Osborne caution on minimum wage

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Chancellor George Osborne has cautioned against “self-defeating” increases in the level of the national minimum wage, amid reports that some Cabinet Ministers are pressing for an above-inflation rise of 50p or more.

Mr Osborne said he wanted to see low-paid workers’ earnings rising, but not at the cost of jobs.

His comments came during a visit to Enfield, to highlight the forthcoming introduction of the new Employment Allowance, which will allow businesses to claim £2,000 a year off their employers’ National Insurance contributions. Mr Osborne said the move, due to take effect on April 6, was effectively “cashback on the jobs tax” for every business in the UK.

“It takes £2,000 off the jobs tax of a business like this and it means a company can hire more people, invest more, do all the things we need to see as part of our long-term plan for Britain to increase jobs and bring economic prosperity to this country,” he said.

Reports have suggested Business Secretary Vince Cable and Work and Pensions Secretary Iain Duncan Smith are pushing a hike in the £6.31-an-hour minimum wage.