Rachel Reeves is reportedly set to raise the minimum wage for those 21 and over, known as the National Living Wage, by more than 6% in April 2025, higher than the Low Pay Commission’s central estimate of 5.8%, which was set out last month.
According to The Times, the National Living Wage will rise from £11.44 to more than £12.12 an hour, after ministers promised to ‘raise the floor’ on wages.
Workers aged between 18 and 20, who currently receive a National Minimum Wage of £8.60 an hour, could be in line for a bigger rise under Government plans to eventually establish a single adult rate.
In comes after UKHospitality warned that significant increases to the minimum wage over recent years meant wages now represent at least a third of business costs.
Businesses are bracing themselves for tomorrow’s Budget, with the Chancellor also expected to announce a rise in National Insurance contributions (NICs) for employers.
UKHospitality has been calling for the Chancellor to make the tax burden for the sector ‘more sustainable’ in the Budget, primarily through the introduction of a lower, permanent and universal multiplier on business rates for hospitality.
Earlier this month, the trade body warned that the rates burden on the hospitality sector is set to increase to £914m if current relief ends as planned on 31 March next year.
Some 170 hospitality bosses have backed a letter, written by UKHospitality, calling for a lower level of business rates for the sector.