Rishi Sunak is reportedly preparing to raise the National Living Wage to £9.50 per hour in Wednesday's budget.

It follows reports over the weekend that minimum wage would rise to £10 by the next general election in 2024 from its current level of £8.91 an hour.

The rise would see a 6.6% increase for anyone aged 23 or over on minimum wage, more than twice the current 3.1% rise in the cost of living.

The rise was recommended by the Living Wage Foundation after the government faced pressure to help low-paid workers who were among the worst hit by the Covid pandemic. 

How does the National Living Wage compare to Minimum wage?

The minimum wage depends on the age of workers while the National Living Wage applies to all workers over the age of 23. 

Those under the age of 18 are paid a minimum of £4.62 per hour rising to £6.56 for those agead 18-20.

Workers aged 21-22 are paid £8.36 and when workers reach the age of 23 they are paid the National Living Wage which is currently £8.91 per hour.

It could be one of few surprises left after a number of details emerged over the weekend.

The Chancellor will head to the Commons with a focus on levelling up transport links outside London, research and development in health, and a “skills revolution”.

It will be the second time this year he has stood in front of MPs and updated them on the state of the nation’s finances after the 2020 Budget was delayed until March due to the coronavirus.

Budget announcement date 2021

The Chancellor will announce the givernment's spending plan for 2021 on Wednesday, October 27.

Mr Sunak will address the Commons following his previous Budget announcement in March following a delay due to the coronavirus pandemic. 

Budget 2021 details already announced

Although some 11 areas of investment were announced by the Treasury over the weekend, Mr Sunak is also expected to impress on MPs the importance of keeping public finances in a healthy state.

Some big-ticket items for investment already announced include:

  • £7 billion for areas outside of London to “level up” transport;
  • £5 billion for health-related research and development, including towards genome sequencing and tackling health inequalities;
  • £3 billion to drive a “skills revolution”;
  • A £1.4 billion fund to funnel money into key innovative sectors and a new talent network to woo foreign talent into UK industries;
  • £850 million to “breathe life” back into cultural hotspots;
  • £700 million for a new fleet of patrol boats for Britain’s borders;
  • £700 million to improve sports and youth clubs;
  • £560 million to provide personalised maths coaching;
  • £500 million towards support for families and children, including new family hubs;
  • £435 million for crime prevention and the Crown Prosecution Service, part of which aims to improve the response to rape and sexual assault cases, and;
  • £5 million for cutting-edge treatments for veterans.

Brentwood Live: Rishi Sunak will unveil the 2021 Budget on Wednesday. (PA)Rishi Sunak will unveil the 2021 Budget on Wednesday. (PA)

‘Road to recovery’ after Covid

Writing in the Sun on Sunday, Mr Sunak said “there are positive signs that we’re on the road to recovery” after the havoc wrought on public finances by Covid-19.

He said: “Coronavirus has meant our economy has taken a hit. And in order to recover strongly, we need to be responsible because everything comes at a cost.

“And the money we spend is yours, the taxpayer’s money, not anyone else’s.

“Earlier this year, I said I would be honest with the country about the challenges we face to ensure our public finances get back on to a strong footing.”

He added: “The experiences of the last 18 months have made me more certain of how important a strong and resilient economy is.

“That is why this week’s Budget and Spending Review will set out a plan to deliver the people’s priorities, support business, help our recovery, ease pressures on the cost of living but also to strengthen the public finances – so we have a stronger economy for the British people.”