businesses are increasingly willing to offer their employees non-cash benefits in addition to the traditional salary - according to a survey released by the Institute of Directors (IoD) in association with the Office of the e-Envoy.

The survey found that 85 per cent of respondents said they now offer higher pension contributions, private healthcare and assistance with the costs of out-of-hours study in order to attract the right staff.

Recognising this shift towards non-cash benefits the Government is publicising a Home Computer Initiative. Designed to be both a perk for an employee and an IT skills boost for an employer, the scheme allows a business to claim back tax on a computer purchased on behalf of a member of staff who can then use it to work from home.

IoD Director-General, George Cox, said: "Modern employers have to be more imaginative with their remuneration packages. In an increasingly competitive market, employees are looking to top up their salaries with benefits that will make a real difference to their quality of life. That might mean a better pension or a grant to cover the costs of part-time study outside office time.

"The challenge for policy-makers is to find ways of linking this demand for more flexible remuneration to schemes that meet the nation's need for stronger skills in areas such as IT."

Andrew Pinder, the Government's e-Envoy, said of the survey findings: "This survey spells out how salary sacrifice schemes could be the key to solving IT skills shortages in the UK."