Autumn Budget 21: National Living Wage (NLW) rumoured to rise to £9.50 per hour

25 October 2021

With the Budget looming on Wednesday, rumours are beginning to circulate that the NLW will increase from £8.91 per hour to £9.50. This would mark a 6.6% increase, over twice the consumer price inflation (CPI) rate of 3.1% announced last week.

This speculated NLW would be higher than the £9.42 (plus or minus 7p) explored by the Low Pay Commission (LPC) in its consultation that ran to 18 June 2021. The official government response to this is yet to be released. An increase to £9.50 would match the real Living wage for 2021/22 tax year, a voluntary wage rate advised for over 18s by the Living Wage Foundation.

While the increase will mean that many on low incomes could benefit by around £1,200 a year, the impact on employers’ wage liabilities will be substantial.

With coronavirus measures putting strains on the government to generate revenue we can expect more revelations to come in Wednesday’s Budget. To keep up to date with the latest information please check the CIPP’s budget hub.

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