Small shops representatives have told the Low Pay Commission that recent increases to the national minimum wage have led to fewer jobs and prevented retailers from investing in their businesses.

In a hearing with the commission this week the Association of Convenience Stores argued that future increases to the minimum wage should be linked to an economic indicators such as inflation.

"The benefit would be that we would see an end to the unpredictable inflation-busting increases in wages that have been a feature of the national minimum wage since it started," said ACS chief executive James Lowman. "This would allow businesses greater ability to plan and decide on investment in their business."

The Low Pay Commission is currently consulting on possible changes to the minimum wage rate. It will make recommendations to the government in February and any changes would come in to force on 1 October 2008.