National living wage to increase to £8.21 an hour from April 2019


Read more updates on the Autumn Budget 2018 in Tuesday’s Daily News email

Autumn Budget 2018: The national living wage will increase by 4.9% from April 2019, rising from £7.83 an hour to £8.21 an hour for employees aged 25 and over.

Chancellor Philip Hammond (pictured) confirmed in his Autumn Budget 2018 speech, delivered today (Monday 29 October), that the government will follow recommendations from independent body the Low Pay Commission (LPC) to increase national living wage rates from next April, to potentially impact 2.4 million employees in the UK.

The government has further accepted the LPC’s national minimum wage recommendations, to be effective from April 2019. This includes increasing the national minimum wage from £7.38 an hour to £7.70 an hour for 21 to 24-year-olds, from £5.90 an hour to £6.15 an hour for 18 to 20-year-olds, and from £4.20 an hour to £4.35 an hour for 16 to 17-year-olds. In addition, there will be a 5.4% national minimum wage increase for apprentices, with the rate rising from £3.70 an hour to £3.90 an hour.

Since April 2015, the lowest-paid full-time employees have seen their wages grow by 8% above inflation and, since the introduction of the national living wage in April 2016, the total annual earnings of a full-time minimum wage employee will have increased by £2,750.

Hammond also confirmed that in 2019, the government will set the LPC’s remit beyond 2020, to align with governmental aspirations of ending low pay. The government will consult with the LPC and other related parties in the coming months to set an appropriate policy and take account of the potential impact on employment and economic growth.

The government’s objective is for the national living wage to reach 60% of median earnings by 2020, subject to sustained economic growth.

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Andy Timpson, partner at Blick Rothenberg, said: “With increase in national living wage to £8.21 and [an] increase in [the] personal allowance to £12,500, the lowest earners in the UK are getting a real wage boost.”

Tess Lanning, director at the Living Wage Foundation, added: “[The] announcement of the rise in the government minimum wage is a welcome step towards closing the gap with the real living wage based on what people need to make ends meet. But the number of people paid less than the real living wage has increased this year, with millions of [employees] struggling to keep their heads above water. That’s why, more than ever, we need more employers to step up and commit to pay the real living wage, not just the government minimum.”