Baroness Gustafsson (Lab)

Before the Division, I was about to turn to the observations of the noble Lord, Lord Sharpe, the first of which was about the impact on SMEs and businesses. I remind noble Lords that we have accepted in full the recommendations of the Low Pay Commission. We are confident that these increases will help millions of families across the country without placing excessive burdens on businesses. The remit of the LPC asks it to take into account the impact on businesses, including SMEs, competitiveness, the labour market and the wider economy. The LPC draws on extensive labour market and pay analysis and stakeholder evidence when recommending rates. Regarding support for businesses as they adjust to these new rates, the 2025 national minimum wage and NLW rates were announced in the Autumn Budget 2024, more than five months before the rates came into effect. These timelines are consistent with previous years, providing businesses with the maximum adjustment time. Similar to previous years, the Government will undertake an extensive communications campaign to increase awareness and understanding of the changes to the rates coming into effect from 1 April 2025 and to ensure that businesses and workers are prepared. The communication campaign is expected to include targeted activities specifically to support SMEs. The Government also publish extensive guidance online to support businesses in understanding the legislation and the steps required to comply. This Government are proud to be delivering the biggest upgrade to the rights of working people in decades. An ambitious minimum wage, backed by robust enforcement, will always be a cornerstone of a Labour Government’s employment rights framework, and we are grateful for cross-party support on this vital measure. As noted, the Government’s impact assessment, which was published alongside this legislation, estimates a direct pay rise for more than 3 million people, covering all the nations and regions of the UK and every sector of employment. It is worth repeating that a full-time worker on the national living wage will receive a gross annual pay rise on 1 April of £1,400, while an 18 to 20 year-old working full time on the national minimum wage will benefit to the tune of £2,500 a year. I reiterate the Government’s thanks to the noble Baroness, Lady Stroud, and the Low Pay Commission. Once a new remit is issued to the LPC, we will look forward to hearing its next recommendations later this year as we continue our path towards a genuine living wage for all adults. I commend these regulations to the Committee.