In a landmark announcement, Chancellor Jeremy Hunt has declared a significant increase in the national living wage, uplifting it to £11.44 per hour from April. This adjustment marks the most considerable cash rise in the history of the wage, amounting to an annual boost of approximately £1,800 for the lowest-income earners.
For the first time, the updated living wage will encompass younger workers aged 21 and 22, extending the benefits of this policy to a broader demographic. Approximately two million individuals are poised to experience the positive impacts of this change.
In parallel, the minimum wage rates for various age groups and apprentices are also set to rise. Workers aged 18 to 20 will receive a minimum of £8.60 per hour, while those aged 16 and 17, along with apprentices, will have their minimum wage set at £6.40 per hour. These increments represent a significant uplift from the previous rates.
Chancellor Hunt emphasized the transformative potential of this increase, stating, “Next April, all full-time workers on the national living wage will get a pay rise of over £1,800 a year. That will end low pay in this country, delivering on our manifesto promise.” The national living wage, first introduced in 2016, has been a pivotal factor in reducing the number of low-paid workers, underscoring the government’s commitment to ensuring work is a viable route out of poverty.
The Treasury has highlighted the progress made since 2010, noting a substantial decrease in the proportion of workers on low hourly pay from 21.3% to 8.9%. This achievement is attributed to consistent increases in the national living wage and adjustments to personal tax thresholds, which now allow a working individual to earn up to £1,000 a month tax-free.
Nye Cominetti, the principal economist of the Resolution Foundation thinktank, acknowledged the significance of this raise, describing it as “huge” and “the third-biggest rise ever in both cash and real terms.” He estimated that at least 1.7 million workers across Britain would directly benefit from this rise, with many more experiencing indirect wage boosts.
The Workers Union Says…
“This development represents a monumental step towards addressing wage disparities and improving the living standards of millions. It underscores the government’s commitment to ensuring fair compensation for work and provides a beacon of hope for those struggling with the rising cost of living.”