Question

To ask Her Majesty’s Government whether they plan to bring the National Living Wage in line with the rate recommended by the Living Wage Foundation by incorporating adjustments for cost of living and support received through tax credits.

The Government wants to move from a low wage, high tax, high welfare society to a higher wage, lower tax, lower welfare society. That means placing more emphasis on support to families on low incomes by reducing income tax through increases in the income tax personal allowance level and increasing wages, than on topping up low wages through tax credits.

The National Living Wage will not be linked to the rate recommended by the Living Wage Foundation. The Low Pay Commission has been asked to provide recommendations regarding the level of the National Living Wage in the future and an assessment of the pace of increase to reach the Government’s ambition of 60% of median earnings by 2020. In making its recommendations on the National Living Wage, the Low Pay Commission takes into account a wide range of evidence from across the economy.