Autumn statement

National Living Wage rise is ‘another headache’

By Michael Stones

- Last updated on GMT

Chancellor Philip Hammond has increased the National Living Wage
Chancellor Philip Hammond has increased the National Living Wage

Related tags National living wage Minimum wage

The rise in the National Living Wage for over 25s, from £7.20 per hour to £7.50 per hour, could cause “another headache for food and drink manufacturers,” warns law firm Gordons.

Following the increase – set out in Chancellor Philip Hammond’s Autumn Statement on Wednesday (November 23) – Mark Jones, food and drink solicitor at Gordons law firm, said: “This increase could pose another headache for food and drink manufacturers less than eight months since the National Living Wage was first introduced.

“Many employers spent those first few months assessing the impact of increased staff costs and although there has been an element of restructuring, the general feeling was that the new National Living Wage was still only a small increase on the National Minimum Wage that was already in place.”

Another 30p increase from April

But now manufacturers were faced with another 30p increase from April and only time will tell the impact this will have on employers, he said.

While critics will argue the latest rise is still not enough, Jones noted the National Minimum Wage increased every year and it was to be expected that National Living Wage would do the same.

In fact, the new figure is less than the £7.64 that had been already been suggested by the Low Pay Commission.

“It is also significant that even with this increase the government’s National Living Wage is still almost £1 lower than the voluntary Living Wage, which is set by the Living Wage Foundation, for employees outside of London.”

Beer duty

Meanwhile, the Campaign for Real Ale (CAMRA) welcomed the chancellor’s decision not to raise beer duty in the Autumn Statement.

CAMRA's national chairman Colin Valentine said: “Pubs are under a huge amount of financial pressure and with UK beer drinkers paying 52.2p of duty on their pint we are seeing more and more people choosing to drink at home rather than at their local.

“This trend not only hurts UK businesses, but is also contributing to the demise of our communities and affects people’s personal wellbeing.” 

While a freeze on beer duty was welcome, CAMRA urged the government do more to reverse the damage done by the beer duty escalator by cutting duty in the 2017 Budget.

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