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State Retirement Pensions: Uprating

Question for Department for Work and Pensions

UIN 45254, tabled on 8 September 2021

To ask the Secretary of State for Work and Pensions, if she will publish her Departments’ analysis supporting the decision to disregard average earnings increases when determining the next State Pension uprating for 2022-23.

Answered on

13 September 2021

DWP expect average earnings figures for July to be around the level seen in June and this would produce a May to July annual earnings growth figure of 8 to 8.5%.

The Social Security (Up-rating of Benefits) Bill will ensure pensioners’ spending power is preserved and that they are protected from higher costs of living. But it will also ensure that as we are having to make difficult decisions elsewhere across public spending, pensioners are not unfairly benefitting from a statistical anomaly.

Annual growth in average employee pay is being affected by temporary factors that have inflated the increase in the headline growth rate. These are compositional effects where there has been a fall in the number and proportion of lower-paid employee jobs and base effects where the latest months are now compared with low base periods when earnings were first affected by the coronavirus pandemic.

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