John Healey hit the brakes on Labour's drive to equalise the minimum wage for under-21s today.

The Chancellor confirmed a 3.9 per cent rise in the minimum wage in his Budget statement.

That will take the national living wage level from £12.71 to £13.20.

However, Mr Healey did not announce a bigger hike to the minimum for workers aged 18 to 20 - abandoning the trend since 2024.

The move is seen as backtracking on Labour's manifesto, which promised to end 'discrimination' in minimum wage rates, although it did not give a fixed timetable.

Businesses have raised alarm that the boosts have made it harder for them to employ young people. The Government has also heaped pain by increasing national insurance contributions.

Almost a million young people are now classed as 'NEET' - not in employment, education or training.

Currently those aged between 18 and 21 are entitled to a minimum hourly rate of £10.85. For 16 to 17-year-olds the rate is £8.

The separate living wage in London is £14.80.

The 2024 Labour manifesto promised to 'remove the discriminatory age bands, so all adults are entitled to the same minimum wage, delivering a pay rise to hundreds of thousands of workers across the UK'.

Asked in June about the commitment to equalise minimum wage rates, Ms Rayner - a backbench MP at the time - said: 'If you challenge me - where did it all go wrong - I think it's where we've deviated away from our promises to the electorate.

'We made promises, we were elected on that mandate. I think we should work with the Low Pay Commission to deliver that.'

Mr Healey admitted in an interview last week that there was a 'trade-off between the level of the minimum wage and the employment rate' and he was 'acutely conscious' of the impact on young people's prospects.

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