New National Living Wage to give living standards boost to Welsh workers
Stephen Crabb: "This One Nation government is committed to making work pay"
National Living Wage
- From 1 April workers in the UK aged 25 and over earning the minimum rate of £6.70 per hour will see a 50p increase
- The new National Living Wage supports the Government’s vision of a higher wage, lower welfare, lower tax society
More than 48 per cent of workers across Wales have said they will feel more positive for themselves and their families as a result of the introduction of the new National Living Wage, announced by the Chancellor at the Summer Budget.
The findings are part of a new Government survey which also shows that 44 per cent of respondents across the region will feel more motivated at work as a result of the increase in their pay packets.
Over a million workers in the UK aged 25 and over are set to directly benefit from the increase, which sees the current minimum rate of £6.70 increase by 50p. Many will see pay packets rise by up to £900 a year. This will be the largest annual increase in a minimum wage rate across any G7 country since 2009 in cash and real terms.
The survey results coincide with the launch of a new advertising campaign based around real people talking about the positive effect the new National Living Wage will have on their lives.
The advert, which aired on TV this week, features a range of workers from across the UK set to benefit from the new National Living Wage as it increases over the next four years.
Chancellor George Osborne said:
The new National Living Wage is an essential part of building the higher wage, lower welfare, lower tax society that Britain needs and it’s great to see that over a million people will see their living standards boosted when this comes into force on 1 April.
Britain deserves a pay rise and this one-nation government is making sure it gets one, helping more people have the security of a higher wage to provide for themselves and their families.
Business Secretary, Sajid Javid, said:
The Government believes that Britain deserves a pay rise and our new National Living Wage will give a direct boost to over a million people. We are building a more productive Britain and giving families the security of well-paid work.
This is a step up for working people, so it is important workers know their rights and that employers pay the new £7.20 from 1 April this year.
Secretary of State for Wales Stephen Crabb said:
The introduction of the National Living Wage this April will boost the take-home pay of thousands of workers in Wales. This will mean more people across the country have more money in their pockets to spend on the things their families need.
This One Nation government is committed to making work pay and making sure hardworking people get the salary they are entitled to.
Dental hygienist practice manager, Abbie Nayar, from Llandaff, South Wales, appears in the TV advert. She already earns slightly over the National Living Wage.
Abbie welcomed the new National Living Wage.
I think it’s really important. It will help. Just little things like getting to the checkout without facing the embarrassment of not having enough money for the shopping. And it will help the country’s economy, giving people more money in their pocket; we need people out and about spending.
Abbie said it was important that people made sure they got paid the National Living Wage from 1 April, if entitled to it.
She added:
People should definitely be talking to their employer. The new National Living Wage will make a big difference to what comes in at the end of the month, so it’s really important people to talk to their employer.
It’s so important for people who work for smaller businesses because the legal protection makes sure there is something behind them. So they can say this is my legal right.
The campaign highlights the new wage and tells people to find out more by visiting the website here
The move will support hard working families across the country. They will also benefit from an increase in the personal allowance, taking the lowest paid out of tax, while free childcare will increase to 30 hours, helping household budgets stretch further.
Many UK companies have already pledged to pay at or above the new rate, including Morrisons, Lidl, National Express and Ikea.
The Government is continuing to raise awareness to businesses to make sure they are ready to pay the new wage on 1 April. As part of this, it has published a four-step guide for businesses on the living wage website, asking firms to:
- Check you know who is eligible in your organisation;
- Take the appropriate payroll action;
- Let your staff know about their new pay rate, and
- Check your staff under 25 are earning at least the right rate of National Minimum Wage.
HMRC will have responsibility for enforcing the new National Living Wage in addition to the National Minimum Wage from April 2016 and will take firm action where an employer fails to pay the correct wage.
Notes to Editors
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To view the full advert click here
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The survey of 1,200 employees across the UK was carried out for BIS by TNS BMRB in November and December 2015. Details can be found here
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The new National Living Wage follows recent rises in the National Minimum Wage rates to:
- £6.70: For 21s and over
- £5.30: For 18 to 20-year-olds
- £3.87: For under 18s
- £3.30: For apprentices (the rate applies to all apprentices in year one of an apprenticeship, and 16-18 year old apprentices in any year of an apprenticeship).
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The National Living Wage and National Minimum Wage are designed to protect low income workers and provide an incentive to work by ensuring that all workers benefit from as generous a wage as possible.
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For exceptions to the National Living Wage and National Minimum Wage please click here
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HMRC has enforced the National Minimum Wage since 1999 and will have responsibility for enforcing the new National Living Wage from April 2016. HMRC’s compliance teams will:
- Investigate complaints from workers and third parties that the living wage has not been paid
- Inspect employers’ records to check that they meet their obligation to pay the living wage
- Help employers to understand their obligations under legislation.
- Secure pay arrears for workers
Abbie Nayar
Mum-of-two Abbie Nayar, from Llandaff, South Wales, is a practice manager for Lucy Reed Dental Hygiene. She runs the practice reception and manages the clinic day to day. It is a new practice so she is hoping that as it gets busier she will get more hours.
From April 2016 people across the country will get a pay rise under the Government’s new National Living Wage, putting more money in their pocket. Abbie says this is a good idea.
I think it’s really important. It will help. Just little things like getting to the checkout without facing the embarrassment of not having enough money for the shopping. And it will help the country’s economy, giving people more money in their pocket; we need people out and about spending.
Abbie said it was important that people made sure they got paid the National Living Wage from 1 April, if entitled to it.
She added:
People should definitely be talking to their employer. The new National Living Wage will make a big difference to what comes in at the end of the month, so it’s really important people to talk to their employer.
It’s so important for people who work for smaller businesses because the legal protection makes sure there is something behind them. So they can say this is my legal right.
Abbie enjoyed taking part in the Government’s new television advertising campaign, which launched on television this week.
Taking part in the advert was fun and kind of random, meeting people who I had never met before, but it was fun. Having my make-up and hair done was great, not something I would normally do when I’m at work!
Lucy Reed – Small business owner, Lucy Reed Dental Hygiene
Lucy Reed already pays her staff above the new National Living Wage rate of £7.20 an hour. She has only recently set up her business in Cardiff, South Wales, which is an independent Dental Hygiene Clinic made possible by a Government changes to Dentistry. She thinks it’s really important for staff to feel valued by their employer.
Lucy said:
It is really important to pay people properly. I would pay Abbie more if I could afford it. We are a new business and just getting going, so as my profits go up I want to be able to pay her more. I really care about make sure people get a fair wage.
The New National Living Wage comes into force in April this year and Lucy thinks it’s a good idea.
Lucy says:
The National Living Wage is a good thing because it makes people generous. We should be realistic about how much it costs to live in this country. People are more important than profits. If you have a good employee they deserve a good wage.
Lucy wants to pay more per hour if she could and hopes that as her business grows she will be able to.
She said:
We wanted to pay the National Living Wage, it was at the top of my list. And it’s great we have such a top employee - she deserves every penny.
From a business point of view you should have a business plan. You can’t blame wages for a failed business, if it’s a good business it will last. Saying that the National Living wage is responsible (for business failure) is a weak excuse.
Lucy also thinks the National Living wage will help productivity saying:
The National Living Wage will help productivity enormously; it’s all about valuing the person. People can work out fast how profitable a company is. If you’re not paying them fairly it spreads resentment. Paying the National Living Wage will be a real incentive for people to work harder.
Craig Wiltshire
Craig Wiltshire, aged 40, from Swansea, currently earns £7.50 per hour as an electrician’s assistant with DC Electrical (Swansea) Ltd.
Under the Government’s new National Living Wage, he will not see an increase this year but is likely to as the wage increases by 2020. He supports the pay rise, which will put more money in people’s pocket.
I think it’s a fantastic idea. It takes the onus off Government to support working people and puts it onto employers by getting them to pay more. It also makes the employee feel more valued if they receive a higher wage.
Craig enjoyed taking part in the Government’s new television advertising campaign, which launched on TV this week.
He said:
It was a fantastic experience and great to meet so many people involved in the campaign. I was amazed how much work goes into producing this type of advert.
People should keep an eye out for what they need to know and should speak to their employers to make sure they get the right rate. Sometimes employers aren’t always aware of these changes so it helps to raise awareness.