State Pension is rising next year but millions of OAPs will get £2,400 less
29.03.2022 - 16:09
/ manchestereveningnews.co.uk
Next year, the amount of State Pension people in the UK get paid will change.
The amount people get paid is rising, and it is set to be the biggest increase ever. Rishi Sunak said the rise in April 2023 would be in line with the inflation rate in September this year, which is expected to be around 7.4 per cent, according to Bank of England forecasts.
Under the terms of the triple lock formula, the state pension must rise by the highest out of average earnings growth, 2.5% and inflation. But this year it was suspended due to skewed earnings growth during the pandemic.
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If it had gone ahead, it would have brought a rise of more than 8% for pensioners battling a fast-rising cost of living crisis. Instead, it will rise by just 3.1% on April 11.
Mr Sunak forecast the increase for next year on Monday, telling MPs the triple lock mechanism for determining annual pension rises would be restored until at least 2024. The Chancellor told the Commons Treasury Committee: "The triple lock will function as it normally functions."
If inflation does hit 7.4 per cent in September, it will jump to £198.85 a week. This would increase the annual payment from £9,627.80 to £10,340 a year, the biggest single increase ever. However, not every retiree will reap the full benefit. That's because the new state pension is only paid to those who retired after April 6, 2016.
That means any man who was born before April 6, 1951, and woman born before 6 April 1953. Those who retired before that date receive the old basic state pension instead. If it is raised by 7.4 per cent in 2023, that would mean a £152.35 a week, which works out as £7,922 a year.