George Lawlor (Wexford, Labour)
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2. To ask the Minister for Enterprise, Trade and Employment if he will reverse his decision to delay the implementation of the living wage until 2029; if he will commit to ensuring that low-paid workers are recognised for the invaluable role they play in the economy; and if he will make a statement on the matter. [21411/25]

Gerald Nash (Louth, Labour)
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I hope the House will join me in wishing all working people across the country a happy May Day. However, delaying the living wage is no way to mark International Workers' Day. It has been 25 years since the minimum wage was introduced and ten years since the Low Pay Commission, which I established, made its first annual recommendation on an appropriate rate for the national minimum wage. This is a really important legacy to protect the interests of low-paid people. The Minister is now publicly instructing the Low Pay Commission, a statutory independent expert body which supposed to be independent of Government, to dump living wage pledge on the pretence of protecting competitiveness. Will the Minister allow the Low Pay Commission to do its job?

Peter Burke (Longford-Westmeath, Fine Gael)
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I thank the Deputy for his very important question. I acknowledge and thank the 2.8 million workers going to work today on what is International Workers' Day. I look forward to addressing the House in that respect later.

I am committed to improving the pay of low-paid workers and the Government’s track record on this is beyond question. Since 2020, the national minimum wage has increased by 33.7%, from €10.10 to today’s rate of €13.50 an hour. The Deputy will agree that this is a substantial increase, and I fully expect the national minimum wage to increase further over the coming years.

Our current rate of €13.50 an hour means that Ireland now has the second highest minimum wage in the EU, second only to Luxembourg. When adjusted for purchasing power standards, we have the fifth highest minimum wage in the EU.

In 2024, there was a significant uplift of 12%, or €1.40, in the minimum wage, and this year the minimum wage increased by 80 cent, an increase of over 6%. Both of these increases were well ahead of inflation and projected wage growth, and have brought about substantial and real wage growth for the lowest paid workers in our economy.

The Low Pay Commission has estimated that the “bite” of the minimum wage, that is, the national minimum wage as a percentage of the median wage, has increased from 50% in 2022 to 55% in 2024, calculated using the CSO’s labour force survey data, or from 54% in 2022 to 59% in 2024, using the CSO’s structure of earnings statistics data.

The Government wants to ensure that any further increases in the national minimum wage are managed in a sustainable way, and in a way that does not threaten employment or competitiveness. That is why Government has agreed to adjust the implementation timeline for the living wage to 2029. This was done as part of a suite of measures to bolster business resilience and support competitiveness during these uncertain times. This decision should be considered in the context of the recent significant increases in the minimum wage which show Government’s continuing commitment to fair wages across the economy.

Gerald Nash (Louth, Labour)
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Speaking earlier on the radio, the Minister said he makes decisions based on evidence. There is no evidence anywhere in the world to suggest that modest incremental increases to rates of national minimum wages impact employment rates or competitiveness. The Minister talks a lot about competitiveness but by delaying the introduction of the living wage, he is owning up to the problems the Government has created. If it wanted to deal with competitiveness, it would deal with the cost of energy, deal with renewables and deal with the genuine cost of doing business in Ireland which has nothing to do with the rate of the national minimum wage.

Deputy Conway-Walsh was absolutely right. These jobs are not to be found in the globally traded international sector; they are in the locally traded sectors - those areas that are not in the front line of Trump's potential tariffs. If the Government wants to address competitiveness, it should look at energy, housing and infrastructure, and not the national minimum wage. As the Minister will know, and I am sure this was the case, section 6 of the 2015 minimum wage Act, which allowed for the Low Pay Commission to be formed, makes it very clear that no decision should be taken that would impact employment rates and competitiveness.

Peter Burke (Longford-Westmeath, Fine Gael)
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The Government has committed to achieving the living wage in the current Administration. The increases of 12% and 10% we have had in recent number years are significantly above wage growth in economy which is 3.5%.

They are also above the inflation rate relating to our economy, which has now tapered down to about 1.75%. My key issue is to make and ensure that any increases are sustainable. We are doing that, and we have the evidence. The first piece of evidence is the joint report from the Departments of Enterprise, Trade and Employment and Social Protection which stated that there would be a 36% increase by 2026 on 2023 levels between the living wage, auto enrolment and sick pay for our smallest family businesses.

Some 75% of workers minimum wage workers are in retail and hospitality, and evidence from the PwC barometer indicates a 50% increase in insolvencies in those sectors. This means that jobs are being lost in those sectors. I want to ensure that workers have real wage growth, which they will because the increases in the minimum wage will continue and are at levels significantly above the rate of inflation. I will take on board the recommendations of the Low Pay Commission when I receive its report in the third week in July.

Gerald Nash (Louth, Labour)
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The Minister also failed to understand and accept that there has always been churn in the retail and hospitality sectors. There were enormous net job gains in the retail and hospitality sectors in recent years, sectors which, quite rightly, were protected during the pandemic but which have continued to be protected with significant subsidies that have no conditions whatsoever attached to them in terms of job quality, retention or pay.

What the Minister is doing in respect of the living wage is virtue signalling. That is it. It has no basis whatsoever in evidence. This will affect the lowest paid people in our society. The reality is that decent pay boosts productivity and increases retention for SMEs. We know the lower paid have a propensity to spend more of their income in the local community, ensuring that demand continues even if the local economy is in some difficulty. The Minister needs to review his position on the living wage and other employment rights he is attempting to decimate on the sham altar of competitiveness. The essence of social democracy is having decent jobs, a decent economy and good, functioning businesses that offer decent working conditions to people. Unfortunately, the Minister is showing that he is picking sides, and this is unnecessary.

Peter Burke (Longford-Westmeath, Fine Gael)
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I am not picking sides. I am ensuring that we have valuable employment and strong businesses. Anyone who says we have not improved workers' conditions is not backing that statement up with evidence. Auto-enrolment will be introduced on 1 January. There is a right to request remote working. Tips legislation to protect vulnerable workers has been introduced. Zero-hour contracts were banned. Parental leave has been introduced. A Fine Gael Government, with the Taoiseach at the time, took the lead on improving employment rights. We all know the work our former Taoiseach, Leo Varadkar, did in this area.

We know the costs that businesses they face, and that is the evidence I am giving the Deputy. I am pointing him to the reports on the basis of which I am acting. I am also pointing him towards how we are improving workers' conditions consistently, right across the economy. I have commissioned a review of employment law by the employment law review group, which is needed for our economy because employment legislation affects so many areas.

I want good, well-paid jobs in our economy. I also want businesses to be viable and to do well. My job is to balance those interests and ensure we protect employees on what is a significant day, namely International Workers' Day.