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Minimum Wage

Volume 462: debated on Wednesday 4 July 2007

To ask the Secretary of State for Business, Enterprise and Regulatory Reform what the level of the national minimum wage was for (a) adults and (b) younger workers (i) at its inception and (ii) at each further increase since then; what the date was of each increase; and what percentage of national average earnings each increase represented. (146574)

[holding answer 2 July 2007]: The national minimum wage rates are set in response to recommendations by the independent Low Pay Commission. The rate for workers aged 16-17 was introduced in 2004 in response to a Low Pay Commission recommendation. The rates have increased since inception as follows:

Table 1: The UK minimum wage

Main rate (workers aged 22+) £ per hour

Development rate (workers aged 18-21) £ per hour

Workers aged 16 -17 £ per hour

1 April 1999

3.60

3.00

1 June 2000

3.60

3.20

1 October 2000

3.70

3.20

1 October 2001

4.10

3.50

1 October 2002

4.20

3.60

1 October 2003

4.50

3.85

1 October 2004

4.85

4.10

3.00

1 October 2005

5.05

4.25

3.00

1 October 2006

5.35

4.45

3.30

1 October 2007

5.52

4.60

3.40

Table 2. The UK minimum wage as a percentage of median earnings

Percentage

Main rate (workers aged 22+)

Development rate (workers aged 18-21

Workers aged 16-17

1 April 1999

45.6

64.5

1 June 2000

45.2

68.3

1 October 2000

44.3

66.0

1 October 2001

47.0

68.6

1 October 2002

46.3

68.1

1 October 2003

47.7

68.0

1 October 2004

49.5

72.3

1 October 2005

49.7

72.7

61.5

1 October 2006

50.2

73.4

65.0

1 October 2007

50.1

73.4

64.8

Note: Calculated as the minimum wage rate as a proportion of the median wage for the given age group. The minimum wage is deflated back to the survey period using the average earnings index (excluding bonuses). October 2007 figures also based on forecast average earnings growth. Source: DTI estimates based on the Annual Survey of Hours and Earnings, Office for National Statistics (www.statistics.gov.uk)