Eamonn Maloney (Dublin South West, Labour)
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I thank the Ceann Comhairle and staff for selecting this item for discussion, and the Minister of State at the Department of Jobs, Enterprise and Innovation, Deputy Gerald Nash, for coming in to respond.

The Minister of State will be familiar with the recently published OECD report on the minimum wage. We can extract from the contents of the report that there are many employers in Ireland who consider that this is no country for those on the minimum wage. We are pretty far down the league of countries cited in the report and it most certainly is not good news for those in the retail sector, the hospitality sector, hairdressing, and the security industry, where traditionally wages have been low. We now have a situation in which many of the workforce are working for less than the minimum wage.

Having said that, we can all appreciate that what is happening in those sectors is a replica of what happened during the 1980s, when the country had its most recent recession. Many people were out of work and chasing limited job opportunities, which made them very vulnerable to unscrupulous employers. On top of that, as at present, there was the difficulty of falling trade union membership which, unfortunately, meant that people who should have trade union representation in the retail or hospitality sector were without it. For many people in low-paid employment, as someone said to me during the Dunnes Stores day of action on 2 April, if faced with the prospect of working below the minimum wage, or just on the minimum wage, or going on the dole, most people will opt to work for the minimum wage. That is the reality and it is what happened in the 1980s. It has adverse consequences, with many people struggling in the sector. It is not that these industries are not making money; they most certainly are, and Dunnes Stores is a good example. Rather, it is about the treatment of people, and the report highlights this. It is important that, as a Government and as a Parliament, we make a stand on this. I welcome the Irish Congress of Trade Unions charter for fair conditions at work, which rightly indicates that the living wage should be €11.45, which I would support. I hope that all parliamentarians in the House would support the work of Congress in achieving the living wage of €11.45 into the future.

Gerald Nash (Louth, Labour)
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I thank the Deputy for raising this important issue. I note that he referred to the recent OECD paper entitled "Minimum wages after the crisis: Making them pay". This is a very interesting cross-OECD report which clearly illustrates that adjustments to the national minimum wage take place within the context of tax and social transfer policies as well as the broader earnings, employment and economic impacts of such adjustments.

It should be borne in mind that the national minimum wage in Ireland is relatively high by international standards, and the House will recall that this Government restored the national minimum wage to €8.65 per hour with effect from 1 July 2011. The most recent figures published by EUROSTAT show that Ireland's rate is the fifth highest among the 22 member states that have a national minimum wage. When the cost of living is taken into account, Ireland's rate is the sixth highest.

Approximately 70,000 employees are on the national minimum wage. I assure Deputy Maloney that if an employer is found to be in breach of the National Minimum Wage Act and is not paying at least €8.65 per hour, that is an offence and will be investigated by the National Employment Rights Agency.

In reviewing the paper, it is important to bear in mind that the conclusions are based on data from 2013. As the House is aware, there have been significant positive developments in the performance of the economy overall and in tax and social policy protections for the most vulnerable in our society since then. In this context, 410,000 low-paid workers have been removed from the USC charge over successive budgets, and the Government will continue this policy of tax reductions for such workers in the next budget and subsequent budgets if we are given a mandate to do so. At the same time, the Government has introduced targeted welfare supports for people returning to work, and particularly for the low paid. I know those are measures that the Deputy supports. The Government will pay €30 a week to mothers or fathers returning to work from long-term unemployment in respect of each child for the first year, and €15 per week per child for the second year. This is a very important back-to-work dividend for families to ensure that work always pays.

For those trapped on rent supplement who cannot go back to work because they will lose their housing support, a new housing assistance payment is being rolled out. The assistance from the State will be based on how much one earns and not on one's employment status. The Department of Social Protection also supports low-income families in work through the family income supplement. These initiatives address issues identified in the paper, such as the fact that even at the bottom of the income ladder, taxes and social levies can strongly reduce take-home pay, and the size of the overall tax burden has implications for how well the national minimum wage supports low-wage workers and low-income families. In this regard, it is worth noting that Ireland ranks very favourably against other OECD countries in terms of the level of employee taxes and social contributions for those on the minimum wage. It also finds that when social benefits are included, the minimum wage in Ireland is particularly effective at moving minimum wage workers above the poverty line.

In many ways, the report confirms the utility of the Government's twin-track approach in assisting those on low pay through reviews of the national minimum wage and pay restoration while also tackling the increased burden of taxation that resulted from managing ourselves out of the economic crisis. It identifies a potential issue for Ireland with regard to the net benefit to Irish workers on the minimum wage of any increase in the minimum wage. As I stated earlier, the data utilised are out of date, given the recent budgetary and social policy initiatives introduced by the Government. None the less, I have no doubt that this issue will be considered and fully explored by the Low Pay Commission in the coming months.

As Deputy Maloney will be aware, the commission has been operating on an interim administrative basis since last February, and the Government yesterday approved the Bill to give it statutory effect. This will be published in the coming days. I look forward to the debate in the coming weeks in the House on the Low Pay Commission Bill, which will give statutory effect to that body.

Eamonn Maloney (Dublin South West, Labour)
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I thank the Minister of State very much for such a comprehensive answer. I think he would share my view that the message from this House is one of solidarity with those on the minimum wage and who have difficulties in their day to day lives. I listened closely to what the Minister of State said and commend the speed with which he took action on the Low Pay Commission shortly after his appointment. That is very important. I think every Member of this House would oppose zero-hour contracts.

I look forward to the legislation the Minister of State has had drafted on collective bargaining. In solidarity with those on the minimum wage and those whose pay is below that, it is important to recognise that, as law-makers, Members of this House have a special responsibility to support the sort of initiatives the Minister of State has taken and the new legislation that will come before the House because it will protect the most vulnerable in the workplace.

Gerald Nash (Louth, Labour)
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The Cabinet approved my draft Bill to place the Low Pay Commission on a statutory footing. When I publish the Bill in the coming days, Deputy Maloney will be interested to see one of its key provisions is a legal requirement that the Low Pay Commission produce a report on, or before, 15 July each year. There is a compelling reason for providing in primary legislation that the report be returned to the Minister of the day by a particular date. That is designed to ensure it is provided well in advance of any budgetary, tax and social welfare changes the Departments of Finance and Social Protection might consider. We want to ensure that any changes recommended by the Low Pay Commission and, subsequently, adopted by Government would be positive and that they would not be nullified by any tax or social welfare changes in budgets.

The national minimum wage rate has not been fundamentally reviewed since 2007. The rate was adjusted downwards by €1 - shamefully so - by the previous Government. We adjusted that and brought it up to €8.65 on election in 2011. It is better for society and the economy and makes good economic and business planning sense to ensure there are more frequent reviews of the national minimum wage. That is what the Low Pay Commission will do. It will also examine other issues related to low pay but its primary legislative function and exclusive focus over the past few months after it was set up on an interim basis was to examine the rate of the national minimum wage and whether that should be adjusted. I look forward to receiving the report of the Low Pay Commission very shortly. I have always supported frequent reviews of the minimum wage to try to take into account the changing economic circumstances annually to ensure that those whom we need to protect in this society, people on low pay and those in vulnerable situations, get the protection I and Deputy Maloney think they are entitled to.

In the next couple of days, I will publish legislation, which was approved by Cabinet last night, on collective bargaining and the reintroduction of a registered employment agreement system. I look forward to the debate on those Bills in the next few weeks. I intend that legislation will be enacted by the end of this Dáil session, by the middle or end of July. If we have any role, it should be to ensure an economic recovery that ensures the jobs we create are decent and sustainable. We want decent work and high standards in our society and economy.