Mick Barry (Cork North Central, Solidarity) | Oireachtas source

I move:

That Dáil Éireann:

notes:

— the latest increase of the minimum wage from €10.20 to €10.50 an hour is a 2.9 per cent increase, and is well below the rate of inflation representing a de facto pay cut for the lowest paid workers in the State;

— the minimum wage rate for those aged under 20 and those on training programmes is less than the main rate, therefore a lower increase, and represents flagrant discrimination against young people;

— that the State has a high level of low pay with approximately 380,000 workers earning below the official definition of low pay – two-thirds the median wage – which represents 1 in 5 workers;

— that 22.6 per cent of women are in low paid work and 33.9 per cent of those aged under 30 are low paid and Ireland ranks 8th in the European Union for levels of low pay;

— that pay for workers in the public and private sectors has generally not kept pace with inflation, representing a substantial erosion in wages throughout the economy;

— that wages have stagnated in the last decade, and according to the Organisation for Economic Co-operation and Development (OECD) (at 2020 constant prices) the average annual wages in Ireland increased by just €191 between 2010 and 2020, a 0.38 per cent increase, while in the same period the Gross National Income increased by 61.2 per cent according to the Central Statistics Office (CSO) and according to the OECD unit labour costs in Ireland have dropped by 6 per cent in the period 2015 to 2020 – all this points to a substantial shift in wealth from labour to capital in the last period;

— that the latest flash figures from Eurostat show the annual rate of inflation in the State is now at 5 per cent according to the Harmonised Index of Consumer Prices, and the CSO found annual inflation to be at 5.5 per cent in December, the highest rate since 2001;

— that key drivers of inflation are energy costs and increases in the cost of other basic and essential commodities;

— that this increased rate of inflation has been sustained for a period of time and more economists are pointing to this being a longer-term feature; and

— that inflation is eroding the pay of workers and disproportionately impacts workers on low- and middle-incomes who spend a higher proportion of their incomes on basic essential commodities, and the official rates of inflation, therefore, are not fully reflecting the impact on low- and middle-income workers;

acknowledges that:

— the living wage in Ireland is calculated at €12.90 per hour, a figure that reflects the minimum needed for individuals working full-time to cover their needs;

— many trade unionists and labour movement activists point to €15 an hour being needed to cover a decent standard of living, especially in the context of high rent and housing costs, energy costs, childcare costs and the stagnation in wages over a decade;

— in Germany, workers have won a 8.8 per cent increase to the minimum wage this year, and have won commitments to further increases which would represent a 25 per cent increase from €9.60 to €12 an hour;

— the minimum wage acts as a floor in wages in the economy, and an increase in the minimum wage would have a positive knock-on effect throughout the economy and serve to increase wages generally for all workers; and

— workers in other states have won beyond inflation pay rises through taking industrial action or organising for industrial action; and

calls on the Government to:

— immediately initiate an emergency review of the national minimum wage;

— ensure that this review sees an increase in the minimum wage, and at a minimum the increase is adjusted to fully compensate for the erosion in buying power and for the increased burden that inflation places on the low paid;

— ensure this review is concluded and implemented by the 1st May, 2022; and

— introduce a system whereby the minimum wage and wages generally are index linked so wages at a minimum cover any increases in the real cost of living.

There is breaking news this morning. According to daft.ie, the rent increases for quarter 4 of last year, when annualised, come in at more than 10%. In some parts of the country, the increase is more than 20%. This underlines the need for a national rent freeze, at the minimum, if not for legislation to actually cut rent. It also raises the need to raise the wages of working people. The Government, which refuses to legislate for even a national rent freeze, is the same Government that has, in effect, cut the wages of the lowest paid workers in the State. The national minimum wage increased by 2.9% on 1 January, a time when inflation stood at 5.5%. The Government has cut the wages of the lowest paid workers in the State.

We are bringing forward the motion for two key reasons. The first is the cost-of-living crisis and how it impacts the low paid. How in the hell is someone meant to survive on €10.50 an hour in the current climate? As it was put to me at the weekend, this is not a cost-of-living crisis; it is a cost-of-survival crisis. We are also bringing forward the motion to benefit all workers. We believe that all workers deserve and need a pay rise at this time. If the minimum wage is the floor below which wages are not meant to fall, our thinking is that if the floor is raised, there will be the knock-on effect of an upward pressure on the wages of all workers. We are unashamedly introducing the motion for those reasons.

Who are the minimum wage and low-paid workers in this country? Minimum wage workers are not a tiny minority of the workforce. They comprise nearly 10% of the workforce now. They are not, in the main, part-time workers or workers who do a bit of work for a few bob. Some 68% of minimum wage workers now work full time. It is an educated workforce. Nearly 50% of workers on minimum wage have been to third level. That is the highest percentage of any country in the EU. It is a higher percentage than in the UK.

Of course, many workers earn just above the minimum wage. The median wage in the State, which is two thirds of the average, stands at €11.86 an hour. Some 50% of hospitality workers are at or below that level. Some 33% of retail workers are at or below that level, as are 15% of healthcare workers. Those are the very workers who got this country through the pandemic and showed the value of their work to society but who now find their wages do not match that value whatsoever. These are disproportionately women workers and young workers. Some 22.7% of women workers are low paid. Some 33.9% of young workers are low paid. In both those cases, the figures are above the European average. They are being hit hard. Electricity bills are up by €800 this year. The cost of groceries has increased by €800 annually. The cost of petrol is up by €500 this year. Between those three items alone, before one even gets into the cost of rent, prices have increased by €2,000. Someone earning €20,000, €21,000, €22,000 or €23,000 has, in effect, had 10% knocked off their purchasing power. If the official rate of inflation is 5% or 5.5%, what is it for the low paid who have no option but to buy these necessities even though prices are increasing at a rapid rate? The real rate of inflation for the low paid is double or triple the official rate.

The Taoiseach stood up in the Dáil yesterday and gave us the usual line. He said Ireland pays the second highest national minimum wage in the European Union. Let us look a little closer at that. When purchasing power and can buy for your buck are taken into account, Ireland is not in second, third or fourth place. It is considerably further down the list in seventh, and heading downward. Last year, the minimum wage was raised by 1% whereas the EU average was four times that. This year, the minimum wage will increase by less than 3%. The EU average is more than double that at 6%. In fact, in Germany the minimum wage is currently undergoing a staggered increase of 25%.

This is not just about the low paid. If we raise the floor, there will be knock-on increases and we want to see that. The Taoiseach said yesterday that he is okay with wage rises provided they are linked to productivity. I would like to ask the him a question but for now I will ask it of the Minister of State. Why, between 2010 and 2020, did the Minister of State and his colleagues from Fine Gael stand over big increases in productivity without wage rises but are now insisting that wage rises can only happen if there are increases in productivity? Between 2010 and 2020, hourly pay went up by 15.44% and GNI went up by 61.2%. Annual wages increased by less than 0.5%. The key figure with regard to productivity is unit labour cost which, between 2015 and 2020, was down by 6% and reached a record low in quarter 3 of 2020. There is one law for the bosses and another for the workers. If productivity increases without wage increases, that is fine, but there can be no wage increases without productivity increases. What hypocrisy. It really shows where Fianna Fáil and Fine Gael stand when it comes to class politics.

The Taoiseach also raised the prospect of a wage price spiral. He gave us the example of the 1970s and in doing so recycled an old Thatcherite myth. Which country has had perhaps the biggest debate about minimum wages in the past five years? It is the United States, which introduced minimum wages citywide, statewide and so on. For every $1 increase in the wage of a worker in McDonalds, there was a 2 cent increase in the cost of a burger. A rise in wages cuts profits and does not automatically lead to a rise in prices if the bosses, who can afford to do so, absorb the increase.

Mr. Duncan Graham of Retail Excellence Ireland was on the radio this morning. It is a pity there is not more excellence in the wages paid by some of the people who operate alongside, and with, Retail Excellence Ireland. The most recently recorded annual profits for Musgraves, which operates Centra and SuperValu, were €98 million. Can they not afford to pay workers €15 an hour? If there are smaller employers who say they cannot afford it, we ask them to open their books and prove it. If they cannot, they should be topped up from a levy paid by the bigger employers who can well afford such an increase.

It seems that the Government has not tabled an amendment to the motion. The Minister of State might clarify whether the Government is opposing the motion or is using a cynical tactic it has often used to deal with motions in recent times, that is, allowing the motion to go thorough and then quietly ignoring it. I call on the Government to own its position on this issue. If the Government is for the motion, it should vote for it and implement it. If it is against, the Government should have the guts to vote against it. There should be no more of the cynical tactics we have seen in recent weeks.

Sinn Féin and Labour have proposed amendments to the motion that look for a timeframe for the implementation of a living wage rate of €12.90 per hpur. That amount would represent a step forward for low-paid workers. We support both amendments. We would make the point that the €12.90 living wage report was issued before the current wave of inflation and even in that report, the author made the point that it would be very difficult for a worker living in Dublin to pay rent on that wage. It is a bit out of date and I think €15 is now the key figure. That said, €12.90 would represent a step forward and we will support that proposal.

We have no faith in the Government on this issue. We will exert pressure on the Government but workers must exert their own pressure. In the UK, the Unite trade union has won cost-of-living pay increases or better in 25 workplaces by taking industrial action or threatening to take industrial action. That is a good, positive example and one that needs to be followed by workers in this country.

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