Social Security Benefits Up-rating Order 2021

Baroness Bowles of Berkhamsted Excerpts

Wednesday 10th February 2021 Grand Committee

[Baroness Bowles of Berkhamsted (LD) [V]]

I thank the Minister for her introduction and for the letter circulated previously. As far as I can tell, as a non-specialist, the increases are either as required in statute or as promised, with additional discretionary increases that can apply for one year only. That leaves me slightly confused as to what happens after that one year. Perhaps the Minister could explain, as I have not been part of the teams and meetings with her.

Broadly, I do not quarrel with the SIs. Where there are issues, it is with the underlying structures that, notably through the triple lock, reward at a higher rate than those benefits that apply to the harder up. I appreciate that the increase in the basic state pension in cash terms has been transposed over to pension credit but, given that there are other thresholds in play, are there pensioners who will lose out due to the increase in thresholds being less than the 1.9% cash increase?

Regarding the triple lock, can the Minister advise on where we are with the original catch-up idea, which came about because pensions had fallen behind earnings? We have had unexpectedly low earnings rises, and now again through Covid, and there has been low inflation. Originally it was projected that it would take until 2038 for the state pension to reach 26% of national earnings. Is there a new projected date by which that will be reached?

Once again, it is still unfair that the over-70s get the triple lock on only part of their pension and not the whole of it.