Brian Stanley
Ceist:224. Deputy Brian Stanley asked the Minister for Enterprise, Trade and Employment to outline his Department's plans for the introduction of a living wage. [46219/23]
Amharc ar fhreagraTuesday, 24 October 2023
Ceisteanna (224)
Freagraí scríofa
As the Deputy will be aware, in 2021 the Government asked the Low Pay Commission to examine and provide recommendations on the introduction of a living wage. The Low Pay Commission’s recommendations were received last year and in November, Government agreed that a national living wage would be introduced and set at 60% of hourly median wages in line with the recommendations of the Low Pay Commission. It will be in place by 2026, at which point it will replace the National Minimum Wage.
The first step towards reaching a living wage was the 80 cent increase to the National Minimum Wage from 1 January 2023 to €11.30 per hour. This will now be followed with the €1.40 increase to the National Minimum Wage which was announced as part of the Budget last week. This significant increase will come into force on 1 January 2024 and will increase the minimum wage to €12.70 per hour.
The Low Pay Commission has estimated that the minimum wage in 2022 was 50.9% of the median hourly wage, increasing to 51.8% in 2023.
The Commission estimates that the €1.40 increase in the 2024 National Minimum Wage announced earlier this week will bring the minimum wage to 55.1% of median hourly wages.
The Low Pay Commission will continue to make annual recommendations on the appropriate rate of the National Minimum Wage, and the increases required so that by 2026 the minimum wage will reach the target of 60% of hourly median wages.
The increase in the 2024 National Minimum Wage of €1.40, or 12.4%, is very significant. Coupled with the changes in income tax and the Universal Social Charge announced in Budget 2024, it shows the Government’s commitment to protecting and improving the incomes of low-paid workers.
Once the 60% threshold is reached, the Low Pay Commission will assess the impact of the progression to the 60% target and then advise on the practicalities of gradually increasing the targeted threshold rate towards 66% of the hourly median wage.