National minimum wage to rise to £12.71 an hour from April

The national minimum wage will rise to £12.71 an hour next year, the chancellor has announced.

From next April, the minimum living wage will rise by 4.1% to £12.71 an hour for eligible workers aged 21 and over, and the minimum wage for 18 to 20-year-olds will increase by 8.5% to £10.85 an hour.

Rachel Reeves said she had accepted recommendations from the Low Pay Commission so that those on low incomes are “properly rewarded” for their work.

The Government said the increases are expected to benefit approximately 2.7 million workers nationwide.

“I know that the cost of living is still the number one issue for working people and that the economy isn’t working well enough for those on the lowest incomes,” Reeves said.

“Too many people are still struggling to make ends meet, and that has to change.

“That’s why today I’m announcing that we will raise the National Living Wage and also the National Minimum Wage, so that those on low incomes are properly rewarded for their hard work.”

The Government said the new rates will increase the earnings of a full-time employee on the national living wage by £900 a year.

Employees on the national minimum wage will see a £1,500 annual boost.

The minimum rate for 16 and 17-year-olds, as well as those on apprenticeships, will increase by 6% to £8 per hour.

Reeves said the boost for younger workers will narrow the gap with the national living wage.

“These changes are going to benefit many young people across our country,” Reeves said.

The chancellor added that the Government must also support businesses while protecting jobs and the economy, which she said is why Labour has secured international trade deals and is committed to economic stability.

“It is why we have capped corporation tax, and why we’re reforming business rates, particularly so that they help the high street,” she said.

“In this week’s Budget, I’m going to deliver our mandate for change, and I’m determined to cut the cost of living for everyone.”