Comparison of HCV annual payments

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Comparison of HCV annual payments

The Skipton fund announced in April 2017 an increase to the HCV annual payments for stage 2 categorised people, at the same time the Scottish Government announced their new supports for Scottish resident beneficiaries, including an income top-up assistance grant for stage 1 categorised people who did not benefit from the much increased Scottish stage 2 annual payments.

Below you’ll find a chart illustrating the comparative levels when measured against the UK national minimum wage and the Scottish ‘living wage’:

The Scottish ‘stage 2’/advanced HCV annual payments are the highest, at £27,000 p.a.

The new English stage 2 payments are very similar to the Scottish Living wage levels for 2017, of £15,150 (second bar from left) and 15,379 (orange horizontal line) respectively.

Interestingly the income top-up for a single person (see page 2 of the guidance of this hyperlink) at £11,500 p.a. (bar on the right) is lower than the UK minimum wage for a full-time employee, £13,650 p.a., by over £2,000 annually. The UK national minimum wage (HMRC calls this the ‘National Living Wage’ also) is £7.50 per hour for over 25’s, from April 2017.

The figures in white (inside the bars) show the monthly equivalent ‘income’ levels.

[Note – Annualised figures have been calculated from hourly figures by multiplying them by a factor of 7 x 5 x 52, representing an uplift for 7 hrs/day, 5 days/week and 52 weeks/year. So £8.45 per hour becomes £15,379 per annum and £7.50 per hour becomes £13,650 per annum for full-time equivalent workers. The SIBSS single-person threshold is calculated as £6.45 on the same basis]

The ‘Living Wage’ represents the real cost of living rather than the statutory calculated cost of living represented by the UK National Living Wage/Minimum wage set out by the UK Government through HMRC.

The Living Wage is independently calculated each year based on what employees and their families need to live. The real Living Wage that meets the cost of living enjoys cross party support, with public backing from MSPs and MPs across the political spectrum. Employers choose to pay the real Living Wage on a voluntary basis. The rates apply to all workers over 18 – in recognition that young people face the same living costs as everyone else. The Living Wage Employer Mark and Service Provider Recognition Scheme provide an ethical badge for responsible pay.

Nicola Sturgeon supports this Living Wage (£8.45/hour). The Scottish scheme’s income top-up threshold for a single person, set at £6.45 per hour equivalent (based on £11,500 p.a.) falls significantly below this.

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