The rate of inflation is slowing, but the state pension looks set for a record-breaking increase next April, according to latest forecasts.
ONS figures show that CPI inflation is currently 9.9 per cent — slightly below the 10.1 per cent figure recorded the month before.
Next year’s state pension is based on the inflation figures published in October. Even if CPI continues to slip, which forecasters are expecting, given the freeze on fuel bills and falling petrol prices at the pumps, it is still likely to be significantly higher than September’s earning figures — at 5.5 per cent, and far in excess of the 3.1 per cent increase pensioners received this April.
Under the terms of the triple lock is increased by whichever is highest of 2.5 per cent, wages (from data published in September) or CPI (published in October).
The triple lock was suspended last year which led to state pensioners getting a 3.1 per cent increase last year. Prime Minister Liz Truss pledged to reinstate the triple lock this year.
Hargreaves Lansdown senior pensions and retirement analyst Helen Morrissey says: “Inflation eased this month, but it still remains sky high and looks set to stay so for the foreseeable future.
“This means pensioners are in line for a significant pension boost next year as long as the government keeps its pledge to keep the triple lock. Yesterday’s wage data put average wage growth at 5.5 per cent so pensioners are already in line for a record-breaking increase, albeit one that is well below inflation. If the link to CPI remains, then we could see pensioners on a full new state pension get more than £200 per week.
“Last year’s 3.1 per cent increase was no match for soaring inflation and has left many pensioners struggling and so a more generous increase will be welcomed. However, any such increase will not kick in until April which feels a very long way away right now for those struggling to make ends meet.”
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