Living wage rise to be SCRAPPED because coronavirus means country 'can't afford' increase to £9.21 per hourSeptember 6, 2020
A PLANNED living wage rise could be scrapped due to the coronavirus pandemic.
The national living wage was expected to rise from £8.72 to £9.21 in April next year, but ministers are considering putting an "emergency break" on the plan, the Telegraph reported.
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The Covid-19 outbreak has meant that British businesses may not be able to afford the increase.
A decision regarding the increase is expected to be made by Chancellor Rishi Sunak when he announces the Autumn budget.
Mr Sunak had set a target of making the wage the equivalent of two-thirds of the UK's median earnings in the next four years.
Members of the Low Pay Commission reportedly think companies cannot afford having to pay an increased national living wage.
According to the commission, the Covid-19 pandemic "clearly represents a very challenging set of circumstances for workers and employers alike, and will require us to review whether an emergency brake is required".
The commission will use the "emergency break" on the plan if they feel raising the minimum wage would be "damaging for the lowest-paid workers".
Mr Sunak's target for increasing the wage was based on the UK having "sustained economic growth" over the next four years – a gross domestic product rise of more than one per cent.
The national living wage was raised to £8.72 from £8.21 on December 30 last year.
The hike was part of Boris Johnson's pledge to "level up" the country.
Meanwhile plans were announced for the minimum wage for all employees aged 21 or over to rise to £10.50 by 2024.
Those aged 25 and over are eligible for the national living wage, while those younger receive the national minimum wage.
The minimum wage is £4.15 for apprentices, £4.55 for under 18s, £6.45 for 18 to 20s and £8.20 for 21 to 24-year-olds.
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