State pension payments to rise by £290 next April as inflation falls to 3.1%

STATE pension payments are set to rise by £290 next April as figures today from the Office for National statistics reveal inflation fell to 3.1%.

The inflation rate is usually used to work out how much the state pension will rise by but it's not by as much as many were hoping.

The Department for Work and Pensions is yet to confirm but State pension payments will always rise by a minimum of 2.5% under the triple lock.

That's despite the fact that inflation has gone down since last month.

The triple lock sets an increase to weekly payments based on the higher of three things: average wages, the consumer prices index (CPI) or 2.5%.

The state pension is set to increase by 3.1% in 2022/23, in line with the inflation figures released this morning.

That means pensioners are set to receive a boost of a little more than £5.50 a week – around the cost of a bottle of supermarket wine - to their weekly incomes from next April.

Broken down, the basic state pension will go from £137.60 per week to £141.85 per week.

While the flat-rate state pension will rise from £179.60 per week to £185.15 per week.

Tom Selby, head of retirement policy at AJ Bell, said: “The good news for retirees is the state pension is set to increase by 3.1% next year, boosting the incomes of those in receipt of the full flat-rate benefit by £5.55 a week.

"The basic state pension, meanwhile, is set to rise by £4.25 to £141.85 per week.

“However, the Government’s decision to suspend the earnings element of the state pension triple-lock means retirees will miss out on a blockbuster 8.3% increase.

“This decision will ‘cost’ someone in receipt of the full flat-rate state pension £9.35 a week in retirement income – or £486.20 over the course of the year."

The triple lock is a measure that guarantees rises in the state pension by inflation, 2.5% or wage increases, whichever is highest, so pensioners could have been in line for much more if this hadn't had been scrapped.

Meanwhile, Helen Morrissey, senior pensions and retirement analyst at Hargreaves Lansdown said: “The 3.1% increase was a touch under what many expected and will come as cold comfort to pensioners bracing themselves for soaring energy bills this winter."

Overall the figures show that inflation has risen by 2.9% in the 12 months to September.

But the figure is 0.1% lower in September this year compared to the same period last year as in September 2021, the consumer prices index increased by 0.3% compared with a rise of 0.4% in September 2020.

The figure is also down from the 3% it rose in the 12 months to August previously recorded, by 0.1%.

At that time it was at its highest in nearly a decade too.

The largest contribution to today's numbers came from the transport sector (0.91%), meanwhile housing and household services contributed 0.69%, restaurants and hotels, 0.34%, and recreation and culture, 0.31%.

Mike Hardie, head of prices at the ONS, said: "Annual inflation fell back a little in September due to the unwinding effect of last year's 'Eat Out to Help Out,' which was a factor in pushing up the rate in August.

"However, this was partially offset by most other categories, including price rises for furniture and household goods and food prices falling more slowly than this time last year.

"The costs of goods produced by factories rose again, with metals and machinery showing a notable price rise. Road freight costs for UK businesses also continued to rise across the summer."

The Bank of England is expecting inflation to exceed 4% before the end of the year so many are advised to save now to keep up with inflation rates and avoid their hard-earned cash taking a hit. 

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