Paul Connaughton Snr (Galway East, Fine Gael)

I thank the Labour Party for bringing this motion to the floor of the House. I have been here for many budgets. Until a few years ago, one could always rely on Fianna Fáil to do the clever thing - it might not be the best thing, but it would be the clever thing - but it has now lost that ability. I will explain why what the Government has done to the minimum wage is neither right nor cute. I will not refer to the Government's outrageous conduct with regard to the blind, the disabled and the carers, as tonight's debate relates to the minimum wage.

Before these changes were made, if those on the minimum wage worked for 40 hours they would be paid €350 a week, give or take one or two euro. That is what they would get for their week's work. When the Government took €1 per hour from them, it reduced their yearly income of €17,500 by €2,000, which is a huge chunk of a small wage. That is what actually happened. Given that the Taoiseach and the various Ministers lost just €10,000 or €11,000 from their salaries, which can rise as high as €250,000, it is clear that there is no fairness in the system. Regardless of how one examines such a concept, high up or low down, one will not see any fairness in it.

I would like to speak about another huge problem with the minimum wage. I agree with Deputy Bruton that we have to ensure we get the people of this country back to work. While I accept that concept, I do not understand the argument that the reduction in the minimum wage will cause more people to want to get out of the social welfare system and back into work. It must be borne in mind that one encounters many hidden costs when one is in work. As most jobs are not created in one's back yard, one usually has to drive to work. Therefore, one has to pay one's insurance and one's tax. One has to pay for meals and all that kind of thing. I think the Government has forgotten all of that. Those who are earning just €350 a week have no room for manoeuvre.

It is against that background that the 3% of the working population who are on the minimum wage consider themselves to be terribly unfairly treated. Having gone out to work in the first place, as they should do, they cannot understand why the Government is coming along with its hatchet to take €2,000 of the €17,500 they earn each year. The Government should be good to this cohort of workers. If we are to overcome the poverty wedge we are always talking about, we need to ensure those who are on social welfare might take a job if they got an opportunity to better themselves. I suggest the Government is striking the wrong balance with this proposal.

I would like to refer to something else that is worth mentioning. Countless numbers of highly qualified graduates have been coming out of our colleges over the past year or two. Most of those who have jobs, as opposed to being on social welfare or having emigrated, are on the minimum wage. People with such qualifications might find it all right to be on the minimum wage for a couple of months or a year, but they will get extremely sour at some stage. They will leave the country and we might never see them again. That brain drain will be exacerbated by what the Government is doing with the minimum wage.

I have always heard about how important it is to take a rounded view of all of these matters. It has been suggested that sum of the various parts makes for an overall policy that can stand up to scrutiny. That cannot be said of the recent budget on several fronts, which we do not have time to discuss. The reduction in the minimum wage is another aspect of the ongoing race to the bottom. I cannot see it doing any good for the people involved or the employers for that matter because, as Deputy Bruton said, there were 101 other ways to reduce costs that were within the remit of the Government. However, it hit the easiest target, which is what Fianna Fáil seems to want to do all the time.

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