Niall Collins (Limerick County, Fianna Fail)
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532. To ask the Minister for Jobs, Enterprise and Innovation the position regarding the programme for Government commitment (details supplied); and the employers PRSI reductions foreseen in line with the increase in the minimum wage for 2017. [40838/16]

Pat Breen (Clare, Fine Gael)
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The Low Pay Commission was established last year through the National Minimum Wage (Low Pay Commission) Act 2015. Its principal function is, once each year, to examine the national minimum hourly rate of pay and to make a recommendation to the Minister respecting the rate, ensuring that all decisions are evidence based, fair and sustainable, and do not create significant adverse consequences for employment or competitiveness.

The Commission submitted its first report in July 2015. Its recommendation to increase the minimum wage from €8.65 to €9.15 per hour was accepted by Government and the increase came into effect on 1st January last.

The Commission’s second report was submitted to Government in July this year and the recommendation made by the Commission for an increase to €9.25 per hour was approved by Government on 11 October.

I signed the Order on 13 October to effect the increase to €9.25 per hour from 1 January next.

This increase in the national minimum wage in conjunction with the tax changes provided for in Budget 2017 will assist lower paid workers.

I welcome the reduction in USC rates and the increase in the new 2.5% band to €18,772 to ensure minimum wage workers are kept within this new lower band.

Minimum wage employment will continue to attract the lower 8.5% rate of employer PRSI, and the PRSI credit applying to employee PRSI for weekly earnings between €352.01 and €424.00, means that the employee benefits from the earnings increase.