§ Mr. Derek TwiggTo ask the Chancellor of the Exchequer what is the Government's policy on tax-relieved profit-related pay in relation to(a) the proposed national minimum wage legislation and (b) the existing agricultural minimum wage legislation; and if he will make a statement. [53679]
§ Mrs. LiddellThe Government accept the Low Pay Commission's recent recommendation that incentive payments—and, in particular, payments of tax-relieved profit-related pay (PRP)—should be included in the earnings that count towards the National Minimum Wage. This represents a significant step towards achieving the Commission's aspiration that the definition of the National Minimum Wage should be "simple and fair". Also, in order to ensure that employers and employees in the agricultural sector are subject to the same PRP rules as employers and employees in other business sectors, the present PRP rule that tax-relieved PRP should not count towards the existing agricultural minimum wage, will be repealed in the Finance Act 1999, with retrospective effect from today. This change will not affect an agricultural worker's right to be paid at least the appropriate agricultural wage—which must not be less than the National Minimum Wage.