Government wage boost will motivate people to work

The National Living Wage, which will be introduced in April, will encourage people in to work, HM Treasury has said.

According to a survey of 1,200 people on how the increase in pay for the over 25s will affect them, 59 per cent said they will feel more motivated to work. More than 70 per cent said they will feel more positive for themselves and their families.

Chancellor George Osborne announced details of the National Living Wage in last summer’s budget. Coming into force on April 1, it will see the current minimum pay rate of £6.70 for those aged 25 and over rise to £7.20.

Cash and real terms boost

More than one million people are expected to benefit from the increase, with many workers’ pay packets boosted by up to £900 per year.

This is the largest annual increase in minimum wage rates – in cash and real terms – in any G7 country since 2009.

Osborne said: “The new National Living Wage is an essential part of building the higher wage, lower welfare, lower tax society that Britain needs and it’s great to see that over a million people will see their living standards boosted when this comes into force on April 1.

“Britain deserves a pay rise and this one-nation government is making sure it gets one, helping more people have the security of a higher wage to provide for themselves and their families.”

Increase for all

Business secretary Sajid Javid added: “We are building a more productive Britain and giving families the security of well-paid work. This is a step up for working people, so it is important workers know their rights and that employers pay the new £7.20 from April 1 this year.”

The National Living Wage follows recent rises in the National Minimum Wage rates to:

  • £3.30: For apprentices (the rate applies to all apprentices in year one of an apprenticeship, and 16-18 year old apprentices in any year of an apprenticeship).
  • £6.70: For 21s and over
  • £5.30: For 18 to 20-year-olds
  • £3.87: For under 18s