The Labour Party will commit to increasing the minimum wage by 50 cent every year if re-elected to government, Tánaiste Joan Burton has said.

Ms Burton confirmed the junior Coalition party’s manifesto would seek a €2 increase to be phased in over four years.

The Tánaiste said: "You need a wage-led recovery, and Fine Gael, their economics people, acknowledge that.

“If we’re going to have a prosperous and thriving Ireland we need people to have a decent level of wages and decent jobs with good terms and conditions.

“ Because, if we’re going to have a knowledge economy, we’re aiming to ensure that everyone who wants a job is back at work. We’re working very strongly towards that.”

“So, I don’t see any threat in the fact that people would earn a decent wage.”

The minimum wage will be €9.15 in January after the Low Pay Commission recommended a 50 cent increase.

The Labour proposals would see it raise to €9.65 in 2017, €10.15 in 2018, €10.65 in 2019 and €11.15 in 2020.

Median wage

The Tánaiste said moving towards a median wage made sense and insisted Fine Gael would agree with the Labour party proposals.

She said: "If you look at the City of London – and this is one of the few things I have in common with Boris Johnson – we're both very strong supporters of the living wage."

Labour has already agreed to reduce and eventually phase out the universal social charge in its manifesto.

There is also proposals to introduce paid paternal leave of three months after maternity benefit and paternity benefit has been completed.