Minister announces minimum wage increase but fails to allocate funding to provide for it – McConalogue
10 December 2015
Fianna Fáil TD for Donegal Charlie McConalogue has accused the Social Protection Minister of trying to take credit for increasing the minimum wage while failing to provide additional funding to companies under the Community Services Programme. These community based programmes will struggle to pay their employees the new National Minimum Wage unless they are allocated additional funding.
Deputy McConalogue commented, “While an increase in the national minimum wage is welcome, it is incumbent on the Government to ensure that companies funded under the Community Services Programme are given additional funding to cover the additional cost. Under the law, all employees will be paid the minimum wage but Minister Joan Burton has failed to allocate extra money under the CSP to do this. This will place a significant financial burden on these companies as they will have to find the money needed to pay the increased staff costs from the current funding levels. For many this will simply not be possible and communities across Donegal will face service cuts as a result.
“These companies play an important role in communities across Donegal. Not only do they provide employment, but they also deliver practical and much needed services. These companies operate on a not-for-profit basis and work on a social enterprise model, but many of them will now face big challenges to remain viable. Many of the areas where these companies operate are disadvantaged and any loss of services or employment would come as a major blow.
“The decision by Minister Burton not to increase the contribution to the CSP in line with the increase in the new national minimum wage is a major miscalculation. The Department should be leading by example but is instead heaping a huge financial burden on to community companies. There needs to be a full review of how all relevant Social Protection funded programmes will be affected by the increase in the national minimum wage. Instead of penalising these companies, the Department should be supporting community based enterprises. There needs to be a rethink of the situation and I am urging the Minister to ensure that these companies are given the necessary funds to pay the increased staff costs”.