Marcella Corcoran Kennedy (Laois-Offaly, Fine Gael)
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I welcome the Minister of State at the Department of Jobs, Enterprise and Innovation, Deputy Nash, and his officials. The Minister of State is here to brief the committee in advance of his attendance at the Employment, Social Policy, Health and Consumer Affairs Council , EPSCO, meeting on 16 October next. The briefing supplied has been circulated to members. I invite the Minister of State to address the committee.

Gerald Nash (Louth, Labour)
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I thank the Chair for her very kind welcome. I also thank her and the members for inviting me to appear before the committee. This is the first occasion on which I have had the opportunity to address them. I look forward to this and all of our subsequent engagements.

I am here to discuss the agenda of the forthcoming EPSCO Council of Ministers meeting in Luxembourg on 16 October. This is the first formal meeting of the Council to take place under the Italian Presidency. The next one will be held in December. The outgoing Commission will be represented at the Council meeting by Laszlo Andor, European Commissioner for Employment, Social Affairs and Inclusion. As members will be aware, this is a time of transition. The new Legislature is only commencing its work and the incoming Commission college will not take up office until November.

I understand the committee has already received a background note on the draft agenda for the Council meeting. I should point out that the actual agenda for the Council meeting has not yet been finalised. We are awaiting the outcome of the next meeting of the permanent representatives in COREPER I on 10 October as it will only be then that the Presidency's plans for the agenda can be finally confirmed. It is likely, however, that the main items on this EPSCO Council agenda will be twofold, namely the proposal establishing a European platform to enhance co-operation in the prevention and deterrence of undeclared work; and the conduct of policy debate on the outlook for the forthcoming mid-term review of the Europe 2020 strategy, including an evaluation of the European semester. The Italian Presidency had also planned to include another item on the Council's agenda, that is, a Commission proposal for a directive setting specific rules on working time for the inland waterway transport sector. That proposal is based on an agreement which was reached in February 2012 by main social partner interests in the sector, namely, the European Barge Union and the European Skippers Organisation, representing the employers' side, and the European Transport Workers' Federation. Following the most recent discussion of this proposal at Council working group level on Friday last, it appears that the Italian Presidency has accepted that it would be premature to bring it forward in its current form.

Reservations raised by Ireland are now shared in different respects by up to nine other member states. Consequently, we expect this item will be withdrawn from the agenda for next week's meeting.

I welcome any move by the Italian Presidency to allow sufficient time for the necessary consideration of the issues raised by a significant number of member states, notably those which are not considered to be covered by the European inland waterway transport system or which involve significant levels of cross-border inland waterways transport activity. Clarification of a number of issues relating to the scope and application of the proposals should be pursued directly by the Commission on behalf of the Council working group through dialogue within the EU sectoral social partner organisations or with those organisations, which signed the agreement in 2012. That was the procedure used four years ago when the Council wished to get clarification about the intentions of the parties to the EU social partner agreement on the prevention of "sharps" injuries in the hospital health care sector, and we would like to see that approach being taken in this instance. I understand the committee initially considered that this proposal might not warrant further scrutiny but I invite it to examine further the evolving character of the discussion on this proposal, which we view as inappropriate for the circumstances of Ireland's inland waterways. I would be happy to facilitate a full exchange of information between the committee and officials from my Department, as well as the Department of Transport, Tourism and Sport, on all the issues involved. It would help us to tease out the matter in a more complete fashion as it relates to Ireland.

With regard to the first item on the Council agenda, Ireland supports the proposal concerning co-operation in the prevention and deterrence of undeclared work. I understand the committee reviewed this proposal at a meeting with officials from my Department on 27 May this year. As members are aware, the Irish Government is looking forward to the adoption of the proposal, as a platform can open opportunities for transitional exchanges of information and mutual learning between enforcement authorities throughout the European Union. The National Employment Rights Authority, NERA, is the most appropriate body to discharge the role of the single point of contact in the Irish context, and it will represent the enforcement authorities in this State on the platform in a co-ordinated manner. It will also disseminate information on its activities. The Council is likely to endorse a general approach on this proposal, which essentially means the Council has confirmed its stance while awaiting confirmation of the European Parliament's position on the proposal.

The second important item will be a preliminary policy debate, instigated by the Italian Presidency, which has asked employment Ministers to consider the forthcoming mid-term review of the Europe 2020 strategy from an employment and social policy perspective. I very much welcome this opportunity, as we enter the recovery stage after the worst global financial crisis the EU has ever faced, to highlight how the current EU strategy and its governance continues to emphasise fiscal consolidation and economic reform at the expense of supporting effective demand through appropriate macroeconomic policies at the level of the Union of the eurozone.

The new Commission President, Mr. Jean-Claude Juncker, has indicated that the European Semester should be the vehicle for pursuing the modernisation of labour markets and social protection systems, including a view to progressing towards the targets set out in the Europe 2020 strategy in the fields of employment and social inclusion. In line with the Government's consistent approach to promoting the social dimension of the economic and monetary union, EMU, I will urge my fellow employment Ministers to use the mid-term review of the Europe 2020 strategy as a means of securing greater coherence between fiscal, economic and social policies at the EU level. Members can buy into that approach, as it is of interest to them.

I look forward to working with the Commissioner-designate, Ms Marianne Thyssen, who has been nominated to the portfolio of employment, social affairs, skills and labour mobility, with the restructured portfolios proposed by the incoming Commission President. She will be in charge of the employment and social aspects of the European Semester, promoting labour market reforms and helping co-ordinate employment policies of member states and strengthening the EU's social market economy. She can also be expected to work closely with the new Vice President for the euro and social dialogue in order to streamline and reinforce the European Semester of economic policy co-ordination. I am pleased the director general of employment and social affairs has been strengthened as part of a better balanced and workable division of responsibilities. This should greatly assist the new Commissioner in contributing to the jobs, growth and investment package to be steered and co-ordinated by the new Vice President for jobs, growth, investment and competitiveness.

I thank the committee for its attention.

I am happy to respond to questions or observations members of the committee may have about EPSCO and its agenda.

Marcella Corcoran Kennedy (Laois-Offaly, Fine Gael)
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I congratulate the Minister of State in his new role in the Department. I understand this is the first opportunity he has had to address the committee. He is most welcome. We look forward to engaging with him at length on other matters.

Peadar Tóibín (Meath West, Sinn Fein)
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Cuirim fáilte mhór roimh an Aire agus guím gach rath air. Tá súil agam go n-éireoidh leis san obair chrua atá roimhe. I wish the Minister of State the very best of luck. I know that he will take a special interest in the issues we will discuss during the meeting.
Undeclared work is a major issue. I understand that in the European Union it is estimated that 18% of the work carried out is undeclared, which leads to a lot of difficulties for many sectors within society. We talk about these issues, but enforcement is a significant issue across the entire sphere of workers' rights and experiences. The best intentions and the best legislation in the world will not be worth anything to those at the coalface unless they are properly enforced and there is an adequate system which works.
Employment and social policy is very interesting for a number of reasons. The Minister of State has articulated a view in his statement that does not seem to be too far from mine. The fiscal austerity path taken by the European Union in the past few years has no doubt frozen the growth prospects of the Union and, therefore, made it much more difficult to create employment. The euro area has an unemployment level of 11.5%, while across the 28 member states it is 10.1%. If one is outside the European Union one has a better chance of tackling the employment problem, probably owing to the fiscal measures one could employ. It is very important that we ensure the decision makers within Europe focus on altering the Union's disastrous policy.
I still have major concerns about the youth guarantee and the level of youth unemployment. I know that efforts have been made by the Minister of State's colleagues in government to try to focus on this issue, but these efforts have been short on ambition and resources. There are still incredible levels of youth unemployment in this and all member states on the periphery. There is a significant difference between the youth unemployment level in Germany and that in Greece and Spain where it is 51% and 53%, respectively. I encourage the Minister of State to inject a level of ambition into European policy as it affects member states on the periphery.
The issue of a stimulus, while discussed ad nauseamfor the past three years, has not yet been dealt with properly from a European and Irish perspective. It is still necessary to tackle the issue of employment creation. While the employment figures have improved in the past while, only 5,000 new jobs were created in the first six months of the year, which is paltry considering the pressure we are under. Some 40,000 new jobs have been created since the Government came to power, a figure which is dwarfed by the level of emigration.
With regard to social policy, what will the Minister of State bring to the table on a minimum or living wage? He has made some statements to the effect that he would like to see the minimum wage improved in the next few years. Since this is his first meeting with the committee, it might be useful for him to articulate his plans on the timescale for the low pay commission. I would like to have some understanding of it, as well as the position on zero hour contracts.

With regard to the working poor, the OECD report indicating that Ireland has the second largest portion of working poor after the United States, while shocking, was expected by many of us at another level. The Minister of State might give his views on that as well.

Gerald Nash (Louth, Labour)
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I thank Deputy Tóibín. I will try to respond to the points he made in sequence. I am pleased that he has recognised the problems associated with undeclared work. It is a European-wide problem and an important issue in terms of our enforcement agencies. We can make some progress at EU level through mutual learning and sharing of experiences, and the responsible bodies must work together on a cross-border, informal basis to share experiences and develop common work practices to ensure everyone is on the same page in terms of protecting some of the most vulnerable workers in our society, not just in Ireland but across the European Union. The enforcement aspect will be extremely important, and from Ireland's point of view the single point of contact will be the National Employment Rights Authority, NERA, which is considered by the European Commission to be one of the exemplars in terms of enforcement of employment legislation and regulations across the European Union.

The Deputy mentioned fiscal consolidation. The purpose of the mid-term review of Europe 2020 is to try to refocus the European Union on the jobs and growth agenda. It is timely that the Italian Presidency has decided to take that initiative, which will be very much supported by the Irish Government and Ireland in general. The Deputy will be aware that part of Prime Minister Renzi's agenda is to try to have a renewed focus on the jobs area and to ensure that while structural economic reforms remain to be achieved at European Union level, we must focus on the social Europe, the Europe that the Deputy and I understand and would like to see. There are opportunities in that regard, and the Europe 2020 mid-term review provides opportunities for a refocusing of the agenda over the coming period.

The Deputy will be aware that the Tánaiste and Minister for Social Protection, Deputy Joan Burton, essentially championed the youth guarantee proposition during Ireland's Presidency of the European Union. That is an idea the European Commission, the Council and so on found very attractive and has set up on an institutional basis. It is important that is properly resourced to ensure that we address the issues the Deputy referred to regarding youth unemployment, and that we make sure young people have the type of opportunities to which both he and I would agree they are entitled to achieve their ambitions. We need to facilitate that. We have unacceptably high levels of youth unemployment in the European Union and we want to address that.

I am glad the Deputy raised the issue of the low pay commission as it is an issue for which I will have responsibility. It is my intention to establish the low pay commission in the first instance on an administrative basis to make sure that we get it up and running in a short period of time. It is important that it is properly resourced; we will enable it to be properly resourced. I want to establish it on an interim administrative basis and then run, in parallel with that, the process to set it up on a statutory basis. It is important that the commission would report to me as Minister on an annual basis on what should be the annual rate of the national minimum wage and that it will do so in an evidence-based fashion. We have experienced situations in the past where Ministers have come into the Dáil and decided, almost unilaterally and without any real evidence, to reduce the national minimum wage rate. It is important that we approach this in an evidence-based fashion and let the low pay commission do its work. We will flesh that out shortly and at an appropriate time I will be interested to hear the views of the committee on the structure of the low pay commission. I have my own views on it. With officials I visited the United Kingdom two weeks ago to discuss the workings of its low pay commission with current members of the commission, the chair and also senior officials from the Department for Business Innovation & Skills, which is the lead department in this area in the UK.

The low pay commission has a statutory role to play in recommending the rate of the national minimum wage, but I would also like it to research other significant areas of concern. When the time is right and appropriate, I would appreciate hearing the views of the committee in this regard.

Marcella Corcoran Kennedy (Laois-Offaly, Fine Gael)
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Does Deputy Peadar Tóibín wish to speak again?

Peadar Tóibín (Meath West, Sinn Fein)
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I wish to flag one further matter. Throughout the State there seems to be abuse of sub-contracting regulations, which is manifest in Lucan on the JJ Rhatigan site. A number of workers who are members of Unite have been on strike for the past five or six weeks. They have experienced their wages being reduced to approximately €5 an hour, which is below the minimum wage. We talk about a living wage being €11.45 an hour, but there are people who are not achieving the minimum wage owing to loopholes in laws governing sub-contracting work. I urge the Minister of State to get on the telephone and speak to both sides in an effort to use his office to resolve the crisis. I ask him to ensure this problem does not occur throughout society in general. The strike is happening on a State-contracted project, with the State being the customer.

I ask the Minister of State to focus on the important issue of insolvency which results in many workers being forced to undertake a protracted sit-in or battle with businesses in that limbo space of insolvency where a business is not officially insolvent but the workers are not being paid. The situation in this grey area leads to significant poverty because the people concerned cannot apply for entitlements and to avail of safety nets which they should be entitled to do.

I suggest these are two very practical projects in which the Minister of State could become involved and which would result in real benefits for those hoping to earn a decent wage.

Gerald Nash (Louth, Labour)
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The insolvency piece is increasingly becoming familiar to us. Politicians were engaged in seeking a resolution of the dispute at the Paris Bakery, for example, which was very undignified for the workers caught up in that dreadful situation. Strictly, insolvency in that context is a matter for the Department of Social Protection. This is a very messy set of circumstances when it occurs; as it is happening more frequently, we need to be more vigilant. I agree that the issue merits further exploration and discussion.

The Deputy referred to the construction sector. The Government has acknowledged the difficulties associated with the collapse of the registered employment agreement, REA, system which has infected the construction industry, in particular, in which its implications have been evident. That is the reason we are reconstituting a registered employment agreement system which is of particular importance to the construction industry. We are working on legislation to reintroduce the system. I will be before the committee on 11 November to discuss the draft heads of the Bill in more detail. This issue is common ground for the trade union movement and the Construction Industry Federation. For very obvious reasons, the trade unions want to see a situation where skilled workers are adequately and appropriately rewarded for the jobs they do. That is my wish, too.

One of the key issues for the construction industry in terms of tendering is labour costs. The industry wants certainty on labour costs. Firms want to ensure that they are competing on a level playing pitch. Nobody wants to see firms undercut by rogue employers who are perhaps registered outside Ireland and coming in trying to undercut employers who are governed by very high standards and are subject to Irish law, as is any company operating here. The reconstitution of the registered employment agreements, REA, system is going to be critically important for construction workers to ensure they get the wages they are entitled to and that the wages and remuneration are commensurate with their skills.

Marcella Corcoran Kennedy (Laois-Offaly, Fine Gael)
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Is the Deputy satisfied with that reply?

Peadar Tóibín (Meath West, Sinn Fein)
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Yes. Tá sé sin ceart go leor.

John Lyons (Dublin North West, Labour)
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I wish the Minister of State the best of luck in his new role. This is a mid-term review of the Department of Social Protection as well as falling within the remit of the Minister of State - the youth guarantee encompasses both. I came from a meeting this morning in Ballymun where we got an update in the job centre on the pilot scheme. As the Minister is aware, Ballymun is running the pilot scheme of youth guarantee. I have the unemployment figures from December 2013 and September 2014 for the Finglas, Darndale and Ballymun offices. The 18 to 24 age category unemployment figure for the Finglas office fell by 1%. The same figure applies to the Darndale office. In the Ballymun office, the figure is 16% where the youth guarantee is in operation.

From that figure, it is safe to say there are signs the scheme is working but the message I am hearing - as there is an evaluation going on given it is a pilot scheme - is that the scheme is costly. There can be barriers to offering a guarantee to people. During the four month guarantee a participant is supposed to be offered another step on a career path. For example, that might be a post-leaving certificate, PLC course. If one is a medical card holder the fee is waived but there are other costs such as the cost of a uniform, for example, if a person is doing a particular course, or examination fees ranging between €300 to €500. Those financial barriers exist.

As this is a pilot scheme, there are some funds to address those issues. However, the concrete message on youth guarantee is it does work but it is costly. Countries such as Ireland which are only getting to a stage where they may have a neutral budget - I think this is the phrase being used - are not in a position to do as much as we would like, I presume, in identifying other areas around the country that are black spots in terms of youth unemployment. The amount of money given by the EU for the youth guarantee budget, which I accept is only supposed to support the scheme and should have matched funding from partner countries, is still very small. Many of the barriers are not concerned with the guarantee itself, but are financial. In fairness to the Department of Social Protection, it has looked at some of the barriers including eligibility criteria. A person has to be a particular age to do a community employment scheme. That has been addressed in the pilot scheme. The message is that if the EU is to be serious about youth unemployment, the funding being allocated to addressing it is far from sufficient. Whatever solutions can be worked out between member countries to address that would be greatly appreciated.

Gerald Nash (Louth, Labour)
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I thank Deputy Lyons. I am well aware of the Deputy's interest in the youth area in general and specifically in youth unemployment and the youth guarantee. I know the Deputy has a particularly keen interest in the Ballymun pilot project. Clearly, the evidence suggest focused interventions such as this do work. I agree it is worth paying for them. We have to focus the resources we have on that cohort in society. It is absolutely crucial for many reasons. The funding has to be proportionate to the need.

There are some EU member states that are better placed to afford the additional investment than others. The message needs to clearly go out from the EU that there is support available and that support should be made available because we cannot afford a situation in the EU or anywhere else where we leave a generation behind. The youth guarantee is supposed to be a dramatic intervention in the lives of young people who are without work and training opportunities. I will be travelling to the EPSCO meeting with Minister of State at the Department of Social Protection, Deputy Kevin Humphreys. Deputy Humphreys has a deep interest in this area and I think it would be appropriate that he would deal with that aspect of it while I deal with the employment side. I will certainly relay that message back to him. I am very much on board with communicating that the youth guarantee needs to be properly resourced, both to the Commission and at the EPSCO meeting.

Marcella Corcoran Kennedy (Laois-Offaly, Fine Gael)
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I thank the Minister and his officials for coming here to engage with us.