Minister to defy unions as she proposes just a 10 cent hike in minimum wage

Ms Mitchell O'Connor is to resist calls to introduce a larger hike amid fears that Brexit is beginning to bite on the Irish economy.

The Low Pay Commission recently recommended a 10 cent rise in the minimum wage, which would benefit 70,000 workers.

Trade unions and opposition TDs expressed disappointment at the proposal and have called for the introduction of a so-called 'Living Wage' of €11.50 per hour.

However, business groups have been piling pressure on the Government not to touch the minimum wage, which stands at €9.15.

While the recommendation by the Low Pay Commission was discussed at Cabinet earlier this year, no formal decision was taken.

But Government sources say that after "serious consideration", Ms Mitchell O'Connor will shortly recommend the 10 cent increase ahead of next month's budget.

"It is about reaching a balance between assisting the low paid but also recognising the challenges facing businesses as a result of Brexit," a source said.

The decision to adopt the proposal by the Low Pay Commission will attract the ire of unions which have described the increase as insufficient.

The Independent Alliance is also likely to take issue with the move.

The party was due to discuss its own budget demands this week, but this was delayed as a result of the row over Waterford Hospital.

Independent minister John Halligan, who has caused the row, has himself called for the introduction of the so-called 'Living Wage' of €11.50.

Fine Gael sources insist that the Government is open to further increases in the minimum wage and that it will be guided by further reports from the Low Pay Commission.

The Budget itself will outline measures that will be rolled out over a three-year period following a decision taken by Public Expenditure Minister Paschal Donohoe.

Mr Donohoe will begin face-to-face meetings with ministers next week, during which specific budget proposals will be thrashed out. Government departments have been given a deadline of today to submit their estimates.