Keeping Up with the Living Wage

13 February 2020 – Care England

Care England has expressed concern about the cost of implementing the National Living Wage when it rises in April 2020.

Professor Martin Green OBE, Chief Executive of Care England, says:

We are really concerned about mounting workforce crisis as social care is attacked from multiple sides; the rise in the National Living Wage and inability to recruit from overseas owing to new migration proposals”.

A study by Skills for Care has found that increasing the pay of the workers directly affected by the new NLW rate will increase the wage bill of the adult social care sector by an estimated £375m-£400m per year, or £250m-£300m more than the wage bill would have increased if the NLW had just risen in line with inflation.

The financial difficulties faced by providers are made even more acute by the failure of fee uplifts to reflect changes in the National Living Wage. Some care providers are being given uplifts of under 4% and in some cases no percentage increase at all. Thus, this leads to already stretched providers being further squeezed regardless of the Low Pay Commission stating that sectors like adult social care which rely heavily upon public funding should be given assistance when implementing new NMW increases.

Martin Green continued:

It is likely that there will be additional indirect costs associated with the rise in the National Living Wage if employers provide similar pay rises to workers already paid above £8.72 in order to maintain pay differentials between experienced and new staff, job roles or competitors. This shortfall needs to be recognised by Commissioners and met or services will go under”.

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