Written answers

Thursday, 17 June 2004

Department of Enterprise, Trade and Employment

Partnership Agreements

4:00 pm

Photo of Martin FerrisMartin Ferris (Kerry North, Sinn Fein)
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Question 42: To ask the Tánaiste and Minister for Enterprise, Trade and Employment if she will commission a study of the numbers of workers who have not benefited fully from each national pay agreement; if her attention has been drawn to any sectors in which the problem exists; the plans she has to tackle the problem; and if she will make a statement on the matter. [17952/04]

Photo of Arthur MorganArthur Morgan (Louth, Sinn Fein)
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Question 55: To ask the Tánaiste and Minister for Enterprise, Trade and Employment her views on whether low-paid workers have not benefited from recent partnership agreements; the steps she will take to deal with the problem; and if she will make a statement on the matter. [17953/04]

Photo of Frank FaheyFrank Fahey (Galway West, Fianna Fail)
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I propose to take Questions Nos. 42 and 55 together.

Social partnership has made a significant contribution to the Irish economy over the past 17 years. The scope of national partnership has widened and deepened over the years, and national agreements now cover not just pay but a broad range of issues, including employment and enterprise development, competitiveness and greater social inclusion. The shared overall goal of the current agreement is to continue progress towards sustaining economic growth and maintaining high levels of employment and securing living standards for all, while strengthening the economy's competitiveness.

The private sector pay element of the agreements is negotiated by IBEC on behalf of employers and by ICTU representing employees. Agreement is reached following detailed discussions between the parties.

The most recent agreements have included recommendations for increases in the national minimum wage. The current agreement, Sustaining Progress, recommended an increase in the national minimum wage to €7. That increase was given effect from 1 February 2004 by statutory order.

Research has been undertaken by the ESRI before and since the introduction of the minimum wage. That body of research shows that the minimum wage has benefited the low-paid, in particular, women and young workers. It has also shown that the percentage of workers on the minimum rate has reduced substantially — from 21% in 1999 to 4.5% at the end of 2002.

The series of national agreements since 1987 has facilitated and encouraged Ireland's economic development and brought benefits to employers, employees and the country as a whole. Unemployment now stands at 4.4%, compared with 17% in 1987; the national debt-to-GDP ratio has fallen from 125% in 1987 to 32.8% at the end of 2003; while in the ten years to 1987 inflation was running at an average of 12%, in May of this year the rate of inflation, as measured by the CPI, was 1.7%. Furthermore, during the period of partnership, the real earnings of workers increased by 40.3%.

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