The Minister for Finance, Public Expenditure and Reform has ruled out the payment of an additional allowance to compensate public servants for working in Dublin.
There have been calls for the allowance to be paid due to the higher cost of living, including accommodation costs, in Dublin.
Paschal Donohoe was responding to queries at the Joint Oireachtas Committee on Finance, Public Expenditure and Reform.
Fianna Fáil Senator Gerry Horkan said that having chaired a school board for nine years, he was aware there was a crisis not just of staff recruitment but also of staff retention.
He cited a teacher who gets a job in Dublin, and then sees a job outside the capital where property prices are more affordable.
Mr Horkan said he was not suggesting a "London weighting" - an allowance sometimes paid to workers in London facing higher living costs - but said the difference between Dublin and rural areas had to be acknowledged.
However, Mr Donohoe said he would not be able to bring in an allowance based on where people work, as if it were introduced for teachers, it would have to be extended across the public service.
Fianna Fáil Spokesperson on Public Expenditure Dara Calleary asked how the Government could develop employees and organisations when there were people getting different pay rates for the same jobs.
He asked in what sectors the Government was having difficulties filling vacancies.
Mr Donohoe acknowledged the problem of differential pay rates for those recruited since 2011, particularly among teachers.
He added that there was a process under way between the teaching unions, the Department of Public Expenditure and Reform and the Department of Education to examine this issue.
However, he cautioned that you cannot move forward on the issues of pay rates in one part of the public service and not pretend that every other part of the public service will expect the same change to happen for them.
He said that while this issue was principally crystallised around teachers, any change to new entrants will be demanded by every other part of the public service.
Mr Donohoe described this as one of the challenges they would have to work through.
He said he did not have specific details of areas where there were difficulties in filling vacancies, but expressed the view that there was a bigger problem with retaining existing staff rather than with recruitment.
The Minister also said that local authority offices should be open late one night a week or at the weekend to facilitate not just the public, but also local authority members, who face difficulty with council meetings held during the day.