Friday 21 October 2016

'Profitable business should pay a decent wage'

Ged Nash

Published 08/12/2015 | 02:30

Minsiter for Jobs, Enterprise and Innovation, Richard Bruton, Taoiseach Enda Kenny, and Mohit Joshi, vice president at Infosys at the company’s announcement that it will create 250 new jobs over the next three years.
Minsiter for Jobs, Enterprise and Innovation, Richard Bruton, Taoiseach Enda Kenny, and Mohit Joshi, vice president at Infosys at the company’s announcement that it will create 250 new jobs over the next three years.

This Christmas, there are 32,100 more people in work compared to last. I am certain that they and their families are looking forward to the festive season with far more hope and optimism than they did in 2014.

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Yes of course the wages they receive will mean they can afford to spend more on their loved ones and on this year's celebrations.

Importantly they also have the dignity, pride and self-worth that comes with having a job, earning a living and leaving the dole queues behind.

The Labour Party believes that work should always pay. We believe that a job is the single best protection against poverty. But, that job itself should be fairly paid and secure.

We believe that workers deserve to be paid enough money to enjoy a decent standard of living.

Our coalition colleague Fine Gael is now suggesting the introduction of a working family payment - essentially a welfare top-up. We have already introduced such a top-up - called the Back to Work Family Dividend - and it's playing an important role in helping 10,200 low-income families return or stay in work.

We will also spend more than €360m on Family Income Supplement this year, a weekly tax-free top-up payment for workers on low pay with children, helping more than 52,000 working families to ensure they are better off in work and can build a more secure future.

But that better financial future ultimately means moving away from welfare and into fairly paid, secure and decent work. That's our vision.

So how do we go about securing better living standards? It must be through a combination of pay increases, tax reforms and a more supportive social welfare system that provides additional help particularly to those with children to maintain a minimum acceptable standard of living.

It cannot simply be about gains in take home pay engineered by reform of our income tax system. There is a limit to the amount of tax cuts that can be introduced before jeopardising the amount available to fund public services like schools and hospitals. An increase in living standards cannot be solely driven by increasing State supports.

There is no dignity in working hard for a living and having to perpetually depend on the State to have your income topped up.

We believe that profitable business should pay their workers a decent wage. This is why I support the Living Wage campaign, where progressive business commit to paying their employees and contracted staff enough to live on.

It's also why I have introduced robust mechanisms for workers and their employers to agree better terms and conditions, including pay, like new Collective Bargaining laws, sectoral employment orders and registered employment agreements.

For example, 50,000 cleaners and security guards are better off because of new arrangements we introduced in October.

At the heart of the matter is whether you believe it is the responsibility of business or the State to ensure that workers have enough money to look after themselves and their families.

Now, whatever about the argument that subsidising low pay would ease the burden on small and medium sized enterprises who cannot afford to pay such rates, the simple reality is that one of the main beneficiaries would be huge corporations whose wage bill would be supplemented by the State.

Fast food chains, huge supermarkets and large retailers with millions of euros in profits would be able to avoid the responsibility of having to pay their staff a decent wage and instead happily sit back and get the State to top them up through your taxes.

Through the work of Labour in Government, the National Minimum Wage will have increased twice during our term in office. Following my acceptance of the recommendations of the Low Pay Commission, the minimum wage will rise to €9.15 on the 1st of January. 124,000 workers will see an increase in their take home pay as a result.

If we are to take these workers alone - they will need a 'top-up' of around €2.60 per hour. If they are working a 40 hour week, that equates to more than €5,000 a year.

Every single euro spent subsidising business which pay low wages is a euro less to spend on hospitals and schools, pensions and carers.

Do we really want to let big business off the hook when it comes to paying a decent wage?

I believe this is fundamentally misjudging what workers want and the value people themselves place in their work.

The Labour Party if returned to Government will work with the Low Pay Commission to see the National Minimum Wage progressively and incrementally increased to allow workers to have a better standard of living.

We will continue to campaign on and support the Living Wage Campaign, a voluntary initiative where progressive businesses agree to pay their staff and contracted workers a minimum of €11.50 per hour. We will lead by example by making Government and its agencies Living Wage employers. We will continue to support small business and strengthen workers' rights.

We will ensure that work always pays - but that you, the taxpayer, don't have to foot the bill in the process.

Ged Nash is Minister of State at the Department of Jobs, Enterprise and Innovation

Irish Independent

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