Ruth Coppinger (Dublin West, Socialist Party)
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23. To ask the Minister for Jobs, Enterprise and Innovation his views on the Nevin Institute's Quarterly Economic Observer (Spring 2015); his further views on the finding related to earnings distribution and low pay, in particular the number of workers earning less than the living wage threshold; and if he will make a statement on the matter. [12085/15]

Gerald Nash (Louth, Labour)
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The Nevin Institute's (NERI) Spring 2015 Quarterly Economic Observer outlines the Institute's latest expectations for the economic outlook in the Republic of Ireland and Northern Ireland and provides a profile of the earnings distribution and low pay in the Republic of Ireland.

NERI concludes that the economic outlook differs for both parts of the island of Ireland. According to the report, an overdue recovery is gaining strength with ongoing improvements in the labour market, exports, domestic demand and earnings.

NERI projections for the Republic of Ireland include strong GDP growth of 3.4% in 2015, declining marginally to 3.1% in 2016; consumption to continue its recovery driven by rising real disposable incomes; improving household balance sheets and a strengthening labour market and strong growth in investment. NERI also forecast improvements in the economy impacting positively on Exchequer finances with the General Government Deficit falling to 2.7% in 2015 and 1.9% in 2016. NERI project a steady decrease in unemployment out to 2016, with the 2015 figure reaching 10% and 2016 figure reaching 9.1%. Also further employment growth of 2.1% in 2015 and 1.9% in 2016 is projected.

The ESRI forecasts released this week are for both GNP and GDP to grow by approximately 4 per cent in 2015 and by at least 3.5 per cent in 2016. Unemployment is forecast to fall to 9.7 per cent in 2015 and 8.4 per cent in 2016. The strong expected performance in 2015 comes after the Irish economy grew by over 5 per cent in 2014. The ESRI envisage continued strong contributions from investment, in particular, and consumption into 2015. In this scenario, the ESRI indicate that the Budget deficit should decline to 2.3 per cent of GDP this year, with a further reduction to 0.3 per cent in 2016.

NERI estimated an update of the Eurostat low pay threshold by looking at those employees in NACE sectors B to S excluding sector O and who are in firms of 10 or more employees. Thus the 2013 median hourly wage rate estimate ranges between €17.14 and €17.25 per hour and low pay threshold estimate between €11.43 and €11.50 per hour.

This government has clearly demonstrated its commitment to the well being of lower paid workers. It restored the National Minimum Wage from €7.65 to €8.65 on taking office. Having returned the economy to sustainable growth through transformational policies implemented through the twin tracks of the Action Plan for Jobs and Pathways to Work, this Government is determined to ensure that the benefits of this recovery are felt by all in our society, both nationally and regionally.

Almost 90,000 more people are at work since the launch of the first Action Plan for Jobs in 2012. This increase has been in full-time jobs rather than casual or temporary jobs, with full time jobs accounting for 86% of the jobs growth. Every job created is a life changed, a family improved, a community enhanced. It is by increasing job creation that we can grow tax revenues and ultimately improve people's lives through better services and further tax reductions. That is why we have placed job-creation at the very heart of the Government's agenda.

The Government has established the Low Pay Commission, which will, on an annual basis, examine and make recommendations to the Minister on the national minimum wage, with a view to securing that the national minimum wage, where adjusted, is adjusted incrementally over time. The Commission will have regard to changes in earnings, productivity, overall competitiveness and the likely impact any adjustment will have on employment and unemployment levels. Legislation to restore the Registered Employment Agreement structure has completed Pre-Legislative Scrutiny and I expect to publish the resulting Bill shortly. Legislation has been passed and Orders made to re-establish Joint Labour Committees.

The second element of Government's strategy is to reduce taxation on low and middle-incomes. In this context, 410,000 low paid workers have been removed from the USC charge over successive budgets. The Government is committed to continuing this policy of targeted tax reductions for workers in the next budget.

The third element of the Government's strategy is to introduce targeted welfare supports for people returning to work, and particularly for the low-paid. From April, the Government will pay €30 a week to mothers or fathers returning to work from long-term unemployment for each child for the first year, and €15 per week per child for the second year.

For those trapped on rent supplement that 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 you earn and not by your employment status.

As a package, the Government expects these measures to have a transformative effect on incentives to work and on the wellbeing of those at work.