"The Tories cannot hide from the fact that working people on average £1,600 a year worse off since they came to office. We need action now to earn our way to higher living standards and tackle the cost-living crisis. That's why, as well as a higher minimum wage, Labour will make long-term reforms to our economy, freeze energy prices, expand free childcare, incentivise the living wage and build the homes Britain needs."
Chancellor George Osborne has emphatically announced his intention to try and increase the national minimum wage, as the political battle to address the ongoing cost of living crisis reaches its latest chapter.
Mr Osborne identified that he wants to raise the wage from £6.31 to £7 an hour from October this year, in a move which would see the minimum wage return to the value it was at before the recession gripped the UK.
The news comes after the after a period of intense debt within the Conservative party, with the new wage proposals being included in the coalitions report to the Low Pay Commission. The Commission are set to evaluate the effects of a minimum wage rise on small business finance and produce a set of recommendations for the government to consider based on their findings.
Mr Osborne cited that the rapid improvement in the countryís economy in the last quarter of 2013 has meant that it is now viable to implement a rise in the minimum wage, where previously it had been difficult due to the increased financial burden businesses would be faced with.
He told the BBC: "Because we are fixing the economy ñ because we are working through our plan ñ I believe Britain can afford an above-inflation increase in the minimum wage so we restore its real value for people and we make sure we have a recovery for all and that work always pays."
It is thought that Mr Osborneís proposals are intended to be a direct response to Ed Milibandís bold an controversial attack on high street banks and to illustrate to the electorate that they are in touch with the everyday workers in the UK. This contrasts with policy chosen by the Tory Party during the 1990ís, where they rejected Labourís initial implementation of a national minimum wage for all across the UK.
Mr Osborne highlighted that he believes businesses now have the financial power to be able to cope with a rise in the minimum wage and has called for the move to be instigated as soon as possible in order to raise the living standards of workers across the UK.
Osborne's swoop comes on the eve of a heavily anticipated major speech by Ed Miliband on the economy in which he will call for limits on the size of high street banks. Osborne regards his move as a bold attempt to outflank Miliband and to draw a sharp distinction with the Tories' past history, when the party opposed the introduction of the minimum wage by the last Labour government in the late 1990s.
The chancellor said he believed businesses would be able to absorb the increase.
"But when I look at the British economy I see the British economy expanding, I see jobs being created, I see the prospect of future jobs being created as well. I think Britain can afford a higher minimum wage. We have worked hard to get to this point and we can start to enjoy the fruits of all that hard work", Mr Osborne added.
However, the Labour party has criticised the Chancellor for taking so long to consider a wage rise and outlined that they had previously rejected a Labour move to try and enact the policy in the past.
Chris Leslie MP, Labour's shadow chief secretary to the Treasury, said: "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.
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