Healey Sets Slower Minimum Wage Rise for Young Workers

Young workers in the United Kingdom are expected to receive a smaller minimum wage increase than in previous years as Chancellor John Healey prepares to announce the government's Budget on Wednesday, October 28, 2026. The proposed changes would raise hourly pay rates by 3.9% while delaying Labour's commitment to equalize minimum wages across adult age groups.

According to reports cited by the BBC and The Guardian on October 27, the National Minimum Wage for workers aged 18 to 20 is expected to increase from £10.85 to approximately £11.27 an hour. The National Living Wage for employees aged 21 and older is projected to rise from £12.71 to £13.20, leaving a gap between the two rates.

The expected increase for younger workers contrasts with the 26% rise in their minimum wage introduced by the Labour government since returning to power in 2024. The government's manifesto pledged to eliminate age-based wage differences, but ministers have indicated that achieving equal rates could take time.

Business Secretary Jonathan Reynolds defended the government's approach in an interview with the BBC, emphasizing the need to consider employment conditions alongside pay increases.

"The manifesto pledge on equalisation still applies but we were always clear it could happen over time," said Reynolds. "Of course, you want not just good wages but good work. It is a balance of making sure the pressures on the labour market are taken into account."

Reynolds also told the BBC that removing import tariffs from more than 100 food products could help households manage living costs. Combined with existing tariff suspensions introduced in June, the measure is expected to save households up to £21 annually, or approximately 40 cents a week, according to the government.

Trade unions and opposition politicians have challenged the proposed wage policy. Andrea Egan, general secretary of Unison, argued that younger employees should receive the same pay as older colleagues performing equivalent work.

"Twenty year-old care workers, teaching assistants and security guards do the same work as their older colleagues," Egan said. "They don't pay less in the supermarket or at the petrol pump. They must be paid equally."

The Green Party also accused Labour of abandoning its commitment to equal pay. Mothin Ali, the party's co-deputy leader, called for workers of all ages to receive the same minimum rate and said the Greens would introduce a £15 minimum wage.

"Anyone doing a day's work, needs to be paid the same rate for the same job. A young person's rent and food bill is no less because they are young, so they need to receive the same wage. Healey and Burnham are now breaking a manifesto pledge to young people that even Starmer managed to keep. Labour have no respect for young people, who appear to just be there for cheap labour for the wealthy and their corporate donors," Ali said.

The Conservatives also criticized the government's cost-of-living measures. Shadow Chancellor Andrew Griffith argued that the proposed changes would not adequately address household financial pressures.

"Shoppers face rising costs at the till and families are struggling to make ends meet, but Burnham's plan is cheaper gherkins. This is an insult to families hammered by Labour's tax rises," Griffith said.

Alongside the wage changes, the government has announced measures affecting workers, families and unpaid carers. These include making a 55p-per-mile tax-free allowance permanent for the first 10,000 business miles and increasing the rate for additional miles from 25p to 35p.

Eligible self-employed fathers and partners are also expected to gain access to two weeks of parental pay worth up to £194 a week. Another measure will replace the Carer's Allowance earnings threshold's existing all-or-nothing rule with a gradual reduction in benefits, although implementation is not scheduled until 2030.

The government has also indicated that fuel duty will remain frozen in the upcoming Budget, with the existing 5p-per-liter discount continuing. The Treasury is expected to publish a complete list of products eligible for import tariff removal on Wednesday, when Healey delivers the Budget.