The UK Government has set out new considerations for the Low Pay Commission (LPC) when recommending next year’s National Living Wage and National Minimum Wage.
The LPC will consult with employers, trade unions and workers on narrowing the gap between the 18–20-year-old rate of the National Minimum Wage and the National Living Wage and will put forward recommendations on achieving a single adult rate in the years ahead.
The UK Government said that younger workers were “being held back by discriminatory age bands” and has committed to delivering a single adult pay band.
Last year the cost of living was included in the LPC’s remit for the first time, leading to a record cash increase in the Minimum Wage for apprentices and those under 18, and a £1,400 annual increase for full-time workers on the National Living Wage from April.
The UK Government said the LPC would continue to actively consider the cost of living in its recommendations for National Living Wage rates to apply from April 2026.
Deputy Prime Minister Angela Rayner said:
“Having started my working life on low pay I know the difference a good, fair wage can make, and delivering this is a non-negotiable priority for this Government as set out in our manifesto. This is a government on the side of Welsh workers. Our landmark plan to Make Work Pay has already delivered one of the biggest pay boosts on record – and up to 160,000 people in Wales have seen the benefit.
“With this remit we are backing the lowest paid Welsh workers, getting more money in working people’s pockets, and raising living standards in every part of the UK as part of our Plan for Change.
“And our Employment Rights Bill – the biggest boost to workers’ rights in a generation – will tackle the insecurity, inequality and low pay that have held back workers and businesses for too long. It will mean the stability of guaranteed hours and income for the 100,000 workers in Wales currently on precarious zero or low hour contracts, sick pay from day one, and an end to exploitative fire and rehire.”
Baroness Philippa Stroud, Chair of the LPC, said:
“We are pleased to receive our remit from the Government. Already, since the beginning of the year, we have spent significant time speaking with workers and employers, to understand the pressures in the economy and the effects of the most recent increases in the minimum wage. We have held a successful call for evidence and received detailed submissions from all sides.
“Our recommendations on the minimum wage are always finely balanced. More than ever, it is important that we draw on first-hand evidence from those affected by our decisions. I look forward to working with the rest of the Commission over the autumn to reach a shared view on this evidence and deliver our advice to the Government in October.”
TUC General Secretary, Paul Nowak said:
“Boosting the minimum wage isn’t just good for workers – it’s good for business too. When low-paid workers have more money in their pockets they spend it locally – supporting shops, cafés and high streets.
“That's why the government is right to set out its ambition to raise the floor of the minimum wage and end the outdated and unfair youth rates.
“The minimum wage has been one of the big success stories of the last 25 years – lifting pay at the bottom and proving the doom-and-gloom merchants wrong. But it's important that it keep rising so that it better reflects what it actually costs to get by in Britain today.
“A bolder, more ambitious minimum wage isn’t a risk. It’s the next step in building a fairer, stronger economy where hard work is properly rewarded.”
