Billy Kelleher (Cork North Central, Fianna Fail)

I welcome the contributions in the House, although many economic theories are being turned upside down. The Labour Party's proposal, if taken to its logical conclusion, suggests that in times of crisis we should increase wages unilaterally across the broader economy. That would certainly dig us out of a hole. Any economic study would suggest that in times of high unemployment and problems with competitiveness, wage restructuring across the broader economy is essential. This is particularly the case in view of the fact that wage restructuring is taking place across the eurozone and, more importantly, across the globe in general. It is important that we consider this in a broader context, making sure there is competitiveness in the economy, that we can sustain the current wage rates and that we can trade our way out of our present difficulties.

The purpose of the minimum wage is to protect people on low wages and ensure they have a proper and decent standard of living. It was introduced in 2000 by a Fianna Fáil Government. Successive Fianna Fáil Governments have increased its level to €8.65 and, more importantly, established a strong corpus of legislation to protect workers' rights. It is disingenuous for people to come to the House and point out that this Government is unilaterally throwing away all the gains made by workers in recent times. It is simply not a credible argument. We must have an honest debate in the House about the difficulties that are being experienced. It is true that no Government likes to reduce the minimum wage, but we must be honest with people, particularly those who are on social welfare and would love an opportunity to work but, because the economy cannot sustain a minimum wage rate of €8.65, cannot obtain employment. A reduction is essential to provide a stimulus in that area.

The Minister, Deputy O'Keeffe, referred the areas of wages, taxation, social welfare and labour activations measures which must be taken as an overall package. Let us consider the areas which are struggling and under great pressure, including the hospitality, retail and the horticultural sectors. It is not a credible argument for people to suggest they can sustain the present rates. Shops, supermarkets, retail outlets, restaurants and bars are closing throughout the country as we speak. Were we to take on board the Labour Party policy, then we would increase the minimum wage even further above €8.65. In his opening remarks, Deputy Penrose stated that those on the minimum wage spend proportionately more in the local economy and that they contribute more to central services in the immediate economy.

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