Tag: Treasury

• National Living Wage will rise to two-thirds of average earnings
• Chancellor commits to Low Pay Commission recommendations, with latest forecasts showing a pay boost next year worth over £1,000 for 2 million low-paid workers
• successive rises mean a full-time worker on the National Living Wage will be over £9,000 better off than they would have been in 2010

In a significant boost for the UK’s lowest paid, the Chancellor committed to accept the Low Pay Commission’s recommendations – which will be announced in November. Based on the Low Pay Commission’s latest forecasts, this would see the National Living Wage increase to over £11 an hour from April 2024 and would mean the annual earnings of a full-time worker on the National Living Wage will increase by over £1,000 next year.

People currently aged 23 and over are eligible for the National Living Wage, with over 2 million workers on low pay set to benefit from the increase. The announcement, after successive rises since its introduction in July 2015, means a full-time worker on the National Living Wage will be over £9,000 better off than they would have been in 2010.

Each year, the independent Low Pay Commission produces recommendations to the Government on National Living Wage and National Minimum Wage rates. This year it is due to make recommendations for the rates that will take effect from April 2024, based on their remit which sets a target for the National Living Wage to reach two-thirds of median earnings by 2024 for workers aged 21 and over, taking economic conditions into account.

Further information

Projected coverage of National Living Wage/National Minimum Wage workers in April 2023 across the UK’s countries and regions

Region	National Living Wage
North East	130,000
North West	300,000
Yorkshire & Humber	310,000
East Midlands	200,000
West Midlands	270,000
South West	200,000
East	220,000
London	200,000
South East	280,000
Wales	120,000
Scotland	180,000
Northern Ireland	130,000
Total	2,540,000

History of the NLW

• Since 1999, the UK has had a National Minimum Wage, which is uprated annually based on the advice of the independent Low Pay Commission (LPC).
• The LPC is made up of representatives from business, employee and academic communities and reaches a consensus agreement on this uprating.
• Prior to the first target announced in 2015, the LPCs remit was to set rates as high as possible without significant employment impacts.
• The first minimum wage target was announced in 2015, when he announced the introduction of the National Living Wage (NLW)  from April 2016. The NLW had a target to reach 60% median earnings by 2020. This target was met in October 2020.
• In 2019 a new target was announced for the NLW to reach two thirds of median earnings by 2024.
• The target for the NLW to reach two thirds of median earnings was set to ‘end’ low pay according to the ONS definition.

• £12.4 million awarded to six innovative new projects to understand barriers to getting into work
• projects include investigating the impact of endometriosis on women’s work choices and how programmes to reduce obesity and type 2 diabetes can improve workforce participation
• funding will help overcome barriers facing those who need the most support getting into work

The projects comprise the first round of the Labour Market Evaluation and Pilots Fund, and take place over the next two years. The results will help to transform the government’s approach to the jobs market and drive forward research into best practice in employment.

While the UK’s employment rate is higher than a number of other advanced economies, the government is committed to ensure that those who most need help getting into the workplace are supported.

The Chancellor announced a range of interventions to address this at Spring Budget 2023 – including a significant expansion of childcare support, making 30 hours of free childcare a week available to parents from children aged 9 months. The Labour Market Evaluation and Pilots Fund is part of that and will be used to test new approaches and generate better evidence to help specific groups back into work or to work longer hours.

Financial Secretary to the Treasury, Victoria Atkins, said:

“Our jobs record is incredibly strong, with high employment that means millions of people are benefiting from work. But for some, that’s not happening.

“We need to look for solutions that are tailored to help people thrive in the jobs market. This analysis is the first step towards that – looking at specific health conditions or living arrangements to find out what works to help people work.”

Minister for Social Mobility, Youth and Progression Mims Davies MP said:

“The vital opportunities and confidence employment gives, helps to transform lives. This is why we are determined to support all those who want to progress to do so, while also driving down inactivity and importantly growing the economy.

“This key new funding for our pilots will enable us to support even more people to move forward in work, including vitally those in supported accommodation and more disadvantaged communities, to help people to break down any barriers to work, so more people can fulfil their employment potential.”

National Statistician, Sir Ian Diamond, said:

“The ONS welcomes the opportunity to shine light on this important area with these projects. This new analysis will provide crucial insight for decision makers in helping to understand how health conditions impact on people’s working lives and what interventions can help people stay in work.”

Minister for the Women’s Health Strategy Maria Caulfield said:

“Endometriosis can be a debilitating condition that stops women and girls from living their lives to their fullest potential.

“Through the Women’s Health Strategy we have set an ambition for all women and girls with severe endometriosis to experience better care, with reduced waiting times for diagnosis and providing funding for key research into the condition.

“The support doesn’t stop at health, and today’s announcement demonstrates how we’re taking a cross-government approach to help women with endometriosis get back to living their best lives.”

One of the projects includes a first-of-its-kind Office for National Statistics (ONS) evaluation which will investigate the impact of endometriosis on women’s participation and progression in the workforce. Endometriosis can affect around 1 in 10 women, with symptoms including chronic pain and fatigue which can disrupt daily routines, fertility and mental health and time off work may be needed for coping with symptoms. Previous work has shown that women with the condition often take this into consideration when making career choices, including the likelihood they will need to take significantly more sick leave. This project will improve understanding and help inform government plans to support women with the condition in their careers.

A second project by the ONS will evaluate whether programmes to reduce the risk of developing type two diabetes and obesity improve people’s ability to join the labour market. Around 3.8 million people in the UK have type 2 diabetes and 2.4 million are at high risk of developing the disease which can have a strong effect on quality of life, including the ability to work. The evaluation will include reviewing the impact of the Healthier You NHS Diabetes Prevention Programme (DPP), a large scale nine-month, evidence-based lifestyle change programme aimed at people at risk of developing type 2 diabetes.

There will also be a new pilot to address barriers to work faced by those aged 18-24 living in supported housing, which is accommodation provided alongside care, support or supervision to help people live as independently as possible in the community and can act as a pathway to transitioning into work.

To support young people in making that transition, DWP and the West Midlands Combined Authority (WMCA) have developed a Proof of Concept that will test financial support and simplification of the benefits system for 18-24 year olds living in supported housing who move into work or increase their working hours. This will help them to build their employment prospects further, work towards becoming financially independent and progress into move on accommodation in a planned way.

Funding will also be allocated to two HMRC projects to evaluate the impact of Tax-Free Childcare on parents’ work choices and women’s return to work after maternity leave. In addition, funding will be provided to DWP to trial employment support and rent incentives to move people out of work or on low earnings into work or onto higher earnings.

Further information

• At Spring Budget, the government announced a comprehensive employment package designed to remove the barriers preventing people from working and support them into the UK’s labour market, to boost economic growth, unlock the UK’s productive potential, and raise living standards. It is estimated to move 110,000 more individuals into the labour market by 2027-28, the largest supply-side policy adjustment the OBR have made to their forecast since 2010.
• Bids for the first round of the Labour Market Evaluation and Pilots Fund were assessed collaboratively by the joint HMT and Cabinet Office Evaluation Task Force.
• Further rounds of funding will be allocated in due course to evaluate new and existing labour market measures, move people into work and increase productivity. The results of these projects will inform future labour market policy.
• The Rent Simplification and Support Proof of Concept scheme is led by the Department for Work and Pensions and would mean young people in supported housing, who start work or increase their hours, would only have to pay up to a capped amount towards their rent (e.g. Local Housing Allowance equivalent rent amount) as opposed to the full rent liability.
• For further information on government action to improve healthcare quality and access for women, please see the Women’s Health Strategy for England, and what we’ve achieved so far over the first year of the strategy.

• Jeremy Hunt, Chancellor of the Exchequer, today unveiled a series of shared economic and financial commitments with India, following talks with Indian Finance Minister Nirmala Sitharaman in Delhi
• the Chancellor welcomed India’s confirmation to explore London as a permitted jurisdiction for overseas direct listings of securities
• agreements also include the launch of a partnership to boost cross-market investment by the insurance and pension sectors and an initiative to share expertise in structuring and financing major infrastructure projects

The news that India will explore potential London listings follows recent changes to Indian regulation to allow domestic companies to access global markets and underlines the UK capital’s strength as a hub for international capital raising.

In addition, a new UK-India Pensions and Insurance Partnership will support the growth of the sector in both countries. The partnership will focus on knowledge sharing, growing bilateral investment and diversifying risk, including through pension fund trade missions to encourage increased bilateral investment.

The launch of a UK-India Infrastructure Financing Bridge was also announced today. Co-led by Indian public policy think tank NITI Aayog and the City of London Corporation, the initiative will focus on sharing expertise in structuring and financing major infrastructure projects.

The announcements are part of a series of commitments unveiled following high-level meetings as part of the 12th UK-India Economic and Financial Dialogue (EFD).

Jeremy Hunt, Chancellor of the Exchequer, said:

“I’m very proud of the progress we’ve made through the UK-India EFD this time. It’s a big step forward to hear India confirming that they’ll explore the London Stock Exchange as an international destination for the direct listing of Indian companies.

“I see India as Asia’s Silicon Valley and the UK as Europe’s Silicon Valley, so there’s a lot we can work on together.”

Total trade between the UK and India was worth £36.6 billion in the last financial year, up over 34% year on year, with an £82 million increase in UK-Indian financial services trade over last year. EFDs are a regular way of deepening ties to grow the economies of both countries.

Investment between the UK and India so far already supports over half a million jobs across both economies, and UK businesses sold goods and services worth around £15 billion to India in 2022.

Today’s EFD was the first face to face meeting of its kind between a UK chancellor and Indian counterpart since 2017, with the most recent taking place virtually in 2021. India-UK trade has more than doubled since the first EFD in 2007.

Other major announcements as part of the EFD, include:

• The signing of the UK guarantee to the World Bank to unlock an additional $1 billion of green financing in India. This will promote clean energy investment and support green growth targets, accelerating India’s climate transition and ability to meet COP26 commitments. It is hoped that it will encourage other international partners to support India and shape the world’s climate transition.
• Agreement to explore new investment opportunities in areas of shared priority, including leveraging institutional capital to invest in climate adaptation and green businesses in India. This builds on the success of the Green Growth Equity Fund, India’s first dedicated climate change fund backed by British International Investment.

The EFD follows Prime Minister Rishi Sunak’s visit to Delhi for the G20 leaders’ summit, where he announced that the UK will provide $2 billion to the Green Climate Fund – the biggest single funding commitment the UK has made to help the world tackle climate change, which will make a significant contribution towards the UK’s pledge to spend £11.6 billion on international climate finance, cementing our global climate leadership.

It also comes after the recently announced ‘Alive with Opportunity’ campaign from the UK government, designed to showcase the deep bond between Britain and India and build on the continuous exchange of people, ideas and culture. The campaign is part of the UK’s ambitions to double trade with India by 2030.

Bill Winters, CBE, Group Chief Executive, Standard Chartered and UK Chair of the India-UK Financial Partnership (IUKFP), said:

“I was delighted to lead a delegation of UK business leaders to accompany the Chancellor of the Exchequer to New Delhi and participate in the EFD. The IUKFP is a crucial platform for UK-India cooperation on issues of critical importance to our respective financial and related professional services industries.

“This innovative public-private partnership has delivered real benefits for both our nations. We look forward to working with both governments to advance our shared goals, including deepening our bilateral trade and investment relationship, greening our financial systems, enhancing collaboration on financial innovation, and enabling cross-border data flows. India and the UK are natural partners, and there are valuable opportunities for us to learn from our respective successes and benefits to be gained by harnessing our full potential.”

Chris Hayward, Policy Chairman of the City of London Corporation, said:

“I am delighted that the City of London Corporation is able to play a part in the Economic and Financial Dialogue (EFD) through the India-UK Financial Partnership and our co-sponsorship of the UK-India Infrastructure Financing Bridge (UKIIFB) with the National Institution for Transforming India (NITI Aayog). This new infrastructure initiative is aimed at leveraging the City of London’s expertise in structuring and phasing major projects to meet India’s infrastructure needs – smoothing the path for long-term sustainable investment into India.

“The EFD marks the strength of the partnership between UK and India and lays an excellent foundation for future ventures between our financial and professional services sectors.”

• £381 million funding scheme to deliver thousands of public charge points across the country opens for applications
• Chancellor opens UK’s largest electric vehicle charging site in Birmingham in major boost to Britain’s electric charging infrastructure
• EV drivers in the West Midlands set to benefit from the 180 charge point hub, becoming the largest electric vehicle charging site in the UK

A new electric vehicle charging hub – big enough to charge 180 cars simultaneously – has been opened by the Chancellor Jeremy Hunt in Birmingham today (Thursday 7 September). It marks a significant boost for Britain’s electric car charging network, becoming the largest electric vehicle charging site in the UK.

The  Gigahub™, located at the city’s NEC Campus, is the largest-ever private investment in a UK electric vehicle project to date. The project has been developed by a three-way collaboration between the NEC, EV Network and bp pulse, and is now operated by bp pulse. It is funded by a record £8 million from its investment partner, Zood Infrastructure Limited. The site will provide 30 super-fast, 300kw DC charging bays and a further 150 7KW a/c charging bays – one of the largest amounts of super-fast chargers in one location in the UK.

The site is strategically positioned to become a major transport hub for the future – located in the heart of the UK motorway network, including the M42, M46 and A45 and the new HS2 interchange station.

The site supports the government’s electric vehicle infrastructure strategy and commitment to decarbonising transport, backed with more than £2 billion to support the transition to zero emission vehicles including accelerating the rollout of chargepoint infrastructure.

As part of that, government and industry have so far supported the installation of over 45,500 publicly available electric vehicle charging devices, including more than 8,600 rapid devices. The public charging network is growing quickly – public charging devices have more than tripled in four years from 10,300 devices in January 2019 to over 45,500 in August 2023.

The number of public chargepoints rose by 38% over the last year, and as a recent report from the National Infrastructure Commission points out, if charge point deployment grows at around 30% per year the 300,000 expectation will be met.

Today the Chancellor has also announced that several local authorities across England can apply for the first round of the Government’s £343 million Local Electric Vehicle Infrastructure (LEVI) Capital Fund, with the West Midlands Combined Authority among the authorities eligible to apply this year.

The LEVI fund will ensure the transition to electric vehicles takes place in every part of the country by supporting tens of thousands of local chargepoints, especially for those without access to off-street parking.

Local authorities will receive LEVI funding in two groups, with the first able to apply for their allocated funding from today, to be distributed this financial year. The second group can apply for their funding next financial year.

The Chancellor of the Exchequer, Jeremy Hunt, said:

“This is the biggest private investment in electric charging in the UK and is a huge vote of confidence in Britain’s role as a leader in green industries.

“The ground-breaking site will be a major transport hub for the future and marks a significant step in our rollout of electric vehicle charging infrastructure across the country.”

Decarbonisation Minister Jesse Norman said:

“Electric vehicles will play a crucial role in helping the UK to decarbonise transport and reach net zero.

“Today’s measures will deliver tens of thousands of chargepoints across the country, boosting the economy and creating skilled jobs.”

Paul Thandi CBE, DL, Chairman of NEC Group, said:

“We are proud to contribute to the UK Government’s Electric Vehicle Infrastructure Strategy. Working in collaboration with EVN and bp pulse, the opening of our EV charging hub provides NEC Campus customers, commuters, and those working for local regional or national businesses, a reliable and convenient way to recharge and support a lower carbon travel future.

“This strategic collaboration and initiative strengthen our destination offer, demonstrate our commitment to reducing the impact our business practices and our Masterplan credentials have on the environment, and ultimately supports a reduction in carbon emissions.”

Akira Kirton, vice president of bp pulse UK, said:

“The transition to electric vehicles is evolving at pace which is why bp pulse is focussed on accelerating the development of the UK’s EV infrastructure, delivering the right charging speeds, in the right locations and investing up to £1 billion to do so.

“This new, nationally significant bp pulse Gigahub™ at the heart of the UK’s road network, is another great example of our strategy in action. We plan to roll out hundreds of hubs this decade in places EV drivers needs them – urban areas, on trunk roads and motorways and at destinations such as restaurants, retail parks and hotels.”

Alexander Walsh, senior managing director at Blackstone, said:

“The opening of the UK’s largest EV charging hub at the NEC is a significant step forward as more drivers across the UK move to electric vehicles, with sites like this playing an important role in supporting the UK’s energy transition.

“Blackstone has been invested in the NEC since 2018, and this development demonstrates the positive impact private investment can have in driving innovation and creating green jobs, and we’re proud to be backing the industries of the future in the West Midlands and beyond that are helping build a more sustainable future.”

Reza Shaybani, CEO, and co-founder of the EV Network (EVN), said:

“The launch of one of Europe’s largest ultra-fast Gigahub™ is a massive game changer for EVN and a huge step forward for UK electric vehicle fast charging. The EVN team responding to the public demand for more charging and we are responding with hundreds of millions of pounds of new investment and the very latest technology.

“EVN has already built dozens of sites across the UK, but the successful completion of this new project launches us onto a much more ambitious growth path, as the leading business in our sector with a range of exciting new partners.

“The NEC was a perfect location that is not only geographically key, but of national significance, to support the EV charging landscape. EVN secured 6.5MVA grid connection, to support the entire infrastructure. The strategic placement and impressive scale of this charging hub within the UK’s transport infrastructure offers reassuring support to drivers journeying between cities.

“Our long-term relationship with both the NEC Group and bp pulse ensures this is not just an investment for the site’s visitors but a transformative step towards bolstering the entire EV charging infrastructure of the UK.

“At EVN we are excited to invest £100M in EV Infrastructure projects this year, and we aim to invest a further £300M equity by 2025.”

Alongside this, UK Research and Innovation has announced that Innovate UK has awarded £5.8m of funding to 12 projects through the Driving the Electric Revolution Challenge Fund. Winning projects include work on best practice in automation and robotics to produce EV chargers, and the scale-up of the assembly manufacturing processes for a rare earth-free permanent magnet generator – allowing us to produce electric machines without using rare earth elements.

Whilst he was in the region, the Chancellor also convened a roundtable with green industries SMEs based in and around the West-Midlands, including leading green electric vehicle, energy and manufacturing companies as part of his ongoing engagement with his five key growth sectors: life sciences, advanced manufacturing, green industries, digital and technology and creative industries.