Background
No national minimum wage existed prior to 1998, although there were a variety of systems of wage controls focused on specific industries under the Trade Boards Act 1909.
Part of the reason for Labour's minimum wage policy was the decline of trade union membership over recent decades (weakening employees' bargaining power), as well as a recognition that the employees most vulnerable to low pay (especially in service industries) were rarely unionised in the first place. Labour had returned to government in 1997 after 18 years in opposition, and a minimum wage had been a party policy as long ago as 1986 under the leadership of Neil Kinnock.
The implementation of a wage was opposed by the opposition Conservative Party and Liberal Democrats.
Read more about this topic: National Minimum Wage Act 1998
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