Simon Coveney (Cork South Central, Fine Gael)

I speak in support of this amendment and to oppose the Minister's intention to reduce the minimum wage by €1. The main reason is that it does not make sense on any grounds. The reasoning behind this came from an economist somewhere who said that Ireland needs to reduce the cost of employing people as a way of encouraging employers to take on more employees. The problem is that we need to encourage people on welfare to actively find employment of all sorts, including low paid employment, hopefully as a stepping stone to higher income. If we are taking such an aggressive cut in the minimum wage, I do not see an incentive to encourage tens of thousands of people on social welfare to find reasonably paid employment that will pay them considerably more than what they would be paid on welfare. This is in the context of protecting wage rates across the public sector in the Croke Park agreement yet at the same time we are targeting working people on the lowest income in the country. By and large they are in the private sector and they are being targeted by a taxation measure, the universal social charge, as well as lowering their gross pay. It is not incentivising many very low paid people, who will face reductions in salary. I do not accept the Minister's explanation that people are on contracts and the contract is protected. Those on the minimum wage do not have rock-solid contracts. They were part-time and their contracts are replaced on a regular basis. By and large, these contracts are loose arrangements that will convert into a new arrangement at €7.65 an hour rather than €8.65 an hour. I appeal to the Government to reconsider. In the context of this amendment in particular, I appeal to the minority party in Government to take a stand.

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