`The Chartered Institute of Payroll Professionals
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Bank Rate increases to 3% Published: 3 November 2022 Emailed: 9 November 2022
In a move that marks the highest increase for 33 years, the Bank of England’s Monetary Policy Committee has increased the bank rate to 3%, an increase of 0.75%.
The committee voted on the proposed increase, seven voting in favour and two voting against it. However, the votes against would have preferred to see an increase of 0.25% of 0.5%, therefore, all were in favour of an increase in some way.
Payroll professionals must now keep an eye on HM Revenue and Customs’ (HMRC’s) late payment interest and repayment interest rates. These track the base rate as such:
• late payment interest – set at base rate plus 2.5% • repayment interest – set at base rate minus 1%, with a lower limit of 0.5%.
The next review of the base rate is due on 15 December 2022.
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Additional Bank Holiday confirmed for 2023 Published: 9 November 2022 Emailed: 9 November 2022
2023 will become the second year in a row to gain an additional bank holiday. May 8 2023 will be a bank holiday to celebrate the coronation of King Charles III, which will be held on the Saturday 6 May 2022.
May will now see three bank holidays, as this is in addition to the early May bank holiday on 1 May 2023 and the spring bank holiday on 29 May 2023.
As with last year, the CIPP recommends that contracts are inspected to identify the impact on holiday entitlements. There is no legal requirement for bank holidays to be given off as paid leave, however, wording in relevant agreements (usually a contract or employee handbook) will be very important.
Employers are urged to think about policies and procedures ahead of time and how to communicate these to workers.
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Inflation for October announced at 11.1% Published: 16 November 2022 Emailed: 16 November 2022
The Office for National Statistics (ONS) has released the inflation figures for October 2022. These figures break down the year-on-year changes in prices and how the contribute to inflation. The consumer price index (CPI) for the 12 months up to October is now at 11.1%. This comes the day before the chancellor, Jeremy Hunt, is due to deliver the Autumn Statement to parliament. The Bank of England has been steadily increasing the bank rate for some months now in order to keep inflation to its targeted 2% per year.
We will see, on 17 November 2022, if the measures introduced to fix the gaps in the Treasury’s budget add to or alleviate the ongoing pressures of inflation.
cipp.org.uk
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