George Osborne backs minimum wage rise to £7 per hour

The minimum wage could rise to £7 an hour by 2015, Chancellor George Osborne has told the BBC. Osborne said the "economy can now afford" an above-inflation rise.

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PM: Minimum wage rise will 'help hardworking people'

David Cameron said previous cuts to the economy means the government can now afford to increase the minimum wage and help "hardworking people."

Prime Minister David Cameron has backed the minimum wage rise. Credit: Stefan Rousseau/PA Wire

Read: Osborne spins on minimum wage as general election looms

The Prime Minister said: "Our long-term economic plan is securing Britain's future and helping hardworking people.

Posting on social networks, he said: "Because of the difficult decisions we've taken to fix the economy, we believe we can now afford to increase the minimum wage - putting more money in people's pockets and helping them provide for their families.

"We are doing all we can to make hardworking families financially secure - cutting income tax for 25 million people, freezing fuel duty and keeping mortgage rates low."

Read: Surprise turnaround as Osborne backs minimum wage rise

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Duncan Smith backs 'bold move' on minimum wage

Work and Pensions Secretary Iain Duncan Smith has welcomed George Osborne's "bold move" of backing an increase in the minimum wage.

Work and Pensions Secretary Iain Duncan Smith. Credit: Ian Nicholson/PA Wire

Read: Osborne spins on minimum wage as general election looms

"It shows that at the heart of all our reforms this Government is concerned to improve the quality of life for the poorest in society," he said.

"The commitment to a higher national minimum wage is all part of ensuring that the economic recovery delivers for people who want to work hard and play by the rules."

Read: Osborne's words on minimum wage 'mean nothing'

Cable: Low Pay Commission must set minimum wage

Business Secretary Vince Cable told ITV News the Low Pay Commission must set the minimum wage and "politicians of all parties have got to respect that" after Chancellor George Osborne backed an increase.

ITV News Deputy Political Editor Chris Ship has tweeted:

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Vince to Osborne: #minimumwage rate has "got to be set by Low Pay Commission & politicians of all parties have got to respect that" @itvnews

Read: Osborne's words on minimum wage 'mean nothing'

Labour: George Osborne 'flailing around under pressure'

Labour’s Shadow Chief Secretary to the Treasury Chris Leslie said Chancellor George Osborne was "flailing around under pressure" but had made "no concrete announcement" on a minimum wage rise.

Earlier, Mr Osborne said Britain can afford a minimum wage increase and backed a rise to £7 per hour.

George Osborne is flailing around under pressure but he has made no concrete announcement about the level of the minimum wage. Ed Miliband and Ed Balls said last year that we need above inflation rises in the minimum wage in order to catch up the lost value over the last few years.

And both the Tories and Lib Dems voted against Labour’s motion yesterday which called for action to make this happen.

– Chris Leslie MP, Labour’s Shadow Chief Secretary to the Treasury

Watch: Clegg stumbles after being asked what the minimum wage is

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CBI: 'Unaffordable minimum wage rise would cost jobs'

The Confederation of British Industry and British Chamber of Commerce have reacted to George Osborne's comments on a possible minimum wage rise.

ITV News Business Editor Laura Kuenssberg has tweeted:

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CBI warns on minimum wage rise -'it must be a matter for the Low Pay Commission..“An unaffordable rise would end up costing jobs'

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Brit chamber of commerce warns of 'adverse effects of an unaffordable minimum wage hike' which would hit, "SMEs,youngpeoplee and graduates"

Watch: Clegg stumbles after being asked what the minimum wage is

Osborne: Britain can enjoy fruits of all that hard work

Chancellor George Osborne said Britain can afford an increase in the minimum wage and "start to enjoy the fruits of all that hard work", in an interview with the BBC.

I think Britain can afford a higher minimum wage. I think we have worked hard to get to this point and we can start to to enjoy the fruits of all that hard work.

– George Osborne

He indicated that he was ready to contemplate a rise in the £6.31-an-hour minimum wage to £7.

The exact figure has to be set by the Low Pay Commission, which talks to business, talks to other bodies in our economy.

But, if for example, the minimum wage had kept price with inflation it would be £7 by 2015/16. It's £6.31 at the moment, so, that's an increase.

I think we can see an above-inflation increase in the minimum wage and do it in a way that actually supports our economy precisely because the economy is recovering and many, many jobs are being created.

– George Osborne

Watch: Clegg stumbles after being asked what the minimum wage is

Osborne's words on minimum wage 'mean nothing'

ITV News Deputy Political Editor Chris Ship has tweeted:

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Given we are still waiting on Low Pay Commission for its recommendation on Minimum Wage - Osborne's words mean nothing. Positioning. Is all

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Is Low Pay Commission's job to advise on how far Min Wage can rise without affecting employment. Due mid-Feb. Osborne trying to get credit

Watch: Clegg stumbles after being asked what the minimum wage is

Read: Osborne signals minimum wage rise

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