Javid pledges to wipe out low pay within five years
● Chancellor takes on Labour with £2 rise in minimum wage by 2024
The Conservatives are now the “workers’ party”, Chancellor Sajid Javid has claimed as he unveiled plans to raise the minimum wage by more than £2 per hour over the next five years.
The Chancellor committed to wiping out low pay altogether, increasing the minimum wage to two-thirds of average earnings.
Mr Javid also revealed that the threshold for young workers to begin earning the full statutory National Living Wage would drop from age 25 to 21. The announcement moves the Tories firmly onto Labour territory, with opposition policy currently to bring wages up to £10 per hour by 2020 for over 18s.
“Over the next five years, we will make the UK the first major economy in the world to end low pay altogether,” Mr Javid said in his speech to the Tory conference.
“To do that, I am setting a new target for the National Living Wage: Raising it to match twothirds of median earnings. “That means, on current forecasts, this ambitious plan will bring the National Living Wage up to £10.50, giving four million people a well-earned pay rise.”
The Chancellor said he was bringing down the age threshold for the minimum wage “to help the next generation of gogetters to get ahead”.
Mr Javid added: “The hard work of the British people really is paying off. It’s clear it’s the Conservatives who are the real party of labour. We are the workers party.”
The announcement was welcomed as “hugely ambitious and hugely welcome” by the Resolution Foundation economic think tank.
But Labour’s shadow chancellor John Mcdonnell said the plans were a “pathetic attempt at catch-up” that will “fool nobody”.
“Labour will introduce £10 as a minimum as soon as we take office and, rising with living costs, it will mean everybody over 16 years of age will be earning comfortably more than £10.50 an hour by 2024,” Mr Mcdonnell said.
Mr Javid said he would launch a “Brexit Red Tape Challenge” that would “help identify EU regulations that we can improve or remove”.
But Dame Carolyn Fairbairn, the director general of the Confederation of British Industry, said Mr Javid’s speech was “silent on how the government and the Treasury would respond to the serious rupture caused by failing to secure a deal with the EU”.
The Chancellor also announced the government would put £5 billion towards rolling out full-fibre broadband to the 20 per cent hardest-to-reach parts of the country, including in Scotland.