The government’s plan to review the minimum wage in view of backbencher complaints about abolishing the 10p tax bracket has been blasted by businesses.

“It is a real shame that it may be employers that end up footing the bill for the government’s u-turn via yet another rise in the minimum wage.” said Jon Taylor, head of employment at emw law. “This is a highly contentious proposal which may well cause yet another political storm,” he continued.

Brown has announced a series of measures in response to threats of rebellion by back benchers, who believe the government needs to pump £1bn of compensation into those hardest hit by the removal of the 10p tax band to appease the voters.  

"No one in their right mind wants to vote against the government, but this is in a different category to anything we have faced over the past 11 years in that the golden thread that ties us together is to protect the poorest,” said Frank Field, backbench Labour MP and leader of the rebels.

In  March Brown had announced the minimum wage for 18 to 20 years olds would be raised from £4.60 to £4.77 per hour this October. It has increased 53% since it was introduced in 1999.
 
The package announced by Brown would also include an increase in winter fuel allowance for the elderly and changing the tax credit system to benefit low-income workers with families.