National Living Wage to rise 50p to £13.21 an hour from April 2027

Workers aged 21 and over on the lowest legal hourly rate will be paid at least £13.21 from 1 April 2027, a rise of 50p on the current £12.71.

The figure comes from the Low Pay Commission, the independent body that advises ministers on minimum pay. Its recommendations were submitted on 23 October and published alongside the Budget on 28 October, and the government accepted all of them. The Treasury says the increase is worth £910 a year in gross earnings to someone working full time on the National Living Wage.

Every band goes up by the same 3.9%:

• 21 and over (National Living Wage): £12.71 to £13.21
• 18 to 20: £10.85 to £11.27
• 16 and 17: £8.00 to £8.31
• Apprentices: £8.00 to £8.31

The accommodation offset, which applies where an employer provides a worker's housing, rises by 43p to £11.53 a day.

How the rate was set

The commission's remit uses two-thirds of median earnings as its reference point for the National Living Wage. It said the April 2027 figure falls short of that level but makes progress towards it. It also said the rise sits above forecasts for inflation between April 2027 and March 2028, with room left for inflation turning out higher than expected, so the rate should hold its value in real terms.

The commission's members agreed the recommendations unanimously.

Younger workers

The government wants the National Living Wage eventually to cover everyone aged 18 and over. The age threshold was cut from 25 to 23 in April 2021 and from 23 to 21 in April 2024.

This year the commission advised against narrowing the gap between the 18 to 20 rate and the adult rate, pointing to weaker demand from employers for young workers. That is why the younger band rises by the same percentage rather than catching up.

The commission's full annual report, with the evidence behind the figures, is due in the new year.