The Taoiseach and his Tánaiste embarrassed themselves yesterday on the issue of the cost of living. Incredibly, the Tánaiste cited a 3% increase in the minimum wage as an example of the Government protecting workers from the ravages of inflation. How can the Tánaiste make such a comment when he knows lower-paid workers are the ones hit hardest by inflation and that inflation is increasing at nearly twice the rate that the minimum wage increased? At a time when Germany is increasing its minimum wage to €12 an hour, the Taoiseach’s Government has effectively cut the wages of the lowest-paid workers in this country. Shame on you, Taoiseach.

He also voiced opposition to wage increases in line with inflation here yesterday. He tried to deny it, but he did. Instead, he said that workers would need to be compensated by an increase in the social wage. Does the Taoiseach expect working people to have any confidence in his words when he decided to compensate them for about 15% of their increased energy bills, while leaving them to dig deep for the remaining 85%? The Taoiseach’s words might be taken a bit more seriously if he were to introduce free childcare for all, legislate to cut rents, bring in free public transport or abolish fees for third level. Anything less than measures such as these and the Taoiseach’s comments about the Vincentian model will be seen merely as waffle and guff.

Workers at Glen Dimplex in Northern Ireland have won a 13.5% pay increase. Unite the Union has won 25 pay increases at, or above, the rate of inflation in Northern Ireland and Britain. How did it do that? How did it successfully defend workers' living standards? It was not by politely asking employers maybe to grant pay increases, as the Tánaiste did yesterday. The union did it by organising, by balloting for industrial action and by taking industrial action where necessary. That is the example which must be followed here now. The bosses can well afford it.

Let us talk about profit inflation. The Musgrave Group made pre-tax profits of €98 million in 2020, while Facebook made after-tax profits of €623 million. I could quote hundreds more examples like that to the Taoiseach, if I had the time. A rise in wages leads to a cut in profits and not to a rise in prices, as the Taoiseach falsely implied here yesterday. Within one month, therefore, will the Taoiseach introduce an emergency package of measures to compensate ordinary people fully for inflation? Will he revisit the question of the minimum wage now that inflation is double the rate of the increase? Will he also voice support for workers submitting pay claims which, at the very least, match the rate of inflation?

Again, people at different times can distort what gets said. I warned against a wage-price inflationary cycle, but not against wage increases, which have occurred in the Irish economy and that have been linked with productivity and other factors. The latest data from the Central Statistics Office, CSO, show that average hourly earnings rose 3.8% in the third quarter of 2021, from a year earlier, and were up 7.6% from their pre-pandemic levels in the third quarter of 2019. We could go through the annual average wage inflation over that period as well, but that is not relevant now. It may be academically, but the reality now is that prices are increasing significantly because of the global energy crisis and supply chain issues arising out of the impact of Covid-19. I was simply pointing out yesterday that the global situation has to be taken on board. It is not the Irish Government that has cut anyone’s wage or income.

The Governor of the Central Bank of Ireland is clear that the wage increases so far are linked to increases in productivity, which is a good thing for the economy. If we were to have wage increases greater than the increases in productivity, that could lead to businesses having to increase prices and so on, and that is in no one’s interest. What I said yesterday is that we must work intelligently through this. That is why the Government worked in the budget on tax relief and on specific, targeted social welfare measures that would help low-income families in particular. In addition to those social protection measures, however, we also took other decisions concerning the cost of living that would impact families in particular.

Reducing paediatric hospital charges, increasing eligibility for families to access GPs for six- and seven-year-olds and reducing the drugs payment scheme threshold are very targeted measures that make a real difference to families in certain circumstances. It is the better, more intelligent approach to deal with the unprecedented inflationary cycle that we are currently experiencing. The Central Bank believes that it will peak in 2022 and that we should hopefully be out of it by 2023.

The Government has also taken measures in respect of the cost of energy through the rebate, which is a €200 million cost. The Minister, Deputy Eamon Ryan has introduced that. The Government has approved the legislation which will reduce electricity bills by €113. We acknowledge that these measures just contribute to easing the burden of inflation on many families. We will continue to work across the different areas to see if we can reduce that impact. We would also like to engage with the social partners and others in terms of adopting an intelligent way to deal with this inflationary cycle that retains the best of what the economy has going for it right now. The economy is producing jobs, which ultimately are the best protection against low incomes and so on.

The Taoiseach referred to a 3.8% year-on-year wage increase for workers. What is the rate of inflation? It is more than 3.8%. It is 5.5% and it is rising. The price of diesel is up 26%. The price of electricity is up 21%. Rents are up 8.3% and a lot more than that for many renters. What we have in Irish society is a de facto wage cut for workers. The Taoiseach is standing over that. I do not hear him saying anything that is going to bridge the gap for workers; €100 off the energy bills is not going to cut it.

Let us have a discussion as well about other wages. Robert Watt has €81,000 of an increase. Paul Reid earns €426,000 a year. Peter Jackson of Paddy Power made €8.7 million last year. Albert Manifold of CRH made €11.2 million last year. Three Bank of Ireland executives made more than €1 million each last year. That was signed off by the Department of Finance. The Government is telling workers to suck it up and accept wage cuts at a time when these massive wages are being paid by the top people to the top people. The Fianna Fáil and Fine Gael way seems to be one law for them, and one law for the ordinary people. What says the Taoiseach on those points?

What I say is that we are not cutting any wages; wages are increasing. The Deputy asked about inflation.

Wages are being cut.

The figure I was quoting was 3.8% in the third quarter of 2021 from a year earlier. That was the rise in earnings then. Wages were up 7.6% from their pre-pandemic levels in Q3. The average inflation for that period was about 2.4% and actually was -0.3% throughout 2020. However, the Deputy is correct. We all accept that the CPI prices were up by about 5.5% in December. Electricity prices are up 22%. We know that. Gas prices are up 28% and home heating oil is up 53%. Petrol and diesel are up 34%. Food prices have not risen to that extent except for bread and cereals, which is problematic. The problem is that energy prices feed into higher costs of production and distribution, which ultimately creates pressure in terms of inflation. I say to the Deputy that we have already taken measures in the budget to try to protect those who need the protection the most, to target that. We are going to continue to look at ways of trying to reduce the burden, particularly on the energy side, on people. We took steps yesterday in that respect.