first Budget – The NEN – North Edinburgh News

Chancellor announces pay rise for over 3 million workers next year, as National Living Wage rises by 6.7%
Pay boost worth £1,400 a year for an eligible full-time worker – a significant move towards delivering a genuine living wage.
18-20 National Minimum Wage will rise by £1.40 per hour – the largest increase on record – and marks first step towards a single adult rate.

Over 3 million workers will receive a pay boost after the Chancellor confirmed the National Living Wage will increase from £11.44 to £12.21 an hour from April 2025.

The 6.7% increase – which is worth £1,400 a year for an eligible full-time worker – is a significant step towards delivering the manifesto commitment to make sure the minimum wage is a genuine living wage.

The National Minimum Wage for 18 to 20-year-olds will also rise from £8.60 to £10.00 an hour – the largest increase in the rate on record. This £1.40 increase will mean full-time younger workers eligible for the rate will see their pay boosted by £2,500 next year. This marks the first step towards aligning the National Minimum Wage and National Living Wage to create a single adult wage rate, which would take place over time.

The move comes ahead of today’s Budget which will ‘fix the foundations’ to deliver change by fixing the NHS and rebuilding Britain, while ensuring working people don’t face higher taxes in their payslips.

It builds on the commitment to be a pro-business, pro-worker, pro-growth Government – delivering a key plank of the Plan to Make Work Pay, which is already set to boost the pockets of the lowest-paid workers by up to £600 a year through the Employment Rights Bill.

The plan will boost productivity, creating a workforce that is fit and ready to help us deliver our first mission to kickstart economic growth – with good jobs and growth in every part of the country making everyone, not just a few, better off.

Chancellor of the Exchequer Rachel Reeves said: “This Government promised a genuine living wage for working people.

“This pay boost for millions of workers is a significant step towards delivering on that promise.”

Business Secretary, Jonathan Reynolds said: “Good work and fair wages are in the interest of British business as much as British workers.

“This government is changing people’s lives for the better because we know that investing in the workforce leads to better productivity, better resilience and ultimately a stronger economy primed for growth.”

Deputy Prime Minister, Angela Rayner said: ““A proper day’s work deserves a proper day’s pay.

“Our changes will see a pay boost that will help millions of lower earners to cover the essentials as well as providing the biggest increase for 18–20-year-olds on record.”

The minimum hourly wage for an apprentice is also boosted next year, with an 18-year-old apprentice in an industry like construction seeing their minimum hourly pay increase by 18.0%, a pay bump from £6.40 to £7.55 an hour.  

These increases will mean 3.5 million workers will receive a pay rise this year in total. They confirm the Low Pay Commission’s recommendations, whose advisory remit was overhauled by ministers in July to consider the cost of living.

Ethics Director at Lush Cosmetics, Hilary Jones said: ““Lush staff making and selling our products are crucial to our success, so we commit to the Living Wage Foundation’s independently calculated real living wage rates each year to feel confident our rates of pay are fair and that our staff can afford what they need to thrive, not just survive.

“In these tough times where the cost of living continues to rise, it is great to see the Government increase minimum wage closer to these calculations to support the hardest working and most vulnerable workers across the UK.”

Chair of the Low Pay Commission, Baroness Philippa Stroud said: “The Government have been clear about their ambitions for the National Minimum Wage and its importance in supporting workers’ living standards.

“At the same time, employers have had to deal with the adult rate rising over 20 per cent in two years, and the challenges that has created alongside other pressures to their cost base.

“It is our job to balance these considerations, ensuring the NLW provides a fair wage for the lowest-paid workers while taking account of economic factors. These rates secure a real-terms pay increase for the lowest-paid workers. Young workers will see substantial increases in their pay floor, making up some of the ground lost against the adult rate over time.”

Good news for low paid workers, then. but some businesses – small businesses remain the bedrock of the UK economy – point out that it’s not the government that will be paying the pay rises, it’s them.

Coming on top of the likely increase in employers National Insurance contributions likely to be announced today they say that these additional costs could force some small businesses, working on small profit margins, to close.

UK Government must scrap the unfair two-child limit at the Budget, say leading children’s charities

Since the Labour party took office on 4^th July, and by the time the Budget is announced, a staggering 12,500* children have been plunged into poverty due to the two-child limit on benefit payments. This shocking surge adds to the 1.6 million children already suffering under this unnecessary policy.

Leading children’s charities (the End Child Poverty Coalition, Save the Children, Action for Children, Child Poverty Action Group (CPAG), Centre for Young Lives, Gingerbread, Barnardo’s and the National Children’s Bureau) have joined together to call on the government to include scrapping the two-child limit in the Budget on 30th October. Two of these organisations, Save the Children and CPAG, are also assisting the government with evidence gathering ahead of the publication of the Child Poverty Strategy in Spring 2025.**

These charities are supported by the 120 members of the End Child Poverty Coalition, an alliance of national, regional and local anti-poverty organisations, united in the view that child poverty in the UK can be addressed via government action.

Joseph Howes, CEO of Buttle UK and Chair of the End Child Poverty Coalition said: ‘The two-child limit must be scrapped: children cannot wait any longer for government action.

“We don’t say only two children in a family can go to school, or that the third sibling cannot receive hospital treatment, so why do we limit benefit payments to only two children? By scrapping this policy, this government would be recognised as one that turns the tide on rising levels of child poverty across the UK’.

Victoria Benson, CEO of Gingerbread said: ‘Scrapping the two-child limit is a quick and cost-effective way to lift children out of poverty and it’s disappointing that our Government hasn’t committed to doing this.

“The majority of families hit by the two-child limit are single parent families who are already almost twice as likely to be living in poverty, compared to couple parent families.

“There is no doubt it is a cruel policy that has done little to meet its aim of increasing employment levels and yet it has left hundreds of thousands of single parent households in poverty.

“If our Government wants to tackle child poverty it must scrap the two child limit as soon as possible.’

Becca Lyon, Head of Child Poverty for Save the Children UK, said: ‘The time for action on the two-child limit to benefits is now and the UK Government must scrap this cruel policy.

“Children cannot wait any longer to receive the same amount of money as their siblings. Our society should be one where being born after your siblings shouldn’t exclude you from support. These are political choices, and the Budget is a chance for the UK Government to right the record for thousands of children.”

The two-child limit to benefit payments is an unfair policy which limits the amount of money families in receipt of social security payments receive for the third or subsequent child born after April 2017. Families affected by it miss out on up to £3455 per child per year.

The policy pushes families into poverty. Recent analysis published by CPAG has shown that for every day this policy remains in place, 109 children are being pulled into poverty.* End Child Poverty Coalition analysis has shown there is a strong positive correlation between child poverty figures and the number of children living in families impacted by the two-child limit.***

Unless this issue is urgently addressed, the government’s upcoming Child Poverty Strategy will fall short of delivering meaningful change. Lifting the two-child limit is a critical step towards to halting the harmful cycle of deprivation and despair.

Children can no longer wait for change. The ‘sibling tax’ must be scrapped.

*More information on the government’s plans to engage on the Preventing Child Poverty Strategy here: https://www.gov.uk/government/publications/tackling-child-poverty-developing-our-strategy

**109 children a day are pulled into poverty by this policy every day, research has found https://cpag.org.uk/news/10000-children-dragged-poverty-two-child-limit-labour-took-office

*** More information on this research can be found here: https://endchildpoverty.org.uk/child-poverty-2024/

Today we have signed a joint statement with: