The Low Pay Commission (LPC) has the task of recommending increases to the National Living Wage (NLW) subject only to there being ‘sustained economic growth’. The objective is for the NLW to reach 60% of median earnings by April 2020. The LPC have forecast that, based on the most up to date data, the NLW rate will increase to around £8.20 from April 2019 and around £8.61 from April 2020. This is quite a lot less than the £9.35 envisaged when the NLW was announced in 2015 and reflects the decline in the rate of average earnings growth in recent years.
For the NMW rates, the Commission has always had the job of recommending rates having regard to the effect on employment. In their report they note that employment in the UK continues to grow more strongly than forecast and is at record levels and that unemployment has fallen to its lowest rate since 1975.
The BHA have been pushing for substantial increases in the accommodation offset and are pleased with the decision of the LPC in this area.