Restoring low wage rate keeps people working, claims Burton

PEOPLE NEEDED the incentive of adequate pay to stay in work, Minister for Social Protection, Joan Burton told the Dáil.

“Low-paid workers are most at risk of becoming unemployed and falling into poverty,” she said.

Ms Burton introduced the Social Welfare and Pensions Bill 2011, restoring the national minimum wage to €8.65 an hour from next month.

Reversing the €1 cut would mean workers on the minimum wage gaining over €40 weekly, making employment more attractive to people claiming a jobseeker’s allowance, said Ms Burton.

“Reducing the rate of the minimum wage was a cut that had the most impact on the lowest-paid workers,” she added.

The Minister said the Bill also provided for the halving of the lower rate of employer’s PRSI contribution from 8.5 per cent to 4.25 per cent from July 2nd this year until the end of 2013.

The introduction of a national internship scheme from next month would provide 5,000 work experience opportunities for jobseekers, she added.

Internships, available to jobseekers in the private, public, community and voluntary sectors, would range from six to nine months, with participants receiving a top-up allowance of €50 a week, in addition to their existing social welfare entitlements.

Ms Burton said the scheme would apply to people entering the labour market after education or training and to unemployed workers whose existing skills were no longer in demand.

The Bill, she added, also provided for the gradual increase of the State pension age to 68 years.

This would begin in 2014, with the age increased to 66, followed by 67 in 2021 and 68 in 2028. It was worth noting, said Ms Burton, that the qualifying age was 70 until the early 1970s.

“The continued participation of older people in the labour market must be encouraged and facilitated to meet the challenge of an ageing society,” said the Minister.

“Employees and employers need to be persuaded to change their attitudes to working longer.”

Fianna Fáil social protection spokesman Barry Cowen said while his party would support the reversal of the minimum wage cut, the Government could not portray itself as the champion of the lower paid, because it was introducing proposals which could impact on the incomes of 250,000 people.