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The ‘National Living Wage’ Per Hour To Increase In The UK From April 2022

A majority of low wage workers in the United Kingdom will see an inflation-busting pay raise next year, after the government, on October 25, said that it will legislate in the parliament to raise the National Living Wage to £9.50 ($13) per hour, up from the current rate of £8.91 ($12.25).

According to the British Treasury, the 6.6 per cent increase, which will be effective for low-wage workers aged 23 and above beginning from April, implies that a full-time worker earning the living wage will receive an increase of more than £1,000 ($1,374.90) every year.

The rise is roughly almost double the current level of inflation, which has risen rapidly in consecutive months as a result of a significant increase in energy expenditures. The UK government has announced an increase in the minimum wage for workers aged 21 and 22 to £9.18 per hour ($12.62) from £8.36 per hour ($11.49).

A full-time worker will receive £1,074 ($1,482) more per year before taxes as a result of the increase. The government has been under pressure to assist low-wage, younger workers who have been disproportionately affected by the outbreak.

Considering as inflation is expected to grow more in the coming months, there will be questions as to whether the hike will be sufficient to help people struggling to make ends meet. The 6.6 per cent hike in the minimum wage for people over the age of 23 – known as the National Living Wage – is more than double the current 3.1 per cent increase in the cost of living. Minimum wage rates for younger workers are also expected to rise.

The Chancellor of the Exchequer, Rishi Sunak, MP, is likely to reveal an additional £5.9bn ($8.1bn) to assist the National Health Service in dealing with a backlog that has grown as a result of the coronavirus outbreak in his budget speech on October 27.

The National Minimum Wage for adults aged 21 to 22 will increase from £8.36 ($12) to £9.18 ($13) per hour, while the Apprentice Rate would climb from £4.30 ($6) to £4.81 ($7) per hour. According to Sunak, “The increase ensures we’re making work pay and keeps us on track to reach our aim of ending low pay by the conclusion of this Parliament.”

The Labour’s shadow Chief Secretary to the Treasury, Bridget Phillipson, condemned it as an “underwhelming offer” that would be largely offset by tax increases, universal credit cuts, and higher energy prices.

Minister Sunak will use his budget to announce a salary raise for low-income workers and the end of a pay freeze for five million public sector employees, but Labour cautioned that households could be worse off as price spikes and tax increases bite.

He will further announce the end of a one-year “pay stop” in the public sector, which will benefit millions of nurses, teachers, and military personnel. “Now that the economy is securely back on track, it’s only fair that nurses, teachers, and all the other public-sector workers who contributed to the pandemic’s success see their wages rise,” Sunak said.

Employees in the public sector will now have to wait until next year for the recommendations of independent pay review organizations to determine the level of their salary raise and if it will keep pace with rapidly rising living costs.

According to Labour, for many people, any rise “would be eaten up” by tax increases, welfare cuts, and skyrocketing energy bills. In 2019, the Conservative administration vowed to raise the national living wage to two-thirds of median earnings by 2024, equating to around £10.50 ($15) per hour, making it the highest in the industrialized world.

The hike comes after ministers terminated a temporary £20 ($28) weekly increase to universal credit, the primary welfare benefit, earlier this month, which was implemented at the onset of the coronavirus pandemic and cost £6bn ($8.27bn) per year.

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