Package for low-paid proves contentious

Talks on a successor to Partnership 2000 hit unexpected obstacles over a package for low-income groups yesterday, but IMPACT'…

Talks on a successor to Partnership 2000 hit unexpected obstacles over a package for low-income groups yesterday, but IMPACT's general secretary, Mr Peter McLoone, said the trade-union side was determined to conclude negotiations by tomorrow.

A mixture of flat-rate increases, the national minimum wage and tax cuts to provide for the low-paid proved contentious throughout yesterday's talks.

After the talks last night, the Irish Congress of Trade Unions general secretary, Mr Peter Cassells, said an acceptable package of tax reforms and pay increases had to be on the table.

There were also difficulties finalising agreement on "family-friendly" workplace policies.

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The SIPTU general secretary, Mr John McDonnell, said that agreement on non-pay issues such as taxation was vital to ensure the low-paid were catered for.

The national minimum wage will be central to any new deal, and costings done for negotiators show that the Exchequer would lose £1 billion a year if all workers on the proposed national minimum wage of £4.40 p an hour were taken out of the tax net.

If the rate was raised to £5 an hour the cost would be £1.3 billion.

ICTU is also pushing for abolition of PRSI deductions on workers on the minimum wage. At present workers on more than £100 a week pay PRSI.

Meanwhile the community and voluntary sector was pressing for indexation of welfare payments at 50 per cent of average earnings.