Scots earn more per hour than English

WORKERS in Scotland now have more spending money and are paid more per hour than those in England.

Living standards north of the border have grown faster than in any English region since the financial crash in 2008, according to a report by the Resolution Foundation think-tank.

After housing costs, Scots had £405 of disposable income each week, compared to £400 in London, for the year 2013 to 2014. Before the crash Londoners had £418 extra cash to play with each week, while Scots lagged behind with £389.

Typical hourly pay in Scotland has now reached £11.92, compared to the typical £11.84 hourly rate in England. In the past 20 years pay in Scotland has grown faster than any other British nation or region.

The revelation came as the Bank of England disclosed that workers in the UK are being deprived of higher wages by low levels of inflation.

Official figures this week are expected to show the cost of living is barely rising thanks in part to falling food and energy prices as the cost of crude oil and other raw materials tumble.

Inflation figures are used by many companies to decide how much to increase staff pay, if at all.

This means low inflation leaves pay growth subdued despite sharp falls in unemployment and record numbers of people in work, because businesses are under less pressure to offer higher pay awards.

The Bank of England said in a report: ‘Despite continued reductions in the rate of unem- ployment, pay growth remains restrained and appears to have dipped slightly.’ It added: ‘The low level of inflation ... might have begun feeding into pay negotiations.’

Analysts believe that weak pay growth, low inflation and a slowdown in the UK economy could mean interest rates remain unchanged for most of this year and possibly into next year.

In a speech tomorrow, Bank of England governor Mark Carney is expected to admit that a rate rise is not imminent – having last year warned a hike could come around now.

The Office for National Statistics will tomorrow report official inflation figures for December. Inflation has fluctuated between minus 0.1 per cent, meaning prices are falling, and 0.1 per cent since February.

On Wednesday the ONS will reveal whether pay picked up or slowed in the three months to November.