Prime minister Gordon Brown is reportedly considering introducing a regional minimum wage to better reflect the cost of living in certain areas.
The Telegraph reports that under such proposals, areas in the south-east and London, where the cost of living is said to be the highest, are likely to see an increase in the minimum wage.
A source told the newspaper that a regional minimum wage system was the "logical next step", although such a policy would inevitably draw criticism from a number of sectors, including the unions.
At present, workers over the age of 22 are entitled to a minimum of £5.35 per hour, while those aged 18 to 21 are paid at the development rate of £4.45 per hour.
Employees who are no longer of the compulsory education age and are under the age of 18 are entitled to £3.30 per hour.
The current rates were introduced in October 2006.
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