Billy Kelleher (Cork North Central, Fianna Fail)

If that is the case then an increase should further help local economies. Unfortunately, economics does not work that way. We live in a real world, something that will dawn on people who are flirting with and considering the policies of the an alternative Government across the House. It is like playing leapfrog with a unicorn in that it may sound like a good idea in the beginning but it gets progressively painful as one continues.

Let us consider what the Government has done in recent times. I refer to the four year plan to ensure funding is available to the State during the next four years. This deal involves the IMF, the EU and other organisations and states throughout the European Union. This is an indication that there is no short-term, quick-fix solution to the issues we face. We are in a difficult situation. The country is on a precipice. We must bring forward policies that are difficult, which may be painful and will cause a certain amount of distress to people. We accept as much on this side of the House. However, at least we are honest enough to point out that this is necessary. This applies not only to the reduction of the minimum wage but throughout the public sector, the readjustment of pension contributions, the embargo in place, the seeking of further efficiencies from the public sector and in the private sector as well.

People are faced with harsh realities on a daily basis. Employers with up to nine employees may have to look one of them in the eye and explain that they cannot be kept on. Employment rights are in place to deal with employers who abuse their workers and seek to undermine workers' rights. A body exists and is available to inspect, enforce and prosecute people who infringe on workers' rights. Equally, many employers throughout the country are keen to retain as much employment as possible. That is not possible at present in the economic cycle. Certain people have consistently highlighted that this is an attack on the poor and those on low pay. It is not an attack on low pay. This is about attempting to ensure that more employment is generated for people with low skills or people in part-time work.

Deputy Penrose referred to the reduction in the minimum wage and people using the minimum wage and the family income supplement as a subsidy for employers. The same argument could be made in the case of a person who is employed for two days per week and who draws social welfare for three days per week. That is the same argument. Is that a subsidy to employers? No, it is simply that the employer cannot afford to pay such a person for two days per week or only needs that person for two days per week. We must be honest. Those in positions of leadership, regardless of which side of the House, should be able to stand up and clearly state that this is done out of necessity because of the need to ensure we are competitive and can generate more employment at the lower end of the economy. This is the purpose of it.

Those of us on this side of the House have been proud in recent years to consistently increase the minimum wage as part of the social partnership agreements. The agreements set out clearly, in statute under the National Minimum Wage Act, how we arrive at increases in rates of pay. One could argue that further rates of pay in the economy may not be sustainable in the longer term. We must be honest about this as well. For example in construction, people are not being paid according to registered employment agreements and are moving to C2 forms. People are now working as self-employed persons and undercutting the rates of pay because, one could argue, the rates of pay in the current climate are not sustainable. There is a haemorrhage of jobs throughout the construction sector. To suggest we are attempting to undermine all protections in this House does not represent a fair debate.

Regarding the four year plan, the Minister, Deputy O'Keeffe, outlined the commitment to review the registered employment agreements, REAs, and the employment regulation orders, EROs, which is essential. Even before the advent of the IMF this was something we discussed in the House on Committee Stage and Second Stage debates on employment rights. There is a need to streamline these agreements and bring cohesion to these areas and to collective bargaining. This is a matter on which we must bite the bullet. We must ensure the system is in place which responds to market needs.

Market need is not about putting profit in employers' pockets. It relates to the demands of the market and what it can sustain at a given time. At present, we cannot sustain the existing arrangements across the board as suggested by certain people opposite because it is popular and it provides a good soundbite. Some of the wages in our economy are unsustainable at present. We are competing against other eurozone members and the UK. Some have suggested we should follow the UK but we must be more competitive than the UK. If we are not more competitive than the UK our people will be working in the UK. This is something about which we must get real. We have no wish to force people abroad but if we try to sustain the current rates of pay in some areas that is where people will end up. We cannot sustain the existing numbers in employment without a lower rate of pay.

This debate is an opportunity to outline that an employment rates body exists, that is, the National Employment Rights Authority, a body much criticised and maligned from time to time. When I was Minister of State with responsibility for labour affairs, I took part in several debates in which people urged me to reduce the number of inspections and to ensure certain industries would not be inspected because they were under pressure, which speaks volumes. The National Employment Rights Authority exists for a definite purpose. It ensures workers' rights are protected and that rates are agreed in a competitive situation, either through the legislation in place to deal with the minimum wage, or through the enforcement of EROs or REAs.

We must accept there is a need for an urgent discussion in this Chamber and elsewhere on the setting of wage rates throughout the economy. There is merit in the motion but it indicates a certain amount of populism propagated in certain quarters. It has been suggested this is an attack on the poor and on people on social welfare. It is nothing of the sort. The Government is making difficult decisions to at least ensure that competitiveness is sustained in the economy. For example, students have not been able to access work in recent times as everyone is aware because many of the businesses employing people on the minimum wage cannot survive.

Only when an order is signed will the minimum wage be reduced. Employers should be conscious that they would be in breach of employment legislation if they unilaterally reduced the minimum wage without discussion or consultation with their employees, a fact which must be highlighted. While the minimum wage is €8.65 per hour, employers must pay €8.65. People should not be shy about reporting instances of abuse to the National Employment Rights Authority.

No Government is keen to come to this House and reduce the minimum wage. However, it has been done for the reasons I have outlined and for the reasons outlined by my colleagues on this side of the House. We must be honest. This process is to ensure that people can find work at the lower rate of pay in very difficult times in this economy and for their families.

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