The government has broken its promise of a “triple blockade” by denying millions of pensioners a record £ 822 increase in the state pension.
Thérèse Coffey, Secretary of State for Labor and Pensions, has announced the temporary suspension of the promise of the long-running Conservative manifesto in a bid to avoid a £ 5.4 billion increase in the annual pension bill.
The mechanism, which ensures that the state pension rises by higher inflation, wage growth or 2.5 percent, will no longer be tied to the benefits of the 2022 revolt.
The state pension will rise by 2.5% or inflation next April instead of the 8.8% increase that was due under the triple blockade. A freak jump in wage growth caused by forlough and layoffs during the pandemic has made the promise untenable at a difficult time for public finances.
However, the prime minister dealt a severe blow to pensioners, ignoring revenue data released by the Office for National Statistics which suggested the government would use a more realistic and reduced revenue figure of 3.5 pcs.
If the change is held in place indefinitely, Britons will have worse off £ 14,000 when they reach the age of 85, assuming the state pension will increase by 2.5 per cent a year instead of earnings. They would get an additional £ 233 a year instead of £ 822. Pensioners lost an additional £ 100 in the government’s decision to opt for the 2.5 per cent lower rise over the 3.5 per cent of the ONS.