Tynwald has backed a call for “transitional support” to help local businesses adapt to the significant increase in the minimum wage set for April 2026.
The motion, brought by Ramsey MHK Lawrie Hooper, passed by a clear majority.
It urges the Department for Enterprise to implement “targeted transitional support for local businesses, especially those SMEs in sectors most impacted by this minimum wage increase,” before the new rate takes effect.
Mr Hooper stressed the motion was not about re-opening the wage debate but providing practical aid.
“This motion is about ensuring that businesses who are required to pay this higher minimum wage are able to do so,” he said, adding support should be in place “before the new minimum wage kicks in in April next year”.
He acknowledged sectors like hospitality and construction had “had one heck of a bad time in recent years” and warned many “do not have much resilience left”.
Amendment
An amendment from Douglas Central MHK Chris Thomas, which sought to ensure the Manx minimum wage does not fall below the UK rate and demanded a government report addressing concerns raised by the Minimum Wage Committee, was defeated.
Enterprise Minister Tim Johnston, who seconded the original motion, welcomed it and said it is his intention to be “in a position to make further announcements early in the new year”.
However, the debate revealed deep concerns about the policy’s impact.
Impact
Onchan MHK Julie Edge warned of a “national crisis,” citing fears of job losses. “We’re creating an enormous storm, and it’s going to come all at once,” she said, urging ministers to meet business groups sooner than planned.
Glenfaba & Peel MHK Kate Lord-Brennan argued the very need for support showed the underlying policy was flawed.
“The fact that we’re having to consider that is telling us that something is wrong with what has been passed,” she stated.
Inequality
In opposition to the amendment, Treasury Minister Dr Alex Allinson defended the wage policy as essential for reducing inequality and attracting workers.
“By linking minimum wages to median earnings on our island, we can ensure that the pay of those on the lowest pay scales keeps up with all other people working in our society,” he said.
MLC Gary Cluett supported the motion but argued against cash subsidies, stating “appropriate support, to me, means structural reform, not cash transfers.”
He emphasised businesses had five years to prepare for the change.
Closing the debate, Mr Hooper reiterated his focus was on managing the consequences of a decision Tynwald had already made.
“Right now, we need to focus on helping and supporting those businesses and those employees and those employers that are going to be impacted,” he said.