Charity body urges government to fund real Living Wage requirement

01 Feb 2024 News

The Scottish Parliament in Holyrood

A charity umbrella body has said its members face “barriers to implementation” of the Scottish Government’s new requirement for them to pay all staff the real Living Wage.

The Scottish Council for Voluntary Organisations (SCVO) urged the country’s government to introduce uplifts to public sector grants and contracts, which now require all recipients to pay staff aged 16 and over the real Living Wage.

Last July, the Scottish Government introduced the requirement for organisations seeking public sector grants, contracts and other funding to pay the real Living Wage as part of its Fair Work First guidance.

In December, it added a template for organisations to request an exception to the real Living Wage condition.

However, SCVO said its members wished to pay the increased wages but would need more funding to do so sustainably.

Earlier this year, SCVO reported that a third of Scottish charities had made use of their financial reserves in the three months to April 2023, an increase compared to the same period in 2022.

‘Action has not been taken’

Writing for Third Force News today, SCVO policy and public affairs officer Sheghley Ogilvie said: “How the sector will fund the real Living Wage, meet the new Living Wage rate (which due to inflation increased by 10% in November), and the impacts on pay differentials, is unclear.

“SCVO have explained that years of under-funding, followed by Covid-19, and the running costs crisis, mean that for many voluntary sector employers, paying the real Living Wage and addressing the knock-on impact this increase could have on other salaries, cannot be achieved without additional resources.

“Last year in both emergency budget responses, the Scottish Government recognised the impact of the cost-of-living crisis on public sector staff and took action to provide wage uplifts, particularly for the lowest paid.

“The Scottish voluntary sector provides similar essential services and support, despite this, action has not been taken to ensure voluntary sector staff can receive pay increases equal to their public sector counterparts.

“Shockingly, recent research by CCPS reveals a 20% pay gap between NHS support workers and voluntary sector social care support workers who are starting out in their career.

“The Scottish Government and their coalition partners, the Scottish Greens, should lead by example by ensuring grants and contracts accommodate at least the real Living Wage and offer pay uplifts for voluntary sector staff on par with those offered to the public sector.”

Scottish Government ‘committed’ to fairer funding

Social justice secretary Shirley-Anne Somerville said: “The Scottish Government welcomed the recent uplift in the real Living Wage and require recipients of public sector grants awarded on or after 1 July 2023 to pay at least the real Living Wage and provide appropriate channels for effective workers’ voice.

“As highlighted to the Social Justice and Social Security Committee on 25 January, we are absolutely committed to pursuing our commitments to Fairer Funding for the third sector through the 2024-25 budget process. 

“This includes providing early notification of grants to organisations as soon as is practically possible and before the end March 2024 for funding beginning on 1 April.”

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