News 6 September 2020
Author: Kafui Mensah

Government plans to increase minimum wage could be “scrapped”

6 September 2020

The UK’s national minimum wage was expected to increase as part of the government’s plans however it is being reported that the damage coronavirus has done to the economy could make this impossible.

The government had been planning to raise the national living wage by increasing the minimum pay rate from £8.72 to £9.21 per hour in April but Ministers and officials have been debating the concept of an “emergency brake” – with the outcome of this decision planned to be announced by the Chancellor Rishi Sunak in the Autumn Budget.

Previously, the Chancellor was following a set target which would see the minimum pay rate increased equal to two-thirds of the country’s median earnings by 2024.

However, members of the Low Pay Commission have said that an increase to £9.21 come April would be impossible and would result in increased rates of unemployment – with the commission having the option to slam the metaphorical emergency brake if evidence points to the rise damaging low paid workers.

This revelation of information comes as a result of the Chancellor informing Tory MPs to expect tax rises in the set budget, stating it was time for the government to be transparent with the public on COVID-19’s effect on the economy.

A meeting is set for the end of next month for the panel to decide on the recommendations of the Chancellor’s budget.