Burton 'concern' over welfare budget

 

Minister for Social Protection Joan Burton is expected to draw the Cabinet’s attention today to the potential additional costs to the welfare budget if controversial plans go ahead to reform wage-setting mechanisms.

Fine Gael Minister for Enterprise Richard Bruton is due to present proposals to reform the joint labour committees (JLC) which operate in the restaurant, hospitality, retail, security, cleaning and other sectors.

Ms Burton was not available for comment last night but other Labour sources said that, if the Minister for Enterprise presented his original proposals, she would be highlighting the implications for her budget in the event that wage-cuts were imposed on the sectors in question.

There would be a prospect of additional claimants becoming eligible for Family Income Supplement whereby workers on low pay are entitled to significant extra payments.

About 200,000 workers are covered by legally-binding JLC pay agreements and the issue has been the first source of open division between the Coalition parties since they took office.

Labour backbenchers denounced the Minister’s plans in a series of press statements last month and Taoiseach Enda Kenny said Mr Bruton was pursuing a “personal agenda”.

The EU-IMF bailout agreement specifies that the system must be reformed but Labour TDs want to ensure any cuts in wages are minimised.

The programme for government includes a commitment to reform the JLC structure and to “examine the rate of pay for atypical hours”.

Additional payments for Sunday working range from an additional one-third up to double time.

A group of fast food operators has challenged the constitutionality of the system and the High Court is expected to issue a ruling on Thursday.

Whatever ruling is made is expected to be the subject of a Supreme Court appeal by either employers or unions.

A special report commissioned by the Government suggested that pay cuts would not lead to jobs growth but Mr Bruton has been promoting additional reforms of his own.

However, he is expected to adhere to the terms of the Duffy-Walsh report at today’s Cabinet meeting and postpone more controversial proposals on issues such as Sunday working.

Jack O’Connor, president of the Irish Congress of Trade Unions, said in a statement: “The Cabinet should not waste time working out ways to crucify the lowest-paid 20 per cent of the workforce through further cutting their pay.

“Reducing basic wages and employment rights will make no contribution to job creation, as the Government’s own independently commissioned Duffy-Walsh report has established,” Mr O’Connor said.

Fianna Fáil’s enterprise spokesman Willie O’Dea said it appeared Mr Bruton was about to “fudge the issue” to placate the Labour Party.

Although Mr Bruton had previously stressed the urgency of reform, Mr O’Dea said it now looked as if there would be no legislation “until next year at the earliest”.

Ictu took out newspaper adverts yesterday opposing Mr Bruton’s approach and the issue is likely to be discussed at its conference in Killarney next week.