UK Parliament approves £6.9 billion increase to state pensions & benefits beginning in April. Pension rises 4.1%; most other benefits rise 1.7%.
The plan includes a 4.1% state pension increase, matching average earnings growth. Most other benefits rise by 1.7%, aligning with inflation, also starting in April.
The government is committed to the “triple lock,” meaning pensions increase by the highest amount when comparing earnings, prices, and 2.5%. The 2025/26 rise will be 4.1%.
The basic state pension will rise to £176.45 per week, from its current £169.50. The new, full state pension will increase to £230.25, from £221.20 weekly.
Pension credit will also increase, with the standard minimum guarantee going up by 4.1%. For single pensioners, it rises to £227.10 weekly; for couples, it goes up to £346.60 per week.
Jeremy Corbyn questioned the two-child benefit cap and asked if they would abolish the welfare cap altogether. The previous government set a welfare cap of £137.4 billion for 2024/25, which is set to be exceeded by £8.6 billion. The government is looking into child poverty, considering social security changes, including the two-child limit, although they avoid making promises.
The government will not change the overall welfare cap, which was debated last week. There is room to discuss its benefits; however, no changes are planned soon.
The new full state pension will be £230.25 weekly, £921 four-weekly, and £11,973 annually. The old amounts were £221.20, £884.80, and £11,502. The new basic state pension is £176.45 weekly, £705.80 four-weekly, and £9,175 annually. Currently, these figures are £169.50, £678, and £8,814.
The Conservatives support increasing pensions; however, someone questioned their stance on the triple lock. Kemi Badenoch mentioned “means-testing” regarding the triple lock’s future.
Danny Kruger said her position was misquoted and that they are not cancelling the triple lock. He added that a colleague thinks it’s a silly system, but there is no immediate plan to review it.
Parliament also approved national insurance thresholds and uprated child benefit and guardian’s allowance. These rates will be fixed at the 2024/25 levels for the 2025/26 tax year.
The regulations also provide a Treasury grant, and veteran employers gain contribution relief. Furthermore, child benefit and guardian allowance increase in line with prices.
The government made tough decisions about finances, including an increase to National Insurance and reducing the threshold. These changes are separate from the regulations, and maintaining other relief measures is vitally important.
The shadow treasury secretary spoke of continuity. He said the regulations show not much change.
