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Thousands of Scots in pay boost as living wage set to increase

The current living wage is set to increase by 20p to £7.85 an hour.

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STV

The living wage is to increase by 20p to £7.85 an hour, boosting the pay of thousands of workers in Scotland.

The new figure was revealed as a new study showed that 5.2 million people across the UK, or 22% of the workforce, are paid less than the living wage - an increase of 1% over the past year.

Finance Secretary John Swinney will meet employers on Monday who are paying the new rate which is well above the national minimum wage of £6.50 for adults.

About 60 companies based in Scotland pay the wage, according to the Living Wage Foundation. In the last year organisations including Standard Life, RBS and and the SECC have all become accredited employers.

Mr Swinney said: "Tackling low pay is a key priority of the Scottish Government and we fully support the living wage campaign.

"We recognise the real difference the living wage makes to the people of Scotland which is why we are the first Scottish Government ever to pay the living wage to all employees covered by pay policy.

"The new rate announced this morning of £7.85 will apply from 1 April 2015 as part of 2015-16 pay settlements.

"We are firmly of the view that employers should reward their staff fairly and encourage businesses throughout the country to support the living wage campaign."

The Government is funding a pilot by the Poverty Alliance over the next year, to promote take up of the living wage and increase the number of employers paying it.

Director of the Poverty Alliance, Peter Kelly, said: "The living wage in Scotland is now gaining genuine momentum with employers - the number of employers paying it here has tripled from 20 to 60 in the last six months.

"But there is no room for complacency. Low pay and in-work poverty is one of the main causes of child poverty in Scotland, so we need to build on the good work that has already been done.

SSE is the largest FTSE 100 company to pay the living wage and is to be recognised for its support with an award from the foundation.

Chief executive Alistair Phillips-Davies said: "Just over a year ago we were very proud to become the first energy company to be a living wage employer. SSE remains the only energy supplier to guarantee to pay all employees a living wage.

"SSE is very proud to receive the Living Wage Champion Award for Scotland. It is a reflection of all the hard work that goes into making sure all our contracts are now living wage compliant and reflects our commitment to being a responsible employer."

The rate announcement comes as research by KPMG, one of the Living Wage Foundation's principal partners, found that more than 400,000 workers in Scotland are being paid less than the Living Wage, with many employed in the retail, catering and care sectors.

Margaret Butler, head of regions for KPMG in Scotland, said: "Far too many Scottish employees are stuck in the spiral of low pay.

The research identifies statistics and trends, but it also reports the concerns of people earning below the Living Wage who expect their finances to worsen during the next 12 months and shows that debt levels have continued to rise among this group.

"Unless wages rise, a significant sector of the Scottish population will see themselves caught between the desire to contribute to society and the inability to afford to do so.

"Business benefits of the Living Wage include higher staff retention and productivity, and nearly 60 responsible businesses in Scotland such as SSE and Glasgow Caledonian University recognise this.

"The Living Wage may not be possible for every business, but is certainly possible as well as enlightening to explore the feasibility of paying it."

Nationwide, and Heart of Midlothian Football Club are among the recent employers to ensuring all their directly employed staff, as well as third party contractors such as security and cleaning teams, are paid at least the Living Wage.

Stephen Uden, head of corporate citizenship at Nationwide, said: "We are pleased to pay all our staff from branch cleaners, to cashiers and senior managers, fair and decent levels of pay. Accrediting as a Living Wage employer made good business sense. Our customers told us that they value our commitment to fair reward

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