Chancellor John Healey is expected to announce a rise of nearly 4 per cent in the minimum wage for lower earners in the Budget, but increases look set to slow for younger workers.
The national living wage, which applies to people aged 21 and over, is poised to increase from £12.71 per hour to around £13.20. Workers aged 18 to 21 will see their rate rise from £10.85 to about £11.27, an increase of 3.9 per cent, according to The Times.
Labour's pledge to scrap age bands
Labour's manifesto committed to scrapping "discriminatory" age bands and to increase wages for 18 to 20-year-olds so young workers are paid the same as those over 21. The minimum wage for younger workers rose by 8.5 per cent this year, reducing the difference to £1.86 an hour.
A Treasury spokesman declined to comment. Speculation has been mounting for months that the Government could back down on its plans to equalise the rates amid alarm over levels of youth unemployment.
Youth unemployment concerns
The numbers of young people not in education, employment or training (Neets) exceeded a million earlier this year, for the first time since 2013. Ex-Cabinet Minister Alan Milburn is expected to publish his review into the crisis in the coming weeks.
Critics have argued increases to the minimum wage are discouraging employers from taking on younger workers. But the TUC rubbished the warnings about equalising the rates, pointing to analysis showing 85 per cent of youngsters are already paid above it.
Polling on Budget priorities
Previous minimum wage rises to bring 23 and 24-year-olds, and later 21 and 22-year-olds, in line with adult rates did not impact employment rates, according to the Low Pay Commission.
Polling found that a majority of voters want action on energy bills to be the government's top priority. Research by More In Common found that 38 per cent want Mr Healey to focus on reducing bills, more than the 25 per cent thinking food prices and petrol (13 per cent) should be top of his list.
Taxes on vape shops and energy companies were also popular, with 60 per cent and 58 per cent backing these respectively. A wealth tax of 1 per cent on assets worth more than £10 million was also supported by 55 per cent, including among people who voted for the Tories in 2024.
However, it found that most Britons are pessimistic about the cost of living, with 56 per cent unsure whether it will ever end. More than half (51 per cent) said their finances have got worse over the past year, with just 11 per cent believing this has improved.
