On 04 November 2019, The Secretary of State for Work and Pensions made a written statement in the House of Commons about the annual welfare and pensions update.  This included the statement ‘The full list of proposed benefit and pension rates will be placed in the Libraries of the House in due course’.

The statement can be found in the deposited papers section of the House of Commons library.

For Payroll Professionals

For payroll professionals, we are interested in two sets of rates:

  • The Statutory Sick Pay weekly and daily rates
  • The parental pay weekly rates (SMP, SPP etc)

The above paper provides us with these proposed figures.  It should be stressed that they are proposed and we need two pieces of legislation (and HMRC confirming them):

  1. The Social Security Benefits Up-rating Order 2020 (in Great Britain), and
  2. The Social Security Benefits Up-rating Order (Northern Ireland) 2020

Of course, we also need to know the value of the weekly Lower Earnings Limit (LEL), as this is vital when considering whether these payments are due.

The Proposed 2020/21 Figures

At the January 2020 HMRC Statutory Payment Consultation Group meeting, HMRC agreed that the proposed rates could be published, as long as it is stressed that they are proposals.

However, we cannot circulate the proposed weekly LEL value.

Statutory Sick Pay (SSP)

The weekly rate of SSP is proposed to be £95.85.  This applies to Average Weekly Earnings (AWE) at or above the LEL:

Unrounded daily rates Number of QDs in week Number of days due
1 2 3 4 5 6 7
£ £ £ £ £ £ £ £
13.6928 7 13.70 27.39 41.08 54.78 68.47 82.16 95.85
15.9750 6 15.98 31.95 47.93 63.90 79.88 95.85
19.1700 5 19.17 38.34 57.51 76.68 95.85
23.9625 4 23.97 47.93 71.89 95.85
31.9500 3 31.95 63.90 95.85
47.9250 2 47.93 95.85
95.8500 1 95.85

 

The revised rate of SSP is payable from the first day of the new tax year (06 April 2020).

Parental Pay Payments

Whilst SSP is always payable from the first day of the new tax year, the other statutory payments apply from the week that commences the first Sunday in April (i.e. 05 April 2020):

Rates effective from week starting on or after Sunday 05 April 2020
Earnings Threshold (LEL) TBC
SMP / SAP weekly rate for first 6 weeks 90% AWE

Lesser of 90% AWE or the following Statutory rates:

·         SMP weekly rate for up to next 33 weeks

·         SAP weekly rate for up to next 33 weeks

·         SPP weekly rate

·         ShPP weekly rate

·         SPBP weekly rate

£151.20
Optional daily rate £21.60
Percentage of payment recoverable 92%
Percentage of payment recoverable (Small Employer’s Relief) 100%
NI compensation recoverable under Small Employer’s Relief 3%
Annual NICs threshold for Small Employer’s Relief £45,000
Proposals

At the time of writing, we stress again that these are proposed rates and it is a proposed LEL value.  None of this is in legislation at the moment and has not been officially confirmed by HMRC.

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