UK National Minimum Wage History: From £3.60 (1999) to £12.71 (2026)

The National Minimum Wage Act 1998 received Royal Assent on 31 July 1998 and came into force on 1 April 1999. It was a manifesto commitment of Labour's 1997 election campaign. The initial rates were set following a Low Pay Commission inquiry: £3.60 for adults (aged 22 and over) and £3.00 for young workers (aged 18 to 21).

The introduction was preceded by fierce debate. Employer groups and the Conservative opposition predicted significant job losses; trade unions argued even £3.60 was too low. The LPC's compromise design -- a modest initial rate with annual review -- proved durable: 27 years later the mechanism that was contested in 1999 is essentially unchanged, though the rates have risen more than threefold.

In the 2015 Budget, Chancellor George Osborne announced the introduction of a "National Living Wage" of £7.20 for workers aged 25 and over, effective 1 April 2016. This was a political rebranding rather than a new mechanism -- the NLW simply became the top band of the existing National Minimum Wage framework, set by the same LPC process.

The naming caused persistent confusion: the Living Wage Foundation had been publishing its own "Real Living Wage" (now £13.45 / £14.80 London) since 2001. The government's NLW takes its name from the Living Wage Foundation concept but is set by the LPC at a lower level. The Foundation has since distinguished its product as the "Real Living Wage" to reduce confusion.

The age threshold for the NLW was 25+ from 2016, lowered to 23+ from April 2021, and lowered again to 21+ from April 2024. The long-term goal is a single adult rate for all workers 18 and over, with the age-based bands phased out entirely.