Thank you for writing to me about the state pension triple lock.
After receiving similar emails from constituents about this issue, I recently wrote to the Treasury for a response. I have copied the contents of their letter below that I hope you will find of interest and sufficiently explains the Government’s decision making.
“Thank you for your email and for sharing your constituent’s key concerns.
The Government is committed to ensuring that older people are able to live with the dignity and respect they deserve, and the State Pension is the foundation of state support for older people. Since 2010, the State Pension has been uprated by the highest of average earnings growth, price inflation or 2.5 per cent- an approach known as the Triple Lock. The full basic State Pension in 2021/22 is over £2,050 a year higher in cash terms and over £875 a year higher in real terms compared to 2010.
Support available beyond the State Pension includes: Winter Fuel Payments (which are £200 per household if the oldest person in the household is less than 80 years old, or £300 per household if they are above 80); free eye tests (saving people over State Pension age around £20 each time), NHS prescriptions (which can be worth up to £110 each year depending on qualifying criteria); and free bus passes (typically worth around £120 each year). Some pensioners may also qualify for means tested benefits including Pension Credit and Housing Benefit.
Last year, the Government delivered primary legislation to increase State Pensions by 2.5 per cent, when earnings fell and price inflation increased by half a percentage point. If we hadn't taken this action, State Pensions would have been frozen.
Due to the effect of the pandemic and furlough on the labour market, reported average wage growth has increased markedly to above 8 per cent - which is an anomaly. Increasing pensions by more than 8 per cent this year would be unfair, unsustainable and hugely costly. That is why the Government is taking the responsible and fair decision to temporarily move to a double lock this year. This means the State Pension will rise next year by the higher of inflation or 2.5 per cent - ensuring we are protecting pensioners against the rising cost of living.
This is a temporary change for one year only and the Government remains committed to implementing the Triple Lock for the remainder of the Parliament.
Please pass on my thanks to your constituent for raising these concerns.”
Thank you again for taking the time to contact me.
With best wishes.
Jonathan Lord MP
Member of Parliament for Woking