Budget 2021: Sunak reveals changes to pension charge caps
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The House of Commons will this afternoon vote on an amendment to legislation that seeks to force the Government to rethink its plans to break its 2019 manifesto commitment. Millions of pensioners across the country are set to be worse off next year as their weekly payments rise by less than inflation.
In September the Conservatives announced they would be suspending the mechanism used to calculate the annual increase in state pension payments for a year.
The changes passed overwhelmingly through the Commons despite Tory MPs quietly seething at the decision.
Many in the party fear breaking a promise they made at the election to stick by the triple lock will harm them at the ballot box at the next time of asking.
An amendment to the Social Security (Up-Rating of Benefits) Bill in the Lords sort to overturn the decision to suspend the mechanism and has forced the matter to return to the Commons.
It means Conservative MPs are once again facing the difficult decision of voting to abandon their manifesto commitment.
One MP representing a Red Wall constituency told Express.co.uk: “I feel rather uneasy about the triple lock.
“It was a manifesto commitment and you break manifesto commitments at your peril.”
Despite concern among Tory backbenchers, the Government is likely to be successful in defeating the Lords amendment that urged them to reconsider the triple lock suspension.
The triple lock sees the payouts rise by the highest out of 2.5 percent, average earnings, or inflation.
But the earnings element was removed for the financial year of 2022-23 after ministers said the furlough scheme had led to a “statistical anomaly” that would have seen pensions soar by as high as 8.3 percent.
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Instead, pensions will increase by 3.1 percent, in line with September’s inflation figure.
The decision will save the Treasury around £5billion a year.
It comes despite fears inflation will be more than double that rate come next spring when the change comes into effect, meaning pensioners will be worse off in real terms.
The lower-than-expected rise is coupled by soaring energy bills, hitting retirees with a double whammy.
Former Tory pensions minister Baroness Altmann, who tabled the amendment in the Lords that forced today’s vote, said: “Do they really think it is right that Britain, with the lowest state pension in the world, can afford to cut taxes on banks and alcohol but can’t keep its promises to protect pensioners?”
Labour peer Prem Sikka, who has also campaigned for change, said he did not expect pensions to rise in line with average earnings, but for a bigger increase than was currently being proposed.
“[The amendment] does not ask for 8.3 percent rise, only that it be more than 3.1 percent,” he said as he called on the public to demand their MPs vote “to support the Lords and current/future retiree”.
The vote is expected to take place at approximately 5pm tonight.
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