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State pension payments may rise by 10 percent next year with £1,000 boost on the horizon

Daily Express logo Daily Express 26/05/2022 Rebekah Evans
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Many pensioners will be delighted to hear the triple lock will be used to uprate state pensions next year. This is following the temporary suspension of the mechanism this year.

The Bank of England has made note of skyrocketing inflation, which is already wreaking havoc on purchasing power.

However, the matter is only set to escalate in the coming months for Britons.

It is expected the annual CPI rate will peak at 10.25 percent in the final quarter of 2022.

While this may create short term financial tightening, it could actually prove good news for pensioners in the long run.

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state pension triple lock © Getty state pension triple lock

As the September CPI figure is used as one of the measures in the triple lock for the following year, it could deliver a bumper boost for pensioners.

An official spokesperson for the Prime Minister confirmed the triple lock freeze was only a "temporary" measure, with no plans to change this.

The full new state pension is currently worth £9,628 per year, although some may get less if they were contracted out.

If an increase of 10.25 percent were to be implemented, it would leave pensioners in line for a boost of nearly £1,000.

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state pension payments © EXPRESS state pension payments

The triple lock mechanism was suspended this year due to warped earnings data.

It was deemed a predicted eight percent increase would be unaffordable, and thus the earnings component of the triple lock was abandoned.

Instead, a double lock was implemented, weighing up the increase between 2.5 percent and the rate of inflation in September 2021.

Consequently, the state pension rose by 3.1 percent this year, in line with the inflationary figure.

With pressure on pockets, pensioners may be relieved to know their sum will eventually rise.

It will be a matter of delayed gratification for millions of older people right across the country.

Steven Cameron, Pensions Director at Aegon, recently said pensioners are "particularly vulnerable" amid the cost of living crisis.

He added: "Pensioners have seen their state pension increase by just 3.1 percent in April, representing a 5.9 percent loss in their purchasing power with inflation currently at nine percent.

"The Bank of England expect inflation to reach double digits at its peak in Q4 later this year.

"This could grant state pensioners a bumper increase under the triple lock next April, but only after what will be a very difficult year and a long, cold winter for many.

"It is still unclear whether the Chancellor will provide temporary or targeted support for those in greatest need.

"In the meantime many individuals will be looking to cut back on 'discretionary' purchases where they can."

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