The National Living Wage will increase by £1.02 an hour from April, the Treasury has announced.
Chancellor Jeremy Hunt said: “Next April every full-time worker on the National Living Wage will receive a pay rise of over £1,800 a year. This will put an end to low pay in this country, delivering on our manifesto promise.
“The National Living Wage has helped halve the number of people on the low wage since 2010, ensuring that work always pays.”
The move will increase the National Living Wage from £10.42 to £11.44 an hour, representing an increase of almost 10 per cent – the most significant in over a decade.
Eligibility for the National Living Wage will also be extended by lowering the age threshold to 21 for the first time.
This means a 21-year-old will get a 12.4 per cent rise from £10.18 this year to £11.44 next year, which is worth almost £2,300 a year for a full-time worker.
National Minimum Wage rates for young workers will also increase, the Treasury said. 18-20 year olds will see their wages rise to £8.60 an hour – a lump sum of £1.11 an hour.
The Department of Business and Trade estimates that 2.7 million workers will benefit directly from the 2024 increase in the National Living Wage.
The announcement comes ahead of Mr Hunt’s Autumn Statement tomorrow, where he will outline the Government’s latest policy changes and plans for tax and public spending.
Apprentices will also see their minimum hourly wage rise by more than 20 per cent next year, going from £5.28 to £6.40 an hour.
The National Living Wage was introduced in 2016 and currently sets the minimum hourly wage that an over 23-year-old earns while working.
The Chancellor fully accepted the recommendations from the Low Pay Commission, the body that advises the Government on the minimum wage. He said the Conservative target of “ending low pay” by raising the living wage to two-thirds of average earnings had now been met.
According to the Treasury, the number of workers on low hourly wages has more than halved from 21.3 per cent to 8.9 per cent since 2010, supported by increases in the National Living Wage.
The Chancellor will set out further measures in tomorrow’s Autumn Statement, to be announced around midday.
When will the National Living Wage rise?
The National Living Wage rate usually changes on 1 April each year. Currently, 2.7 million people on low wages are expected to benefit from the increase.
In addition, the rate for the National Minimum Wage (NMW), aimed at those of at least school-leaving age, will increase on 1 April. Minimum wage in this category differs depending on age and whether a person is an apprentice.
How much will the new Living Wage rise?
- National Living Wage (21 and over): £11.44 an hour (up from £10.42)
- 18 to 20 year old rate: £8.60 per hour (up from £7.49)
- 16 to 17 year old rate: £6.40 per hour (up from £5.25)
- Apprentice Rate: £6.40 per hour (up from £5.28)
- Accommodation Offset: £9.99 per hour (up from £9.10)
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