Pensioners boosted by promise to re-instate triple lock

Pensioners are in line for a £733 boost to the state pension next year, after the Government promised to reinstate the state pension “triple lock”.

Ministers denied millions of pensioners a record £822 increase in the state pension this year due to its controversial decision to suspend it this April. The triple lock dictates how much the state pension rises by each year – the highest of inflation, wage growth or 2.5%.

It will rise by just 3.1% this year, September’s figure for inflation, rather than wage growth, which was 8.1%. The Government said that a jump in wage growth caused by furlough and redundancies during the pandemic made the manifesto pledge to keep the triple lock unaffordable at a difficult time for public finances.

The increase will fall far short of inflation, which is expected to be above 8pc by the end of the year. This will leave pensioners £458 worse off in real terms. The Government will save £10bn in benefit spending in the 2022-23 tax year by curbing the uprating.

This comes as a further blow for pensioners who are among the most vulnerable to rising energy prices and have little protection as the cost-of-living crisis bites. Inflation is forecast to hit 7.6% in September, according to Goldman Sachs. A 7.6% increase in the state pension next year would boost the new state pension by £14.10 per week to £199.25 in April 2023. This equates to an extra £733 a year. The current full state pension is £179.60 a week.

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Sources: Techlink