Universal Credit, PIP and state pension claimants set to get big payment rise next year

State pension: People 'rely on the DWP' to get sums right

We use your sign-up to provide content in ways you’ve consented to and to improve our understanding of you. This may include adverts from us and 3rd parties based on our understanding. You can unsubscribe at any time. More info

A Treasury minister pledged to do more to support those in receipt of various payments, such as Universal Credit, Personal Independence Payment (PIP) and the state pension. Speaking to his fellow parliamentarians about the National Insurance Contributions Bill, Simon Clarke MP revealed that the recent hike in inflation “will be reflected” in the uprating figures for April 2023. However, this is entirely dependent on if current inflation forecasts end up being a reality.

Last week, figures from the Office for National Statistics (ONS) revealed that inflation in the UK has now hit 6.2 percent, representing a 30-year high.

Next month, benefit payments administered by the DWP will only rise by 3.1 percent, based on inflation figures from September 2021.

This means that those who claim Universal Credit, PIP and the state pension will be receiving payments which will not align with the rising cost of living.

Usually, the state pension payment hike is based on the triple lock, whichever is the highest of inflation, average wage increases or 2.5 percent.

READ MORE: Council tax reductions explained: Who is eligible to pay less and how to claim

However, the Government has temporarily suspended the triple lock due to average earnings being artificially inflated due to the furlough scheme. It is set to be reinstated next year.

Once the triple lock is reinstated, state pensioners could see their DWP payments go up by as high as eight percent, if current economic forecasts remain in place.

This could be a major financial boost to pensioners coming out of the pandemic and would result in a payment hike of £770 annually.

Other benefit payments, such as Universal Credit and PIP, would experience a similar rate hike.

Speaking in Parliament, Mr Clarke said: “The United Kingdom spends £243billion a year on our wider welfare spend, including pensions. This is a country where we do a huge amount to make sure that everyone is supported.

“We have to consider all our decisions in the context of both wider affordability and also how the system operates.

“The welfare system always operates on the basis of an uprating in September for changes in the ensuing April.

“If there is high inflation, as is forecast, during the course of 2022 that will be reflected in the uprating figures for April 2023 and the triple lock will be in place to protect families.”

The parliamentary representative for Middlesbrough South and East Cleveland later said the uprating payment figures for 2023 will be confirmed this autumn, depending on inflation predictions.

Previously, DWP Secretary Therese Coffey defended the Government’s decision to hike benefit payments by last year’s inflation figures.

When asked by MPs last month whether this will leave families in an “impossible decision” financially, Ms Coffey said the move was a “reasonable” one.

She said: “We have this consistent approach using the same index year on year… inflation moves around and I think it was a reasonable approach to continue with that consistency.”

As part of his Spring Statement, the Chancellor Rishi Sunak announced a variety of support measures to assist households with the cost of living crisis, including raising the National Insurance threshold.

The Government believes this move will save taxpayers £330 a year from July and benefit 30 million people across the country.

Benefit payments are set to rise next month.

Source: Read Full Article