Photograph by William Warby
The government have announced that the national minimum wage is to rise by 12p an hour to £6.31 for adults and by 5p to £5.03 for 18-to-20-year-olds from October.
This rise follows the recommendations of the Low Pay Commission according to Business Secretary Vince Cable, although they are below the current inflation level of 3.2%. The rise of under 2% also falls below the Consumer Price Index (CPI) which currently stands at 2.8%.
Rates for apprentices will also rise by 3p to £2.68/hour.
Speaking on the increase, Vince Cable said:
“The independent Low Pay Commission plays a crucial role in advising the government when setting the national minimum wage every year. It balances wages of low paid workers against employment prospects if the rate was set too high.
We are accepting its recommendations for the adult and youth rate increases, which I am confident strikes this balance. However, there is worrying evidence that a significant number of employers are not paying apprentices the relevant minimum wage rate.
Apprenticeships are at the heart of our goal to support a stronger economy, and so it is important to continue to make them attractive to young people. Therefore, I am not taking forward the LPC’s recommendation to freeze the apprenticeship rate due to non-compliance, but instead am raising it in line with the youth rates.
We are working on a series of tough new measures to ensure we tackle non-compliance issues across the board.”
In response to the announcement of an increase to the minimum wage, TUC General Secretary Frances O’Grady said:
“Boosting the incomes of the low paid goes straight into the economy and wage-led growth must be part of the recovery so we would have liked to have seen minimum wage rates go up further today, even if the government has rightly rejected calls for a freeze.
But we are pleased that ministers have increased the apprenticeship rate. This sends a positive signal about the importance of apprentices.
…And we will continue to urge the many employers who can afford it to implement a full living wage for their staff.”
Speaking on behalf of UK manufacturing, EEF’s Head of Employment Policy Tim Thomas said:
“Today’s announcement on the National Minimum Wage strikes a delicate balance between the need for an element of pay progression and the limitations employers face in accommodating pay rises.
The modest increase in the Apprenticeship rate is unlikely to negatively affect apprenticeship recruitment and of much greater importance is the raising of apprenticeships standards, better information and advice to students and ensuring that apprenticeships are truly employer-led and employer-driven.”
