Chancellor Rachel Reeves confirms £1,400 pay rise for minimum wage workers next year - all you need to know
Minimum wages workers will earn more as of April next year, the Chancellor of the Exchequer has confirmed, as part of her first Budget. Today Rachel Reeves announced that the pay for minimum wage will rise in April.
The increase will affect workers aged 18 to 20 and over 21s, as well as apprentices. It is estimated more than three million workers will benefit from the rise.
Speaking during her Budget announcement Ms Reeves said: "For the first time I can confirm that we will accept the Low Pay Commission's recommendation to increase the National Living Wage by 16.7 percent to £12.21."
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But who exactly will this affect and how much will they get? The minimum wage for over 21s, which is known as the National Living Wage, will rise by 6.7 percent from April 2025.
This means it will rise from £11.44 to £12.21. In April this year, it increased to £11.44 an hour, from £10.42.
The increase equates to a £1,400 annual pay rise for fulltime workers on the National Living Wage. For 18 to 20-year-olds on minimum wage it will increase from £8.60 to £10.
This follows a rise in April 2024 from £7.49.But apprentices will get the biggest pay increase, from £6.40 to £7.55 an hour. Before April this year it was £5.28.
Prior to the announcement, the Chancellor said: “This Government promised a genuine living wage for working people. This pay boost for millions of workers is a significant step towards delivering on that promise.”
Deputy Prime Minister Angela Rayner also commented: “A proper day’s work deserves a proper day’s pay. Our changes will see a pay boost that will help millions of lower earners to cover the essentials as well as providing the biggest increase for 18 to 20-year-olds on record.”
Rates for the National Living Wage and National Minimum Wage are set by the Government every year, with the new rates coming into effect the following April.
The move has been welcomed by the Low Pay Commission. Baroness Philippa Stroud, Chair of the commission, said: “The Government have been clear about their ambitions for the National Minimum Wage and its importance in supporting workers’ living standards.
“At the same time, employers have had to deal with the adult rate rising over 20 percent in two years, and the challenges that has created alongside other pressures to their cost base. It is our job to balance these considerations, ensuring the National Living Wage provides a fair wage for the lowest-paid workers while taking account of economic factors.
“These rates secure a real-terms pay increase for the lowest-paid workers. Young workers will see substantial increases in their pay floor, making up some of the ground lost against the adult rate over time.”