Enda Kenny (Mayo, Fine Gael)
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The Minister for Health and Children has instructed the HSE to implement a new contract for community pharmacists in just over two weeks. This has caused much anxiety among people who use the GMS system, who number well over 1 million and are among the most vulnerable in our society, that they will not be able to obtain their medicines after 1 March. There is currently a stand-off between the HSE and the pharmacists. At yesterday's five hour meeting of the Joint Committee on Health and Children, which is to resume this morning, it was made perfectly clear by the representatives of the HSE that they had been instructed by the Minister for Health and Children to implement this new contract by 1 March.

What contingency plans does the Taoiseach have to ensure that substantial numbers of elderly and vulnerable people and children who avail of medical cards will be able to obtain their medicines after 1 March if this stand-off continues? This is causing considerable stress to many people. This party does not condone any precipitate action, either by the pharmacists or by the HSE, that will reduce the level of services. What are the Taoiseach's contingency plans after 1 March?

Bertie Ahern (Dublin Central, Fianna Fail)
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I acknowledge the meetings of the Joint Committee on Health and Children that have taken place yesterday and today. The committee has done its best to tease out the issues. I should point out that if any community pharmacists decide not to honour their contracts they must give three months notice. No pharmacy in the Republic, to the best of my knowledge, has provided such notice. Thus, the issue should not arise. I note Deputy Kenny's point that there should not be any precipitate action, which means that pharmacists should not break their contracts. That is the position.

The Shipsey dialogue process was established by the HSE to address the concerns of the Irish Pharmaceutical Union, on behalf of community pharmacists, about the implications of the legal advice on competition law and the right of the IPU to negotiate margins on medicines. That has continued for the last few months. We discussed it here last autumn. At a meeting on 5 December 2007 under the auspices of Mr. Shipsey, a two-stage process was offered to the IPU by the HSE. The first stage was to address the immediate concerns of the IPU regarding the alleged impact of the proposed revised wholesale arrangements on GMS-dependent pharmacists — the ones mentioned by Deputy Kenny — while the other was to provide a basis upon which discussions on a new substantive contract could commence. As the IPU rejected this offer, the HSE proceeded to offer a draft interim contract to address the main concerns regarding the alleged impact of the proposals. As Deputies we have all heard from pharmacists about how this will affect them. The details of the draft interim contract and the HSE's other intentions in this regard were set out in letters to individual community pharmacists after Christmas and into the new year.

I understand the HSE now intends to implement revised arrangements on 1 March and that it also intends to enter discussions with the IPU on the development of a new substantive pharmacy contract as soon as possible. The Minister is working to develop appropriate arrangements for the deployment of the contracts and for the setting of fees. These arrangements may include the establishment of an independent body which would consider the nature of the service to be provided and all other relevant factors in each case——

Pádraic McCormack (Galway West, Fine Gael)
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Before March?

Bertie Ahern (Dublin Central, Fianna Fail)
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——and make recommendations to Government on the fees it considers appropriate. Many Members have asked how it would work, but its terms of reference and the timescale for its work are among the matters to be discussed. I can inform the House, because I know all Deputies are interested in this, that the Minister is anxious that the process to enable the development of new contractual arrangements for the delivery of general practitioner, dental and community pharmaceutical services be put in place as soon as possible. Consultations are continuing with all relevant stakeholders with a view to establishing these arrangements.

Pádraic McCormack (Galway West, Fine Gael)
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Will it happen before March?

Bertie Ahern (Dublin Central, Fianna Fail)
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It will happen as soon as possible.

Enda Kenny (Mayo, Fine Gael)
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It is a pity the Minister was not as direct about the intention of introducing savings by reducing the administrative bulge in the HSE, which has been recognised by the Taoiseach.

The Taoiseach has not answered my question about his contingency plans for the provision of medicines to people all over the country in the event of a withdrawal from the GMS by community pharmacists after 1 March. This is exercising the minds of people in the Taoiseach's own party as well as every other party. I recognise that it is important that savings be introduced. If the HSE and the Minister for Health and Children are so confident of the irrefutability of their figures they should not have anything to fear from arbitration. I commend the actions of Minister for Transport, Deputy Noel Dempsey, in appointing an arbitrator to deal with the broken promise about Cork Airport. Independent arbitrators have been appointed all over the place. This is a matter of genuine concern——

Deputies:

Hear, hear.

Enda Kenny (Mayo, Fine Gael)
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——to ordinary people who want to be assured they will be able to obtain their medicines.

Seymour Crawford (Cavan-Monaghan, Fine Gael)
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They are sitting behind the Taoiseach.

Enda Kenny (Mayo, Fine Gael)
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Pharmacists are well able to stand on their own two feet and will approach this argument in a mature fashion. If the Taoiseach and the Minister are so sure of their figures, they should not have anything to fear from arbitration.

At yesterday's committee meeting it was made perfectly clear that the Indecon report, commissioned by the HSE, stated that there should not be any precipitate action. Although the Taoiseach says that the draft interim contract is to be implemented on 1 March, the committee was told yesterday that this was a voluntary interim contract but that the changes at stake would still be implemented by the HSE.

I ask the Taoiseach again what contingency arrangements are in place. Second, in order to bring some sanity and common sense to this stand-off, will the Taoiseach agree to the appointment of an independent arbitrator to consider how a reduction in costs can be achieved without affecting the delivery of services to people throughout the country? This process should be put off until such time as a competent arbitrator can make a recommendation — within a month, six weeks, two months or whatever date the Taoiseach decides.

When the committee and the HSE were questioned yesterday, they said that if the Minister was to say that she wanted this put back until 1 May, they would follow that direction. The same thing happened when she intended to introduce the long stay health institutions Bill on 1 January. When the Government recognised that there was a problem, it put back the introduction and implementation of that Bill and we still have not seen it. If there is a problem, it should be dealt with.

It is now two weeks and the clock is ticking in a situation where hundreds of thousands of people are concerned and anxious. In many cases, it is causing stress to elderly people because they fear they will not be able to get their medicines and prescribed drugs when they need them. There is a problem and a stand-off. The Taoiseach can deal with it by appointing an independent arbitrator and giving that person six weeks or two months to deal with it. If that happens, I am quite sure the matter can be resolved so that savings can be introduced without any disruption to the quality of the service that has been available for so many years to hundreds of thousands of people through community pharmacies. What are the Government's contingency plans and will the Taoiseach direct that an independent arbitrator be appointed?

Bertie Ahern (Dublin Central, Fianna Fail)
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A number of points have been made. In respect of the main point made by Deputy Kenny, the HSE had contracts with 1,600 pharmacists. If anybody wishes to break from this contract, he or she must give three months notice. That is the legal fixed position. In respect of interim arrangements, if nobody has declined the contract, that is the position. As Deputy Kenny stated, people should not take precipitative action. I do not want them to do that either.

The Department of Health and Children understands that preliminary interests have been expressed by pharmacy chains and individual pharmacies in the new interim contract offered by the HSE. However, definitive information on possible take-up is not available from the HSE. A preliminary meeting was held recently between the HSE and the Irish Pharmaceutical Union to discuss the contractual matters.

In respect of pricing, I understand that we deferred it. Deputies Kenny and Gilmore raised the matter in October and November and we took an active interest in it at that stage. I understand that it was deferred on 1 November.

Seymour Crawford (Cavan-Monaghan, Fine Gael)
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Nothing happened.

Bertie Ahern (Dublin Central, Fianna Fail)
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The crux of the matter is that the wholesale margin in this country is more than double that found in any other country in Europe, including Northern Ireland. We must work to find a solution, which we have been doing. It is an enormous margin. I will not get into the side issue. This is simply a statement of fact. The Minister wants to agree a contract, which must be done. I said again this morning that the Minister is working to develop appropriate arrangements for the development of contracts and the setting of the fees payable.

The issue relates to the fees. Pharmacists have put their case to me, as they have done to every Deputy in this House. They are entitled to do so and have put their case well. The Minister said, and I repeat, that these arrangements may include the establishment of an independent body which would consider the nature of the service to be provided and all other relevant factors in each case and make recommendations to the Government in respect of the fees it considers appropriate. The composition of such a body, its terms of reference and the timescale for its work are among the matters to be considered in this regard.

I believe Deputy Kenny would agree with me that rather than us scaring and upsetting a large number of people, particularly older people, it would be reasonable for the sides to agree the contract. Based on the cases I have heard from individual pharmacists, I understand that the main issue that divides them is the fees element. The Minister has said that only then could we involve an independent arbitrator or body who would examine the fees issue. That does not seem to be an unreasonable position.

Pádraic McCormack (Galway West, Fine Gael)
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Will the Government do that?

Bertie Ahern (Dublin Central, Fianna Fail)
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I urge the sides to lower the temperature, agree the contract and then allow the Minister to look at the fees element. I am only stating a fact. I am not trying to upset——

Seymour Crawford (Cavan-Monaghan, Fine Gael)
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Cart before the horse.

Mary Harney (Dublin Mid West, Progressive Democrats)
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It is not a case of putting the cart before the horse.

Bertie Ahern (Dublin Central, Fianna Fail)
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It is not a case of putting the cart before the horse. One cannot negotiate a fee with somebody if one has no arrangement. Let us not be unreasonable about this. It does not seem an unreasonable position for the sides to take and they should consider it.

Bernard Durkan (Kildare North, Fine Gael)
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Why not appoint an arbitrator now?

Eamon Gilmore (Dún Laoghaire, Labour)
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I previously raised here reports that workers on the Irish Ferries vessel running from Ireland to France are to be paid €4 per hour. It is not the only case of low pay that has been in the news in the past week. Last week, the Government was forced to concede in the High Court a case which has resulted in the striking down of the employment regulation order which sets the minimum wages and conditions for 25,000 workers in Irish hotels. This, in turn, has implications for approximately 250,000 people, most of them low-paid workers, working in various services who are covered by the joint labour committees.

We also know that over the past two years, there have been 296 detections of breaches of the minimum wage legislation. However, there has been only one prosecution. It appears that there has been an increase in the number of labour inspectors employed, which is welcome, but there has been a drop in the number of inspections carried out. There were 1,500 fewer inspections carried out last year, a drop of 9% on the number of labour inspections despite the increase in the number of inspectors. I understand that the number of inspectors who are employed in turn is now up to 50 but is significantly less than the 90 that was promised in the employment agreement.

Meanwhile, the Government is delaying bringing forward legislation to protect the rights of agency workers. An employment law compliance Bill was promised but has still not appeared. Ireland is one of three EU countries that continues to block the EU directive on temporary agency workers.

Will the Taoiseach tell us what the Government will do to protect the rights of workers, particularly low-paid workers, and to eradicate the continuing exploitation of low-paid workers in this well-off country with a prosperous economy? What investigation has been carried out into the reports of the payment of €4 per hour on the Irish Ferries vessel? What will the Government do to protect the pay and conditions of the 25,000 hotel workers who have now been exposed as a result of last week's High Court decision? When will the necessary legislation be brought before this House to provide adequate protection for workers on low pay?

Bertie Ahern (Dublin Central, Fianna Fail)
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This Government has done more than probably any government in Europe in respect of low pay. We were the first government in Europe to bring in a minimum wage. We have progressively improved that, in conjunction with the Labour Court, employers and workers. We have removed the workers from the tax net, which has had a significant effect.

In respect of the two issues mentioned by Deputy Gilmore, the National Employment Rights Authority legislation is on a non-statutory basis. The legislation is due before the House. Deputy Gilmore raised this during Question Time last week. I spoke to the Minister of State with responsibility for labour affairs. I understand that they had already commenced an investigation last Tuesday into the Irish Ferries case to see if it was factual, which would not surprise me, and, if so, what arrangements were to be used to pay those workers. That is under examination.

On the inspectorate, close to the full complement of 90 people are employed. The last figure I saw was 78 but I can confirm the number with the Deputy's office.

Denis Naughten (Roscommon-South Leitrim, Fine Gael)
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The rest of them are still in training.

Bertie Ahern (Dublin Central, Fianna Fail)
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We are anxious to progress the legislation. The Minister has completed two of the Bills. He has been in consultation with the Irish Congress of Trade Unions. He wants to bring the legislation to fruition in a way that addresses aspects not in Towards 2016, but that arose subsequently. The Government supports the legislation.

I explained the issue of agency workers in detail to the House last week. The European directive creates its own problems in terms of our position, which is that our social partners must agree on these issues. Rather than just accepting the European position and putting that into Irish law, we have always taken the view that we must consult. Sometimes it suits employers that we do so and sometimes it suits the organised workers, but it is the same regardless of the issue and it would be wrong to move away from that position and adopt a directive without taking account of the normal arrangements we have for industrial relations. There is no difficulty in this regard. Both the Minister, Deputy Martin, and the Minister of State, Deputy Kelleher, have been engaging with the Irish Congress of Trade Unions and they and their officials are anxious to continue to do so.

On the joint labour committees, JLCs, as the Deputy is aware, an injunction was granted last week. That case was taken by the employers' side. The immediate effect of the injunction granted is to prevent increases in the minimum rates of pay for workers in the hotel sector, which were due to come into effect on 16 November last. As employment regulation orders, EROs, generally address the conditions of low pay workers, the pay increases at issue are quite modest; they are less than €8.50 per week. The Irish Hotels Federation action appears to be driven by a determination in principle not to pay more than the statutory minimum wage. It is the opposite to the Irish Ferries case the Deputy raised where they were paying less than the minimum wage. This issue was an argument to tie the JLC to the minimum wage.

There is a commitment in Towards 2016, which the Minister, Deputy Martin, pointed out in recent days, to modernise the operations of the JLC system. That is ongoing under the Labour Court but the exercise was not intended to consider the legislative aspects of the system. It was appropriate to take the legal decision we took last week but we are now faced with having to resolve the legislation for the JLC system generally.

Eamon Gilmore (Dún Laoghaire, Labour)
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I thank the Taoiseach for his reply, which covered a lot of ground. I acknowledge that consultation is required in respect of a number of these matters but, as the Taoiseach will have seen, some of the social partners have indicated over the course of the past week that the lack of action by Government on the matters I have raised this morning could cause them to hold back from entering into new social partnership talks.

The difficulty with the minimum wage is the fact that it is not being enforced. I have drawn attention to the fact that 296 cases have been detected but only one prosecution has been brought. First, why is that the case? Second, can the Taoiseach tell me the reason the number of inspections have dropped even though the number of inspectors has increased?

Third, on the hotel workers issue, which is the most immediate one dealt with over the course of the past week, what is the position now with regard to the hotel workers? Is it intended that a new employment regulation order will be made for hotel workers or is the Taoiseach accepting that their pay will be pinned to the minimum wage? I remind him that in the case of hotel workers in many instances we are talking about people like waiters, bar staff and other skilled people working in the hotel industry whose wages were traditionally set by the joint labour committees and were not pinned to the minimum wage.

Did I understand from the end of the Taoiseach's reply that it is intended to introduce new legislation to strengthen the joint labour committee system and provide protection not only for the 25,000 hotel workers, but for the other 250,000 largely low paid workers who are covered by the JLC arrangement?

Bertie Ahern (Dublin Central, Fianna Fail)
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To answer the last question, we are examining last weekend's decision. The Government has to take its own action because the whole system of the JLCs, which are statutory bodies, as Deputy Gilmore and I fully understand, was established under the Industrial Relations Act and their role has always been to fix the minimum rates of pay and the regulation of employments. The system was undermined by this decision. We already had a commitment in Towards 2016 to modernise the operation of the joint labour committees and that is ongoing under the auspices of the Labour Court. This case was not foreseen but it was not intended to consider the legislative aspects of the system. We must examine that now because similar actions could be taken in other areas.

I was surprised by the action of the Irish Hotels Federation in this area but that is its entitlement. We must now examine the system. This system has worked well. It was set up in under a clause in the 1946 Act and it regulated these sectors fairly well for many years. We are considering the implications but the legal position must be examined because JLCs are statutory bodies under the 1946 Act and if they are struck down we must examine that.

On the other issue, the Minister, Deputy Martin, and I accept the point that we must try to finalise these legislative matters and that is what the Government wants to do. Last autumn, we approved the drafting of the employment law compliance Bill to give effect to the relevant provisions of Towards 2016. That included the appointment on a statutory basis of the director of the National Employment Rights Authority, NERA, which has now been working for 12 months on an interim basis, to secure better compliance with employment law through information and enforcement activities. It is supported by 90 labour inspectorates, an increase of 59 over the number a year ago, and the appointment of a statutory tripartite advisory body to advise the director on those activities.

The social partners were invited to nominate members of the interim advisory board. The Bill will extend the remit of NERA inspection services to include enforcement of the Employment Permits Acts of recent years. Drafting of the Bill, which involves the amendment of over 30 enactments, is proceeding and it is hoped the Bill will be published this month.

The regionalisation of the NERA inspection services is also progressing. It is now headquartered in Carlow but it has offices in Dublin, Cork and Shannon and premises in Sligo, which will be operational in about a month. The Department of Finance sanctioned 59 labour inspectorate posts. All the positions have been filled following a recruitment campaign. An additional 47 inspectors have been appointed and the remaining 12 will take up their positions shortly.

Regarding the labour inspectors, the Deputy's point about the action and the cases in the courts, the labour inspectorate, or NERA, as it is now called, has dealt with 14,200 calls and inspections. I understand the reason there are not prosecutions in most cases is because the companies pay the arrears as a result of the inspection and correct the procedures. The inspectors do not then proceed on actions but they call back. It is to try to clean up arrangements. The inspectors are active and are coming down hard on those who do not pay the minimum wage. They are watching the rights of the new Irish, the foreign workers, and they are examining the area of permits. They are dealing with any cases brought to the attention of NERA by organised workers or the public.