There are doubts over whether a proposed increase of nearly 80 cent per hour for about 200,000 workers covered by the national minimum wage will be approved by the Government. <\/p>\n
Senior sources said over the weekend it was not certain the Government would follow the recommendation of the Low Pay Commission (LPC) for a 79c increase in the hourly rate<\/a>, which would bring it to \u20ac14.94 from January 1st next year.<\/p>\n The LPC, which includes representatives of stakeholders such as employers\u2019 groups and trade unions, recommended the increase to Minister for Enterprise Peter Burke<\/a> this summer. <\/p>\n Burke is not required to accept it, but no such recommendation, made every year, has been rejected since the establishment of the minimum wage. They are generally considered by the Cabinet as part of the budget<\/a> process. <\/p>\n One senior source said while no decisions had been taken, it was \u201ccertainly not a definite\u201d that the Government would sign off on the full increase, and another Cabinet Minister shared their private view that the \u201crecommendation is too high\u201d \u2013 but added they were not sure what the final decision would be. <\/p>\n That Minister also expressed the view that the LPC should be restructured. Some in Government believe an increase would drive labour costs up, which in turn could feed into the price of food and other consumer goods and services. <\/p>\n If implemented, the new rate would take the weekly wage for a person working a standard 39-hour week to \u20ac582.66 and to \u20ac30,298.32 annually, breaking the \u20ac30,000 mark for the first time.<\/p>\n However, employers have argued the proposed increase in the minimum wage from the start of next year would damage employment in labour-intensive sectors such as construction. <\/p>\n Elsewhere, pressure is growing within the Coalition to go higher than a mooted \u20ac7.50 increase in weekly welfare payments in the budget, with fears of a political blowback if it is seen as coming in too low. <\/p>\n However, senior sources warned that a higher across-the-board increase would mean less could be done on targeted measures.<\/p>\n Negotiations over weekly welfare rate increases are \u201cnowhere near agreement\u201d, according to a source with knowledge of discussions \u2013 but there is considerable unease across Government about the prospect of trying to sell an increase of \u20ac7.50, which would be \u20ac2.50 less than last year.<\/p>\n [\u00a0Should the minimum wage be raised again?Opens in new window<\/a>\u00a0]<\/p>\n Meanwhile, spending officials are resisting further steps towards scrapping the means test for the carer\u2019s allowance after last year\u2019s budget led to a significant increase in new applications for the payment.<\/p>\n