Seeing red over young Blueshirts’ plan

Tuesday 01 July 2014, 01pm

A number of weeks ago, Young Fine Gael, the youth wing of Fine Gael, made the dramatic call for a cut in the minimum wage by 23% or by €2 an hour.

Their plan was for the minimum wage to be restructured so that an experienced adult worker would get €6.65 an hour; a worker who is over 19 and in their second year of employment would get €5.79 an hour; a worker who is over 18 and in their first year of employment would get €4.92 and those under 18 would get €4.06 an hour.

If ever there was a warning to young workers and socially-conscious people, this is it. At a time when poverty and deprivation rates are escalating towards record levels, and when many large businesses are experiencing pre-recessionary profit margins, the youth wing of the controlling government party are calling for more deprivation and higher profits.

They say that they would refund the €2 for those already earning the minimum wage through an “income tax credit”, but don’t explain where the money to pay for this credit will come from.  There can only be two reasons for such an absurd proposal like this. The first is that it’s a softening-up mechanism whereby, Young Fine Gael call for a cut in the minimum wage, but when their party doesn’t actually cut it, or cuts it by less than the €2 per hour, we’ll all be grateful and think, “Well, it wasn’t as bad as it could’ve been.”

The second – and more likely – reason for the statement is that, temporarily as it may have been, the ideological veil has slipped on the future of the Fine Gael party.

Big business

A plan to cut pay for the lowest paid workers in our society, irrespective of how profitable their employer is, is simply a plan to subsidise big business. As if they don’t get enough of a subsidy already with free labour schemes, low taxation rates and a range of loopholes to avoid paying any tax in the first place.

And who’ll pay for these subsidies? Low and middle-income earners of course. This is ideological and young people and progressives cannot stand by while the people proposing this monstrosity of a policy become possible future governors of this country. The failure of YFG to comprehend the effect such a plan would have on the labour market is significant in itself, but unfortunately we don’t have time to get into that in detail. However, they deceptively say that Ireland has one of the highest minimum wage rates in Europe which – wait for it – acts “as a barrier to job creation.”

Have they slept through the crisis? Do they know that one of the biggest problems facing our country is, and has been, the collapse in domestic demand due to cuts in income levels?

Cutting further will only deepen the crisis in domestic demand – which affects the retail, bar and services sector disproportionately. Irish workers need more money in their pockets to boost local business, create more jobs and get the economy going again, not less.

Then there’s the disingenuous element, whereby they only mention the headline minimum wage rate and not the other employment costs such as employer’s PRSI rates – which are up to 50% below the rates of some other countries in Europe.

You see, the minimum wage is only one portion of an employee’s pay (i.e. employer’s PRSI, pension contributions etc). Put simply, it is far cheaper to employ a worker in Ireland than in the average EU country.

We are a low labour-cost economy but employers and right-wing political parties hide behind a headline minimum wage rate rather than discussing the full employee compensation package.

Furthermore, if the state is to subsidise profitable employers to the tune of €2 for every hour a worker is employed, where will the money come from?  Do you think it’ll be from higher taxation on corporations, a wealth tax or the introduction of more stealth taxes that disproportionately impact on lower paid households? I know which one of those options is most likely under the current and previous governments of this country.

Worryingly, if Fine Gael’s record is anything to go by, it’ll be through cutting public expenditure, which is already at breaking point. Just ask anyone attending an emergency room in any hospital across the country this weekend.

Rallying call

What YFG’s proposals do is issue us with a rallying call. This is our future unless we on the Left get organised and resist. This is especially true for young workers who will be most affected if YFG are to be part of any future government.

Remember, it wasn’t long ago that people like prominent politicians Minister Leo Varadkar or Lucinda Creighton were in Young Fine Gael.

The best way to resist these ideological attacks on workers and their incomes is by mobilising industrially – through getting involved in your trade union and by politicising yourself.

If you’re interested in getting involved with Mandate Youth, please email us at news@mandate.ie 

This article was written by David Gibney, Mandate communications officer and ICTU Youth Secretary

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