Thursday, 13 March 2014


In April nearly two million of the poorest pensioners will see a rise in their state pension payments of £1.69 a week (£1.22 each for a couple). That will mean a rise in their income of barely 1%.

So does this break the Government’s ‘triple lock’ promise of raising the state pension by earnings, inflation, or 2.5% whichever is the highest?

The basic state pension paid to people who have paid enough National Insurance contributions is £110.15 a week and will rise in the second week in April by £2.95 to £113.10. That is a rise of 2.7% in line with CPI inflation in September 2013. So far, promise kept. Some get higher or lower amounts of state pension. Lower if their NI contributions were not enough for a full pension. And higher if they have SERPS or graduated pension on top. Their total state pension will also rise by 2.7%. Promise more than kept.

But the poorest 3 million pensioners get their state pension topped up by another benefit called pension credit. It can be claimed by any anyone aged 62 or more who has a low income below around £148 (single) or £226 (couple).  And people aged 65 or more can claim extra if their income is below £190 (single) or £278 (couple). All figures apply from 7 April.

These three million split in three –

Group 1: those aged 62-65 with weekly income up to £148 (single) or up to £226 (couple;  older partner that age).
Group 2: those aged 65 or more with weekly income up to £120 (single) or £192 (couple; older partner 65 or more).
Group 3: those aged 65 or more with weekly income £120 to £190 (single) or £192 to £278 (couple; older partner 65 or more).

From April their pensions will rise

Group 1: their total pensions – state pension and pension credit – will rise by £2.95 (single) or £4.45 (couple) a week. That is a rise of 2%.
Group 2: their total income – state pension and pension credit – will rise by £2.95 (single) or £4.45 (couple) a week. That is a rise of 2%.
Group 3: their total income – state pension, pension credit, and any other income – will rise by £2.95 (single) or £4.75 (couple) a week but their pension credit will fall by £1.26 (single) or £2.31 (couple) leaving a net gain per week of £1.69 (single) or £2.44 (couple - £1.22 each).  These are rises of around 1% (between 1.15% and 0.9%) in their total income. Calculations assume other income is flat, from earnings, pension, or savings for example.

The triple lock applies only to the percentage rise in the basic state pension. And that is rising by 2.7%, the rate of inflation at September 2013 measured by the CPI. So the pledge is met in that narrow sense. Someone with £500 a week from work or a company pension will get a 2.7% rise in their state pension adding at least £2.95 a week to it.

But it is not being met in any sense for the poorest pensioners who rely on means-tested pension credit to boost their income. Their rise will be less than 2.7% - somewhere between 0.9% and 2%. And for many it will be less in cash terms - £1.69 instead of £2.95. For couples £2.44 (£1.22) each instead of what will be at least £4.75 on the state pension.

The Government wants to get rid of the means-tested pension credit. It is doing this in two ways. First, the basic state pension will be much bigger for those who reach pension age from 6 April 2016. It will be above the level at which pension credit starts and so groups 1 and 2 will not get any pension credit. The extra pension credit at age 65 will be scrapped from that date. So very few new pensioners will get pension credit.

People already getting pension credit at 6 April 2016 will continue to receive it. But the amounts will be restricted as the extra pension at 65 will be cut each year. Already in three years from May 2010 to May 2013 the cost of this part of pension credit has fallen by more than £780m a year - a fall of 23%. Altogether 320,000 fewer people claim pension credit and, as about 100,000 of those are couples, about 420,000 fewer people rely on it.

Just under a million people claim the part of pension credit that guarantees to bring their income up to £148 (single) or £226 (couple). Adding in partners, that part supports 1,150,000 people. They fall into group 1 or 2 above and will get a cash rise of £2.95 (single) or £4.45 for a couple. That will be a rise of 2%.

Just under 1.5 million people claim the extra part of pension credit (called savings credit). Adding in their partners, that supports 1,780,000 million people. They are in group 3 and generally will get a cash rise of £1.69 (single) or £2.44 (couple - £1.22 each). That will be a rise of around 1%.

The last time there was a fuss about a small rise in the state pension was 2000. A low rate of inflation in September 1999 led to an increase in the basic state pension of 75p taking it from £66.75 to £67.50. The low rise was opposed in the House of Commons by Steve Webb, the young Liberal Democrat MP, who was spokesman on Social Security matters. He said "Pensioners I talk to are insulted by being offered 75p next April" He added that it was "inadequate". Others pointed out that 75p was not enough to buy three first class stamps - then just raised in price to 27p each.

Steve Webb is now the pensions minister in the Coalition government and responsible for this year's increases and the plans not phase out pension credit. The £1.69 a week rise or less for 1.8 million on pension credit is not enough to buy three first class stamps - which rise to 63p each on 31 March. I wonder if he will notice this time?

Source: DWP statistics. My calculations. Weekly amounts rounded down to nearest pound.

Version 1.00 13 March 2014


  1. The basic state pension may be given a significant boost. We see unprecedented rise in the basic state pension and an increase in the age. It’s good news for women who take time out of work to look after children or who act as carers, but higher earners will lose out and some older women won’t receive it. Some peple can’t rely on that, so there’s a good decision: payday loans which might be timely and helpful.

  2. Information on THE ‘TRIPLE LOCK’ AND A PENSIONS RISE OF 1% is great dear. Annuity advice Bristol & Pension Adviser Bristol

  3. Prodigy oil and gas is watching developments of reserves in and across the borders of these United States

  4. I am here to give testimony of how i got back my husband, we got married for over 9 years and we have two kids. thing were going well with us and we where always happy. until one day my husband started to behave in a way i could not understand, i was very confused by the way he treated me and the kids. later that month he did not come back home again and he called me that he want a divorce, i asked him what have i done wrong to deserve this from him, all he was saying is that he want a divorce that he hate me and do not want to see me again in his life, i was mad and also frustrated do not know what to do,i was sick for more than 2 weeks because of the divorce. i love him so much he was everything to me without him my life is incomplete. i told my sister and she told me to contact a spell caster, i never believe in all this spell casting of a thing. i just want to try if something will come out of it. i contacted traditional spell hospital for the return of my husband to me, they told me that my husband have been taken by another woman, that she cast a spell on him that is why he hate me and also want us to divorce. then they told me that they have to cast a spell on him that will make him return to me and the kids, they casted the spell and after 1 week my husband called me and he told me that i should forgive him, he started to apologize on phone and said that he still live me that he did not know what happen to him that he left me. it was the spell that he casted on him that make him come back to me. my family and i are now happy again. Thank you Dr. Aluta for what you have done for me i would have been nothing today if not for your great spell. i want you my friends who are passing through all this kind of love problem of getting back their husband, wife , or ex boyfriend and girlfriend to contact and you will see that your problem will be solved without any delay.