From Ros Altmann:economist and pensions,
    investment and retirement policy expert

  • pensionsandsavings.com

    Today’s inflation numbers show why 3.1% pension increase will be so damaging

    Today’s inflation numbers show why 3.1% pension increase will be so damaging

    The latest 4.2% CPI rise for October was driven largely by rising household bill, such as electricity, gas and other fuel, after the energy price cap was increased last month. This shows how inadequate the 3.1% rise in State Pensions next year will be.

    Pensioner poverty was already rising before the pandemic and rising inflation will leave more in desperate straits as they try to pay their basic bills during the coming months.  

    Today’s CPI inflation numbers confirm again the cost of living crisis already engulfing pensioners and the shameful decision to increase their state pensions by just 3.1% next year will plunge more elderly people into poverty.

    The House of Lords gave the Government and MPs the chance to think again and they refused to accept our compromise proposals which would have helped correct for the anomalies of Covid impacts on the earnings and CPI statistics. Instead they have ploughed ahead with the clearly insufficient September cpi number which was artificially lowered by the pandemic policies.

    Pensioners have been left without the protection they were promised and more will struggle to make ends meet as inflation keeps rising. With rising energy costs, I fear many of the poorest will be even less able to afford to heat their homes adequately over the winter. Those pensioners who do not depend on the State Pension alone may be better off but millions – most of them women – have nothing else to fall back on and never had a chance to build another pension. To take away their much-needed and promised protection, knowing inflation pressures are rising, seems unjustifiable, especially when money was found for reducing bank, alcohol and other taxes.

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