The Low Pay Commission (LPC) is the independent body that advises the Government on the level of the minimum wage. Later this year, it will recommend the National Minimum Wage (NMW) and National Living Wage (NLW) rates to apply from April 2024. LPC would like to invite you to submit evidence to its consultation by 9 June 2023.
You can view the consultation here.
The National Living Wage
On 1 April, the NLW will increase to £10.42. This increase is on course to reach the estimate of the target of two-thirds of median earnings in 2024.
This year, LPC expects the Government to once more ask for an increase the NLW towards the 2024 target, taking economic conditions into account. In addition, the Government intends to move the age threshold for the NLW from 23 to 21 in 2024. LPC’s remit from the Government this year will be published in due course.
In April 2024, LPC anticipates the on-course NLW will be between £10.90 and £11.43 with a central estimate of £11.16. This is based on the latest wage growth forecasts, but actual wage growth may turn out higher or lower. However, knowing where we are on the path to the current target is only one part of the decision-making process. The recommendations are also subject to Commissioners’ assessment of economic conditions.
Other National Minimum Wage rates
LPC’s remit for other NMW rates will be to raise the rate as high as possible without damaging employment. If, as expected, the goal of reducing the NLW’s age threshold to 21 in 2024 is fulfilled, then 2023 will be the last year in which there is a separate 21-22 Year Old Rate.
This year LPC is considering if there is a need for a separate Apprentice Rate in the longer term, and is therefore asking for evidence on the effects of abolishing this rate and what considerations should inform the decision.
Minimum wages after 2024
Subject to economic conditions, in April 2024 the NLW will reach its target of two-thirds of median earnings; and the age threshold for this rate will be reduced to 21. LPC is seeking submissions on the question of what should happen to the NLW (and other rates) after this point, to inform advice it will provide to the Government at the end of the year.
How to respond
Email your response to this address. Respondents are not expected to answer all questions unless they are able to; they should focus on the areas which are of most concern to them and where they can provide the most comprehensive evidence.
LPC is open to meeting interested parties to hear evidence, and invites all stakeholders to consider taking part in its programme of regional visits. More information is available here.