The Taoiseach, Brian Cowen, has said the CSO statistics on public sector pay published today do not present a correct comparison to what is actually happening.

He said they do not take into account the public service pay levy, which averages 7.5% across the public sector, or the fact that we are seeing a reduction in public service numbers of up to 3,500 people.

Mr Cowen said the Government reserved the right to take the urgent decisions that were necessary to return the nations finances to their correct position.

The Taoiseach said there will be intense discussions with the public servants unions but he already has indicated that he would be looking for reductions in the pay and pensions bill and the Government will also be looking at the social welfare area.

Figures from the CSO show gross average weekly earnings in the public sector rose by 3.2% in the year to June.

The figures also show, for the first time, an annual decrease of 3,300 in the numbers employed in the public sector.

Today's figures are for gross earnings and do not account for the impact of the pension levy or income levy.

They show average earnings in the public sector, excluding health, rose by 3.2% in the year to June.

One finding showed that gardaí's earnings - when overtime was included - actually fell by 3.1% over the year.

Another finding showed that after a long period of expansion, the numbers employed in the public sector, excluding health, fell by 3,300 over the year

While it remains the subject of intense debate, it is difficult to draw comparisons with earnings in the private sector.

The latest figures there, which date from April, show earnings falling by 11.1% in the financial sector but increasing by 6.1% in manufacturing.