The Low Pay Commission has today recommended to the Government an above inflation rise of 3% to the UK's minimum wage. If implemented, this would represent the highest increment since 2008 and would mean a rise in the minimum wage from £6.50 to £6.70. For a full-time worker aged over 21, it would mean an actual annual increase of £416 a year. The proposal still needs to be approved by Government ministers and would come into effect from October 2015.
Workers between 18-20 would also see their earning rise by an even bigger margin - 3.3% - which would see their hourly rate improved from £5.13 to £5.30 and 16 and 17 year olds' earnings would rise 2.2% to £3.87 an hour.
Business secretary, Vince Cable, was delighted to announce these rises, though one of his recommendations for apprentices was rejected. Vince Cable had proposed an increase of £1 for 16 and 17 year-olds on the apprentice rate, but the commission instead only approved a 7p rise to £2.87 an hour.
Chancellor George Osbourne had indicated that the minimum wage would be at £7 an hour by 2015, had it kept pace with inflation. Last year, Labour leader Ed Milliband had promised that the level would be at £8 an hour by 2020, under a Labour government.
On the same day, UKIP leader, Nigel Farage, announced that he would give the NHS staff a pay rise and he would cut hospital car parking charges. He pledged an extra £3bn to the NHS, but UKIP's Health Spokesman Louise Bours would confirm neither how big would be the rise nor whether the improved pay offer would be funded from this additional spending. Under current Conservative plans, health workers will receive a 1% pay offer.
Those on minimum wage will undoubtedly welcome the increase and the government will want credit from raising the level by nearly £1 from £5.80 at the start of its term. As the General Election approaches, issues over public spending will become paramount. The posturing amongst the parties is already beginning, as leaders set out their positions on key policy. The impact of each political gain, the parties hope, will be felt in the ballot box come May.