THIRSTY Brits face paying a 30p more for a pint after Rishi Sunak hikes wages for the lowest paid in tomorrow’s budget, business chiefs have warned.
Landlords say they’ll have to put up prices because they’re struggling with spiralling overheads that will be compounded by the salary hike.
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The chancellor is poised to announce that the national living wage is going up by 6.6% from £8.91 to £9.50 an hour.
He says the move will add on average around £1,000 before tax to the annual pay of a full-time worker.
Mr Sunak is also set to end the public sector pay freeze and hand millions of workers a raise.
Business minister Paul Scully today insisted the raises are necessary and they won’t “build a recovery based on the backs of the lowest paid in our society”.
He said the Government wants to eradicate low pay by making sure the minimum wage becomes two thirds of the average salary by 2024.
But the boss of one watering hole chain warned the move will inevitably hit punters in the pocket.
City Pub Group chairman Clive Watson said landlords can’t soak up extra overheads as the industry is “coming off life support” after Covid.
He said: “We cannot absorb all these increased costs whether it is the energy costs whether it is food inflation, whether it is labour costs.
“So the only way forward for us is to put the price of beer and food up in our pubs.
“No-one wants to do that but I reckon the price of beer would probably have to go up 25p-30p a pint to take account of all these increased costs.”
The National Living Wage sets the minimum hourly rate employers can pay to all workers aged over 22.
There is a separate National Minimum Wage for 21-22 year olds, which will also go up from £8.36 to £9.18.
Apprentices will get a raise to £4.81 from £4.30, but there has been no announcement on the pay of under-18s or 18-20 year olds.
Quadruple whammy
Businesses are already facing a quadruple whammy from inflation, the supply chain crisis, record vacancies, and rising energy prices.
A recent poll revealed 99 per cent of the hospitality sector were experiencing stock issues and shortages.
Eight in 10 boozers plan to – or already have – hiked up prices in response to rising overheads.
Ordinary punters are also braced for a cost of living crisis as Britain heads into an “uncertain” winter.
But despite the rising costs being faced by families Mr Sunak is refusing to bend to calls for him to slash VAT on energy bills.
Campaigners want the chancellor to cut the rate, which stands at 5%, to help households through the colder months.
But he will defy them in tomorrow’s budget and is said to believe such a move would do little to help the poorest Brits.
Mr Sunak is already facing questions over whether his vaunted pay rises will really help low income families.
The Institute for Fiscal Studies calculated that most workers on the living wage will only see their income rise by £250 a year.
That’s because their taxes will rise and the benefits they receive will fall falls as their earnings increase.
Many families are also set to lose up to £1,000 a year because of the end of the temporary uplift to Universal Credit.
Meanwhile, ministers were unable to say whether the pay rise for public sector workers will outstrip inflation which is running at 4%.
But in better news for consumers Mr Sunak will ditch a planned hike in fuel duty that would’ve added 2.84p to the cost of a litre of petrol.
The chancellor has been forced to scrap the hated levy after prices at the pumps hit a record 142.94p on Sunday.
