Category: 0 Reviewed

The Low Pay Commission, the body that advises the Government on the level of the minimum wage, today welcomed the acceptance of its recommendations for the rates to apply from April 2018. These include a 4.4 per cent increase in the National Living Wage, the rate for workers aged 25 and over, from £7.50 to £7.83.

LPC Chair Bryan Sanderson said:

The LPC welcomes the Government’s acceptance of our recommendations, which we are required to make on the National Living Wage and the other rates of the National Minimum Wage. On the former we are asked to make recommendations such that the rate reaches 60 per cent of typical earnings by 2020. For the latter, which affect those below the age of 25 and apprentices, we recommend rates as high as possible without damaging employment.

The core decision was whether the most recent economic evidence met the condition of sustained economic growth to enable the NLW to be uprated in line with the path to 60 per cent of median earnings. Commissioners weighed the available evidence carefully, judged that it did, and agreed to keep a steady course to 2020. The recommended rate of £7.83 is in line with the indicative rate of £7.85 that we set out last October.

For young people aged between 18 and 24 years old, Commissioners judged that economic conditions warranted larger percentage increases. There have been ongoing improvements in their employment and unemployment position, and their earnings have been growing faster than those of workers aged 25 and over for three years.

This is good news for the millions of low paid workers who are paid at the minimum rates.

Notes:

1. The Low Pay Commission is an independent body made up of employers, trade unions and experts whose role is to advise the Government on the minimum wage. The National Living Wage is the legally binding pay floor for workers aged 25 and over. The other minimum wage rates comprise: the 21-24 Year Old Rate, the 18-20 Year Old Rate, the 16-17 Year Old Rate and the Apprentice Rate.
2. The LPC’s remit prescribes different requirements in relation to the NLW than for the four other bands of the minimum wage. For the NLW we are asked to make recommendations on the pace of increase towards a target: an ‘ambition…that it should continue to increase to reach 60 per cent of median earnings by 2020, subject to sustained economic growth’. For the other rates we are asked to ‘help as many low-paid workers as possible without damaging their employment prospects’.
3. Our full recommendations for April 2018 and underpinning analysis will be published today in our 19th report, once it is laid in Parliament, as will a letter from the LPC Chair to the Secretary of State for Business, Energy and Industrial Strategy.
4. We said in our report in March 2016 that, in the absence of economic shocks or other strong evidence, we thought that the default for the NLW would be a straight line rolling path to the 60 per cent target – evenly spreading our (annually updated) estimate of the increase in relative value needed to hit the target over the remaining years to 2020. Our recommendation today reflects this approach, and the cash level is in line with the indicative figure we set out last October – £7.85.
5. The new rate will increase pay for typical minimum wage workers (working 30 hours per week) by just over £500 per year. An increase of 4.4 per cent is, after the introduction of the National Living Wage in April 2016, the largest increase in the main rate of the minimum wage since 2006.
6. We estimate that the £7.83 rate will raise coverage – the number of workers paid at or below the NLW – by up to 530,000, from 1.6 million jobs (6.4 per cent of the cohort) in April 2017 to 2.1 million (8.6 per cent) in April 2018. Looking at progress towards the 60 per cent target, we estimate that the £7.83 rate will represent an increase in the relative value of the NLW for workers aged 25 and over of 1.1 percentage points, up from 56.9 per cent of the value of typical earnings (October 2017) to 58 per cent (October 2018).
7. Rates for workers aged under 25, and apprentices, are lower than the NLW in reflection of lower average earnings and higher unemployment rates. International evidence also suggests that younger workers are more exposed to employment risks arising from the pay floor than older workers. Unlike the NLW (where some consequences for employment have been accepted by the Government), the LPC’s remit requires us to set the other rates as high as possible without causing damage to jobs and hours.
8. We have also provided an indicative rate for the National Living Wage from April 2019. This is inevitably uncertain because pay forecasts are likely to change, but using those available in October we project that the on-course rate will be £8.20. Using OBR forecasts published today, the projected figure is £8.18. For 2020, the LPC’s projected rate for 60 per cent of median earnings is £8.61, within a range of £8.55 to £8.66. Using its forecasts published today, the OBR wage growth projections give a slightly higher estimated figure for 2020, of £8.57.
9. The National Living Wage is different from the UK Living Wage and the London Living Wage. Differences include that: the UK Living Wage and the London Living Wage are voluntary pay benchmarks that employers can sign up to if they wish, not legally binding requirements; the hourly rate of the UK Living Wage and London Living Wage is based on an attempt to measure need, whereas the National Living Wage is based on a target relationship between its level and average pay; the UK Living Wage and London Living Wage apply to workers aged 18 and over, the National Living Wage to workers aged 25 and over. The Low Pay Commission has no role in the UK Living Wage or the London Living Wage.
10. The members of the Low Pay Commission comprise:

• Bryan Sanderson, Chair
• Sarah Brown, Professor of Economics at the University of Sheffield
• Kay Carberry, TUC
• Neil Carberry, Managing Director, People and Infrastructure, CBI
• Clare Chapman, Non-Executive Director & Remuneration Committee Chair at Kingfisher PLC
• Richard Dickens, Professor of Economics, Sussex University
• Peter Donaldson, formerly Managing Director, D5 Consulting Ltd
• John Hannett, General Secretary, Usdaw
• Brian Strutton, General Secretary, BALPA

Our recommendations comprised:

	Current rate	Future rate (from April 2018)	Increase
NLW	£7.50	£7.83	4.4%
21-24 rate	£7.05	£7.38	4.7%
18-20 rate	£5.60	£5.90	5.4%
16-17 rate	£4.05	£4.20	3.7%
Apprentice rate	£3.50	£3.70	5.7%
Accommodation offset	£6.40	£7.00	9.4%

The learning app is designed and developed in an educational project under UK – Vietnam Fund. This project has also supported the creation of an English version of the MOET online teaching and learning portal.

On 14th November, teachers in Hanoi participated in an exciting day of ICT & Maths professional development at the Hanoi Hilton Hotel, provided by Just2easy and highly experienced British teachers. Teachers in Ho Chi Minh took part in a similar event on the 16th November at the Sofitel Hotel Saigon Plaza.

J2blast can be accessed by any students and teachers in Viet Nam by logging in to the MOET online teaching and learning portal. Each student can access their own personalised account that tracks their progress and development in everything from Times Tables to various elements of Secondary School Maths curriculum.

Teachers can also benefit greatly from using the app by tracking student progress in numeracy, identifying struggling students with specific maths challenges and then supporting their students with further activities or help.

The Managing Director for Just2easy, Danny Young said:

We are thrilled to be able to provide this unique and exciting app for every student in Vietnam. We really want to enable every student in the whole country to have fun in learning and practicing their maths & ICT skills.

For further information, please contact:

• Ms Dinh Thu Huong, the British Embassy Communications Manager; Tel: 3936 0500 ext 2227; Email: dinh.huong@fco.gov.uk
• Mr. Alastair Cameron, International Director, Just2easy Ltd; Mobile: 00447515817699; Email: alastair@j2e.com

Prime Minister Theresa May said:

This morning I met the leaderships of Sinn Fein and the Democratic Unionist Party to discuss the ongoing political stalemate in Northern Ireland.

I made clear the determination of this Government to re-establish the fully functioning, inclusive devolved administration that works for everyone in Northern Ireland.

I also reiterated our steadfast support for the Belfast Agreement and its successors. For their part both the DUP and Sinn Fein expressed their commitment to seeing Stormont back up and running.

From our discussions it is clear that the issues dividing the parties are relatively small in number, focusing mainly around culture, legacy, identity and the future stability of the devolved institutions.

While not in any way underestimating the challenges involved, I believe that a way forward can be found and an agreement reached.

It is therefore imperative that the parties re-engage in intensive discussions next week aimed at resolving the outstanding issues so that the Assembly can meet and an Executive be formed.

Following an investigation by the Insolvency Service, the Secretary of State for Business, Energy, & Industrial Strategy accepted a disqualification undertaking from Juris Vezenkovs for seven years, effective from 7 November 2017.

Mr Vezenkovs was a director of McDouglas Developments Limited who failed to ensure that the receipts were declared on the company’s VAT Returns which resulted in under declared VAT of £459,000.

McDouglas Developments Limited undertook building and construction work and entered liquidation on 26 October 2016, with liabilities to creditors of £1,584,512 of which £1,574,512 was owed to HM Revenue & Customs.

Susan MacLeod, Chief Investigator of Insolvent Investigations, Midlands & West at the Insolvency Service, said:

Company directors have a duty to ensure businesses meet their legal obligations, including paying taxes. Neglect of tax affairs is not a victimless action as it deprives the taxpayer of funds needed to operate public services.

The Insolvency Service will take action against directors who do not take their obligations seriously and abuse their position.

Notes to editors

Juris Vezenkovs date of birth is December 1980 and he is known to have resided in Manchester.

McDouglas Developments Limited (CRO No.09769443) was incorporated on 9 September 2015 and traded from Manchester as a provider of dry lining, plastering and roofing services.

Juris Vezenkovs was the sole registered director from 9 September 2015 until the company went into liquidation on 26 October 2016. The estimated deficiency as regards creditors and shareholders was £1,584,612.

On 17 October 2017 the Secretary of State accepted a Disqualification Undertaking from Juris Vezenkovs, effective from 7 November 2017, for a period of 7 years.

A disqualification order has the effect that without specific permission of a court, a person with a disqualification cannot:

• act as a director of a company
• take part, directly or indirectly, in the promotion, formation or management of a company or limited liability partnership
• be a receiver of a company’s property

Disqualification undertakings are the administrative equivalent of a disqualification order but do not involve court proceedings. Persons subject to a disqualification order are bound by a range of other restrictions.

The Insolvency Service, an executive agency sponsored by the Department for Business, Energy and Industrial Strategy (BEIS), administers the insolvency regime, and aims to deliver and promote a range of investigation and enforcement activities both civil and criminal in nature, to support fair and open markets. We do this by effectively enforcing the statutory company and insolvency regimes, maintaining public confidence in those regimes and reducing the harm caused to victims of fraudulent activity and to the business community, including dealing with the disqualification of directors in corporate failures.

BEIS’ mission is to build a dynamic and competitive UK economy that works for all, in particular by creating the conditions for business success and promoting an open global economy. The Criminal Investigations and Prosecutions team contributes to this aim by taking action to deter fraud and to regulate the market. They investigate and prosecute a range of offences, primarily relating to personal or company insolvencies.

The agency also authorises and regulates the insolvency profession, assesses and pays statutory entitlement to redundancy payments when an employer cannot or will not pay employees, provides banking and investment services for bankruptcy and liquidation estate funds and advises ministers and other government departments on insolvency law and practice.

Further information about the work of the Insolvency Service, and how to complain about financial misconduct is available.

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A Downing Street spokesperson said:

“At the Gothenburg Social Summit, Prime Minister Theresa May held a bilateral meeting with European Council President Donald Tusk.

“In positive discussions, the two leaders spoke about the progress which had been made so far in the negotiations on citizens’ rights, Northern Ireland and the financial settlement.

“Prime Minister May and President Tusk agreed that there is more work to be done and discussed how to take further steps forward together in advance of the European Council in December.

“The Prime Minister also held a constructive bilateral meeting with the President of France, Emmanuel Macron.

“They discussed the progress which has been made so far. The two leaders looked forward to further progress being made ahead of the December Council.

“President Macron and the Prime Minister also discussed the strong bilateral relationship which exists between France and the UK and looked forward to building upon it further in coming months and years.”