Neale Richmond (Dublin Rathdown, Fine Gael) | Oireachtas source

I move amendment No. 1:

To delete all words after "That" and substitute the following: "Dáil Éireann resolves that the National Minimum Wage (Equal Pay for Young Workers) Bill 2022 be deemed to be read a second time this day twelve months, in order to allow for further consideration of the Bill.".

I wish to start off by sharing my sympathies with the family, friends and many fans of Christy Dignam. I admit to being a fan of his music and much else. Deputy Boyd Barrett is right that his music will live long past many of our own timelines. He was a timeless contributor to the arts in this country.

The Government acknowledges this Bill from People Before Profit. I greatly appreciate the interventions made by both Deputies Smith and Boyd Barrett. Deputy Smith was right to mention the staff in Deputy Paul Murphy's office who worked so hard putting this together. It is a fine piece of work.

To cut to the chase, the Government is proposing a timed amendment of 12 months' delay on this Bill. The timed amendment quite simply is to allow the current examination of the sub-minima rates of the minimum wage by the Low Pay Commission to continue. Following this examination, recommendations will be made to Government for the retention or abolition of these rates. It is important we give the Low Pay Commission the time and space to carry out this review.

When we discuss the minimum wage, it is important we recall the work that is being done and progress made. In 2011, the minimum wage was €7.65 an hour and today the full rate stands at €11.30, with a 7.8% increase this year alone. I expect a greater increase. Like Deputy Smith, I want to see us moving towards the living wage as soon as possible. The Taoiseach, as Minister for Enterprise, Trade and Employment, indicated that will achieved at the latest by 2026.

As Deputies are aware, the Low Pay Commission was established in 2015 as an independent body with the mandate to advise Government on the setting of a minimum wage that is both fair and substantive for workers and supports employers and competitiveness. More context on this commission may be helpful. The Low Pay Commission is made up of both workers and employers, particularly from the SMEs and those operating in low-paid sectors. In addition to this, there are also independent members who have a particular knowledge or expertise in relation to statistics, labour market economics and employment law. This well-balanced membership allows the commission to represent all stakeholders. The commission will take an evidence-based approach to arrive at its recommendations and is obliged to consider the likely effect any proposed national minimum wage order will have on levels of employment and unemployment, the cost of living and national competitiveness. I have no doubt this will be a thorough piece of work.

The Government is supportive of the Low Pay Commission and the work it has carried out since its foundation. We have the utmost respect for its independence and expertise in advising on matters of low pay and the national minimum wage. This respect is clearly reflected in the fact the now Taoiseach asked the commission to examine the youth rates of the minimum wage and to make recommendations. Government is expecting to receive this report back from the commission before the end of 2023.

As we speak of the Low Pay Commission, it should be said that the current youth rates of the minimum wage were also established on foot of recommendations from the Low Pay Commission. The current rates came into effect in March 2019 following a previous examination of the rates undertaken by the Low Pay Commission in 2016 and 2017. At that time, the youth rates applied to those under 18 years of age, those over 18 who were in a first job and those over 18 who were undergoing a prescribed course of study or training. In the course of this previous analysis, the Low Pay Commission found that of 26 OECD countries that have a statutory national minimum wage, just over half have sub-minima rates for young people. The commission considered abolishing youth rates but concluded that the minimum wage rate would then no longer offer any recognition of the difference between a young inexperienced worker and a more experienced colleague, which could lead to employers seeing less value in hiring young people, with a potential impact on youth employment rates. Ultimately, the commission recommended that the youth rates should be simplified and changed to an age-based system. It also recommended that the trainee rates should be abolished and that all workers should be paid the same, regardless of their educational status. It is also worth noting that the commission recommended that the rate for employees under 18 should also be retained in acknowledgement of the fact that such employees have a statutory restriction on their working hours and conditions under the Protection of Young Persons (Employment) Act 1996. These recommendations were accepted by Government and form the basis for the current sub-minima rates for those under the age of 20: 90% of the hourly national minimum wage rate for those aged 19; 80% for those aged 18; and 70% for those under the age of 18.

Following the request for a re-examination of the issue from the then Tánaiste and Minister for Enterprise, Trade and Employment in 2022, the Low Pay Commission commissioned research from the Economic and Social Research Institute, ESRI, into the matter. This forms part of a broader research partnership agreement that operates between the ESRI and Low Pay Commission, which is tasked with undertaking and disseminating research on issues related to low pay in Ireland and helps provide the evidence base for the commission's advice and recommendations to Government. The commission will also be initiating a stakeholder consultation on the prevailing youth rates in the near future.

I encourage all of those interested and invested to make a submission when the time comes. I am happy to engage with the Deputies opposite and indeed the visitors in the Gallery. I congratulate Molly Greenough on her term as president of the University College Dublin Students' Union. I have had considerable engagement with her both as a local Deputy and in my in role. I wish her the best going into future and I look forward to dealing with successors in the coming weeks.

Following the conclusion of this consultation and ESRI research in the coming months, a final report and recommendations from the Low Pay Commission are expected in the latter part of this year.

For these reasons, Government is proposing a timed amendment to the Second Reading of this Bill. We propose that the Bill be read a Second Time in 12 months' time. At that point, the Government will have received and had an opportunity to consider the recommendations of the Low Pay Commission on retaining or removing the sub-minima rates of the national minimum wage. I therefore propose that the Second Reading of this Private Members' Bill is deferred for one year.

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