Although a mere 4% of Irish workers are currently receiving the minimum wage, a reduction in the legal rate looks increasingly likely today.

The Government is said to be proposing the measure, along with all other responses to the economic crisis.

However, Tanaiste and Enterprise Minister Mary Coughlan is against the proposal as she feels lowering the minimum wage would risk driving lower paid workers out of the workforce.

"We wouldn't like a situation to arise where it is more attractive to be on social welfare than be out working," her spokesman said.

The comments come as Health Minister Mary Harney warned there is also a proposal before the social partners for a pay freeze in the public sector.

Ms Harney also stressed that while the minimum wage is "no longer her responsibility" she said an examination of the rate "can't be ruled out".

She said: "For example, we are going to contemplate cutting social welfare payments in the context of the very serious budgetary situation we find ourselves in.

"And I think everything has to be examined, to be quite honest with you. I think given the economic challenges that we face, everything has to be on the table."

(BMcC/KMcA)