Minimum wage set for increase to £5.30

A big rise in the minimum wage was being unveiled by Tony Blair today in a bid to revive Labour's election campaign.

Despite protests from bosses' groups, the pay floor will go up to £5.05 in October and then £5.30 next year - an increase of almost 10 per cent.

The inflation-busting rises - from the current £4.85 - will be key to Labour's attempts to woo back low-income families. It comes as campaign managersare increasingly nervous that a low turnout by traditional supporters is the biggest threat to a third term in power.

However, a YouGov survey today claimed the Tory revival had stalled, with the party falling back to 32 per cent, six points behind Labour.