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The state pension is forecast to hit £200 per week in 2024 despite only being subject to the 'double lock' in 2022. 

Based on the latest forecasts from the Office for Budget Responsibility (OBR), and calculations by Lane Clark & Peacock (LCP) partner and former pensions minister Steve Webb, the firm suggested UK pensioners will face a "financial rollercoaster" in the next few years.

In April 2022, the state pension will rise by 3.1% - less than half the current rate of inflation - and the Spring Statement measures offered little help for most pensioners, LCP said.

However, in 2023 the state pension will again be subject to the triple lock, the government has confirmed - it was turned into a double lock in 2022 - so the rate will reflect the surge in inflation, with the OBR forecasting a 7.5% increase, LCP's research suggested. This will add over £10 per week to the basic state pension and more than £13 to the new state pension.

By April 2024, OBR forecasts suggest the state pension will go through the £200 per week barrier.

However, the coming 12 months are set to be one of the toughest on record for many pensioners, LCP said: "The main help they will receive from the Chancellor is the already-announced £150 off Council Tax bills, but only for those in properties in bands A to D. They will also get £200 off energy bills in the Autumn, but this will have to be repaid over the coming five years."

Webb said: "Pensioners are set to face a financial rollercoaster in the coming years with a tough squeeze this year followed by a catch-up next year. The Spring Statement will have been a big disappointment, and some pensioners may find themselves having to apply to their council for hardship funds simply to make ends meet.

"But next year should see the biggest ever cash rise in the value of the state pension, as pension rates catch up. The problem is that ‘jam tomorrow' will not pay bills today."

 

source ProfessionalAdviser.com 24/3/2022

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