Vol. 544 No. 3
78 Mr. Rabbitte asked the Tánaiste and Minister for Enterprise, Trade and Employment when the lump sums payable under the Redundancy Payments Act, 1979, were last increased; if she has received representations from the trade union movement for an increase in these payments; her plans to increase payments under the Act; and if she will make a statement on the matter. [28660/01]
Redundancy arises where an employee's job ceases to exist and he or she is not replaced. Reasons include rationalisation or reorganisation, not enough work being available, the financial state of the firm, company closure, etc.
The Redundancy Payments Acts, 1967-1991, oblige employers by law to pay redundant employees what is known as a statutory redundancy entitlement. The amount is related to the employee's length of service and his or her normal weekly earnings based upon his or her gross weekly wage, average regular overtime and payment-in-kind, all added together, subject to a ceiling of £400 per week.
The ceiling was increased from £300 to £400 per week, with effect from 1 April 2001, following consultations with the social partners. While there are no specific proposals to legislate for payments over and above the prescribed amount, the statutory redundancy scheme is kept under continuous review. In that context, correspondence has been recently received from SIPTU and ICTU proposing general improvements to the redundancy payments scheme. These proposals are currently under consideration in my Department.
Has the Minister of State information in his files that will give us the up-to-date position with regard to redundancies this year? Does he accept that the Redundancy Payments Acts as they stand are hopelessly out of date in terms of providing a safety net at some decent level for people who lose their jobs through no fault of their own? He did not address the question on when the sums were last increased other than by referring to the ceiling, but is it not the case that the floor has been the same since 1967, i.e. a half week's pay per year of service plus a week for somebody under 41 years of age? That has long been overtaken by the practice. When the Minister says the proposals are "under consideration", does that really mean anything? Does he intend to bring forward reforming legislation?
There are two questions tabled by Deputies with regard to the figures, one in the name of Deputy Flanagan, which will obviously be available later on. The cumulative total of redundancies notified through my Department to 30 December 2001 was 14,036. This represents a 38.4% increase in the numbers notified to me for the same period last year, which was 10,145.
The House should also know that, in the past six months, there was an 80% increase in the number of notifications for redundancies. This is a serious issue.
I increased the ceiling from £300 to £400 on 1 April. That was obviously an indication by me that there was a need to address this issue. The Deputy has asked me for my views and it is time to look carefully at the question of the amount involved. It is a complex matter. There are many different factors involved, not just with regard to the lump sum, but with regard to the calculation of the lump sum and the question of those who are under or over 41 years of age.
The trade union movement has made its views known on this issue. My view is that this issue needs to be addressed. It is under consideration in that sense. In the normal course of events, these issues are dealt with by consultation with ICTU and IBEC, which is the procedure in this case. Certainly, it is timely to address this issue.
Am I to take it the Minister of State is responding positively to the request from the trade union movement to revise the redundancy payments legislation? If so, has the Minister of State the approval of his boss, the Tánaiste, who expressed a different view to the House quite recently? She told me she is not in favour of renewing the redundancy legislation. Is the Minister of State in agreement with her? If they are only now consulting on whether they are in agreement, we really are in trouble.
Not unless one has consensual Government.
Never did one small part of the country produce three such outstanding Ministers. If they are in agreement, we can do anything. Anything is possible. I have failed to get an answer to my question. Will the Minister of State, Deputy Tom Kitt, say – if he is in favour of reforming the legislation – whether he will support the Bill I am now ready to publish on this matter with the full support of the trade union movement?
As Minister of State with responsibility for labour, I have said to Deputy Rabbitte that I feel this issue needs to be addressed. The Government's position, as I said in my reply, is that the matter is under review – we have a very good submission from the trade union movement.
I know. I read it. Does the Tánaiste think it is good?
There is a very straightforward process of consultation, not just with the trade union movement, but with IBEC.
We are all entitled to our views in the House. These are the issues on which I work very closely with my colleague the Tánaiste. We work together on these issues. My initial response is that there is a case to be met. With regard to how that is delivered, it is a matter for Government. It is also a matter requiring a consultation process, but I have outlined the figures involved. In light of the number of redundancies, the issue needs to be addressed and we will keep the Deputy informed on how we address them.
It seems to have the support of the left wing in Fianna Fáil, but does it have the support of the Government?
Which of the three Members present on the Government side of the House represents the left wing in Fianna Fáil?
