The government is suspending the triple lock on pensions for one year from April 2022, Therese Coffey has announced.
The work and pensions secretary said the state pension will rise by inflation next year to make the system more “fair”.
A surge in wages would have qualified pensioners for a 8% hike in pensions if the rise was based on earnings, Ms Coffey said.
In the Conservative Party’s manifesto it says the state pension must rise by the highest of average earnings, inflation or 2.5% every year.
But Ms Coffey said this will be put on hold next April due to wage anomalies during the coronavirus pandemic.
“This year, as restrictions have lifted and we have experienced an irregular statistical spike over the uprating review period, I am clear that another one-year adjustment is needed,” Ms Coffey told MPs as she made a statement in the Commons.
“So tomorrow, I will introduce the Social Security Uprating of Benefits Bill. For 2022/2023 only, it will ensure the basic and new state pensions increase by 2.5% or in line with inflation – which is expected to be the higher figure this year.
“And as happened last year, it will again set aside the earnings element for 2022/23 before being restored for the remainder of this Parliament.
“This will ensure pensioners spending power is preserved and protected from higher costs of living but will also ensure that as we are having to make difficult decisions elsewhere across public spending – including public sector pay – pensioners are not unfairly benefitting from a statistical anomaly.
“At a time when we have made tough decisions to restore the public finances which have impacted on working people, such as freezing income tax personal thresholds at current levels, this would not be fair.
“Setting aside the earnings element is temporary and only for one year. This means we can and will apply the triple lock as usual from next year for the remainder of this Parliament in line with our manifesto commitment.”
Shadow work and pensions secretary Jonathan Reynolds called the move “more a triple let down than a triple lock” – referring to the Conservatives’ broken manifesto promises on pensions, taxes and foreign aid.
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