The chancellor is expected to announce a wage rise in his budget tomorrow.
An increase in the UK's national living and minimum wage is expected to be revealed as the chancellor makes his speech in Parliament at around 12:30pm on Wednesday 27 October.
Independent advisers the Low Pay Commission recommended the wage rise as the UK deals with a cost of living crisis.
Gas and petrol prices have soared due to an energy crisis. There will also be an increase in national insurance tax from April next year and the £20 boost to universal credit that came in during the pandemic
It means there are fears people will be feeling the living costs, particularly if there is no rise in wages, which the government hopes will help.
The rise is expected to come into effect in the spring of next year.
When will the wage rise happen?
The wage rise will come in to effect from 1 April 2022.
This is the same time that the rise in national insurance payments and the health and social care levy increase will come in to play.
Some businesses are concerned about the wage rise, as it of course means they will have to pay more. But it also appears that there will be no change to business rates, which the Conservatives pledged to cut in their 2019 manifesto.
In theory, a cut in business rates would make it easier for business to pay their employees.
Minumum wage salaries are a legal requirement and the government have a useful tool where employers and employees can check if the correct amount is being paid.
What is the wage rise?
For workers over 23, the national living wage will go up from £8.91 to £9.50 an hour. This rise means a full-time worker will get £1,074 extra a year before tax and it is a rise of 6.6%. The current rise in the cost of living, by comparison, is believed to be 3.1%.
People in work from the ages of 21 to 22 will see the national minimum wage will go up from £8.36 to £9.18 an hour, a 9.8% increase and apprentice wages will increase 11.9% from £4.30 to £4.81 per hour.
The chancellor said: "[The rise] 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."
Labour said in response that the plans are 'underwhelming'.
Shadow chief secretary to the Treasury Bridget Phillipson said: "This underwhelming offer works out at £1,000 a year less than Labour’s existing plans for a minimum wage of at least £10 per hour for people working full-time."
National minimum wage for 18 to 20-year-olds will go from £6.56 to £6.83, while it will move up from £4.62 to £4.81 for under 18s.
