Older people on low incomes can apply for a pension loan through the Department for Work and Pensions. Thanks Three locks, State Pensions Raised by inflation, average earnings or 2.5 percent; Which is higher. however, Pension loan It did not receive a similar triple lock-style toll hike as is currently in place.
Currently, state pensioners who are eligible for Pension Credit have their weekly earnings rise to £182.60 if they are single.
If there is one partner, which includes spouses and civil partners, their joint weekly income is increased to £278.70.
Pension Credit claimants may be given an extra amount if they are responsible for caring for young children or a disabled person.
Pensioners are set to receive an extra £300 in living costs this winter to help with rising bills.
If the triple lock pledge continues, state pension payments will rise by 10.1 per cent.
It will be inflation-adjusted and will provide a £200 per week boost from April 2023.
However, it is yet to be confirmed how much other benefit amounts will be raised by next year.
Tom Selby, head of pensions policy at AJ Bell, outlined why those receiving Pension Credit should not receive a similar boost.
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Mr Selby explained: “The good news for those receiving State Pension ‘protected cash’ or additional State Pension entitlements is that the law requires the Government to increase these benefits in line with inflation.
“Should inflation be higher than income or above 2.5 percent in September, they should see all of their state benefits rise in line with prices.
“However, what happens to the more than 1.4 million people in receipt of pension credit – among the poorest retirees in society – is less clear.
“The law only requires the government to raise the ‘fixed minimum guarantee’, a key component of pension debt, in line with average earnings growth.
“Based on average earnings growth in the three months to July, this implies that guaranteed credit will rise to 5.5 PE.
“Other components of pension credit, including savings credit and additional top-ups for carers and people with severe disabilities, saw no increase.”
It is important to note that the government is yet to emphasize support for the triple lock on state pensions following the appointment of Prime Minister Rishi Sunak to the country’s highest post.
According to Mr Selby, an increase in benefit charges will be implemented next year, but it is not known by how much.
He added: “This does not mean there is no increase or no increase in the case of the standard minimum guarantee – but it does mean that it is at the discretion of the government.
“For example, the temporary law created as part of the decision to reduce the revenue component of the triple-lock for one year to the increase used this year increased all components of the pension debt by 3.1 percent in accordance with the September 2021 CPI. Inflation figure. This law falls for next year’s increase.
“Pension credit is being offered to the UK’s lowest-income retirees, which could cause uproar if they don’t get the same protection against inflation as they do on the state pension.
“The uncertainty surrounding this is undoubtedly worrying a lot of people, especially in the context of recent energy price rises.
“The government has the power to ease the worries of millions of people by determining exactly what increases will be applied next year.”
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