There hasn’t been much good news on the state pension lately. That may be about to change.
State pensioners are about to benefit from the triple lock again (Image: Getty)
There’s been plenty of doom and gloom around retirees, much of it focused on the state pension triple lock, which has enemies everywhere. MPs on both sides of the Commons have been calling for the hugely popular uplift mechanism to be axed for years. Now we’re seeing a real concerted effort. Pressure is growing on Andy Burnham to replace the triple lock with something less generous. As new chancellor John Healey struggles to balance the books, the temptation must be huge.
A whole army of influential think tanks and organisations is lining up against it. They range from the left-wing Resolution Foundation and right-wing Institute for Economic Affairs. The Tony Blair Institute, Institute for Fiscal Studies (IFS) and now the British Chambers of Commerce have all called for its demise. And they’re only some of the triple lock’s enemies.
Plenty of politicians have added their voices, including prominent Tories such as former chancellor Jeremy Hunt and cabinet member Michael Gove, as well as Andy Burnham’s favourite economist Lord O’Neill and Zack Polanski’s Green Party. Many claim older people are being favoured over the young, and say axing the triple lock will save much-needed billions over the years.
3 extra payments state pensioners could be entitled to
Pensioners struggling with the rising tax bills and the cost-of-living crisis will be outraged, because for many the triple lock is a lifeline. Since introduction in 2011, it has helped lift millions of pensioners out of poverty.
Under the mechanism, the state pension increases each year by earnings, inflation or 2.5%, whichever is highest. According to the IFS, the state pension is 12% higher than if it had only risen in line with earnings. That’s an extra £1,500 a year for those on the maximum new state pension.
The triple lock is about to work its magic again, as we’re likely to learn on Tuesday. The inflation element is based on the September figure. But for earnings, it’s based on average wages over the three-month period from May to July.
We get that figure on Tuesday, and the forecast is that earnings will have grown by 4.1% across those three months. If correct, that’s the minimum pay rise state pensioners will get from April 2027. And it’s pretty good. More than inflation, which is currently 2.9%.
How much that means in practice depends on the pensioner. Today, somebody on the maximum new state pension gets £12,547.60 a year. A 4.1% increase is worth £514.45 a year, or £42.87 a month. Those who retired before April 6, 2016, get the older basic state pension, currently worth at most £9,614.80 a year. They’d get an extra £394.21 a year, or £32.85 a month.
We clearly have a two-tier state pension problem, and it’s only going to get worse. Both increase under the triple lock, but the basic state pension is lower, so each annual increase is worth less.
Many on the basic state pension get increments such as Serps or S2P, but these rise only with inflation each year. Which further widens the gap between the two, in years when wages are higher.
The latest inflation figure we have is for July, when consumer price inflation hit 2.9%. On Wednesday, the August figure is published. As I said, it’s the September number that counts. If that comes in higher than 4.1%, pensioners will get that instead. We’ll know on October 21.
First, let’s see what’s on offer on Tuesday. But one thing is certain. It will once again show why pensioners value the triple lock so highly.
Ed Miliband’s ‘secret’ reason for switching off Freeview TV for every household in Britain
Net zero zealotry threatens to turn off our tellies
Ed Miiband in Downing Street (Image: Getty)
Labour’s switch to net-zero energy, championed by Ed Miliband, is driving plans to turn off Freeview television signals. Ending traditional TV broadcasts will free up radio frequencies for use by solar plants, windfarms and storage facilities, Government documents reveal.
The Department for Culture, Media and Sport is currently conducting a consultation on proposals to end digital terrestrial television (DTT) broadcasts, which include Freeview, in 2034. Viewers would be expected to switch to internet services instead, but campaigners warn this would rob people without internet connections of the means to watch their favourite programmes and leave them isolated.
The elderly, people on low incomes and those in rural communities would be worst affected, according to campaigners. Labour former cabinet minister Steve Reed is among those calling for the switch-off to be delayed until at least 2034.
But government papers state that one of the advantages of ending traditional TV would be to free up part of the radio spectrum, from 470MHz to 694MHz, for other services including the UK’s planned “green” energy network.
So-called green energy is dependent on the weather, and generation may fall when there is no wind or sun. It requires more power to be stored in giant batteries, and reserve fossil fuel power stations to be activated when needed. Wind farms may also need to be turned off in periods of high output, to stop the network overloading.
As a result, various parts of the network are in constant communication.
A Government paper looking at “alternative uses of DTT spectrum” states: “There is demand for additional spectrum to improve operational communications within energy networks. This is particularly important for the real-time load management and zero-carbon system co-ordination required to achieve 2030 clean energy targets, and to ensure energy network security and resilience.
“The energy system is forecast to experience substantial growth in connected assets, from renewable generation and storage to increasingly distributed resources. These assets require more frequent and more granular monitoring.”
It adds: “The critical nature of these communications suggests a potential need for dedicated spectrum.”
Radio spectrums currently used for TV could also be used to improve mobile phone services and communications for the emergency services, the paper states.
But it says “both 500MHz and 600MHz bands are attractive in principle” for the energy industry.
Campaign group Silver Voices has led opposition to a 2034 switch-off. Director Dennis Reed said: “Public anger over the proposal to switch off terrestrial television is growing with over 160,000 signatures on our petition to save Freeview, but Labour still seems to have its head in the sand on the issue.
“MPs have raised numerous concerns over switching off the TV distribution system, including security and the impact on commercial radio as well as the impact on older, disabled and rural viewers.
“Andy Burnham needs to get a grip on the Department of Culture as they are leading him up a blind alley.”
A Broadcast 2040+ spokesperson, said: “Millions of households who rely on free-to-air terrestrial TV shouldn’t be cut off before the country is ready. Under the Government proposal to extend Terrestrial TV to 2044, there is scope to release some further spectrum which could be used by the mobile sector, utilities or other uses.
“This can be achieved whilst continuing with the much-loved and heavily relied on Freeview service and without negatively impacting viewers who will be able to continue to receive a comparable service to that they enjoy today.
“We are urging the Government to adopt that option rather than a rushed total switch-off of Freeview in 2034 which risks leaving millions of households without a TV service at all or forced to pay for expensive broadband or streaming services just as budgets are stretched.”
A government spokesperson said: “The government believes there is a strong case for a transition to IPTV, but no decisions have been made. The purpose of the Media Green Paper was to gather views from across the sector and the public before any final decisions are taken.
“We are committed to ensuring that no one is left behind as TV viewing increasingly moves online. Any future transition would only proceed once we are confident the right safeguards, infrastructure and support are in place so that everyone can continue to access television affordably and with confidence.”