Pensions to Rise but Minimum Wage to Slip Behind UK

The island’s state pension will rise by 8.5% after a commitment by UK Chancellor Jeremy Hunt to maintain the triple lock guarantee.

Treasury Minister Dr Alex Allinson had previously said that the island will follow the UK’s lead on the decision.

The uplift means that the state pension will rise to a maximum of £241.59 a week. Not everyone will get this amount, some people will get more, some people will get less. The amount you get will depend on your National Insurance record.

Another change announced in the UK’s Autumn Statement means that islanders will be paying a higher percentage of our income for NI than our counterparts in the UK.

Mr Hunt (H!) has announced that the main rate for employees will be cut from 12% to 10% from 6 January. It is currently charged at 12% on earnings between £12,571 and £50,271 – and 2% on anything above that.

On the island, the rate is 11%, on earnings between £145 and £864 per week, and 1% on all earnings above £864.

Also announced by the Tory Chancellor is a rise in the minimum wage which will put it above the island’s own rate.

The national living wage (UK’s minimum wage) will rise to £11.44 an hour, up from £10.42, for all workers over the age of 21.

On the island, the minimum wage is currently set at £10.75 per hour for anyone over the age of 18.

The new UK rate is still below the island’s voluntary living wage, which is £12.01. Tynwald has previously committed the gov to marrying up the island’s minimum wage and living wage by the end of 2025.

The living wage is intended to represent the minimum level of pay necessary to allow people the basic opportunities and choices necessary for them to participate in society.

The Manx gov is expected to respond to the Budget this week.