Pensioners could be in line for a £478 boost to the state pension next year as rising inflation puts pressure on the government’s promise to maintain the triple lock for millions of households.
The Bank of England has predicted inflation will reach 4 per cent in September, fuelled by the recent £25 billion increase to employers’ national insurance contributions and a higher minimum wage.
The triple lock guarantees that the state pension goes up in April each year by whichever is highest of wage growth, the inflation figure from the previous September or 2.5 per cent. A 4 per cent increase would raise the full new state pension from £230.25 a week to £239.46 next year, or up to £12,451 a year, although not everyone receives that amount.
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Such a rise would cost Rachel Reeves, the chancellor, £2.1 billion to maintain the triple lock for the 4.48 million people who claim the new state pension — which she and her party promised to keep at the past general election. This week the National Institute of Economic and Social Research told Reeves that she must raise taxes in the autumn budget to fill a £50 billion fiscal black hole.
