Low-paid workers will get another $10 a week in their pay packet following today's announcement of a two percent increase in the minimum wage.

Labour Minister Kate Wilkinson has announced the minimum wage will increase by 25c an hour, from $12.50 to $12.75, which she said was in line with the Consumer Price Index.

The training and new entrants' minimum wages will increase from $10 to $10.20 an hour.

The increases are effective from April 1.

Wilkinson said the rise was a balance between protecting jobs and ensuring a fair wage.

"We do not want to see workers priced out of the market, but we are confident that a 25c increase, in line with inflation, will not overly harm or discourage businesses from taking on new staff,'' Wilkinson said.

"The Government is working hard to provide the right environment for economic growth and ensuring workers can maintain the buying power of their wages is part of that."

But Council of Trade Unions president Helen Kelly said the 25c rise was "mean'' and barely covered inflation. The two percent rise was below inflation forecasts for the year of 2.3 percent, she said.

"If this is the rate at which we intend to catch up with Australian wages then we will never get there," she said.

"Workers who live on the minimum wage are already struggling as the Government itself has publicly acknowledged. To set this increase at the absolute minimum will increase their difficulties in the coming year and is very unfair."

The CTU wants a minimum wage of $15 an hour.

(Source: COLIN ESPINER - Stuff.co.nz27/01/2009)