News 2 October 2023

Millions to get pay rise as national living wage set to increase

2 October 2023

In a speech at the Conservative Party conference, Chancellor Jeremy Hunt is set to confirm a significant boost to the national living wage, raising it to a minimum of £11 per hour starting from April next year.

The current national living wage stands at £10.42 per hour, applicable to workers aged 23 and over. Rates for younger employees are lower, in accordance with the law.

Each year, the government determines these rates based on recommendations from the independent advisory group, the Low Pay Commission, with ministerial approval typically following suit.

While the Low Pay Commission has not yet finalised its recommendations for next year, initial estimates suggest a range between £10.90 and £11.43 may be necessary to meet the government’s goal.

Chancellor Hunt is expected to pledge that, regardless of the commission’s recommendation, the rate will increase to at least £11 per hour.

This change means that a full-time worker on the national living wage will witness an annual earnings increase of £1,000 in the coming year, according to the Conservative Party.

Hunt plans to address benefits sanctions, aiming to incentivise job seekers to re-enter the workforce. He argues that while companies struggle to find workers, approximately 100,000 individuals leave the labor force annually to rely on benefits. The details of these benefit reform plans are expected to be revealed in the Autumn Statement in November.

This move is expected to benefit approximately two million of the lowest-paid workers across the country.

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