UK finance minister to announce boost for lowest earners

Manchester – The UK minimum wage will go up next year, finance minister Jeremy Hunt will announce at the Conservative party’s annual conference Monday, as the country gears up for a general election.

The rise from April next year comes amid the worst cost of living crisis in a generation, with the government battling stubbornly high inflation and industrial unrest across the economy.

The boost for the UK’s lowest earners will see wages rise to at least £11 an hour ($13.4) — an annual increase for a full-time worker of over £1,000, Hunt will tell party members in the northwestern city of Manchester.

The chancellor of the exchequer will also announce proposals for a crackdown on people claiming out-of-work benefits payments while failing to look for work.

“Work must pay,” Hunt was expected to tell the conference, according to extracts of his speech released in advance.

“Whilst companies struggle to find workers, around 100,000 people are leaving the labour force every year for a life on benefits.

“It is a fundamental matter of fairness. Those who won’t even look for work do not deserve the same benefits as people trying hard to do the right thing,” he was due to say.

– Populist –

Prime Minister Rishi Sunak’s party is currently trailing the opposition Labour Party in the polls, with an election looming next year.

The British leader has to call a vote by January 2025 at the latest.

But Hunt said there would be no crowd-pleasing tax cuts this year, although he did not rule them out for 2024.

“We’re being honest with people, there is no short cut to tax cuts,” he told the GB News television channel, which is supportive of government policy. 

“If I gave a big tax cut this year, it would be inflationary, because we’d be putting money in people’s pockets, which would boost up demand, which would ultimately mean prices would go up as well.

“So this is not the right time.”

Hunt’s speech comes as hospital doctors launched their latest round of industrial action as the state-run National Health Service struggles with huge backlogs caused by the pandemic and years of under-funding and under-staffing.

Monday’s walk-out sees junior doctors — those below consultant level — and consultants striking together for the first time for three days over their demands for above inflation pay rises.

“I think these strikes are completely unacceptable,” Sunak said.

The long-running strike action follows walkouts by other health workers including nurses and ambulance staff.

Others across the economy have also staged stoppages from lawyers and teachers to port workers and train drivers.

Hunt’s announcements come amid a recent strategy shift intended to draw clear dividing lines with Labour.

Last month Sunak announced a major reset to green policies aimed at achieving net-zero carbon emissions by 2050, seen as a populist measure to win round voters.

The new strategy also included the pushing back of a ban on the sale of new petrol and diesel cars from 2030 to 2035.

The softening of the policies will ease pressure on homeowners, landlords and motorists hit by the cost-of-living.

But they have drawn criticism from opposition lawmakers, environmental campaigners and the car industry.

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