The Department of Trade and Industry have announced that there will be a further rise in the National Minimum Wage in October, which will benefit over 1.3 million workers in the UK.
The adult rate is due to increase from £4.85 at present, to £5.05. The Youth and Development rate is going up to £4.25 from £4.10.
The Government has accepted the Low Pay Commissions' recommendation that the rate for 16-17 year olds remains the same at £3, but is due to be reviewed in 2006. The Government proposes further increases from October 2006, with the adult rate raised to £5.35, and the Youth and Development rate going up to £4.45.
If these rises did go ahead, this would mean that the rates would have doubled since the national minimum wage was introduced in 1999.
Our view
Minimum wage is a difficult issue, striking a balance between employees who need a fair deal, employers who sometimes cannot afford it because certain employees may not be pulling their weight and certain employers who abuse the system and pay low wages to staff who deliver more than £5 an hour.