Skip to main content
Normal View

Dáil Éireann debate -
Wednesday, 1 Mar 2000

Vol. 515 No. 4

National Minimum Wage Bill, 2000: Second Stage.

I move: "That the Bill be now read a Second Time."

I am pleased to be the first Minister to present a National Minimum Wage Bill to the House. The Bill delivers on the Government's commitment to introducing a national minimum hourly wage. The Bill will ensure that tens of thousands of low-paid workers will secure an increase in their pay to a level that reflects the status of this country as a modern developed economy and a caring society.

The commitment to introduce a national minimum wage contained in the programme for Government was, in essence, a social policy commitment placed in the framework of an assault on exclusion, marginalisation and poverty. However, the Government also recognised that, as a social policy issue, it had significant economic implications. The terms of reference of the National Minimum Wage Commission reflected this. I indicated my concern to protect those workers who are vulnerable and prone to being exploited, especially women and young people. We also have to protect employment and competitiveness, and the Bill strikes the right balance. The outcome is both a victory for jobs and the rights of workers.

The Bill is an historic development which will influence the lives of many thousands of workers, both now and in future. Our economy has been radically transformed in recent years. Employment has reached new levels and unemployment has been significantly reduced. Real earnings of employees have improved substantially, although not all employees have equally benefited from our economic success. Many thousands of workers are paid rates which are no longer acceptable. A statutory minimum wage will greatly alter how we as a society view and value the work undertaken by thousands of workers which has historically been categorised as being of low skill, low esteem, dead-end and, consequently, low-paid. Such views have, to some extent, marginalised the workers concerned, reduced work incentives, and promoted a dependency culture, as well as subjecting them to low levels of income. Many of these workers are women and young people. However, the work performed by such workers has an intrinsic value to society that must be recognised and fairly rewarded.

The National Minimum Wage Commission was the first step towards fulfilling the Government's commitment to introducing a national minimum hourly wage. The commission was appointed by the Government on 18 July 1997 to advise on the best way to implement the commitment. I thank the commission members, Evelyn Owens, Rita Ahern, Carmel Bolger, Phil Flynn and Peter Malone, for their valuable contribution to this important policy initiative. I published the commission's report on 5 April 1998.

The commission recommended, inter alia, that a target date of 1 April 2000 be set to implement the commitment. It also recommended that the national minimum wage should be measured against the median earnings of all employees.

In taking this view the commission went on to state:

The initial rate for the national minimum wage should be set at around two-thirds of median earnings and should take into account employment, overall economic conditions and competitiveness.

These two issues – the implementation date and the initial rate – have been central to the debate that followed the publication of the commission's report. The Government has, from the beginning, accepted that the national minimum wage should be introduced from 1 April 2000 and I have repeatedly stated this since April 1998 in order to ensure that both employers and workers had adequate time to prepare for the introduction of a national minimum wage.

On the issue of what hourly rate should be set for a national minimum wage, the commission recommended that it should be set at around two-thirds of median earnings and should take into account employment, overall economic conditions and competitiveness. Some people have tended to focus on the first element of this recommendation and ignore the latter one. The Government does not have that luxury. In deciding on the rate I considered that, in line with the thrust of the commission's recommendation, the impact of any proposed rate on employment and competitiveness must be taken into account. The ESRI impact study puts figures on the realities facing us in this regard in deciding on the appropriate rate, reduced employment, increased unemployment and reduced competitiveness. It would be easy in the current economic climate to disregard the impact of a high minimum wage but I must have regard to the welfare of the economy and, more importantly, the employment opportunities of its people now and in the future. The Government believes the introduction of a rigid automatic rate setting mechanism would not be the best way of addressing this issue. Since April 1988 I have stated that I consider that the appropriate rate should be £4.40 from April 2000. After considering the results of the ESRI impact study, I remained even more convinced that this was the appropriate rate.

The recently negotiated Programme for Prosperity and Fairness also included a recommendation that the initial rate, will be £4.40 per hour from 1 April 2000, and that it should be increased to £4.70 from 1 July 2001 and to £5.00 from 1 October 2002. Mechanisms for adjusting this rate are contained in the Bill and agreement by the social partners to specific increases in the rate during the lifetime of the new agreement will be dealt with in that context. I also welcome the commitment of the trade unions and employers in the Programme for Prosperity and Fairness that no repercussive claims related to or following on from the application of the national minimum wage will be made by trade unions or employees.

Questions have been raised about how the legislation interacts with the pay provisions in the recently negotiated Programme for Prosperity and Fairness. A worker on a wage which is less than £4.40 an hour will, from 1 April, in accordance with the legislation, have an entitlement to the new national hourly minimum wage. The new agreement, once ratified, will apply to various workers at different stages throughout 2000 and may apply to some with effect from 1 April. The agreement does not provide a different regime of timing or flat or percentage increases for those whose pay would be altered by the legislation on 1 April. Consequently, it will be open to such workers to pursue the basic pay increases under the Programme for Prosperity and Fairness separate from increases granted under the legislation.

All the relevant terms of the draft pay agreement would apply in these, as in all cases, but that is a matter separate from the establishment of a national minimum wage. The Bill has been drafted in the context of the existing statutory minimum wage fixing machinery. Current statutory minimum rates of pay are specified in a number of employment regulation orders and registered employment agreements, covering various occupations and industries ranging from agricultural workers to the construction industry. Employment regulation orders and registered employment agreements go beyond minimum wage fixing and include conditions of employment.

The National Minimum Wage Commission examined the question of whether the Joint Labour Committee/Employment Regulation Order system should continue to operate following the introduction of the national hourly minimum wage. The commission recommended that no changes be made to the Joint Labour Committee system and concluded that they should continue to set rates of pay and conditions of employment for the sectors covered by the committees. I have accepted this recommendation, subject to the proviso that where the minimum amount of pay prescribed in an Employment Regulation Order is less than that prescribed by the Bill, the employee's entitlement to remuneration will be in accordance with the Bill. This will also apply in relation to Registered Employment Agreements.

The Bill strikes the right balance between the desire of society to prevent the exploitation of workers on low pay and the necessity to share the fruits of recent economic growth more fairly against the need to continue to grow employment and create wealth in our economy. I will now outline the purpose of the most significant sections of the Bill, which I hope all sides of the House can support.

Section 1 provides the Short Title and permits the Minister for Enterprise, Trade and Employment by order to appoint a date on which the Bill or particular provisions of it will come into operation. I intend that the Bill shall be implemented with effect from 1 April 2000.

Section 10 is central to the operation of the Bill. The pay of an employee may vary from time to time due to particular circumstances within the workplace, for example, working on different shifts or working on a Bank Holiday. The purpose of a pay reference period is to allow these variations that may arise to be averaged over the pay reference period. The employer may choose the pay reference period which best suits his or her pay patterns, subject to it being no longer than one calendar month. The selection of a pay reference period for a national minimum wage under this Bill does not alter an employee's existing pay period. To ensure that an employee is informed by his or her employer as to the period which the employer has selected, section 42 will accordingly amend section 3 of the Terms of Employment (Information) Act, 1994, to provide for this requirement.

Section 11 enables the Minister for Enterprise, Trade and Employment by order to prescribe the national minimum hourly rate of pay having taken into account the impact the proposed rate may have on employment, overall economic conditions and competitiveness in the economy. In relation to the review mechanism for the national minimum hourly wage, it is necessary in line with the recommendations of the interdepartmental group, to provide two mutually exclusive alternative mechanisms. Where a national agreement is in existence, or proposed, and contains a recommendation to the Minister for Enterprise, Trade and Employment in relation to the national minimum hourly rate of pay, section 12 will apply. However, where these circumstances do not apply, section 13 provides that the Labour Court can be requested by an organisation substantially representative of employees or employers to make a recommendation to the Minister for Enterprise, Trade and Employment. In either case the Minister may accept, vary or reject the recommendation. If varying or rejecting the recommendation, the Minister must make a statement to the Oireachtas of the reasons for that variation or rejection.

Section 14 prescribes that an employee aged 18 or over must be paid for his or her working hours in any pay reference period at an hourly rate of pay that, on average, is not less than the national minimum hourly rate of pay unless sections 15, 16 or 39 apply. An employee under the age of 18 years must be paid for his or her working hours at an hourly rate of pay that, on average, is not less than 70% of the national minimum hourly rate of pay. Section 15 concerns the entitlement of a job entrant, being an employee who enters employment for the first time after reaching the age of 18 years, or having entered into employment before reaching the age of 18 years, who continues in employment on reaching that age. A job entrant must be paid by his or her employer for his or her working hours at an hourly rate of pay that, on average, is not less than 80% of the national minimum hourly rate of pay in the first year of having commenced employment for the first time, after reaching the age of 18, or the first year of employment, after continuing in employment on reaching the age of 18, and 90% of the national minimum hourly rate of pay in the second year of having commenced employment for the first time, after reaching the age of 18, or the second year of employment, after continuing in employment on reaching the age of 18. Any employment under the age of 18 is not reckonable for this section.

Section 16 implements the recommendation of the National Minimum Wage Commission that employees undergoing training should be paid 75%, 80% and 90% of the national minimum hourly rate of pay in the first, second and third year of training. An employee, aged 18 or over, undergoing a prescribed course of study or training authorised by his or her employer must be paid for his or her working hours at an hourly rate of pay that, on average, is not less than 75% of the national minimum hourly rate for the first year of training and 80% of the rate for the second year of training, and 90% for the third year of training. These percentage rates are to apply pro rata to each one-third of the duration of a course of study or training if it is less than three years.

Regulations will prescribe the criteria to which a course of study or training must comply in order for an employer to apply the sub-minimum rates.

The rationale underpinning these provisions, as stated by the commission and the interdepartmental group, is that, all other things being equal, an experienced employee is of more value and more productive than a new entrant or trainee. It is also equally important that those seeking employment would not be prevented from getting the opportunity to enter work because of their lack of experience or training.

Section 19 and the Schedule to which it refers sets out what components of an employee's pay are reckonable and non-reckonable when calculating if an employee has been paid at least the minimum hourly rate of pay to which he or she is entitled in accordance with this Bill. The section reflects the recommendation of the interdepartmental group in the statement that all gross payments, which can be regarded as making up the rate for the job, should be considered to be reckonable, such as basic pay, bonus payments, commission, piece and incentive rates and allowances for special duties. The group also recommended that all premia payments paid to an employee in relation to normal or standard working hours should be included as reckonable pay.

I recognise that the issue of what should constitute reckonable pay for national minimum wage purposes is difficult and has given rise to differing views, but the general principle advocated by the interdepartmental group, namely, that the general rate for the job should be the applicable criterion, provides a basis for addressing this issue. I would be concerned to ensure that those employees, who should mainly benefit from the introduction of a national minimum wage, are not deprived of this benefit by manipulation of reckonable and non-reckonable pay components. That is why, in addition to providing for changes in pay structures that may arise in the future, there is a degree of flexibility provided for in allowing the Minister to amend by regulation the Schedule of components, as appropriate, after consultation.

Section 23 has been designed to provide a structure that allows any potential dispute to be resolved speedily between an employee and an employer. An employee will have the right to request from his or her employer a written statement of his or her average hourly rate of pay during a particular pay reference period, subject to it being a pay reference period falling within 12 months immediately prior to the employee's request and not relating to the employee's current pay reference period. This process should help identify any under-payment and allow the parties to resolve the dispute without recourse to the enforcement provisions of the Bill.

Sections 24 to 28 provide that a dispute which has not been resolved between the parties may be referred by either party to a rights commissioner for a decision and any party aggrieved with such a decision may appeal it to the Labour Court for determination. The rights commissioner or the Labour Court in dealing with an appeal, if satisfied that an employee has not been paid his or her entitlement under the Bill, will be empowered to award arrears of remuneration owing to the employee and to award reasonable expenses to the employee.

Another mechanism to ensure employers will adhere to the provisions of the Bill will be the appointment of inspectors by the Minister under section 32. An employee who feels that he or she could not openly identify themselves by taking a case to a rights commissioner may, under section 33, request an inspector to investigate if his or her employer has failed to pay the employee's appropriate entitlement to remuneration under this Bill. It will be an offence under section 34 for an employer to refuse or to fail to pay an employee for each hour worked at an hourly rate of pay that on average is not less than the employee's entitlement to his or her minimum hourly rate of pay under this Bill. Section 36 provides for appropriate penalties to be imposed for offences committed contrary to the provisions of the Bill.

The ESRI impact study highlights the potential impact the national minimum wage could have on employment levels. With this in mind, the interdepartmental group recommended that provision be made for an inability to pay for firms in difficulty within certain parameters. Section 39 implements that recommendation without undermining the thrust of the legislation.

Section 39 permits the Labour Court to grant a temporary exemption to an employer if satisfied that the employer is unable to pay the national minimum wage and if the employer were compelled to do so, the employee would likely be laid off or would have his or her employment terminated. An employer will only be entitled to be granted one temporary exemption by the Labour Court which shall not exceed one year. A number of other safeguards will apply, including the convening of a Labour Court hearing to examine the application, and an employer must obtain the consent of each employee or the majority of employees affected to make the application to the Labour Court.

As evidenced by the ESRI impact study, repercussive or spill-over claims by those employees for whom the legislation is not intended to benefit could undermine the purpose of the legislation as well as negatively impacting on their own employment and on national competitiveness. It is, therefore, vital that the State's industrial relations machinery should not be used by such employees to further such claims. The National Minimum Wage Commission recommended that the social partners and the Government conclude an agreement that "any claims on foot of the introduction of the minimum wage would not be recognised or accepted by the Labour Court". The interdepartmental group endorsed this approach but also recommended that a provision be included in the legislation.

Accordingly, section 41 will implement that recommendation. The effect of the section is that the Labour Relations Commission and the Labour Court, or a conciliation and arbitration scheme in the public sector, may not recommend in favour or endorse any claim or part of a claim referred to it which is based on the restoration of a pay differential between an employee and another employee who has secured or is to secure an increase in pay as a result of this Bill. Similarly, the Labour Court may not accept a proposal for an employment regulation order from a joint labour committee or register an employment agreement or vary a registered employment agreement if the proposal, agreement or variation is based on the restoration of a pay differential between an employee and another employee who has secured or is to secure an increase in pay as a result of this Bill. As I said earlier, the Programme for Prosperity and Fairness contains an agreement by ICTU and employers that trade unions or employees will not make such claims.

The remaining sections of the Bill primarily provide safeguards for employees arising from its operation. As I mentioned earlier, the Schedule lists reckonable and non-reckonable pay components in calculating the minimum hourly rate of pay of an employee. I propose, subject to the passage of this Bill through the Oireachtas, to bring the legislation into operation from 1 April 2000.

I will, in accordance with section 11 by order, set the initial national minimum hourly rate of pay at £4.40 per hour from 1 April 2000. Having considered the findings of the ESRI study, I am satisfied that this hourly rate strikes the right balance between the need to ensure that vulnerable sectors of the workforce, mainly women and young people, are not exploited and the need to ensure that employment and competitiveness is maintained. As I said earlier, the recently concluded negotiations for a successor to Partnership 2000 included an agreement by the social partners that the national minimum wage hourly rate be increased to £4.70 from 1 July 2001 and to £5 from 1 October 2002. The Government will consider this recommendation at the appropriate time in accordance with section 12 of this Bill.

My Department will launch an intensive publicity and information campaign if the Bill is approved by the Oireachtas so that employers and employees will be aware of their obligations and entitlements. I recognise that enforcement of the national minimum wage is critical to the achievement of its objectives. The present complement of labour inspectors is ten and they are responsible for the enforcement nationwide of an extensive array of highly complex labour-employment legislation, employment regulation orders and registered employment agreements. The need for additional resources for the inspectorate arising from the national minimum wage legislation has been acknowledged by both the National Minimum Wage Commission and the interdepartmental group on the implementation of a national minimum wage. Accordingly, the Government has agreed, at my request, to assign significantly increased staffing resources to the inspectorate to enable delivery of an enforcement service in respect of the national minimum wage legislation and other employment rights legislation. The additional resources consist of seven labour inspectors and three support staff.

This Bill heralds a new era as to how society views and values the work undertaken by workers who have until now been confined to the margins of our economic progress. The Bill will ensure that 163,000 workers will receive an improvement in their pay as and from 1 April 2000. The Bill provides a fast and cost-free method to employees to determine disputes between them and an employer, an effective system of enforcement and a transparent method to review the hourly rate.

It is extremely disappointing to commence a debate on legislation which, in principle, is getting a warm welcome by all parties by vigorously protesting at the speed with which it is being pushed through this House and Seanad Éireann. Neither I nor Deputy Rabbitte want to be blamed if the minimum wage does not come into force on 1 April as heralded by the Government two years ago.

What has happened in those two years?

The Minister is treating this House like a rubber stamp. During her contribution she was rather disingenuous when she said, "My Department will launch an intensive publicity and information campaign, if the Bill is approved by the Oireachtas". Everyone knows that her publicity campaign is already cranked up, that she has arranged her photo opportunities and chosen the clothes she will wear to the photo call—

I am not even involved in the campaign.

—and that the people who will be part of that photo call have already been identified. The Minister should not make fools of us by saying "if the Bill is approved by the Oireachtas". She knows that the Government can put anything it wants through the House when it chooses.

What has been happening since the National Minimum Wage Commission was established on 18 July 1997? The commission issued its preliminary report on 16 December 1997 and sought additional time before issuing its final report, a request with which everyone agreed. The final report was issued on 5 April 1998 and the Minister established an interdepartmental committee to consider how it might be implemented. That committee made its interim report in November and issued its final report in May 1999 which the Minister published, with great fanfare, on 22 June 1999, my birthday.

I wanted to give the Deputy a nice present.

In her statement that day, for which she received a great deal of publicity, the Minister said "I will be announcing details of my legislative proposals in the near future." Anybody seeking a definition of the term "near" would assume it meant one, two or, at the outside, three months, they would not assume it meant seven months. A finite date of 1 April 2000 was set for the introduction of the national minimum wage and for the legislation dealing with it to appear on 24 January 2000 was an insult to the House, to the people who will be obliged to implement the legislation and to the 160,000 whose wages are currently below the national minimum.

We do not have time to trawl through the legislation to ensure that this historic development is properly placed on the Statute Book. Second Stage will be taken today and tomorrow and Committee Stage will be taken immediately thereafter. There will not even be one full day between Second and Committee Stages. The Opposition was obliged to reluctantly agree to take Committee Stage on Friday and again next week, mainly because Deputy Rabbitte and I are not in a position to devote six or seven hours on one sitting day to the Committee Stage debate.

Anyone who has an interest in this legislation will not be able to have the input to its passage to which they are entitled. As late as this morning I received a telephone from a representative of a chamber of commerce situated outside Dublin who informed me that the chamber did not know how the small businesses it represents would be able to implement the minimum wage by 1 April. It may be easy to do so if a firm's employees are all over 18 years of age, out of training and have been working with the company for some considerable time. In such cases, employees' whose wages are below the minimum will receive an increase on 1 April. What about a company with an employee it considers to be involved in a training process but which does not have a structured training course in place? On employing the person, the owner of the company may have stated that for the first one or two years they would be considered to be learning the job or in training. That employer is entitled under the legislation to seek to pay an amount lower than the minimum wage to the employee in question. However, they will not have time to establish training structures and, if they do not want to find themselves in hot water with the courts, they will have no choice but to pay the minimum wage. They may be able to back-pedal when they establish the prescribed training courses.

The speed with which the legislation is being introduced is unfair to the workers and to the 175,000 small businesses which form the backbone of employment. Companies with fewer than 50 employees offer most of the employment opportunities in this country. The small firms to which I refer, particularly those with three or four employees, will have difficulties implementing the legislation if they do not have structured training courses in place while one or two of their employees are considered to be in training.

For many months, Deputy Rabbitte and I morning after morning inquired after the whereabouts of the legislation. I went as far as to inform the Minister that if it was not introduced early enough we would be obliged to squash the debate on it into a few short days. That is precisely what has happened. Measure the delay in bringing this legislation forward with what occurred in the UK, the only other European country apart from Ireland which did not have a national or statutory minimum wage. The UK authorities published their legislation on 26 November 1997. It gained what they call "royal assent" on 31 July 1998, which meant that parliamentarians had seven months to discuss the legislation with various interested parties in their constituencies. The legislation did not come into effect until 1 April 1999, meaning that almost year elapsed from the time the National Minimum Wage Act, 1998, gained royal assent until the minimum wage was introduced. In the interim, consultations took place, regulations were introduced and committees of the House of Commons had the opportunity to consider the legislation and decide whether they were satisfied with it.

In my view, the Minister has been found wanting in terms of the way she has dealt with this Bill which is one of the crucial elements of her legislative programme as Minister for Enterprise, Trade and Employment. I am disappointed – I am sure the Minister is also disappointed but is not in a position to admit it – at the way matters have been handled. A number of months ago the Minister of State at the Department of Enterprise, Trade and Employment, Deputy Treacy, came before the House with the Companies (Amendment) (No. 3) Bill. All Stages of that legislation were taken in quick succession in both Houses. On that occasion we informed the Minister of State that we would facilitate him because the flotation of Eircom had to proceed but we also said that we would not do so again because people needed to have an opportunity to examine such complicated legislation.

The Select Committee on Enterprise and Small Business, at my suggestion, recently put in place an extremely successful mechanism for dealing with the Copyright Bill. Between Second and Committee Stages, we invited the different groups interested in the legislation to appear before the committee to discuss the legislation. Not only did Members hear their views but they heard each other's views. In my view that was a very good exercise in democracy and it allowed lobbying groups to see the problems encountered by their counterparts. That mechanism has served the committee well while it continues to debate the legislation in question.

There is no time to take similar action in respect of the National Minimum Wage Bill. I would have liked a week to have been set aside in order that the INOU, ICTU, the chambers of commerce, the Small Firms' Association, IBEC, etc., might discuss their concerns about the implementation of the legislation with Members. That would have proved beneficial because suggestions for amendment to the legislation might have been forthcoming.

As a profession, politics is losing face because everything is moving outside this House for discussion. The emphasis on scrutinising legislation has been removed from the House because no one takes a blind bit of notice of its proceedings anymore.

While there is one journalist in the Press Gallery today, little or no recognition is generally given to our debates on legislation, unless it is extraordinarily interesting or very controversial. I am sorry to go on about that but I am really disappointed with the Minister, particularly given what happened in the UK.

The Minister might say she could not do anything until the new partnership programme, the Programme for Prosperity and Fairness, was negotiated. However, that would be wrong because the bulk of this legislation is enabling. She has not put a figure in it, although I know she wanted to. This legislation could have been drafted and published before the social partners began their discussions. That would have been very helpful and might have helped the Minister make some amendments to the legislation. I hope she will take on aboard the amendments I table because there are flaws in this legislation. I agree with the overall principle of a minimum wage. However, the Minister is running the risk of not having the best possible legislation.

There is a well known African expression that Fr. Sean Healy has often used in discussions with me – when elephants fight it is only the grass that gets trampled. This legislation is not for the elephants of this society but for the people on the grass. They need a national minimum wage. We see the trappings and manifestations of great wealth – boats, two and three cars and good houses – of many people, many of whom worked very hard to get it. That is wonderful and it is great to see Irish people succeeding and enjoying prosperity. However, we must also remind ourselves that many people are living on very small wages and incomes. Pensioners and widows are living on £72 or £73 per week. As a colleague said to me, two people would not get very much for £70 in any medium or good restaurant. Some people have to live for a week on that much money. This legislation is for the people in our society who have not felt the breath of the Celtic tiger or heard him purring in their ear.

When the idea of a minimum wage was first proposed some people said it would be very damaging and would cause a loss of jobs and growth. Perhaps in 1997, when it was first announced, there might have been some factuality to that and there might still be some job losses. However, we should look carefully at what the chairman of the British low pay commission, Professor George Bain, said when he was asked about this.

He said he would be surprised if there were not some job losses but that perhaps British workers might be better off without the sort of low wage jobs that could be lost. He said the scale of losses would be based on the level of the minimum wage. He also went on to say that the jobs which it might be better to lose, for which I am sure he was criticised, would be those very low skilled, low paid positions which Britain should be looking to move beyond. He said he did not think the future for Britain was to try to compete with the low wage economies of the Third World. He went on to say that anyone who says they know what the impact will be is misleading people because there are so many imponderables, which was also said in the preliminary report of the minimum wage commission.

Things have changed even in the two years since the Small Firms Association and IBEC made some quite trenchant and strong statements about the introduction of a minimum wage. It is now almost impossible for employers to get employees and they often have to offer them wages above the minimum wage we are introducing, which is good. I was told by the part owner of a major hotel in Dublin that high class hotels must pay a minimum of £5 per hour and £9 per hour for evening work to get good staff. They have had to move with the times.

The experience in the UK was that as soon as a minimum wage began to be discussed, many of the firms which felt it would affect them began to move towards making changes in their pay structures, so that the gap between their current pay levels and the minimum wage they would eventually have to pay would not be too great and they could plan it in a phased way. I believe that has also been happening in this country, either in a proactive way or as something forced on employers who cannot get employees.

Those who are saying this is bad for the country do not have a strong case to make. However, they are entitled to ask how it will be implemented and to make a claim under section 39 that they cannot pay the minimum wage because a financial downturn means the company will close if they have to pay it and the employees will lose their jobs. I welcome that protection.

However, there is a feeling in Britain that the minimum wage can lead, and has led, to more jobs. Professor Bain said that Prime Minister Blair and Mr. Brown have said that American evidence shows that a minimum wage leads to a raising of productivity and forces employers to train their staff better. That is a double gain of better trained staff and more productivity, and the employer gets better value for his £4.40 an hour, although I hope very few people will be earning such a low wage. It is important to recognise that the direction our society and economy have taken has helped considerably.

The Minister said rightly that the people who will benefit most from this national minimum wage will be women and those under 25 years. That is as it should be because far too many women are working in sectors where they are paid very little. Most of the women earning those low wages have no choice. Due to responsibilities in their homes and the lack of child care places, they have to take a job that pays only £2.50 per hour because that extra £40 or £50 will mean they are not hungry at the end of the week or can buy shoes for their child to wear to school. They are forced into exploitative employers' hands.

I want to raise the issue of home helps. This minimum wage will also apply to the public service. Did any Departments object to the introduction of a minimum wage? Did they complain they would not be able to pay it unless they got more money? The level of home help pay is a scandal. It ranges from about £2 to £3.50 per hour for really difficult and stressful work. As a result of the chaos in our hospitals, many people are being sent home early from hospital to free up beds. The pressure of minding somebody who should, perhaps, have stayed in hospital for another week falls on the local support staff of the health boards, principally the home helps. They have to help old or sick people get in and out of bed and use the toilet, dress them and dress wounds if bandages fall off. A home help is called on to do this stressful work as well as providing food, comfort, conversation and company for a sick or old person.

It must sicken those home helps to hear people talk about the high wage economy when they are taking home £20 or £40 after a number of hours of really difficult work. I hope the Minister can assure me that the Department of Health and Children will provide the necessary money immediately from 1 April to every health board and that if, on 2 April, I telephone a home help, almost all of whom are women, she will be able to tell me she is getting £4.40 an hour.

The minimum wage on its own will not help the unemployed or the low paid and the Government must provide a package of measures to improve the position of such people. There is a need for tax reform, but not tax reform for the rich as in the Government's budgets so far, including the fiasco of the last budget where it did not know how to cope. A total of £60 of the minimum wage will be taxed. The Government raised the tax free threshold to £120 but the remaining £60 earned by a person working a 39-hour week on £4.40 per hour will be taxed. The Government promised to deal with this issue but has not introduced any measures to date. Fine Gael's proposal to exempt the first £170 of earnings, the minimum wage level, should have been taken up by the Government in the budget.

The Government must also provide targeted training for the unemployed and those on low incomes in low-skilled jobs. These are the people who will suffer if there is a downturn in employment statistics. The Government must also provide a proper employment service. I appeal to the Minister to look again at the community employment schemes. From 1 April, in conjunction with the introduction of the minimum wage, the Minister proposes to introduce changes to CE schemes which will mean people over 35 years of age who spend three years on a CE scheme will not be able to join another scheme. The Minister uses words like "flexible" but FÁS officials on the ground do not know what she means by this. As far as they are concerned if someone completes three years on a CE scheme and they are over 35 years of age they cannot take part in another scheme – three years is the cut-off point. The Minister should give real flexibility in this area as these people will probably never enter full-time employment because of their age and the work they are doing suits the CE schemes. The Minister has a responsibility to re-examine this proposal.

I referred earlier to a UK study which indicated that the minimum wage did not result in a downturn in employment as there were so many imponderables involved. The preliminary report published by the commission stated that it can be difficult to interpret the competing results concerning the employment effects of minimum wages. It also noted that many studies reported small negative effects, others reported zero effects and some had found small positive effects. This defeats the argument that there will be a downturn in employment.

I wish to deal with the tourism sector which, I hope, will be assisted by the minimum wage. It is estimated that 51% of those employed in hotels, catering and tourism are skilled workers. All jobs in tourism and catering involve some form of skill. They are not low-skilled jobs whether one is clearing tables, waiting on tables or making beds. A survey carried out in 1997 estimated that 57% of employees in this sector work longer hours than the national average of 40.4 hours per week, 37% work 41 to 50 hours per week and 20% work between 51 and 80 hours per week. The survey also indicated that almost half the graduates surveyed earned under £150 per week while three quarters earned under £200 per week. These are skilled catering and tourism workers and these salaries are disgraceful. Ireland is second from bottom among OECD countries in that 24% of our workers are paid less than 66% of the median average earnings. This is a disgraceful indictment.

I wish to address some of the concerns expressed by the SFA and IBEC. I am glad the PPF addressed the issue of follow-on claims and the Minister also dealt with it in this Bill. I hope this will allay that concern. Section 16 of the Bill deals with training but is extremely badly written in the sense that I do not know, nor can any employer know, what is meant by a prescribed course of study or training authorised by the employer. It is a different matter if someone is sent on a FÁS training course but what if an employer establishes a training course? No work has been done on this issue and the legislation needs to set out what constitutes training provided by employers, otherwise there will be exploitation. A training course allows the employer to pay 75% of the minimum wage for the first 12 months, 80% in the second 12 months, 90% in the third 12 months following which the trainee goes on to the full minimum wage. There will be exploitation if there is no structured training regime in a company.

What will happen if a worker who has taken part in a three year training course and eventually obtains the minimum wage, moves to another company? Can the new employers decide they do not like the previous training received by the employee and send him or her on another course so that the worker ends up on a merry-go-round of training courses for three, six or nine years? The legislation does not deal with this scenario so I have tabled an amendment which would prevent a new employer from behaving in this way.

I hope the Minister will produce more information on Committee Stage on how training will be defined, how assessment will be carried out, what certification will exist and how one will compare in-house and outside training? How will colleges or courses be prescribed? If a person is in the beauty business and sets up a training course in his or her house, will that be enough to constitute a training course? What about small companies with only three or four employees who want to take part in training? What will happen when such a company has to let go an employee?

In a report produced in the UK six months after the introduction of the minimum wage, John Monks, general secretary of the TUC, noted that everyone agreed that the minimum wage had no effect on jobs or inflation and expressed disappointment at the lack of an annual review. The report also noted that there is little evidence of jobs being lost as a result of the minimum wage and that there were no signs of significant minimum wage effects on employment figures and no measurable impact on overall employment. This report deals with the concerns expressed by the Minister and others.

As regards enforcement, I welcome the Minister's statement that there will be more inspectors but I am not sure this will be enough. Some of the claims for Partnership 2000 will not be settled until October 2000 or later. What will happen if, on 1 April, an employer claims that with the full implementation of Partnership 2000 in October his or her employees will reach the £4.40 level and so they are not obliged to pay the minimum wage on 1 April because it was back-loaded from Partnership 2000? I seek an assurance that workers will get their money from 1 April.

The legislation does not include safeguards on anti-avoidance measures which have been included in other recent legislation and I will table amendments to deal with this issue. When setting out what constitutes reckonable and non-reckonable income, I hope the Minister will remove from reckonable pay some of the social and bank holiday payments. She should also exclude tips paid to low income workers in their payrolls. This is a mean provision. The Minister is not regarding tips paid directly into workers' pockets as reckonable but is making those paid in wages as reckonable. People earn tips because of the quality of service they provide and they are entitled to them. We should do away with tips and give a better wage, but once tips are earned they should not be regarded as reckonable income.

I have rarely looked forward to a Bill as much as this one. It has the capacity to remedy a major and widespread injustice in society. Rarely, however, have I been so disappointed by a Bill.

Section 19 and its accompanying Schedule go to the heart of the national minimum wage. To the ordinary worker the Bill means that the basic wage will be fixed at £4.40. Section 19, however, does not do that. It states that "reckonable components" may be taken into account when calculating the hourly rate. Those reckonable components, defined in Part 1 of the Schedule, include basic salary; service pay; shift premium; unsociable hours premium; all productivity related payments such as piece and incentive rates, commission and bonuses; allowances for special or additional duties, including those of a post of responsibility; the monetary value of board with lodgings; any amount distributed to the employee of tips or gratuities paid in a central fund managed by the employer; the amount of any service charge distributed to the employee through the payroll; public holiday premium, Saturday premium, Sunday premium and where any such holidays or days are worked; any payments under section 18 of the Organisation of Working Time Act, and other factors.

I take no pleasure in this but one has to conclude that it is fraudulent for the Tánaiste or anyone else to promulgate a national minimum rate of £4.40. It is a fraud and an abuse of language. Take one element of all those listed – premium pay. The situation is well established, a two cycle shift earns a premium of 16.6%, a three cycle shift earns 20% and continuous shift working earns 33%. That may be taken into account when calculating the basic hourly rate. On top of that there could be service pay, holiday pay or weekend working. Any such pay component can be put into the melting pot and divided by the number of hours in the working week. An employer could pay £3 per hour and implement the terms of this Bill properly because shift premium, service pay and weekend working could be added on and he would be within the £4.40 rate.

I wonder about the drafting of this legislation. The English in the British legislation is a great deal more simple and succinct. I do not know why such simplicity should be so difficult here, in a city that boasts of the best spoken English in the world and where it is written as well as anywhere else. When all the verbiage is stripped away, the unfortunate young person on the lowest of wages has been led to believe by the Tánaiste and the Government that he will have a minimum rate of £4.40 per hour. It will not be like that at all.

I say that because, as Deputy Owen said, low pay is a major problem in this economy. Job expansion in this State has been unprecedented, almost exponential, in the past six years. There is, however, a serious problem of low pay. It is amazing how quickly those of us who are on a somewhat more comfortable wage – I include my respected friends in the Civil Service in this – forget the conditions in which some low paid workers labour. The Tánaiste established an interdepartmental committee to implement the work of the commission. I can imagine those committed and intelligent senior civil servants sitting around a table and working out that the figure of £4.40 per hour has to be eroded because it might break the economy. I am not commenting on the commitment of those civil servants to their jobs or their excellence at them, but it is remarkable that someone on a relatively comfortable wage can sit around and decide that £4.40 an hour could unhinge the economy.

For that reason they inserted section 19. Now they do not have to worry about it because, under section 19, the figure can be circumscribed in such a fashion that it is no longer £4.40 per hour. By including these premium payments it becomes a case of now you see it, now you do not.

It is quite improper to include unsociable hours premiums. In Britain basic wage means basic wage. The addition of premium payments for the purposes of calculation is not permitted. Service pay might not be much but for someone earning £4.50 per hour, 40p is significant. Add in shift premium, which ranges from 16.6% to 33%, weekend working and holiday pay and it becomes very significant. Effectively, it undermines what the Tánaiste seeks to do.

Low pay is a widespread phenomenon. When in Government, people get so accustomed to making speeches and beating their breast, telling us how well they are doing and about all the jobs they are creating and the efforts they are making to bring in 200,000 from outside the State that they forget there are many people in the State who find it difficult to make ends meet.

The Tánaiste may reply by saying that the trade union movement agreed to this. If it did we must remember that the people on this rate of pay are generally not trade union organised. That is why the trade union movement has never overly concerned itself about this issue. These workers are outside the trade union movement. They form the most vulnerable section of workers.

The Tánaiste may ask, as she has done on a number of occasions, why the Rainbow Government did not introduce a minimum wage.

The question never featured from the social partners during the period of the Rainbow Government, nor did it feature during the negotiations for Partnership 2000. It was not an issue. My colleague, Deputy De Rossa, raised the matter, but he received little or no support from the social partners generally. On 28 October 1995 what was then The Cork Examiner contained a headline “A minimum wage is not the answer, says Ahern” and in the following article the then Deputy Bertie Ahern, leader of Fianna Fáil, went on to deliver what was described as a “strong attack” on the call by the then Minister for Social Welfare for a minimum wage. That was the official position, but history has been rewritten and I acknowledge the Taoiseach's skill in dealing with the issue. When we considered the pending general election in 1997 it was suggested that it might be a good idea to promise a minimum wage in our election manifesto, but we then remembered what happened in 1977.

My union, the then ITGWU, now SIPTU, did not espouse a statutory national minimum wage for various historical reasons and also because the union was of the view that it would act as a disincentive to recruitment and to low paid people joining the union. This was at a time when there was a high penetration of trade union organisation in the country. The issue has only come into focus in recent years. I know it is different on the Continent – many things are different there.

The Tánaiste knows that when the commission published its report in April 1998, it recommended a rate of £4.40 per hour. If account is taken of the movement in earnings in the two years between then and now, the April 2000 equivalent of this figure would be £4.90 per hour. In the negotiations just finished SIPTU sought a rate of £5 per hour and the Government indicated it would consider a higher rate if the employers and trade unions agreed on one. Nothing was agreed and the Tánaiste and the Government submitted to the employers' resistance. This meant the commitment to the principle of relating the minimum wage to two-thirds of median earnings has now been departed from. If this principle, which was generally accepted on this side of the House, was applied to the April 2000 context, the rate of £4.40 per hour will represent 52%, not two thirds, of median earnings.

I agree with Deputy Owen's comments on the Tánaiste's skill in the area of promotion and the way she has sold this measure. She has launched it a number of times since November 1997. However, it is little understood outside the House that we are not getting a minimum wage of £4.40 per hour for the reasons I have explained, nor are we getting a minimum wage that represents two-thirds of median earnings.

I pay tribute to the trade union leaders in concluding the Programme for Prosperity and Fairness because it is a considerable achievement in the wake of 12 years of social partnership to be able to continue it in present conditions of relative affluence. It brings many advantages in terms of certainty, planning and so on. As with any deal a contract is made, issues are prioritised and compromises are made. I would love to see the day when my Oireachtas colleague, Senator O'Toole, would have as his main focus the question of the national minimum wage because I doubt if it would be struck at £4.40 per hour, eroded by the method of calculation set out in the Bill. The Bill has no significance for most trade union members. It will be relevant to those who are not in unionised employments.

I am unable to suggest with any accuracy that when this legislation is enacted it will have a major impact on society. The Tánaiste knows as well as I do that the proposed hourly rate has been overtaken in the market place.

We will let the market decide.

I concede that the Tánaiste's normal flights of rhetoric were somewhat contained when she introduced the Bill, but to show that she did not move completely away from the historical pattern I remind the House of what she said, which was: "I do not exaggerate by describing the Bill as an historic development that will influence the lives of many thousands of workers."

I did not say that.

The flourish at the end of her speech was: "In conclusion, this Bill heralds a new era as to how society views and values the work undertaken by workers.".

Note the crescendo.

Whatever this modest, flawed measure does, it does not herald a new era for workers. We in this House should maintain some perspective on reality and not indulge in that kind of hyperbole, which bears little relationship to the reality.

There were objections to a proposed national minimum wage in 1997, but does the Tánaiste believe this issue is now among IBEC's top ten concerns? IBEC knows the reality. It knows that if McDonald's Restaurants advertises for children to work at £5 per hour the proposal to set the minimum wage at that rate in 2002, as provided for in the Bill, has no meaning. It has no meaning in most of urban Ireland, although it may impact on some pockets in provincial areas. Even here, the value of the measure to young exploited workers is negligible because of the manner of calculation.

The Bill does not provide for any anti-avoidance mechanisms. Anybody with knowledge of this business knows that certain kinds of employers will manipulate the terms of the legislation. The Minister has said she does not want to see this happen, yet she has not included any provisions to prevent this.

There is no point in Deputy O'Flynn telling me how good employers are. I know there are many good employers, but we are trying to catch those who are not so good because they are exploiting young workers, etc. Anti-avoidance or anti-evasion mechanisms are necessary to prevent such employers from doing what we have seen them do elsewhere, namely, reduce the number of hours. It is easy to pay £4.40 per hour if the number of hours is reduced. Overtime working can be described as "unsociable hours".

That is correct.

The names of some payments can be changed to fit into the category of reckonable components under section 19. I am not suggesting this is a widespread phenomenon among Irish employers, but it does happen and this area has not been addressed by the Minister.

As Deputy Owen said, it is regrettable that we are discussing the Bill effectively under guillotine. The Committee on Enterprise and Small Business acceded to the request from the Minister and said it would attempt to facilitate the enactment of the legislation by 1 April, as is required by the Programme for Prosperity and Fairness. We did so with the utmost reluctance as we know it is virtually impossible to give it the attention it requires and for Opposition Deputies, who have minimal back-up, to be able to engage in the research required. Second Stage will end with many Deputies offering to contribute. However, we have been told by the whips to facilitate the conclusion of Second Stage tomorrow night at the request of the Minister. The following morning Committee Stage will begin, which has only happened in emergency circumstances. We have to draft amendments before we make speeches on Second Stage, an amusing situation if the matter was not so serious.

This is not something which crept up on the Minister. Rather it is something the Minister has been brooding over since taking up office. Therefore, she had plenty of notice and time for prep aration. The Minister is looking over her glasses at me and may well latch onto Deputy Owen's line that she was waiting for the Programme on Prosperity and Fairness to be concluded. However, Deputy Owen and I know that the Minister was not waiting for the programme and made a fair effort at a solo run just before Christmas when she tried to upstage it. She wanted to include a rate of £4.40 in the Bill and to publish it.

That is not true.

I even know about the deputation to the Taoiseach and the emissary sent by the Taoiseach to make peace who worked out an agreement with the Minister. The Minister wanted to publish the Bill with the inclusion of the rate. If she wanted to upstage the talks at a delicate stage she could have published the Bill months ago.

It was never our intention to include the rate in the Bill.

The Minister wanted it included in the Schedule.

The Minister was going to announce the rate in conjunction with publication of the Bill at the press conference she arranged before Christmas, and drive SIPTU and the others mad. They got so mad they had to go to the great conciliator who fixed it up, and the Minister stayed her hand.

The rate is still £4.40.

Let me give credit where it is due. I acknowledge that the Minister got her way, and this is a pity in terms of the tens of thousands of workers who were expecting some relief under the Bill. The great conciliator, however he did it, brought the unions back on line. I am not going to make any cheap shots at the expense of the Minister because I think this reflects her personal political orientation, which is fair enough and I respect it. However, she is letting her ideological slip show in this regard. There is no basic commitment to the concept of a national minimum wage. It is one of the things to which the Government realised it was committed following the election. Neither is there a commitment to it in the Minister's Department. The Department was horrified when the programme for Government was examined in the aftermath of the 1997 election. I know the mantra –"It will halt our economic progress. It will put jobs at risk. Jobs will be lost".

That is not true.

Perhaps the job of the Civil Service is to take a conservative view on these issues. The document from the minimum pay commission is relatively balanced and of course the Minister's officials will admit that events have overtaken us all. The labour market has tightened so much that—

It does not hurt any longer to introduce the minimum wage.

It does not hurt. The task of getting workers—

In that case we would not need the minimum wage if the market is dealing with it.

It depends on what the rate is fixed at and how it is calculated. The rate of £5 per hour suggested by SIPTU seems reasonable in current conditions. If McDonalds is paying young people £5 per hour, it is unreasonable to expect anybody to work in the rag trade in factory conditions for less than £5 per hour. The inclusion of the reckonable factors in the Bill has undermined this.

It is strange that on the one hand we are so bellicose and so given to boasting about the Celtic tiger economy and on the other hand we have such a lack of confidence that we have to build mechanisms into the Bill to allow the Minister dismantle it in a doomsday situation. On reading sections 11 and 12 one would think there was an outbreak of war. Under those sections the Minister may, in certain circumstances, intervene and call the whole thing off. She may even alter, vary, change, amend or reject a Labour Court recommendation. Since 1946 we have lectured both sides of industry that they must not reject Labour Court recommendations. Now the Minister is saying that in case war is declared she wants to be in a position to reject a Labour Court recommendation. It is fantastical and does not show much confidence.

A Minister might want to increase the rate.

Yes, but that can be done by order, the mechanism selected by the Minister.

I am providing for the time when the Deputy might be in the Department.

Such forward planning is to be welcomed. I do not think the interdepartmental committee would have returned to me with that report. Interdepartmental committees always have some way, as if by osmosis, of divining what the Minister would like to hear, and I think this committee returned to the Minister with what she would like to hear. It would not have returned to me with a similar report.

Having said that, we on this side of the House have tried to facilitate the passage of the Bill.

I ask the Minister to understand that we also have certain responsibilities and duties to perform and while we are foreshortening the debate we want the opportunity on Committee Stage to deal with some of these important matters. She hinted in her contribution that she might be amenable to considering some changes, but she had better ask her officials to read the contributions to this debate and prepare for agreed changes, otherwise Committee Stage will take a long time. I do not say that in a threatening sense but these issues must be addressed. For example, the Minister hinted that she might be amenable to rethinking her approach to section 19, which is a key section. It was important that she gave such an indication because otherwise Committee Stage would take as long as that of the Copyright Bill, 1999.

I hope not as long as the DIRT inquiry legislation.

I wish to share my time with Deputy O'Flynn.

Is that agreed? Agreed.

I am pleased to have the opportunity to contribute to the debate. I agree with Deputy Rabbitte that the trade unions have never shown a huge commitment to dealing effectively with the needs of people who are essentially outside the organised labour area. However, the Deputy may be bringing some of the baggage of his trade union background to this debate because despite all his talk he does not display great commitment to the introduction of the national minimum wage. The constituency he represents very much mirrors mine. There has been high unemployment but in recent times, due to economic progress and the actions of the Government, there has been a significant reduction in the levels of long-term unemployment. The most recent figures for part of my constituency indicated that 400 people were on the long-term unemployed register.

Unemployment is falling but many of those who return to work take up quite low paid employment. It is important that that sector is protected. Many women and young people in my constituency work in the catering industry, which is notorious for its low wage regime; the rag trade, to which Deputy Rabbitte referred; the security industry, which is notorious for its exploitation of workers; and the cleaning and retail industries. All those workers will surely benefit from the introduction of a national minimum wage. Home helps are paid £3 per hour.

Even less in some cases.

Surely, it is incumbent on all of us to make provision for better working conditions for such people. I hope the House will support the Bill and I praise the Minister for its introduction. It should be recalled that other measures, such as the PRSI exemption, were introduced in the budget and these will improve the lot of the low paid.

I was concerned about comments made by Simon Nugent, a director of the Chambers of Commerce of Ireland. He referred to the need to delay the introduction of the national minimum wage. That should not be entertained and none of us should countenance it. There are concerns in the home improvements-DIY sector, which is open to competition from multinationals, but it operates in the commercial world and the companies involved are well aware of how to approach measures such as this.

The National Youth Council welcomed the introduction of the Bill from day one. It is a significant protection and will be of significant benefit to thousands of young people on low pay. The Minister referred to an information campaign. A proactive campaign is vital because the minimum wage will be introduced on 1 April. For example, when the minimum wage was introduced in the UK there was a lengthy information campaign.

I outlined the dates. We did not get that time here.

It is even more important that a well targeted campaign is undertaken so that the potential beneficiaries of the national minimum wage and employers are aware of its existence.

I am also concerned that only ten departmental inspectors are responsible for enforcement of the legislation. I am glad that seven additional inspectors and three support workers have been recruited. It is important because many of us will recall how difficult it was to police the Protection of Young Persons (Employment) Act, 1996. Employers have little reason for not being aware of or being ready to implement the minimum wage provisions. Clearly, some employers are opposed to its introduction and they have articulated their views. I was lobbied months ago by some of them and they know where I stand. It is also important in terms of enforcement that the inspectors try to work outside of office hours because a small number of unscrupulous employers will find ways of getting around their obligations, if necessary. It took three years to fully enforce the Protection of Young Persons (Employment) Act, 1996. There are still loopholes in it but it is a good deal better than what went before it.

A suggestion has been made to me and I ask the Minister to consider it. It could be included in the regulations which are to be introduced as a result of this legislation. A provision could be included obliging employers to display information on minimum pay in the workplace. That would be similar to the provisions in the Protection of Young Persons (Employment) Act, 1996, whereby employers are compelled to display posters with information on their obligations and young people's rights. Young people attending third level institutions or participating in further education should be the focus of an information campaign and commercial radio stations in Dublin, to which many young people listen, might be a vehicle for explaining young people's entitle ments. A help line ought to be introduced which will be staffed by people, preferably officials from the Department of Enterprise, Trade and Employment, who are knowledgable about the provisions of the legislation.

I do not pretend that I fully understand the Bill but there will be ballet dancing over section 19, which deals with reckonable and non-reckonable income. It is important that an information campaign to explain the intricacies of the legislation is undertaken. On young people involved in training, the fact that reduced rates will only apply where the training leads to certification is to be welcomed as it will ensure that employers will not be able to exploit the provision. Employers should be made aware that there is no room for ambiguity in the interpretation of this provision. Unfortunately, experience has shown that employers will abuse such loopholes if they feel they can get away with it.

An ongoing programme of information should be targeted at young people, thousands of whom will be entering the workforce every year. In regard to the categories of workers outside the trade union loop, some mechanism must be devised to inform them of the Bill's provisions. I suggest the establishment on an ongoing basis of a national minimum wage commission comprising trade union, employer, Government and social partner representatives.

The commission originally recommended that the initial national minimum wage rate should be set at approximately two-thirds of median earnings and should take account of employment levels, overall economic conditions and competitiveness. While £4.40 would have represented two-thirds of median earnings when the recommendation was made, that is no longer the case. I acknowledge that the Programme for Prosperity and Fairness provides for a step by step improvement in that regard.

I welcome the Bill's provisions and believe that, by and large, employers will support their implementation. Although a small number of employers may be tempted to manipulate the Bill's provisions to avoid their implementation in the workplace, I hope they will not do so. The provisions will benefit a significant number of workers in the area which I represent.

At the outset, I want to declare my interest in this Bill as an employer. As a public representative, I am aware that the Bill will assist many low paid workers as its introduction has been welcomed by many of the people visiting my clinics. As an employer, I support the introduction of a measure of social solidarity and the recognition that a wage floor must be imposed. Most employers pay fair wages but the few who pay scandalously low wages drag down the good name of others. This Bill will go some way towards addressing negative perceptions of Irish business people.

Home helps are among the groups who will benefit from the Bill's provisions. There are currently 8,293 home helps employed in Ireland, 2,500 of whom are employed in the Southern Health Board area, at a rate of £3 per hour. I welcome the fact that those people will now be paid £4.40 per hour.

There is a clear need for a major information campaign which would make employers and employees aware of the Bill's provisions. While most people are aware that the general rate will be £4.40 per hour, I suspect that few would be aware of what the rates of pay will be for those under 18 years of age, for trainees or for new job entrants. I also doubt that many people are aware of what the £4.40 covers, whether bed and board is classified as reckonable or non-reckonable income or what constitutes training for the purpose of the training rate. These are the types of questions being asked by employers and employees and we must ensure that those affected are informed of the answers before 1 April.

In January, the Chambers of Commerce of Ireland conducted a survey of 342 businesses in 25 locations throughout Ireland. The survey revealed that only two firms could correctly answer questions on the proposed date of introduction, the rate, whether the minimum wage applied to under-18s or other groups or whether allowances would be made for variations between industry sectors. Many employers are not aware of the key aspects of this Bill. I urge the Minister to inform as a matter of priority all those who will be affected by the Bill. I suggest that a dedicated helpline and website be put in place to deal with queries in the coming weeks.

Part III of the Bill provides that it is ultimately the Minister who will set the rate which is expected to be based on agreement among the social partners although the Minister may reject or alter their recommendations. There is no provision in the Bill which requires that an adequate period of notice be provided to the public regarding any changes in the rate. As it stands, the Minister could simply announce that the rate would be increased or decreased with immediate effect. That could create difficulties as it would not allow employers adequate time to adjust and prepare in terms of working out the costs involved in any increases. A sufficient lead-in period must be provided for any change in the rate and any intended changes should be publicised in advance to allow businesses to make necessary adjustments to their financial plans.

I want to issue a word of warning to any business people or employers who may be considering running for election to this House. They should forget it because details of their private lives and assets will be splashed across the pages of the Sunday newspapers. I, among other Members of this House, received a fax last week from Ireland on Sunday which contained five personal questions about my business and family affairs with the implication that I should answer them or the newspaper would report my refusal to do so. I consigned that fax to the bin.

I do not object to facts being printed about me as a public representative but private interests should remain private. Some sections of the media are abusing their position, setting out to pillory politicians in the name of investigative journalism. Last Sunday, Ireland on Sunday beat all by attempting to summarise the value of Members' property assets on the basis of the register of Members' interests which is laid in the Oireachtas Library. In my view, that goes beyond the boundaries of acceptability.

The Ethics in Public Office Act, 1995, was never intended to be abused in this manner by some sections of the media. As I understand it, the Bill's intention was to create transparency and reveal possible conflicts of interest in regard to our role as public representatives. I am in favour of the register of Members' interests but I am opposed to people's private assets being calculated by journalists, aided and abetted by auctioneers and other professionals who can use a calculator, and splashed across the pages of the national press.

I am concerned for the safety of my family. My family has now become a target for criminal gangs and potential criminal acts. It is not so long ago that members of the families of business people were kidnapped and held to ransom for large sums of money. I spend three days in Dublin every week. I do not know whether someone is casing my house at the moment with the intention of burgling it or committing other criminal acts. I was horrified to see photographs of Members' houses published in Ireland on Sunday last Sunday.

I am also concerned about my personal business interests. My creditworthiness or customer confidence could be affected by the Ireland on Sunday article. Ireland on Sunday employed professional auctioneers to carry out these valuations. We are paying a very high price for being involved in politics and I am not sure it is worth it.

I understand the Deputy's concerns but will he relate them to the Bill?

I made a verbal complaint today to the Ceann Comhairle, the Clerk of the Dáil, the Chief Whip and the chairman of the All-Party Committee on the Constitution, Deputy Brian Lenihan. I asked Deputy Lenihan to pay particular interest to the 1967 review of the Constitution which states in regard to parliamentary privilege that "all other offences against Parliament should, in our view, be dealt with by a special Act of the Oireachtas ." along the lines of legislation passed by other countries. I have asked Deputy Lenihan to consider the issue of privacy to which Members are entitled. I know Opposition Members will support me.

I started my business on 1 April 1985. I have always adhered to national wage agreements and paid staff the required rate. I have no problem supporting this Bill as an employer, none of whose employees are paid below the minimum wage. I am in business 15 years and my success is due to hard work. It should not be allowed for this to be written about in the manner in which it was reported last Sunday.

I propose to share my time with Deputies Bradford and Ring.

Is that agreed? Agreed.

I am privileged to follow a millionaire Deputy and I welcome his commitment to the national wage agreement. This is an important Bill and it is regrettable that it is being rushed through the House. We must get it right. This is an opportunity to legally protect young and vulnerable people in employment. We are burying our heads in the sand if we think young people and housewives who must work to supplement meagre incomes and support their families are not being exploited.

Deputies Owen and Rabbitte have a good insight into this Bill. This legislation is a three card trick –"now you see it, now you don't"– the quickness of the hand deceives the eye. The Government is a past master at the three card trick, as we have seen in the past two and a half years. It appears there are ways of getting around the minimum hourly wage of £4.40. Overtime, wet time, Sunday work and holiday time can be included in the calculation of the minimum rate. Workers may still earn £2.50 or £3 an hour. We have failed before we start and those being exploited will be outraged.

A young person leaving school and entering employment is delighted to receive his or her first wage cheque. No matter how small the amount, the first wage cheque is important as it is money into their hands. However, then the expenses start – they are rightly expected to contribute at home, they may have to provide their own clothes and they have outgoings they did not have previously. Suddenly they are 18 years old, adults, and the meagre wages they thought were great are not sufficient. They are being used and abused. There is no doubt that ruthless employers have become wealthy on the backs of young workers. However, there are many considerate employers who understand they must look after their workers. What if this Bill does not address the problem of exploitation, as we are promising it will? Shortcomings have already been highlighted. Can these be addressed by amendments to the Bill in the time we have been given? It appears not. This Bill, which has been heralded for many years, will be makeshift. This is unacceptable.

Workers are being exploited in a number of areas. It is important that people are rewarded for their work. Under this Bill, if a kind waitress is tipped by a couple having a meal, it will be taken into account when she is paid. This is outrageous and unacceptable. This is a small token of appreciation given by patrons of a restaurant, hotel or pub. Waitresses do an important job. We could not have a meal or a drink sitting at a table unless we had young girls or boys to serve us. Tips which are put in a jar and shared among them will be taken into account. The Minister should forget about this. This morning I spoke on the Social Welfare Bill, which contains outrageous anomalies. However, it is just as wrong to treat workers like this.

Home helps are important in remote rural areas – perhaps they are not as important in Dublin or other urban areas where people have neighbours. Home helps look after old people, make them a cup of tea, help them into or out of bed and dress them. Those prepared to do this social work should not be exploited for their kindness. Their work should be rewarded by the State. The meagre wages they are paid are an insult. They are not working for the money, but they must be rewarded. I ask the Minister to take this on board. The Bill is important and I ask for more time to get it right so that when it is implemented we can laud ourselves for a good day's work.

The previous speaker said he was glad to follow a millionaire Deputy – I am equally glad to follow a small farmer from Cavan. Like most speakers, I welcome the Bill. However, it is disappointing that such compulsory legislation must be introduced and that in a tiger economy, every employee is not yet in receipt of what is considered a fair minimum wage. The Bill is fine in theory. However, in practice, its implementation and the result is best judged by the Government's budgetary policy. On the debate on the Finance Bill, many speakers referred to how people earning a minimum wage cannot receive their earnings tax free. This should not be an aspiration but fiscal policy. If one Minister states a worker must be paid a minimum wage to have a reasonable standard of living, the Minister for Finance should ensure tax free allowances are high enough to ensure it is not taxed. Hopefully, the Minister will respond to this.

An article in one of today's newspapers stated that up to 200,000 immigrant workers may be needed to fill existing vacancies. I hope that when this legislation is enacted, the rates of pay being offered will at least take up the slack among the unemployed. It is difficult to explain to our constituents that at a time when more than 100,000 people are out of work, many jobs cannot be filled. Low pay is probably the reason for that. I hope that equation will be resolved as a result of enactment of this legislation. If there is a need to bring almost 200,000 people into the country to work, perhaps we should offer more attractive wage rates and more certainty in regard to those rates. That will address the problem.

When the Bill was published my party colleague, Deputy Owen, referred to the way the recent wage agreement among the social partners will have a bearing on this Bill; she may have referred to it again in her contribution. I wonder if the minimum wage as currently agreed will take into account the increases being provided for over the coming years under the Programme for Prosperity and Fairness. The relatively modest increases being provided under that agreement will raise all boats to some degree but we must examine closely the way minimum wage rates will be calculated for the people at the lower end of the spectrum.

My colleague, Deputy Boylan, referred to the people who are receiving scandalously low rates of pay from the State through the health boards under the home help scheme. As backbench Deputies, we find it difficult to explain to our constituents that the Minister is introducing a minimum wage while the Minister for Health and Children presides over a system where some people receive £2 or £2.50 per hour from the various health boards under the home help scheme. It does not make sense that one Minister is blatantly contradicting another Minister's stated aim and I would like to know what this Minister has to say in that regard.

We have received quite an amount of correspondence on this legislation from the social partners and the demand being made most strongly by various unions relates to the need for a minimum wage of £5 per hour. In the era of the Celtic tiger, it is difficult to understand the reason the minimum rate should be set at a lower rate than that. The value of labour is what has driven this economy into such a strong position and we would not be enjoying that economic success were it not for the efforts of so many people over the past decade or so. We must reward the people at all ends of the spectrum who have contributed but we should also try to better the lot of those who are currently being paid £3, £3.50 or £4 per hour.

I hope this legislation will help but until such time as we ensure, through our tax laws, that the person in receipt of the minimum wage is not losing money to the taxman every week, it is purely aspirational. The Minister for Finance has set the tax free allowances at such a rate that people on this so-called minimum level continue to pay a weekly tax.

I am glad to speak on the Bill. This is important legislation. For many years, people who were not lucky enough to get a third level education raised their families by working in hotels, restaurants and pubs, washing floors and so on. Those people were badly treated by millionaire employers who could not pay them £2 per hour but who could, when the property next door came up for sale, spend £700,000 or £800,000 buying it. They had three or four holidays per year and drove a Mercedes or a BMW.

I want to talk about the women who suffered in the hotel and restaurant industries under employers who used and abused them. These women had to take whatever they were given because it helped to subsidise their incomes and allowed them to raise their families. In many cases, it was the only employment in their areas. I welcome this legislation and I know that there are many worried employers. Why would they not be worried? They are not used to paying high rates and they abused many of their employees.

A previous speaker referred to the 100,000 immigrants coming to this country. I welcome the immigrants but I hope they will not be the new skivvies who will be used and abused for the sake of cheap labour. I hope their employers will not tell these people that if they open their mouths to complain, they will have them run out of the country. They should be protected as well as our own people, and not used and abused as was the case in the past. Over the years, many people were treated badly by their employers and they had no legal redress. I am glad to see the Bill come before the Dáil.

There has been some criticism of the reason it took so long for this legislation to come before the Dáil. Many people involved in the tourism trade are upset because they had to print their booklets and brochures without knowing what they would be paying their employees for the summer. Some of them will have to pay the going rate because it appears this legislation will pass through both Houses fairly quickly. It should be enacted by the summer so that the people who work in this industry on a seasonal basis can be paid at least £4.40 an hour.

Two years ago – I have not been there since and will not go back – I visited Temple Bar where I had a meal with some friends of mine. When I received the bill I noticed there was a service charge, which is outrageous. There should not be a charge for service when one goes out for a meal. In addition, for the privilege of having a meal in Temple Bar, I was told I had to pay a tax. Surely that is illegal. Taxes cannot be charged like that. It is bad enough that the Government takes every penny out of our pockets. We were well charged for the food and drink, and we even gave a tip to the waiter – that was probably taken by the employer. I hope this matter will be dealt with in the Bill. Restaurant owners should not be allowed to add a service charge to the bill. We should be charged the price of the meal and if there is VAT on top of that, so be it, that goes to the State, but there should not be an extra tax for the privilege of being in Temple Bar. That is outrageous and it should be addressed.

Many speakers referred to the home help service. We talk about scrupulous employers but the worst employer in the State has been the State itself. At one time the health boards were paying £1 per hour to home helps, although that has been increased substantially. Do they have any conscience? The chief executive of a health board would not go too far down the road for £1 an hour. It is a joke. It took about three years for those of us in the Western Health Board to get an increase for these people. I do not know the salary of the chief executive officer of the health board, but it is certainly a lot more than £1 an hour, and then there are expenses on top of that. It was women who suffered the most in this case because 99.9% of carers are women. Again, it is a case of it being all right because they are women. Women have been badly treated in this country.

The women have raised families and have done a wonderful job. They have been wives, mothers and employers. I hope this Bill will protect women because they deserve such protection. They are great. There is a women's day but at some stage in the future the Government should pay a few pounds to women who stay at home. They should be looked after because they are good people.

(Wexford): I welcome the opportunity to speak on this Bill. I have been a Member of this House for 17 years and over those years I have heard much talk about the introduction of a minimum wage. It is not often that I praise the Minister, Deputy Harney. I am probably more noted for—

Why? The Deputy is in Government with her. They are supposed to be friends.

(Wexford): I am more noted for criticising her but I must pay tribute to her and the Minister of State, Deputy Treacy, for their commitment—

The Deputy was always known to flow with the tide.

It is a temporary little arrangement.

(Wexford): It is not temporary. There are another two and half years left for the “temporary little arrangement”.

The Deputy does not seem comfortable with her.

(Wexford): The Minister has single-mindedly pursued this issue in Government for the last three years. While there is criticism of the slowness in bringing the Bill before the House, it is welcome that it has been introduced. The Celtic tiger continues to roar and much of the country is benefiting enormously. However, there are still sections of the community which the economic boom has not yet visited. There are still many people living on small incomes.

County Wexford has a major problem with unemployment. While the rate in the rest of the country is down to 5% or 6%, it is still at 12% in Wexford. There is also a major problem in the county with early school leaving. I do not know why it is peculiar to Wexford but large numbers of young people drop out of second level education to go into employment and they are the workers who are most likely to experience exploitation. To date young people have not received an adequate or decent wage. Wexford does not have a third level college which, in itself, creates many problems. The county has one of the lowest entry levels to third level education.

The Bill is a historic development. It is one of the most vital measures to have come before the House. It is a milestone in ensuring workers will be paid a reasonable hourly rate and in stopping scandalous exploitation of workers. We have all heard about low skill, low esteem, dead end jobs but I have expressed concern for some time about the jobs in a number of sectors, for example, hotels, supermarkets, tourism, petrol stations and hairdressing salons. These are sectors in which young people are being exploited daily. There are excellent employers in these areas as well but exploitation does occur there.

Members are aware that some operators pay as little as £1.50 per hour. Deputy Ring referred to rates of £3 and £3.50 per hour. In some areas of my constituency pay can be as low as £1.50 per hour and in some cases it is less than that. We have the evidence. A constituent came to talk to me last week about getting a council loan. She was working for a doctor in the county and her income was £110 per week. She was paying £60 per week rent which left her with £50 to live on. I told her she had no hope of getting a loan on that income. I rang the local clinic to check if she would be eligible for supplementary rent allowance but the answer was that she was not because she was working. However, people who earn much more on social welfare get rent allowances. Lone parents and so forth receive a rent allowance on the same level of income. I have no problem with that, but problems such as this need to be addressed. I hope the Bill will be passed as quickly as possible and that it will deal with problems like that of my constituent.

Constituents tend to come to their Deputies when they are seeking council loans. One does not have to be earning a large wage to qualify for a council loan but in some cases salaries are so low that the loans officer will point out that the person could not possibly afford the repayments on a council loan or even on a shared ownership loan. I hope the Bill will seriously address this problem.

I was a little concerned about IBEC and the small business associations when they started to scream and roar about this legislation. The Celtic tiger is of benefit to the business community. There is low inflation, low interest rates and half a million more people are employed compared with ten years ago. That is the result of the policies pursued by different Governments during those years. No single Government can claim a monopoly of credit for the economy because different Governments continued to implement the policies introduced ten years ago. Most people have benefited from them.

Organisations such as IBEC and the small businesses have a right to comment on policies but it is morally wrong of them to continue to defend the low wages which some workers are paid. It is also morally wrong to criticise the Minister for introducing a Bill which will guarantee a worker £4.40 per hour. In a time of prosperity we should probably seek to increase the amount and I am glad the Minister, in her discussions with the social partners, has concluded that it will increase to £5 per hour over the next two years. Hopefully, through the generosity of employers and honourable people in business, it might increase even more.

Business and industry are making huge profits at present. There is no need for IBEC and the small business associations to be afraid of this legislation or to run away from it. There is no need to undermine the Government's intentions. They should accept the legislation in a spirit of goodwill. The Minister, Deputy Harney, has been reasonable in what she is asking from business. A 40 hour week at £4.60 per hour amounts to £184 per week. That is not a large amount of money but in some cases it might mean an extra £40 to £60 per week in take home pay. I welcome that.

I wish to comment on the unholy hours young people are asked to work in hotels, supermarkets, petrol stations and in the horse industry. It has been brought to my attention that young trainees are being exploited in some sections of the horse industry. They are working for up to 80 hours per week and are not paid adequately. I hope the Bill will deal with that problem.

There are poor working conditions for young people in many business sectors. It seems to be an attitude in the tourism industry, especially if they live in hotels, to give them some money, a bed and some food and assume they will be happy. I assure those in the tourism industry that these young people are far from happy and, as a public representative, I receive complaints on a regular basis from this sector. If the minimum wage does anything, it is important that it brings to heel that broad section of the tourism industry which is not paying its workers adequate wages.

I have argued with different Ministers that there should be some scale of payment for trainees in the hairdressing industry. I have checked as recently as the past few days and have found that, in small towns especially, male and female trainee hairdressers earn in the region of £40, £50 or £60 per week. They are told they are learning a trade and that, when they are qualified, they will be able to earn a good living. It is not right that these people are exploited. Regularised payments should be introduced for people training in the hairdressing sector and other related professions.

Home helps were mentioned and this is an issue not just on the western seaboard but throughout the country. While not wishing to criticise the Minister for Foreign Affairs, Deputy Cowen, I hope the new Minister for Health and Children will introduce a reasonable and decent system of payments for people who provide home help. At present, they earn between £1.50 and £2 an hour, yet they save the Exchequer millions by keeping people out of hospital. In my area, it costs between £1,000 and £1,500 to keep a person in hospital. We want to pay small but decent amounts of money. In this day and age, £2 an hour is an insult to a person who provides home help and a tremendous service to the recipient, and who saves the State money.

While we talk of bringing industry to heel in the area of low pay, we should follow suit in the area of home helps and the Minister should introduce a minimum rate of pay of £4.40 an hour for those people. That would not be expecting too much. We would be well repaid over the years by people being kept out of hospitals and living in and being part of the community. Usually women provide the home help service, although in my neighbourhood men also provide it. It is only right that they should be paid a decent and honourable hourly wage. Perhaps on Committee Stage the Minister would listen to all sides of House and, in conjunction with the Minister for Health and Children and his Department, examine the issue of introducing a minimum wage of £4.40 an hour for home helps.

I thank Deputy Browne for affording me the opportunity to contribute briefly to this welcome debate. I express my appreciation to Evelyn Owens, the chairperson of the commission established to examine this area in 1997. The report of the national minimum wage commission was issued in April 1998 and it went into great detail, having obtained submissions from numerous bodies and having commissioned detailed research. Everything and anything we need to know about the national minimum wage issue is dealt with in the report of the commission.

We may be one of the last countries in the European Union to have introduced this measure. It is something which should have been pursued more vigorously in the past. From reading the report, which details systems which operate throughout the world, it is evident that almost every country in world which has a thriving economy has some system in place to protect workers from the scourge of low wages. It has been stated that the system may lead to problems and these are dealt with in the report. Overall, such a measure would greatly enhance the prospects for increasing wage levels, reducing poverty and eliminating some of the handicaps many families have suffered because of low wages. Even though it is welcome, there are some side effects and these need to be examined and guarded against.

One of the matters which caused me concern when I was in the Department of Labour in 1980, when these issues were discussed under the partnership arrangements in place at the time, was dealing with the issue of underage people in employment and the manner in which they were exploited, especially in the larger towns. One of the main complaints 20 years ago, which is as relevant today as it was then, was that, although there was legislation to protect young people in employment from being exploited, a poor inspectorate was in place. Unless we put in place an inspectorate which will be effective in ensuring that the terms and conditions laid down in the Bill are enforced, the measure will fall far short of expectations. One of my major worries is that we might build up expectations for the legislation which may not be realised. It could also have some negative impacts and these need to be guarded against. One of the negative impacts may be an acceleration of young people leaving school because, in their short-term view, it is more economical for them to do so. This would be very damaging in the long-term and could mean the displacement of many low skilled workers. We need to guard against that.

I was taken aback to hear a representative say during a radio discussion that the legislation should be postponed. It baffles me and, I am sure, many Members present how anyone involved in an organisation could say after three years of discussion and years of neglect on this issue that the April deadline is too soon and that it should be postponed. This has been heralded for a long time. There was an opportunity for three years to make submissions.

The problem is that the Minister published the legislation only a month ago.

Everyone knew the legislation was in the pipeline.

We did not know what would be in it.

Deputy Owen knew that as well as I did and that it was long overdue. For people in representative bodies to complain now that it is being introduced too soon, that they are not prepared and that it will cause chaos and confusion is an excuse for not being part of this arrangement. The social partners have a responsibility in this regard. As Members know, in the final analysis, many of the problems in this area will have to be worked out through social partnership and dialogue between ICTU, IBEC and the other organisations. There is a need to do that.

I have not read the detail of the Bill because I did not have an opportunity to do so. It appears there were references in the report of the commission to a need to have a separate rate for those under 18. I am not sure how this will be dealt with, but perhaps it could be examined on Committee Stage. Apparently, according to the report of the commission, most countries where this structure has been put in place have separate rates for apprentices, people under 18 and others in similar categories. The main problem which will arise from the legislation is that, unless there is proper compliance and effective enforcement, especially through tax returns and a decent inspectorate, we face the prospect of the return of the black, blue or grey economy, or whatever one likes to call it. We will witness payments being made under the table.

Acting Chairman

Deputy Daly must conclude.

I thank the House for the opportunity to contribute to this debate. While I do not wish to delay the legislation, I believe it is essential that we put in place an inspectorate to ensure it is enforced. If that is not done the prospect of this legislation being effective will be very much reduced.

I wish to share my time with Deputy Joe Higgins.

Acting Chairman

Is that agreed? Agreed.

I welcome the Bill which is essential legislation. I remember being at a Young Fine Gael meeting many years ago when Dr. FitzGerald was on one of his famous crusades. One of his ideas for economic and social progress was the introduction of a minimum wage. We had to wait a long time before we, as legislators, got the opportunity to introduce a minimum wage Bill. In general, it is to be welcomed.

Employers have taken advantage of and paid poor wages to a number of people. This has happened in the services industry generally. It is ironic that we are dealing with a minimum wage Bill when the economy has reached great height. The sting has been taken out of its introduction because the free market is also dealing with this issue in another way. I strongly suggest that, due to labour shortages, a large number of employers are finding it so difficult to keep employees that they have to increase wages to retain them. This situation has sorted itself out. However, legislation is required to put the payment of proper wages on a statutory basis. Many employers now have to pay over the £4.40 rate to ensure they keep employees. There is a valid argument for increasing the rate to £5 but we should concentrate on putting the payment of the minimum wage on a statutory footing and review it at a later date.

For a small country – I say this about a great deal of legislation – we are good at introducing legislation but our policing of that legislation leaves a lot to be desired. It is of no benefit introducing legislation of this ilk if it is not properly policed. The Minister needs to take a look at that issue. If it is properly policed, employers who take advantage of employees will be weeded out and that is not a bad thing for society.

I wish to refer to the home help service referred to by other Deputies. It is appalling that a State body pays such measly wages to people performing such an excellent job. The Depart ment of Health and Children, through the health boards, is paying £3 or less an hour to people taking care of the elderly in our communities. One has only to look at the sheer economic value of the work they are doing compared to the emotional value in the sense that hospitalisation or institutionalisation of such people would result in a massive cost to the State. As Deputy Owen said, once this legislation is introduced the health boards will have no choice but to pay the minimum wage of £4.40 to those people. If the health boards do not introduce this rate how can we as legislators expect the private sector to do so. We cannot tell them they have to do it when semi-State organisations do not do so. That will not work. I am of the opinion that the proper rate will be paid to those workers once this legislation has been passed. We have a moral obligation to ensure that happens.

Deputy John Browne went a little overboard when he said the statements made by the Small Firms Association were immoral. That association represents employers who are concerned about the introduction of a minimum wage. I was raised in a small family run business. Many major employers are making a great deal of money. The number of young people employed by small family run businesses in many of our towns and villages is quite substantial. I can understand why they are concerned about the introduction of the minimum wage given the increase in overheads and competition which they have had to face over recent years. I can understand where the Small Firms Association is coming from. There has been a 20% increase in the rates payable by small businesses over the past five to eight years. Revaluations have, in many cases, quadrupled the rates which small businesses have to pay. They have had to pay increases in wages to ensure they kept employees. That is another overhead. Overseas competition has increased which has made it difficult for small family run businesses to survive. Such competition has also resulted in decreased margins. These are serious issues which the employer must take into consideration. It is right to say there are more employees in the country than employers but if one does not provide incentives to the employer, they cannot employ people. The minimum wage does not then come into consideration. In that context the concerns of small family run businesses are justified. Every public representative is aware of these businesses and the number of people they are employing.

I welcome the Bill and the introduction of a minimum wage. I hope it will be enacted as soon as possible.

(Dublin West): The Minister should be ashamed of herself, as should the Government on whose behalf she is acting, to come before this House with a Bill to fix the level of wages at the rate of £4.40 per hour. The Bill contains many loopholes which will be used by unscrupulous employers. There are more escape hatches in it than a badly holed sieve for recalcitrant employers who are already notorious for the low wage exploitation they operate as regimes in their workplaces. Instead of an outright onslaught on low pay, the Minister is giving these people one escape hatch after another.

The sum of £4.40 an hour was first mooted two years ago and amounts to £171.60 for a 39 hour week or £8,923 per annum. That is the minimum wage which the Government believes it should be proud to introduce. Perhaps it is not surprising that the Government thinks it is doing the devil and all with this legislation. Ministers are light years removed from the living conditions of the low paid. When they exist on £90,000 plus a year, they begin to forget what it is like to exist on less than £9,000 or £15,000 a year.

According to a Sunday newspaper, an Oireachtas committee, without any reference to me, has put in a pay claim for a minimum of 26% which would tie the wages of Deputies in with those of principal officers of Departments. This means a Deputy's pay would increase from £38,842 a year to £48,000, an increase of £10,000. Some Deputies believe they should be entitled to an increase greater than the entire sum of the minimum wage the Government is introducing. Perhaps the article in Ireland on Sunday which stated there were 24 millionaires in our midst might explain the indifference of many people in the Dáil. The plight of the low paid would not be the first thing on the agenda of a millionaire Deputy or legislator. They would not understand the problems of trying to exist on low pay.

Let us take the price of a home. A young couple on the minimum wage worked out by the Government would receive the princely sum of less than £18,000 a year. If they go into a bank to try to purchase a home, they would be shown the door. This Bill does not bring within the ambit of low paid workers the beginnings of what would make for a life of reasonable comfort which every human being in our society deserves and to which they aspire. It is an insult to the low paid.

Low pay is endemic in our society. The Socialist Party campaigned recently in towns and cities on a name and shame basis, whereby employees notified us of the amount they receive per hour. I am well aware of the difficulties which the poor and working people face, but I was taken aback by some of the levels of pay reported and confirmed. In one provincial town – I will not name it because it is happening in every provincial town and city, including Dublin – supermarkets were paying £1.75 per hour, security firms were paying £3 per hour and hotels were paying £3.50 per hour. Many swanky hotels are springing up as if the island was built on a gold mine and are thriving on the low pay exploitation of workers.

The official leadership of the trade unions stands indicted for the low pay exploitation of workers. It is incredible that the leadership of the Irish Congress of Trade Unions and of many unions, with some honourable exceptions, did not fight for the low paid years ago. They stand indicted for accepting £4.40 as a minimum wage. It is incredible that people who claim to be the leaders and representatives of working people would agree to the miserly wage of £4.40 per hour. They do not deserve the title trade unionists if that is their level of understanding and empathy with people who are trying to exist on low pay.

It is incredible that there is still resistance among some employers. I was askance this morning to hear the chief executive of the Chambers of Commerce of Ireland say he wanted the matter delayed. I was so incensed that I, along with my Socialist Party colleagues, will put a picket on its office in Merrion Square tomorrow morning to let it know how outraged low paid workers are that these privileged people should try to thwart the introduction of the Bill.

It is pathetic how the Government is going out of its way to facilitate Scrooge employers. The little extras workers in a restaurant depend on to make up a reasonable wage, such as tips, will now be counted as part of the minimum wage. The Irish Hotels Federation gloats about this in its most recent newsletter. It states that employers in the sector will be particularly welcome of the fact that basic pay items, such as service pay, shift premiums, bonuses, service charges and board and lodgings, will be reckoned when calculating the minimum wage. This is a shameful capitulation to low paying employers.

A minimum wage of £5 per hour should be introduced immediately which would give workers £195 per week basic income. It should be tax free which would further increase the take home pay of workers by approximately £1,502 a year. That would be a significant step but it would only be the beginning. It should be increased each year by £1 until it reaches £8 per hour, the amount regarded as the decency threshold by an EU group. In order to highlight this, the Socialist Party, along with other groups and backed by some trade unions, will take to the streets of Dublin on Saturday, 11 March in a protest demonstration to demand £5 per hour which should be implemented immediately.

The exclusions are mind boggling. Far out relations, such as half brothers and half sisters, are excluded from the legislation. By doing so, the Government has acknowledged that the family may be subject to exploitation wages. Soldiers who spend long hours on Border duties and workers in uniform will also be excluded because of the miserly level of their take home pay. That is disgraceful.

Employers can use prescribed courses of study and training as an excuse not to pay workers. There will be more workers on study and training courses once this Bill is implemented than there has ever been in Irish history.

It is shameful that people who start work at 18 or 19 years of age will only be entitled to 80% or 90%, respectively, of the minimum wage. The minimum wage should be £5 per hour tax free for all workers from 16 years of age.

Debate adjourned.