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The National Living Wage is to rise 6.7% in April 2025 to an hourly rate of £12.21, the Chancellor has confirmed ahead of her first Budget.
National Living Wage, currently £11.44 per hour, is the minimum rate of pay for workers aged 21 and over. The National Minimum Wage for those aged 18-20 is also set to rise from £8.60 to £10 per hour as part of the Low Pay Commission’s recommendation to equalise pay rates across all age groups.
The increase in the National Living Wage is set to mean a pay rise of over 3 million workers across the UK from April 2025, worth approximately £1400 a year for a full time eligible worker.
The minimum hourly wage for an apprentice will also be boosted next year, with an 18-year-old apprentice seeing their minimum hourly pay increase 18.0% from £6.40 to £7.55 an hour.?
Chancellor of the Exchequer Rachel Reeves said:
“This Government promised a genuine living wage for working people. This pay boost for millions of workers is a significant step towards delivering on that promise.“
Business Secretary Jonathan Reynolds said:
“Good work and fair wages are in the interest of British business as much as British workers.
“This government is changing people’s lives for the better because we know that investing in the workforce leads to better productivity, better resilience and ultimately a stronger economy primed for growth.“
Deputy Prime Minister Angela Rayner said:
“A proper day’s work deserves a proper day’s pay.
“Our changes will see a pay boost that will help millions of lower earners to cover the essentials as well as providing the biggest increase for 18–20-year-olds on record.”
The announcement to increase minimum pay rates from next year comes ahead of Chancellor of the Exchequer Rachel Reeves’ first Budget. Addressing the House of Commons from 12.30pm 30th October, her Budget will be the first ever delivered in the UK by a female Chancellor. Reeves is expected to announce tax rises and spending cuts of around £40 billion alongside changes to government borrowing rules that will enable investment in infrastructure.