Abolishing wage agreements and reducing pay will not tackle the problems facing Ireland's restaurant sector, according to thinktank Tasc.

A nine-page briefing document published by the organisation has claimed the move would reduce consumer demand and increase inequality, and has called for other measures to be implemented. According to Tasc research, the Irish exchequer would lose about €1,143 (£970) for every full-time restaurant sector employee whose pay is reduced to the statutory minimum.

Instead of cutting wages, the thinktank suggests a temporary VAT reduction and excise taxes for restaurants could be more effective in helping the industry to address the issues facing it. Tasc head of policy Sinéad Pentony said: "An across-the-board 8 per cent cut in wages in the hospitality sector will cut consumer spending by approximately €170m (£144.3m)."