JOAN’S REMARKS AT THE FORUM ON THE LIVING WAGE, DUBLIN CASTLE

It’s a great pleasure to be here today and I want to thank all of you for attending.

We’re here today to discuss the Living Wage and how it might be achieved.

When I first floated the concept of a Living Wage for Ireland two years ago, we were facing into another very difficult budget.

But it was clear to me at that time that the underlying foundations for recovery had been laid and were solid.

And I was extremely conscious that when Ireland returned to growth, economic recovery wouldn’t be enough.

There would have to be social recovery too, so that everybody benefitted from renewed prosperity.

That is why, upon becoming Labour Party Leader and Tánaiste, I immediately put the establishment of the Low Pay Commission on the agenda.

It was central to my negotiations with the Taoiseach on the revised policy priorities of the Government.

My reasoning was simple.

I wanted an independent body to ensure the Minimum Wage was reviewed in an evidence-based way on an annual basis.

By so doing, I believed we could take the politics out of low pay, and ensure no more politically motivated attacks on low-paid workers.

My colleague, Minister Nash, did Trojan work to get the Low Pay Commission up and running, and I want to thank him for that work.

The Commission issued its first report this year, recommending an increase in the National Minimum Wage.

A 50c increase in the minimum wage would mean an annual pay increase of circa €1,000 for a low-paid worker – a significant amount.

The Government will address that issue in the Budget, and I look forward to the Minimum Wage being increased early next year.

We’ll also address any potential anomaly in the PRSI system arising from the Commission’s recommendations, to ensure workers benefit from any increase rather than the Exchequer.

But the minimum wage, though critically important, is not the full answer.

The minimum wage is a base rate, of course – an essential protection against exploitation, against poverty.

But it is not a guarantee of adequate wages for all workers, which is why I want to see a Living Wage introduced in Ireland.

What would that look like?

The Living Wage would be an independently assessed and measured rate of income considered necessary to meet basic needs, such as housing, food, clothing, transport and healthcare.

It would be set at a rate that would mean a person could meet their basic needs without resort to welfare, in stark contrast to many on the minimum wage.

Because that’s one of the great hidden truths about modern economies across the world – the degree to which the welfare state subsidises employers.

And that’s a point that critics of the welfare system often miss.

Many of those critics don’t realise that if we hollowed out welfare as they so fervently wish, it would place extra pressure on many major employers whom they champion so heavily as the model of efficient enterprise.

For example, in 2014, my Department spent around €280 million on Family Income Supplement – a weekly tax-free top-up payment for workers on low pay with children.

It was paid to assist more than 50,000 families and 111,000 children.

And it was money well spent.

Because FIS makes the crucial difference for people by ensuring they are better off in work and building a more secure financial future for their families.

Nonetheless, it is a reality that if those workers were paid a Living Wage, they wouldn’t need such significant assistance from the state.

And we could use the money in other ways.

Now, none of this should be read as a criticism by me of employers.

Just as many individuals and families suffered immensely difficult times following the crash, so too did employers.

For a lot of people, those difficult times are not yet over, and the same applies for a lot of employers.

But the recovery is taking hold, and the Government is intent on securing that recovery and ensuring it is felt across the regions.

We’re now the fastest growing economy in the EU.

We’re adding 1,300 jobs a week as existing employers expand again and new businesses open.

Unemployment has fallen from a crisis peak of more than 15% to 9.4% as of yesterday.

So the first point is, we’re making significant progress.

Secondly, we’re investing to cement that progress, for businesses and communities alike.

This week, the Government launched a new, six-year €27 billion capital investment programme that will pump money into crucial infrastructure such as rail, roads, enterprise funding, schools, broadband and more.

It will create 45,000 construction jobs alone during the duration of the plan, and support hundreds of thousands of existing jobs.

Thirdly, we have a range of schemes to assist employers, including wage subsidy schemes like JobsPlus, where the State meets some of the salary costs when a company hires a jobseeker who has been long-term unemployed.

So in a variety of ways, this Government is doing its utmost to help businesses recover, just as the economy generally is recovering.

In addition, it’s important to understand that the Living Wage, as I see it, would be introduced on a voluntary basis in the first instance.

This would be a similar to London, where more than 800 companies are accredited as Living Wage employers on a voluntary basis.

There has already been an extraordinary pay-off as a result.

Research has shown that the voluntary Living Wage in London has lifted more than 10,000 families out of working poverty.

I believe we can achieve similar success in Ireland by introducing a voluntary Living Wage here.

I’m very pleased that already a number of organisations in Ireland have signaled their support for the development of a Living Wage.

I’m committing the Labour Party today to being a Living Wage employer.

And while I acknowledge that more work needs to be done, with the commitment of the delegates representing employers and workers here today, I expect to see a Living Wage Campaign up and running next year.

In that respect, my Department will make €40,000 available to fund the next phase of work for the Living Wage Campaign.

This will scope out how such a campaign could be introduced in Ireland and what its framework would be.

Because the simple truth is this: we must have social recovery with economic recovery, and that means raised living standards.

It means a Living Wage for workers.

And I look forward to working with you to achieve it.

Thank you.