Autumn Budget: National Living Wage & Universal Credit
National Minimum Wage / National Living Wage
The national living wage will see a 6.6% rise from 1 April 2022. The new rate will increase by £0.59 per hour above the current rate to £9.50 per hour. The national living wage is the statutory minimum wage payable to workers aged 23 and over. For a full-time worker, this will equate to a pay rise of over £1,100 per annum.
The national minimum wage, payable to those under the age of 23, will also see above-inflation increases. The new rates payable from 1 April 2022 are:
|National Minimum Wage||Rate from April 2022||Current Rate (April 2021)||% Increase|
|21-22 Year Olds||£9.18||£8.36||9.8%|
|18-20 Year Olds||£6.83||£6.56||4.1%|
|16-17 Year Olds||£4.81||£4.62||4.1%|
During the pandemic, Universal Credit claimants received an additional top-up of £20 per week. This was withdrawn from the beginning of October. The government has announced in the Budget 2021, that help will be provided to those who work in the form of a reduced taper rate. The current rate of 63% means that for every £1 earned, £0.63 is taken away from the Universal Credit payment, this is a very high rate of deduction. The announcement today reduces the taper rate from 63% to 55%, meaning that claimants will keep more of their Universal Credit when working.
There is also an increase to the work allowance which affects certain claimants with children or those with disabilities. The work allowance will be increased by £500 to a maximum of £515.
The changes announced today, will be brought in no later than 1 December 2021.
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