Yahoo Finance Rishi Sunak expected to raise national living wage in autumn statement
Rishi Sunak is set to increase the national living wage and give 8 million households cost of living payments worth up to £1,100 in an effort to help Brits through the cost of living crisis.
Chancellor Jeremy Hunt and Sunak will accept an official recommendation to increase the living wage from £9.50 an hour to about £10.40 an hour, nearly a 10% rise, according to The Times.
The increase would take effect in April 2023 and would benefit around 2.5 million people.
Read more: FTX implosion sees $5bn crypto withdrawn from exchanges
The national living wage is the minimum amount all employers have to pay staff aged 23 and over.
Those younger than 23 can be paid the minimum wage instead, which is £9.18 for 21 to 22-year-olds and £6.83 for those aged 18-20.
Watch: We need to get a grip on inflation, says Prime Minister Rishi Sunak
The chancellor may also extend cost of living support, including a second £650 grant for people on means-tested benefits, another £150 payment for people on disability benefits and another £300 payment for pensioners, giving the poorest a potential boost of £1,100.
Among the other measures reportedly being considered are freezing of thresholds for income tax, national insurance, VAT, inheritance tax and pensions savings.
The government has already said that the poorest households will be prioritised, leaving wealthy and middle-income households to bear the greatest burden from tax rises.
Sunak said yesterday that “fairness and compassion” would be at the heart of the autumn statement.
But Hunt has warned tax rises will hit “everyone” and that "we'll all be paying a bit more tax".
Read more: UK unemployment rate rises to 3.6% as real wages lag behind inflation
Spending cuts of about £35bn and plans to raise some £20bn in tax in the coming years are expected to be set out in Thursday's autumn statement.
The chancellor added that there will be no enticing “rabbit out of a hat” policies either.
