New minimum wage recommendations

Published: Sunday 22nd February 2015 by The News Editor

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Recommendations on how much the national minimum wage should rise are set to be given to the Government amid union calls for an hourly rate of £7.

The Low Pay Commission is believed to have finalised its report, which it is understood will be sent to ministers tomorrow. The Government is likely to acknowledge receipt of the report, and announce its decision in the Budget next month.

With wages set to be one of the main issues at the general election in May, the decision by the commission on what it believes the new rate should be is eagerly awaited.

The commissioners, including representatives of business, unions and academics, have been meeting over the past few months to decide what the new rate should be.

The adult minimum wage increased from £6.31 an hour to £6.50 last October and a new rate will come into force in October this year.

Labour has already pledged to raise the minimum wage to £8 an hour over the course of the next parliament if it wins power in May, while Chancellor George Osborne has suggested it could increase to £7 this year as the economy improves.

Research has shown that more than two out of five firms intend to raise pay at the same rate as RPI inflation this year.

The Press Association understands that some sections of industry would accept a £7-an-hour minimum wage but others, including retail, would be opposed.

The minimum wage has not increased in line with inflation in six of the eight years since 2006, only keeping pace with price rises in 2009 and 2014.

Analysts have calculated that if the minimum wage had kept up with inflation since 2006, the adult rate would now be £6.99 an hour.

Published: Sunday 22nd February 2015 by The News Editor

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