John Gerard Hanafin (Fianna Fail)

I welcome the Minister of State to the House and second the amendment. The Government has a proud record. Some of the difficulties it has faced had not been experienced by previous Governments, such as dealing with vast numbers of immigrants. This is borne out by the fact that the Opposition constantly berates us for not having the numbers necessary to enforce standards. This issue was raised within social partnership and at the time the numbers were not regarded as a difficulty. This Government is managing growth very well despite what the Opposition may say.

I acknowledge there have been difficulties but nobody had the Government's permission to behave in such a way. The actions taken by Gama and Irish Ferries were unacceptable. The Government wants only the highest and best standards of employment for workers. There is no distinction in employment rights legislation between Irish and migrant workers. For the avoidance of doubt, section 20 of the Protection of Employees (Part-Time Work) Act 2001 provides that all employee protection legislation on the Statute Book in Ireland applies to workers posted to work in Ireland, in line with Directive 96/71/EC of 16 December 1996 of the European Parliament and Council. This directive relates to the posting of workers in the framework of the provision of services and applies also to a person, irrespective of his or her nationality or place of residence who has entered into a contract of employment that provides for his or her being employed in the State or who works in the State under a contract of employment. All employee legislation applies to migrant workers.

The general approach adopted by the labour inspectorate to employment rights enforcement is to seek compliance and rectification of any breaches identified, including payment of any arrears due to employees. Inspectors pursue allegations of worker mistreatment and seek redress for the individual or individuals concerned and a prosecution is initiated if appropriate. Successful prosecution can be dependent on adequate support from witnesses.

Following the Minister's announcement on 12 April 2005, 31 inspector posts have now been sanctioned for the labour inspectorate, representing a doubling of the inspectorate in the past 12 months. This is indicative of a determination to ensure compliance with employment rights legislation. Following a recent selection process the inspectorate now has its full complement of 31 inspectors.

When the full complement of officers is fully operational they will concentrate on those employment sectors that have traditionally required considerable attention from the inspectorate, for instance, the service sectors such as hospitality and cleaning and agricultural work which are covered by employment regulation orders. It is notable that many migrant workers are currently employed in these sectors.

Work has been progressing with regard to the discussion document prepared in connection with the mandate and resourcing of the labour inspectorate. The discussion document covers all the issues that impact on the operation of the inspectorate, ranging from the legislative framework to the operational aspects and staff development. The social partners, together with representatives from the Departments of the Taoiseach and Finance, are members of the employment rights compliance group, ERCG, which is considering the discussion document. It is anticipated that the ERCG will conclude its business this month.

The Government is committed to having the minimum wage exempt from tax but it is also committed to sustaining economic growth and keeping the public finances in a healthy condition. Budget 2006 removed the minimum wage from the income tax net. The Government introduced the minimum wage to protect low-paid workers and over the past eight budgets it has removed a record number of 465,000 workers entirely from the tax net. Ireland has one of the highest minimum wage rates in the European Union. Since its introduction in April 2000, the minimum wage has increased by almost 37%, taking account of the latest increase, and this is well ahead of inflation. When the statutory minimum wage came into effect in 2000, less than 64% of the annualised figure of €11,330, or £8,923, was exempt from taxation. In the budget of 2002, 90% of the minimum wage became exempt from tax and in budgets 2003 and 2004 this position was maintained even though the minimum wage was increased in October 2002 and February 2004.

The current entry point to income tax is €14,240 per annum for a single person aged under 65 years. It is estimated that approximately 37,000 income earners will be in an income range which would bring them into the tax net if their annual earnings fully reflected the increase in the national minimum wage. However, this group will, of necessity, include part-time workers earning more than the minimum hourly wage and certain pensioners whose earnings are in the equivalent range. These 37,000 people should therefore be regarded as the upper band for any estimate of the number who may ultimately come into the tax net on a full year basis as a result of the minimum wage increase.

The Government has a fine record in maintaining employment rights. Where the labour inspectorate has found that people have been mistreated, this mistreatment was not done in our name. This country is still Ireland of the welcomes.