Chancellor John Healey has suggested that younger workers may not receive the same minimum wage as older workers before the next election, potentially breaking a Labour manifesto pledge to remove 'discriminatory age bands' for 18 to 20-year-olds.
In an interview with the BBC's Sunday with Laura Kuenssberg, Healey was asked whether the gap would be closed by the time of the next election. 'We'll take one step at a time,' he said, suggesting Labour might abandon its plan to equalise wages before voters next go to the polls.
Labour's 2024 manifesto promised to end the disparity between the adult minimum wage and pay for 18 to 20-year-olds. However, in last week's Budget, younger workers were set to see the same increase as older workers, leaving the gap intact. In 2026, pay for 18 to 20-year-olds will rise to £11.27 per hour, while over-20s will be paid a minimum of £13.21.
Healey said Labour remained committed to the ambition but hinted the timetable might slip, partly to encourage businesses to hire younger staff. 'There is no question about whether or if, it's a question of when, it's a question of how fast,' he said. 'I want to make sure we can look hard at those trade-offs that are there between jobs and wages.'
He described the current situation as 'a moral shame on this nation,' pointing to one million young people 'written off without any prospect of being helped into work and making contributions to this country for the future.' He added that he wanted to 'take business, I want to take trade unions with me, and with the government' on the issue.
The shift is likely to anger unions and some on the left of the Labour Party. The chancellor also suggested he was prepared to make potentially large cuts to areas of public spending to reduce the national debt. Budget documents outline real-terms reductions to some government departments in the years ahead, though the Institute for Fiscal Studies has questioned whether the government will follow through. Asked whether he would make cuts of more than 2% a year to some departments, Healey said: 'We will carry that through to the 10-year plan and the spending review next year.'
Analysis
Why This Matters
- The minimum wage equalisation was a flagship Labour commitment; delaying it could erode trust in the party's promises among younger voters and union allies.
- The gap means 18 to 20-year-olds will earn £1.94 less per hour than older colleagues, a significant disparity at a time of high living costs.
- Healey's comments come alongside warnings of real-terms cuts to government departments, setting up potential internal and external battles over spending priorities.
Background
Labour's 2024 manifesto pledged to remove age bands from the minimum wage, arguing they were discriminatory. The current system pays lower rates to workers under 20. Last week's Budget raised both rates but maintained the gap, with the chancellor now signalling that full equalisation may not come before the next election, expected by 2029. Healey has framed the delay as a trade-off between higher wages and protecting youth employment.
Key Perspectives
- John Healey, Chancellor: says the government remains committed to equalisation but will take 'one step at a time' and needs to balance wage increases with the risk to jobs for young people.
- Unions and left of Labour Party: likely to be angered by the delay, according to the BBC report.
What to Watch
- Whether internal Labour pressure forces Healey to set a firmer timeline for equalisation.
- The next spending review, due in 2027, which will reveal the scale of departmental cuts and test whether Healey follows through on reducing debt.
- Business and union responses to the government's consultation on youth employment and wages.
Checked
12 claims in this story checked against 1 source: 10 supported.
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- SupportedHealey suggested younger workers might not receive the same minimum wage as older workers before the next election.BBC News: “The Chancellor, John Healey, has suggested that younger workers might not receive the same minimum wage as others before the next election, potentially breaking a Labour manifesto promise.”
- SupportedLabour’s 2024 manifesto promised to end the minimum-wage gap for 18- to 20-year-olds.BBC News: “In 2024, Labour said it would remove "discriminatory age bands", vowing to end the gap between the adult minimum wage and pay for 18 to 20-year-olds.”
- SupportedAsked whether the gap would be closed by the next election, Healey replied, “We'll take one step at a time.”BBC News: “In a BBC interview to be broadcast on Sunday , Healey was asked if younger workers would be paid the same as older workers, when it comes to the minimum wage, by the time of the next election? "We'll take one step at a time," he said, suggesting that Labour might abandon its plan to close the gap before the next election.”
- Partly supportedYounger workers were set to get the same increase as older workers in the Budget, leaving the gap intact.BBC News: “But in last week's Budget, Healey said that younger workers would see the same increase as older workers, leaving a gap between the two rates this year.”
- SupportedIn 2026, the minimum wage will rise to £11.27 an hour for 18- to 20-year-olds and be £13.21 an hour for over-20s.BBC News: “Pay for 18 to 20-year-olds in 2026 will rise to £11.27, while over-20s will be paid a minimum of £13.21 an hour.”
- SupportedHealey said, “There is no question about whether or if, it's a question of when, it's a question of how fast,” and said he wanted to examine trade-offs between jobs and wages.BBC News: “"There is no question about whether or if, it's a question of when - it's a question of how fast," he said. "I want to make sure we can look hard at those trade-offs that are there between jobs and wages."”
- SupportedHealey called the situation “a moral shame on this nation” and referred to a million young people written off without prospects of help into work.BBC News: “I want to take business, I want to take trade unions with me, and with the government, because together we have to get into what at the moment is a moral shame on this nation. A million youngsters - written off without any prospect of being helped into work and making contributions to this country for the future.”
- SupportedThe shift is likely to anger unions and some on Labour’s left.BBC News: “It is a change that is likely to anger the unions and some on the left of the party.”
- Sources say otherwiseHealey said, “We will carry this through to the 10-year plan and the spending review next year.”BBC News: “Pressed on whether he would make cuts of more than 2% a year to some government departments, he added: "We will carry that through to the 10-year plan and the spending review next year."”
- SupportedHealey suggested he was willing to make potentially large public-spending cuts to reduce the country’s debt.BBC News: “The chancellor also suggested that he is willing to make potentially big cuts to some areas of public spending, to get the country's debt falling.”
- SupportedBudget documents outline real-terms reductions for some departments, and the IFS questioned whether the government would follow through.BBC News: “The budget documents spell out real-terms reductions to some government departments in the years to come. The likelihood of the government following through was questioned by the respected independent number cruncher, the Institute for Fiscal Studies (IFS) this week.”
- SupportedHealey was asked whether he would make cuts of more than 2% a year to some departments.BBC News: “Pressed on whether he would make cuts of more than 2% a year to some government departments, he added:”