The government has published the independent Dube Review into minimum wages which backed a more ambitious National Living Wage in the country.
Chancellor of the Exchequer Sajid Javid has proposed to raise the National Living Wage to two-thirds of median earnings to end low pay.
The review by Professor Arindrajit Dube concluded that minimum wages in a range of countries have had a negligible or zero effect on jobs, but significantly increased the earnings of the lowest paid.
“Based on the overall evidence—with a special emphasis on the recent, high quality, evaluations of the National Living Wage and other more ambitious policies internationally — my report concludes that that there is room for exploring a higher NLW in the UK up to two-thirds of the median wage,” he said.
Chancellor’s proposal, announced at his party’s annual conference in Manchester in September, would take minimum pay for those aged over 21 to £10.50 an hour, based on current forecasts – up from a current £8.21, applicable to those aged at least 25.
He further proposed to extend the same minimum wage to younger workers in a phased manner.
“The evidence is clear that our approach is the right one” Javid commented. “We will end low pay by putting the National Living Wage on a path to increase to £10.50 over the next five years.”
The previous NLW target was to reach 60 percent of median earnings by 2020.
The government said it will respond fully to the review in due course.