The National Living Wage for millions of Brits is set to rise to £9.50 an hour, the Treasury has confirmed.
The 59p rise means a full-time worker on the living wage would see their annual income jump by more than £1,000.
Chancellor Rishi Sunak is set to announce the change in his autumn budget on Wednesday.
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It will see the hourly rate rise from £8.91 to £9.50 for those aged 23 and over from April 2022.
The National Living Wage is higher than the National Minimum Wage and introduced in 2016.
Mr Sunak said: “This wage boost ensures we’re making work pay and keeps us on track to meet our target to end low pay by the end of this Parliament.”
The Chancellor is also expected to raise the National Minimum Wage for people under the age of 23, with those aged between 21 and 22 to earn a minimum of £9.18 per hour, up from £8.36.
Following changes on April 1 this year, employers currently have to pay workers at the following rates:
Aged 23 or over - £8.91 an hour
Aged 21-22 - £8.36 an hour
Aged 18-20 - £6.56 an hour
Aged 16-17 - £4.62 an hour
Apprentice - £4.30 an hour
But this will change during the next tax year with the BBC reporting a 6.6% increase in the minimum wage for all those aged 23 and over - more than twice the current consumer price inflation rate of 3.1%.
Among the promises he has already made are:
- £1.4bn to encourage foreign investment into UK businesses and attract overseas talent
- £700m to be spent mainly on the new post-Brexit borders and immigration system, as well as a new maritime patrol fleet
- £435m for victims services, crime prevention and the Crown Prosecution Service
- £560m for adult maths coaching to help increase numeracy
- a six-month extension to the Covid recovery loan scheme to June 2022
It comes after Mr Sunak said he was confident in the government's plan to drive up living standards.
He told Trevor Phillips On Sunday on Sky News: "We’re seeing employers wanting to hire, we’re seeing business’s intentions to invest growing, again, partly aided by measures that we’ve taken like the super deduction, which is a huge tax incentive for businesses to invest in increasing their productivity.
"And we’re seeing people’s wages rise, real wages today are 3.5% higher than they were before the crisis.
"So actually, all the things that we put in place, the plan for jobs that I’ve been on this show talking about a lot over the last year-and-a-half, that plan for jobs is working, people are seeing the benefits of it and I’m confident that if we continue to deliver on investing in infrastructure, innovation, on skills, we will see our growth rise.
"And next week’s Budget will demonstrate that plan in action, we will build that stronger economy, we’ll drive up our economic growth and productivity and people are going to feel that in higher living standards and a better quality of life."
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