The Low Pay Commission today welcomed the Government's confirmation that from October 2010 the National Minimum Wage will increase in line with its recommendations. 

From 1 October 2010, the adult minimum wage rate will increase from £5.80 to £5.93 an hour, the Youth Development Rate will rise from £4.83 to £4.92 an hour and the minimum wage for 16-17 year olds will increase from £3.57 to £3.64 an hour.

For the first time, apprentice pay will be covered by the minimum wage framework.  A new apprentice rate will be introduced at £2.50 an hour.  This change should make apprentice pay across the UK easier to administer and subject to better enforcement arrangements.

The Chair of the Low Pay Commission, David Norgrove said:

"The UK economy is on track for recovery, but the speed and strength of that recovery are unclear.  We have recommended an increase in the adult rate of the National Minimum Wage that balances the needs of workers against the challenges that remain for businesses."

"This year, the Commission has paid particular attention to the vulnerability of young people in the labour market.  They have been affected more than anyone else in this recession and our recommendations reflect their vulnerability.  We shall be focusing research effort in this area in the coming year. "

"We are pleased that apprentice pay will, for the first time, be brought within the National Minimum Wage framework.  Our aim was that the apprentice arrangements should be simple, robust and straightforward to administer and enforce."

Notes to Editors

1. The Low Pay Commission is a statutory body whose role is to advise the Government on the National Minimum Wage.
2. This is the Commission's eleventh report.  All reports are available from the Stationery Office Bookshops or the Commission's website at: http://www.lowpay.gov.uk.
3. The members of the Low Pay Commission are:
   David Norgrove (Chair), Chairman of the Pensions Regulator and Trustee of the British Museum; Susan Anderson, Director of Public Services Policy at the CBI; Professor Bob Elliott, Professor of Economics and Director of the Health Economics Research Unit at the University of Aberdeen; Neil Goulden, Chairman of the Gala Coral Group; John Hannett, General Secretary of the Union of Shop, Distributive and Allied Workers; Ian Hay OBE, Chairman of Xtra-Mile.com, Charterhall Finance Ltd, Flight Bureau Ltd , Staff Offers Ltd; Professor Stephen Machin, Professor of Economics at University College London and Research Director, Centre for Economic Performance, London School of Economics; Frances O'Grady, TUC Deputy General Secretary and Heather Wakefield, National Secretary for UNISON's Local Government Service Group.
4. A full list of this year's recommendations follows:

National Minimum Wage Rates

1. We recommend that the adult minimum wage rate should increase from £5.80 to £5.93 from October 2010 (para 8.55)
2. We recommend that the Youth Development Rate should increase from £4.83 to £4.92 and that the 16-17 Year Old Rate should increase from £3.57 to £3.64 from October 2010 (para 8.56).

Accommodation Offset

We recommend that the accommodation offset should increase from £4.51 to £4.61 per day from October 2010 (para 8.58). 

Apprentices

We recommend that non-employed apprentices are excluded from the apprentice minimum wage and continue to be exempt from the National Minimum Wage (para 6.19). 

We recommend that the apprentice minimum wage be applied as a single rate to those apprentices currently exempt from the National Minimum Wage.  That is all those under the age of 19 and those aged 19 and over in the first 12 months of their apprenticeship.  The wage should cover both those employed on traditional contracts of apprenticeship and employed apprentices on government-supported Level 2 and 3 schemes (para 6.50).

We recommend that all hours of work and training (relating to both on-the-job and off-the-job) under an apprenticeship should be counted as hours for which the apprentice minimum wage must be paid.  All hours should be paid at the same wage rate (para 6.59). 

We recommend that the apprentice minimum wage be set at an hourly rate (para 6.65). 

We recommend the apprentice wage is set at a rate of £2.50 per hour and is introduced from October 2010 (para 6.88). 

We recommend that in England transitional arrangements are put in place so that current apprentices retain a contractual entitlement to a minimum of £95 a week for the remainder of their apprenticeship or until they would become eligible for the National Minimum Wage (para 6.92).

We recommend that the Government includes the review of the apprentice minimum wage rate and arrangements in our annual terms of reference (para 6.96).

Particular Groups of Workers

We recommend that the Government produces, in conjunction with interested parties, sector specific guidance on the National Minimum Wage for the entertainment sector (para 4.50). 

We recommend that HMRC investigates whether contract and agency cleaners in the hotel sector are receiving their entitlement under the National Minimum Wage for their hours worked (para 4.88).

Compliance and Enforcement

We recommend that the Government commits, as a minimum, to maintaining current funding in real terms for monitoring and enforcement of the National Minimum Wage until at least March 2014 (para 7.40).
Low Pay Commission
1st Floor
Kingsgate House
66-74 Victoria Street
London
SW1E 6SW
Tel. 020 7215 8199
Web: http://www.lowpay.gov.uk

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