Nick Ferrari grills Thomas-Symonds as he forgets minimum wage
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Tony Blair’s government introduced the living wage in 1999, giving workers a valuable safety net. The initial rate was less than half what people get today at £3.60, and only over-22s could get the main rate. The present rate rose to £8.91 for those aged 23 and over in April this year, and by 2022, Rishi Sunak will make one of the most dramatic changes in its more than 20-year history while inflation dips.
In 2022, Mr Sunak will raise the rate by 6.6 percent, outpacing the current inflation rate of 0.99 percent.
The National Living Wage will surge from £8.91 to £9.50 an hour.
Full-time workers on the wage will see their total income increase by £1,074.
And with inflation on a downward trend, people will see this go much further than it would in previous years.
Over 23s can take advantage of the coming change, with their National Living Wage rising more than twice the current cost of living increase of 3.1 percent.
Younger workers will see their wages rise as well, from £8.36 to £9.18 an hour for those aged 21 to 22 and £4.30 to £4.81 for people living on the Apprentice Rate.
Past minimum wage adjustments have come prior to inflation spikes, however, undercutting their value.
In 2010, when the Government raised the main rate to £5.93 and lowered the threshold to 21, workers were quickly stung by rising inflation.
At the time, inflation was up to 2.49 percent, an increase of 0.53 percent on the previous year.
And by 2011, inflation had risen to its highest rate in nearly two decades.
The 2011 inflation rate was 3.96 percent, cutting another 1.36 percent off people’s spending power compared to the year before.
The last time the rate had spiked so high was in 1992, when it declined to 4.59 percent, a difference of -2.87 percent compared to 1991.
Over the next few years, inflation started declining again, going from 3.86 percent to 0.37 percent by 2015, a total decrease of -1.08 percent.
The Government would hike wages again in 2016, making £7.60 the main national living wage for those aged 25 and over.
That change came in just as inflation started to surge once again.
In 2016 inflation was 1.01 percent, and by 2017 it had risen to 2.56 percent.
The increase of 1.55 percent knocked out additional spending power amongst low wage Britons, who recently had the minimum raised to £7.50.
But inflation has declined for the last few years, with Britons now poised to claim more spending power than they have in years.
Since 2017, inflation has fallen by 1.57 percent, down to 0.99 percent as of 2020.
The decline has paved the way for Britons living on the lowest wages to live more comfortably in uncertain times.
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