit at this time given the level of uncertainty that is there," he said.

He said he will bring a memo to Cabinet in the next fortnight to set out the Government's position before discussing new pay deals with public sector unions.

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However, Mr McGrath said a change to the pay deal will not be enough to combat rising costs on its own, as he cited the measures announced by the Government in recent weeks to mitigate inflation.