VocaLink Take Home Pay Index Takes a Tumble as we Enter 2010

The VocaLink Take Home Pay Index Starts the Year by Dropping to 1.4% from 1.9% in December, Reflecting VocaLink's Long-Term Prediction of Stagnating Wage Growth

LONDON, February 4 - The VocaLink Take Home Pay Index for January reflects the current
challenges facing the UK labour market as we enter 2010. The Index has
reversed its gains from December to drop back down to 1.4 per cent in
January. The manufacturing index has been a significant contributor to the
fall, plunging 0.9 percentage points at the start of year, while the services
index has dropped from 1.7 per cent in December to 1.6 per cent, beginning
2010 at nearly one half of the value from the same month in 2009.

Despite the recent news that the UK economy stopped contracting last
quarter after six consecutive quarters of negative growth, the bounce back
for the fourth quarter of 2009 fell well short of industry expectations and
has served to feed through into even weaker pay growth. Without any
indications of a strong economic upturn on the horizon, spare capacity in the
economy is preventing pay growth from escaping the range of 1.0 to 2.0 per
cent where the VocaLink Take Home Pay Index has sat for the past eleven
months.

With a question mark hanging over the speed of economic recovery, the
impending General Election appears to be adding further uncertainty in the
market which means employers are less likely to increase employment and
compensation. As pay growth is squeezed, consumers are also feeling the pinch
from the temporary VAT cut being reversed at the start of the year. In
response, inflation rates are likely to jump from an already nine month high.

Marion King, Chief Executive Officer at VocaLink, said: "As we enter
2010, The VocaLink Take Home Pay Index reflects the trends of the past 12
months for low or falling wage growth. Although we are now technically out of
the recession in the UK with the last official GDP estimate, pay growth rates
are not going to return to those pre-recession levels for quite some time.
Stagnating salaries combined with the restoration of the 17.5 per cent VAT
rate are going to have a real impact on households' spending power."

Douglas McWilliams, chief executive of economics consultancy cebr, said:
"The recovery - which is already slower both in magnitude and timing relative
to expectations - is likely to be sluggish and fragile. The implication is
that labour market conditions will remain weak for quite some time. Following
the VAT cut reversal, we expect a period of rising inflation without a
corresponding increase in pay growth which will further limit disposable
income for the foreseeable future."

VocaLink processes over 90% of UK salaries and the VocaLink Take Home Pay
Index, established in 2004, provides the most timely and accurate disposable
income data available in the UK. It is based on actual payments made to
employees on a three-month moving average compared with the same Continuation
measure a year earlier. It is affected by changes in tax rates, National
Insurance and other employer payments or deductions.

Note to editors:

The VocaLink Take Home Pay Index is an important aspect of the UK's
economic performance and one of the components that drives the Bank of
England's Monetary Policy Committee's (MPC) interest rate policy due to be
announced on Thursday 4 February 2010.

Follow this link to read the full report, available from Thursday 4
February 2010 - bit.ly/tsJyX

Methodological notes

The average payment per employee is estimated from the total value of
payments and the number of transactions and then expressed as an index for
each month. The data uses a 3-month moving average to mitigate seasonal
variations and looks at the year on year increase to provide a fair economic
indicator that is also comparable with other data.

While the FTSE 350 sample is largely representative of the corporate
economy in the UK, when comparing the VocaLink take home pay index data with,
for example, government statistics, it is important to take into account the
fact that some trends, which affect relatively larger firms differently, may
have a disproportionate impact on the VocaLink take home pay index compared
with the government's official Average Earnings Index (AEI). For example, the
VocaLink index does not include the public sector so when pay trends in the
public sector are different from those in the private sector, this will
affect the VocaLink index differently from the AEI.

The VocaLink Take Home Pay Index is based on take home pay data. It is
therefore affected by changes in tax rates, changes in National Insurance
contribution rates and changes in other employer payments or deductions. It
is therefore a more representative indicator of disposable income for salary
earners than data that does not take this into account.

If you would like to receive the monthly press release please e-mail
vocalinkuk@hotwirepr.com or deborah.souter@VocaLink.com

    The VocaLink Take Home Pay Index series

    Three month average annual change
    Year                                      2009                       2010
    Month                Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec  Jan
                          %   %   %   %   %   %   %   %   %   %   %   %    %
    VocaLink Take Home
    Pay Index            2.7 2.4 2.0 1.6 1.1 1.3 1.3 2.0 1.7 1.7 1.4 1.9  1.4
    VocaLink
    manufacturing index  1.4 1.5 1.2 1.4 1.1 1.3 0.5 0.8 0.9 1.5 2.0 2.0  1.1
    VocaLink services
    index                3.1 2.9 2.4 1.7 1.0 1.2 1.9 2.8 2.1 1.8 0.9 1.7  1.6

About the VocaLink Take Home Pay Index

The VocaLink Take Home Pay Index tracks monthly take home pay levels in
the UK. VocaLink is the processor for automated payments in the UK on behalf
of Bacs, the UK body responsible for clearing and settlement. This includes
all Direct Debit and Bacs Direct Credits, which account for over 90% of
salary payments delivered into employees' bank accounts. The VocaLink Take
Home Pay Index is compiled using the data captured from the salary payments
of 100 of the FTSE 350 companies.

VocaLink works with the centre for economics and business research (cebr)
to deliver the analysis of this powerful and timely indicator of take home
pay inflation to economists, analysts and the media. It is an important
aspect of the UK's economic performance and one of the components that drives
the Bank of England's Monetary Policy Committee's (MPC) interest rate policy.
The VocaLink Take Home Pay Index is also split by broad sector group into two
sub-indices - the VocaLink Industry Index and the VocaLink Services Index.

About VocaLink

VocaLink is a specialist provider of transaction services to banks, their
corporate customers and Government departments. It processes domestic and
international automated payments and provides ATM switching solutions. On a
peak day, the VocaLink automated payment platform processes over 90 million
transactions and over half a billion in a month. Its switching platform
connects the world's busiest ATM network of over 60,000 ATMs. Its Real-Time
Payments platform provides the central infrastructure for the UK Faster
Payments service. VocaLink is working with BGC (Bankgirocentralen) to provide
outsourced processing for the majority of Sweden's domestic payments.

Having pioneered electronic payments over 40 years ago, many of the
world's top banks and their corporate customers have grown to rely on
VocaLink to meet their transaction needs. Its processing services offer banks
reach throughout the Single Euro Payments Area (SEPA) and beyond; and are
complemented by value-added services that leverage industry expertise and
technical capabilities.

Please visit www.vocalink.com for more information

About cebr

Centre for Economics and Business Research ltd is an independent
consultancy with a reputation for sound business advice based on thorough and
insightful research.

Since 1992, cebr has been at the forefront of business and public
interest research. Providing analysis, forecasts and strategic advice to
major UK and multinational companies, financial institutions, government
departments and agencies, trade bodies and the European Commission.

Cebr is recognised as one of the country's leading independent
commentators on economics and business trends. Its forecasts are used by a
diverse audience of business people, policy makers and journalists; even the
Treasury publishes its predictions for the UK economy.

For further information, please contact: Suzanne Hewitt, Hotwire, +44(0)20-7608-2500 or vocalinkuk at hotwirepr.com; Deborah Souter, VocaLink Limited, +44(0)870-920-8651 or deborah.souter at VocaLink.com