The pension payment was confirmed on Wednesday when the latest inflation figures were released – showing the core measure of the Consumer Price Index (CPI) at an annual rate of 0.5% in September.
This was up from 0.2% the month before, when government discounts on Eat Out To Help Out restaurants distorted the pricing picture in the economy as it battled COVID-19[feminine[feminine lock damage.
The increase in state pensions is determined by three factors – hence the terminology of triple locking – as it guarantees an increase in the highest figure of the CPI, the growth of income for the year until July, or 2.5%.
Weak wage increases and low inflation mean the 2.5% figure is stuck.
The government has embarked on the triple lockdown – a clear commitment – despite the enormous pressure on public finances from the coronavirus crisis that resulted in record levels of peacetime borrowing.
The Institute for Fiscal Studies (IFS) think-tank analysis released Wednesday suggested the funding guarantee was living on borrowed time due to pressure to cut costs and raise taxes later.
The IFS said the latest increase to reduce inflation would raise the state’s full basic pension to £ 137.60 per week, with recipients of the new state full pension compensating 179, £ 60.
The CPI figure, however, means increases in state benefits will be limited to an increase of 0.5% after the 1.7% seen at the start of the current fiscal year.
September’s inflation figure is also used to decide on the annual increase in business rates, although the Chancellor may extend a one-year vacation for hard-hit retail and hospitality businesses to exempt them from the increase next April.
Commenting on rising inflation, Office of National Statistics (ONS) deputy national statistician Jonathan Athow said: “The official end of the Eat Out To Help Out program resulted in restaurant prices rising in September. , partly offsetting the sharp drop in inflation for August.
“Airfares would normally drop significantly around this time due to the end of the school holidays, but with prices moderate this year, as fewer people travel overseas, the price drop has been smaller.
“Meanwhile, as some consumers seek alternatives to using public transport, the demand for used cars has increased, which has seen their prices rise.