New bill proposes to increase national minimum wage to match rising cost of living

A rise in the minimum wage to meet the soaring cost of living is being proposed under a new bill. 

Launching the Living Wage Bill 2022, Labour Party Leader, Ivana Bacik TD said it would deliver a much-needed pay rise for workers in Ireland, and deliver on the long delayed commitment in the Programme for Government.

“With the cost of living soaring and inflation at a 22-year high, Ireland needs a pay rise. The purpose of our new bill is to amend the National Minimum Wage Acts to provide for a pathway to a living wage over three years and we are calling for immediate government action to deliver on this Labour Party bill," Deputy Bacik said.

There has been some opposition recently to an increase in the minimum wage from employers groups. 

The Small Firms Association (SFA) described the minimum wage as "a blunt instrument" and said other measures need to be taken to tackle the rising cost of living. 

"In the current Irish context, with businesses just reopened and so many small firms getting back on their feet after being closed and reliant on government grants, warehousing, subsidies and deferrals, the SFA believes that wage increases cannot be enforced across the board. Voluntary increases are the most practical, taking account of the businesses," the association said earlier this year. 

However. Labour is firmly behind a minimum wage increase. 

“A living wage provides for needs, not wants, and is defined as the hourly rate of pay that makes possible a minimum acceptable standard of living, is evidence based, and grounded in social consensus.

“At present the minimum wage is set at €10.50 after the most recent 30 cent increase in January but it is not based on the cost of living.

“The living wage for 2021 was determined at a rate of €12.90 per hour. That is a €2.40 per hour wage gap that would make a real difference to the lives of so many people.

“As recently as 2018 one in five workers were categorised as low paid, earning just below €11.90 per hour, or about 380,000 people. Transforming the minimum wage into a Living wage will also list the wages of many other workers.

“Our Bill would transform the low pay commission into a living wage commission and assign it new duties to enable it to make recommendations.," Deputy Bacik said.

“Workers are having to cope with an unprecedented spike in the cost of living, a spike that is affecting every household, individual, family and community across Ireland. The costs of fuel, rent, housing, food, childcare and basic services are rising. Even the price of basic items like bread and milk are rising.

“All of us are hearing daily from constituents who are feeling a real squeeze and whose incomes are no longer enough to meet the rising cost of living that they face," Deputy Bacik said.