The government has also set hourly rates of £11.27 for 18–20-year-olds and £8.31 for 16–17-year-olds. Employers across the UK must pay eligible workers the new minimums from 1 April 2027.
The UK government has set a £13.21-an-hour legal minimum for workers aged 21 and over from 1 April 2027, up from £12.71. Chancellor John Healey included the minimum-wage increase in his Budget. The rates apply across the UK. BBC Business says the increases will affect 2.3 million workers.
| Worker’s age | Current rate | New rate | Hourly rise |
|---|---|---|---|
| 21 and over | £12.71 | £13.21 | 50p |
| 18–20 | £10.85 | £11.27 | 42p |
| 16–17 | £8.00 | £8.31 | 31p |
The rate for workers aged 21 and over is called the National Living Wage; the younger workers’ rates are called the National Minimum Wage. The Treasury says the 50p adult-rate increase would add £910 to gross annual pay for someone working 35 hours a week. That calculation depends on those hours, rather than guaranteeing every worker a £910 increase.
In its 2026 remit, the government asked the Low Pay Commission to recommend rates for 1 April 2027 and provide advice by the end of October 2026. The government said it wanted to raise living standards while asking the commission to consider living costs, employment conditions and the effect on businesses.
The government plans a 26 November start for suspensions covering 101 food and agricultural products, including garlic, gherkins and plant-based milk.
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The government also says it wants the 18–20 rate eventually to match the rate for older workers. It has left the timing to the commission and asked it to prioritise younger workers’ employment prospects. Both adult age bands are due a 3.9% increase this time, so the new rates do not narrow the gap between them.
The Living Wage Foundation has separately announced a Real Living Wage of £14.10 an hour across the UK and £15.45 in London. The charity sets these voluntary rates with living costs in mind; employers can choose to pay them, but they are not the government’s legal minimums.
From 1 April 2027, employers across the UK must pay eligible workers the applicable new statutory rate, even when those workers are not paid by the hour.
The Budget preserves the £20,000 annual cash ISA allowance and proposes a 24% rate on savings and rental income for basic-rate taxpayers from April 2027.
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Under the announced Your First Home terms, eligible first-time buyers purchasing qualifying new-build homes in England can seek a 20% equity loan with a deposit from 2.5%. Applications are scheduled to open in February 2027.
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