Fergus O'Dowd (Louth, Fine Gael) | Oireachtas source

I welcome the Bill and this discussion. Listening to the Deputies opposite, one would believe that the Low Pay Commission was being set up to take money from workers rather than to examine increasing homes' incomes or to consider strategies that involved proper analyses of how to achieve consent on increasing low incomes, which are concerning for people who find it increasingly difficult to live as we emerge from the recession. It should form part of an analysis of the structure of society with a view to helping people return to work.

We have 100,000 more people working today than we had on the day that we entered office. Significant changes are taking place in society and there is an increasing awareness of improvements in our economy. Our export levels have increased and there is a general increase in confidence in the Government's capacity to deal with the recession in a pragmatic way that has resulted in major changes to how people view their future prospects in this country.

A question that we must address, and which the Government has addressed in some respect, is on how to provide additional money to people who are working. One way is through tax reductions.

A reduction in income tax makes it more attractive for people to go to work or stay in work. A significant part of the Government's strategy involves reducing the contributions made under the much-condemned universal social charge, particularly by lower-paid workers. The number of people not paying the charge has increased significantly since we came into office. I know the Taoiseach is committed to making that number larger and more significant in the forthcoming budget.

Many of those with whom I speak think it is important that going to work be made a much more attractive option for people. The Government has made significant progress to that end - for example, through the back to work schemes. I do not think people who are going back to work should lose some of the benefits they enjoy at present. I refer particularly to medical care benefits such as medical cards. Such people should also be entitled to retain portions of their social welfare income. While a rising tide will lift all boats, it is a fact that the lowest-paid workers comprise the most significant cohort of people whom we need to help and continue to help. I acknowledge that there is absolutely no doubt that significantly increased resources are required to make the move from unemployment and long-term unemployment to going back to work.

The shortage of housing means that unemployed people who want to go back to work are facing big difficulties in trying to find accommodation. Regardless of whether one is unemployed, a significant increase in resources is needed to rent a house. We have a difficulty in County Louth with housing assistance payments and rent allowance. I refer to the Government's proposals. The only accommodation that is available is at a much higher price than the going rate from the HSE or from local authorities will support. I think this is an area in which we need to significantly increase our resources and indeed our attention. Like other Members of the House, I know of families with children that are practically homeless. I am being contacted by an increasing number of people who are sleeping in cars, on sofas or on camp-beds. I believe that if the Government increases the cap, the whole system will shift upwards and prices will increase again.

The proposed Low Pay Commission is a significant part of our strategy to get people back to work and to make work more valuable for lower-paid workers in particular. It is part of a balancing and a readjustment. It is terribly important that those who are employing people and offering employment are very much a part of all this. There is no point in saying we are going to increase the minimum wage by a certain amount if employers are not on board. They have difficulties as well. They have to compete in the marketplace. They have to be competitive. Much of what we produce is sold abroad. We have to compete abroad. We cannot increase costs at a rate that is disproportionate to growth in the economy. We priced ourselves out of the market previously. Our competitiveness as an economy decreased significantly over the period of the boom. We paid ourselves far too much and we saw the result of that. Government expenditure increased out of all bounds. It was absolutely ridiculous that we relied on a tax on the sale of houses as a basic income tax for our day-to-day spending.

I agree with the constructive and positive analysis of the Minister of State, Deputy Nash. It will bring about change. It will bring additional resources to encourage people back to work. The level at which people have the least amount of money is where this encouragement will be most effective. When they are trying to get back into the workforce, it is a most difficult time for them. I would like to see an increase in child allowances that would help families on law pay to survive in a much better work environment. The Minister of State, Deputy Nash, is doing the right thing. I welcome that. It is not the panacea to cure all ills. I believe he is bringing the employers on board, which is absolutely essential. There cannot be a gun to any employer's head as a result of this. We will move forward together. That is how this country will increase its capacity to sell its products abroad, while becoming a fairer and more competitive society at the same time.

See this speech in context