The Chief Minister has this morning confirmed that the government is now proposing a 5% increase to the island’s minimum wage in April.

It’s a climb down given Tynwald had previously approved a 9.9% rise, which has sparked real concern among the business community.

The island is currently due to raise the minimum wage to £13.46 an hour from April 2026, a 9.9% increase based on a policy of setting pay at 66% of median earnings.

The announcement comes after Treasury Minister Dr Alex Allinson was asked to step down yesterday, with new Treasury Minister Chris Thomas stating that taking a slower approach to the minimum wage would be his priority.

The CM also said there'll be significant increases to personal tax allowances for ‘those who most need’ it this year.

In Tynwald this morning, Mr Cannan announced the changes will be brought in as part of February's budget.

Wondering what made the Chief Minister make this drastic change to his CoMin?

He recounted a recent visit to a café where the owner was ‘nearly in tears’ while explaining how the minimum wage changes would affect the business.

He added that shop staff spoke openly to him, expressing concern that the policies could put their jobs at risk.

Taking a grilling in the Chamber this morning, Mr Cannan has said he ‘had to take action at some point’.

He adds: ‘We had to seek to change the direction, argue for a change in focus, and look at how we can support the low paid.’

He added that he felt he had to make a decision before the decisions made could lead to business closures and job losses.