The UK’s minimum wage will rise to £10.50 an hour over the next five years, Chancellor Sajid Javid has pledged.
Workers over 21 years old will benefit from the “ambitious” increase, he said, lowering the previous age threshold of 25.
In 2016, the Conservative government rebranded the national minimum wage for over-25s to the “national living wage”, although it is less than the real living wage calculated by charities.
Speaking at Tory party conference in Manchester on Monday, Javid said four million people would be helped by the boost.
He told delegates he had a set a new aim to increase the wage to two-thirds of UK median earnings, up from the current target of 60%.
The current national living wage is £8.21 an hour for over-25s, with the minimum wage for those aged 21-24 sitting at £7.70 per hour, and £6.15 an hour for those between 18 and 20 years old.
The UK’s real living wage, calculated by the Living Wage Commission on the basis of what workers and families need to make ends meet, is currently set at £9 an hour – rising to £10.55 per hour in London.
In Scotland, around 1500 firms are currently accredited as living wage employers, paying the £9 rate.
The Chancellor said: “Over the next five years, we will make the UK one of the first major economies in the world to end low pay altogether.
“To do that, I am setting a new target for the national living wage: raising it to match two-thirds of median earnings.
“That means, on current forecasts, this ambitious plan will bring the national living wage up to £10.50 – giving four million people a well-earned pay rise.”
He added: “It’s clear it’s the Conservatives who are the real party of labour. We are the workers’ party.”
Javid also said a no-deal Brexit would not be without “significant challenges”.
He told delegates: “I know that some businesses and households are concerned about what a no-deal outcome might mean for them.
“I recognise that, and I understand that the uncertainty around Brexit is challenging.
“But our step-change in preparations has made a deal outcome more likely and a no-deal outcome more manageable.
“Every department now has the resources available to prepare for no-deal.”