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'Politics got us into this mess' - Why increasing wages won't help housing crisis

Ireland's national minimum wage could be replaced in four years' time
Jack Quann
Jack Quann

17.45 14 Jun 2022


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'Politics got us into this mes...

'Politics got us into this mess' - Why increasing wages won't help housing crisis

Jack Quann
Jack Quann

17.45 14 Jun 2022


Share this article


An increase to the minimum wage won't make any dent in the housing crisis.

That's according to the chief executive of ISME, Neil McDonnell.

He was responding to proposals that Ireland's national minimum wage could be replaced by a living wage in four years' time.

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This would be set at 60% of the median wage in a year, with plans based on research carried out by the the Low Pay Commission.

It means if you earn a minimum wage of €10.50 an hour, that would increase to €12.17.

But Neil told The Hard Shoulder this won't alleviate the shortage of housing.

"In May 2012 there were 15,000 properties available to rent on Daft.

"In May just gone, there were 851 in the whole country - that's a 96% decline in stock.

"That was because of political decisions to tax the provision of accommodation by landlords out of existence.

"So it was politics that got us into this mess, and we will not get out of it by simply increasing wages."

'Transferring money from employers to landlords'

He says the wage could go as high as €30 an hour, but it's all relative.

"Don't worry about your 12.90: you can go to €20 an hour, you can go to €30 an hour.

"All you will do, when you have a situation like you have in the country... when there is a desperate, desperate short [sic] of housing is you will transfer money from employers, who can barely afford to pay it, to landlords and the owners of property.

"We have to get our head around the fact that forcing wages up by legislative fiat is simply bound to fail.

"And we actually have to start addressing the root cause of the increases in costs: and the only way you do that is to provide more accommodation".

He adds: "As long as we continue with, and I have to be critical here, with this illusion that if we simply try to push up wage cost we will address the cost of living.

"And I'm afraid that simply won't happen".

Earlier President Michael D Higgins labelled housing policy in Ireland a "great, great failure".

He said the housing situation "isn’t a crisis anymore. It is a disaster."

"I think we have to really think about meeting the basic needs of people in a Republic – be that food, shelter or education.

"Building homes is what is important. It is not to be a star performer for the speculative sector internationally or anything else," President Higgins added.


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Accommodation ISME Living Wage Low Pay Commission Minimum Wage Neil McDonnell The Hard Shoulder

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