Tony McLoughlin (Sligo-North Leitrim, Fine Gael) | Oireachtas source

This National Minimum Wage (Low Pay Commission) Bill 2015 will, among other things, oversee the establishment of a new low pay commission. This commission will be tasked with examining the national minimum wage rate every July. It will also be expected to make expert recommendations to Government on the minimum wage issue.

The national minimum wage for a person over the age of 18 stands at €8.65, one of the highest minimum wages in the European Union and it has once again become a major talking point in Irish politics. As the Irish economy continues its strong export-led recovery, many unions and representative organisations and bodies have begun the process of lobbying for the national minimum wage rate to be increased by Government.

While I agree with the argument that low-paid workers and the less well-off in Irish society need to be assisted and while I also cautiously agree with the argument that an increase in the minimum wage needs to be introduced, I believe the Government needs to be extremely careful about how it deals with this sensitive pay issue. Many populist arguments are gaining ground which say that the Government should increase the national minimum wage in order to offset the effects of inflation and to give hard-pressed Irish people more money in their pockets.

The Government, however, also needs to ensure that small businesses and vulnerable companies, such as those in the north west, are protected from the effects of any potential increases. For example, raising the national minimum wage rate across the entire country may benefit a percentage of people in one particular area. It may, however, ultimately have a detrimental effect on small businesses which are already struggling to survive in many other parts of the country and which would not be able to handle any further increases in their business costs.

I recently met with a delegation from the Irish Business Employers Confederation, IBEC, from the north-west region to discuss a wide range of issues, including road infrastructure, broadband and barriers to growth and development. The raising of the national minimum wage was a major concern for many of the business people I spoke with. If there is to be an increase in the national minimum wage, it needs to be done in a fair manner, with due consideration given to all sections of society, in all geographical locations throughout the country.

In line with this sentiment, I am pleased that section 4 of the proposed Bill states that any decisions on the minimum wage will be taken in a fair and sustainable manner by the Low Pay Commission members, and that these decisions will be taken without creating significant adverse consequences for employment or competitiveness. I very much hope this will be the case. I am pleased with the level of detail in section 5 of the Bill which lists the functions of the proposed commission. It will be tasked with investigating a wide range of mitigating issues which surround the overall minimum wage debate, including whether employment is increasing or decreasing, comparisons with the UK minimum wage, the overall cost of living in the country, the levels of unemployment and employment, the need for job creation and overall national competitiveness. Due to these two sections of the proposed legislation in particular, I have full confidence in this Bill as I believe that their inclusion will ensure that the new Low Pay Commission will act in a fair and proper manner to provide expert analysis on the minimum wage debate.

I fully support this legislation as I believe that the new Low Pay Commission, if established, will provide expert analysis to the Minister, enabling him or her to make a fully informed decision on the topic, away from the populism which follows it.

We, as legislators, need to continue to stand up for the less well-off in Irish society, but we need to do this in an informed and educated manner. Too often in the past bad and uninformed Government decisions led to detrimental effects for many. We need to take greater responsibility and I firmly believe that this commission will help to address one aspect of this approach. It has taken a great deal of time and effort to bring this Bill to the House and I commend the Minister of State and his officials for the work they have put into getting it this far.

See this speech in context