What is the national minimum wage for 2021 and could it rise to £10 by the next election?

THE majority of workers in the UK are entitled to receive the National Minimum Wage, but the amount they are paid is dependent on their age.

You must be at least 16 years of age to get the minimum payment, but you’re entitled to it even if you just do part-time work.

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The minimum wage in the UK increased in April this year, giving a pay rise to more than two million workers.

However, pay could rise to as much as £10 by the next election to boost Brits’ incomes, as the Chancellor is expected to announce a hike to payslips in this week’s Budget.

But what is the National Minimum Wage? We explain all you need to know.

What is the National Minimum Wage?

The National Minimum Wage is currently the amount workers under 23 (but of school-leaving age) are entitled to.

The first National Minimum Wage was set in 1998 by the Labour government.

Before that, no official rate existed although trade unions battled hard to fight their workers’ corner.

The full National Minimum Wage is £8.36 and applies to those aged 21-22.

For 18- to 20-year-olds, the minimum wage is £6.56, and for under 18s, it’s £4.62 an hour.

Meanwhile, the Apprenticeship Wage is currently £4.30.

The amount changes every April – at the beginning of the new financial year – and has risen every year since the initiative was launched.

What is the National Living Wage?

The National Living Wage is the minimum wage for workers aged 23 or over – it is currently set at £8.91.

It was re-branded to the National Living Wage in 2016 for those over 23.

The pay rate is different to the “real Living Wage” campaign, which is voluntarily paid by more than 7,000 UK businesses.

Campaigners say the living wage should be £9.50 per hour, rising to £10.85 in London.

Will inflation rise if minimum wage increases?

The link between minimum wage increases and inflation is hotly debated.

In the past, high unemployment has typically coincided with high inflation, according to Investopedia.

One argument is that raising the minimum wage increases inflation as people have more money, and the costs of goods

rise as a result. 

People in favour of this argument usually add that raising the minimum wage also causes unemployment to rise, as employers cut back on labour costs.

However, those against this line of thinking argue that historically inflation has not risen when the minimum wage was raised.

Will the National Minimum Wage increase to £10?

Chancellor Rishi Sunak is expected to announce in this week’s Budget that the National Living Wage will increase to around £9.42 per hour.

Currently that compares to the £8.91 rate workers receive.

The roughly 50p increase could be set to make up for Universal Credit cuts that hit 3.2 million working families at the beginning of the month too.

Because borrowing is £135billion lower than predicted, Chancellor Rishi Sunak has more money for the three year spending review to be unveiled alongside his Budget.

That means experts are predicting minimum wage rates to hike to as much as £10.50 an hour by the time the next general election rolls around, the Mirror reports.

The next general election is due to take place on May 2, 2024, in just three years’ time, coinciding with when the new pay rate would come into effect.

Which workers qualify for the National Minimum Wage?

To qualify for the National Minimum wage you have to be of school leaving age, which is usually above 16.

You are eligible to receive the pay rate if you work full-time, part-time or as a casual labourer, for example someone hired for one day.

You could also be an agency worker or someone paid by the number of items you make.

Apprentices qualify for the National Minimum Wage, as well as trainees and staff still in their probationary period.

You are also entitled to the National Minimum Wage if you are a disabled worker.

Anyone who thinks they are not getting paid fairly should raise the issue with their employer in the first instance.

If this is not effective, the next step is to file a complaint on the government’s website.

Which workers do not qualify for the National Minimum Wage?

Those who are self-employed, voluntary workers, company directors and family members who live in the home of the employer and do household chores do not qualify for the minimum wage.

Au pairs, members of the armed forces and people on a government employment programme are also not entitled to the payment.

There is no difference in pay for those that live in London compared to elsewhere.

The only discrepancy is for people working in agriculture or horticulture.

Workers already employed before October 1, 2013, are entitled to the pay set under their contract of employment.

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This post first appeared on thesun.co.uk