In a significant move aimed at increasing the incomes of working individuals, the government has redefined the responsibilities of the Low Pay Commission (LPC) as of today, Tuesday, July 30th. This adjustment mandates that the independent body now include the cost of living in its future minimum wage recommendations to the government.
Recognizing the success of the minimum wage over the past 25 years, this new directive marks an essential step toward ensuring a true living wage for workers. The LPC’s updated remit will not only consider the cost of living but also evaluate the impacts on businesses, competitiveness, the labor market, and the broader economy.
The Business and Trade Secretary Jonathan Reynolds said:
“For too long working people have faced the worst of the cost of living crisis, but this Government is taking bold action to address it and make work pay.
“The new remit to the LPC is the first of many vital steps we will take to support more people to stay in work and improve living standards.
“Our focus remains on putting more money in working people’s pockets and boosting economic growth.”
Chancellor of the Exchequer Rachel Reeves said:
“Economic growth is our first mission, and we will do everything we can to ensure good jobs for working people. But for too long, too many people are out of work or not earning enough.
“The new LPC remit is an important first step in getting people into work and keeping people in work, essential for growing our economy, rebuilding Britain and making everyone better off.”
The Secretary of State and Deputy Prime Minister have formally communicated these changes to the Chair of the Low Pay Commission. This initiative aligns with the Government’s Plan to Make Work Pay, which outlines a bold agenda to modernize workplace rights, empower workers, and stimulate economic growth.
The Secretary of State and Deputy Prime Minister have written to the Chair of the Low Pay Commission. The letter and the full remit can be found here.
These modifications represent the initial phase in the government’s strategy to boost the economy and improve living standards nationwide.