Pensions triple lock scrapped for millions of Brits
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The state pension triple lock is supposed to increase the sum by whichever is the highest: 2.5 percent, inflation or average earnings. However, this was not the case this year, as the earnings component of the measure was scrapped.
Perceived lack of affordability due to warped earnings data meant the eight percent increase expected by pensioners did not come to pass.
The Government has confirmed the triple lock will make its return from next year onwards.
Both Pensions Secretary Therese Coffey and Chancellor Rishi Sunak confirmed the Government’s intention to reintroduce the policy.
However, some Britons are still not convinced about the longevity of the triple lock or the Government’s promises.
A survey of 2,000 UK adults showed more than a third as stating the triple lock suspension has made them less trusting of pension policy.
When the suspension was first announced last year, a survey from NerdWallet found 36 percent of Britons were now less trustful.
Mistrust of the Government’s pension policy was highest amongst those over 65s, with 52 percent expressing doubts.
But younger Britons were also sceptical, and 42 percent said they were now less trustful.
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Many people are hoping to rely upon the state pension for their retirement.
A guarantee that the sum will increase is therefore likely to provide welcome relief for those looking ahead.
Richard Eagling, Senior Pensions Expert at NerdWallet, commented on the matter.
He said: “The state pension triple lock is not just an issue for those in retirement.
“Its future will have implications for the generations to follow.
“The news that the Government has pledged to honour the triple lock for the rest of this parliament will offer some reassurance.
“But the fact remains that the smaller increase to the state pension this year will do little to offset the cost of living crisis that many retirees face.
“An extra 200,000 people of pension age fell into relative poverty last year.
“With this year’s state pension increase significantly lower than inflation, we can expect this situation to deteriorate further.”
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Predictions have suggested a “bumper increase” for the state pension next year, tied to the triple lock.
With inflation set to soar to eight percent this year, it is likely this will be the measure by which the state pension is uprated.
If this were to come to fruition, Steven Cameron, Pensions Director at Aegon, remarked it could potentially be “the highest increase ever” and compensate somewhat for the relatively low increase of this year.
A DWP spokesperson told Express.co.uk: “We recognise the pressures people are facing with the cost of living, which is why we’re providing support worth over £22 billion this year to help.
“From this month, the full yearly amount of the basic state pension will be over £2,300 higher than in 2010 and the latest figures show there are 400,000 fewer pensioners in absolute poverty compared to 2009/10.
“We’re also continuing to work with stakeholders and others to increase awareness of Pension Credit, with the number of new claims 30 percent higher in 2021 compared to 2019 – and take up now at its highest level since 2010.”
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