Ahead of the general elections in May, the British government has announced the biggest increase in the national minimum wage since 2008.
On Tuesday, Prime Minister David Cameron and Deputy Prime Minister Nick Clegg announced a 3 percent real-term minimum wage increase to GBP 6.70 per hour with effect from October 2015.
In a joint statement, Cameron and Clegg said that the rise in the minimum wage will benefit to over 1.4 million of lowest-paid workers.
The announcement, however, could not impress the country’s trade union bosses who say the government will fail to tackle the in-work poverty. The Trade Union Congress, TUC, warns that it would not provide as much relief for the UK’s poorest.
“For the low paid to get a fair share of the recovery, this was a year in which we could have had a much bolder increase in the minimum wage”, TUC General Secretary Frances O’Grady said.
O’Grady added that the country’s minimum wage workers should be very fearful of the billions of pounds of cuts to government help for the low paid that the chancellor is planning if re-elected.
“It is an increase above the rate of inflation. But you have to bear in mind that the general per capita income of the population has been seriously depressed over the period since the recession. In fact the wage levels per capita now are the same as they were in 2006 and that’s getting nearly 10 years ago”, . Jonathan Rosenhead University Professor & Commentator told Press TV.
Rosenhead said that the living wage is between 1 pound per hour and 2.50 pound per hour higher than this increased minimum wage that is highest in London and less elsewhere. Now, what we have is enough money being paid the minimum wage level and that is applied to a lot of people.
The minimum wage hike announcement comes a day before the coalition government’s sixth and final budget will be presented in parliament.
Finance Minister George Osborne has pledged to stick to his economic plan before a knife-edge general elections.
“This budget is all about securing a truly national recovery,” he told over the weekend.
Reports suggest the budget will contain perks for older voters, allowing pensioners to swap regular retirement incomes for cash lump sums.
Last year, Britain’s economy grew by 2.6 percent, which was the fastest since before the financial crisis.
However, despite a gradual economic recovery, Cameron’s government has faced criticism for painful austerity cutbacks which the opposition says have damaged the economy and increased inequality.