Richard Bruton (Dublin North Central, Fine Gael)

I thank the Opposition for raising this matter and it is important to have a debate on it in the House.

We must consider the context in which this debate is occurring. We have had the most catastrophic collapse in employment in this economy. We have lost 340,000 jobs and 450,000 people are on the live register. We must strike a balance between regulating detailed arrangements governing the working conditions of individuals and creating employment opportunities. That is what the programme for Government set out to do. As stated in the amendment, we immediately increased the national minimum wage to restore the wages of people who are on the very lowest pay. We are retaining the JLC system, which is a system for regulating and giving certainty to people who are in sectors that are typically poorly organised, but we are reforming that system because it must be responsive to those dramatically changed employment conditions. Following the collapse of demand that has occurred, with people having to cut prices - hotel prices are down 20% - and having to scrapple and scrounge to keep businesses alive, we cannot pretend that competitiveness does not matter. It does matter and we must be able to be competitive.

The Government is reforming not only this system but the upward only rent review system, legal costs and other professions that are in the sheltered sector. We are reforming access to credit to ensure small businesses can get credit to survive. We are reforming the way we regulate business to ensure there is less red tape. There must be a concerted effort to create employment in this society and that is the most critical issue we face.

Our system of labour regulation is unusual in Europe in that we have a combination of centralised bargaining, a national minimum wage system and a series of sectoral minimum wages that regulate not only wage levels but an array of details about employment terms, some of which are protected in other parts of labour law already. We have a very complex structure. It is not only in Ireland labour market structures are being reviewed so as to become more able to create employment; this is happening throughout Europe. It is not surprising that has arisen as very much part of the adjustment to our difficulties.

Jobs are the key to recovery in this country. That is the core belief of this Government. It is essential that we make choices that make jobs the priority.

I listened to talk about poverty and that is a real concern. There is no category in the labour market more prone to poverty than people who are out of work. They are ten times more likely to be living in poverty than people who have jobs. That is the core driver of disadvantage in our community. It is the surge in unemployment that is marginalising people. We must do everything we can to protect against that.

One can say that reform in this area is affecting people who are low paid. People covered by JLCs and EROs are predominately low paid and less organised, but it is also to those sectors of construction, retail, catering and hotels that we look for opportunities to bring young people and less skilled people who are out of work back into employment. They will not get jobs in teaching or social services; those are not the opportunities that will be available to them. We need to examine this sector as well as all the other sectors that the programme for Government is addressing. It is vital we open up opportunities for people and that we counteract poverty in the most practical way by giving people a purpose to get up in the morning, a job to go to and a reward for their efforts. That is very important.

We have had the Duffy report which was initiated on 8 February by the previous Government. The report, conducted by Mr. Kevin Duffy and Dr. Frank Walsh, undertook widespread consultation. The independent review concluded that substantial competitive gains could be realised in some of the sectors covered by joint labour committees, JLCs, and registered employment agreements, REAs, by reforming the structure of decision making so that the system would be more flexible and responsive to the needs of those particular sectors. The review favours simplifying the system in a way that reduces the burden of supervision and compliance with regulations and provides a degree of co-ordination and oversight in the system so as to ensure arrangements across sectors are reasonable and proportionate.

The review observed that there is validity in the argument that the current arrangements regarding Sunday working are unduly burdensome, particularly in sectors in which Sunday is a normal working day. The review accepts that there is a need for greater consistency across sectors in respect of such matters as overtime and Sunday premiums.

While the Government is committed to retaining the basic structure of the JLC-REA system, we need to reform it to make it more responsive to changed circumstances. The rates of pay are substantially above the national minimum wage and have increased more rapidly than it.

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