Options to reduce the ever-increasing costs of the UK State Pension are currently being considered by the Department for Work and Pensions (DWP). A pension hike of 8.5 per cent is suggested by present pay growth, which is used to determine how much the state pension rises by next April.
A recent report stated that as per the ‘triple lock’ (a safeguard applied to the state pension to ensure it doesn’t drop in value due to of inflation), old age pensioners (OAPs) would have seen a rise linked to wages next year from April onwards.
However, it has come to light that government ministers are weighing whether to remove the effect of public sector bonuses on this earnings figure. Such a move would reduce the increase OAPs receive from 8.5 per cent to 7.8 per cent, while potentially saving the UK government what amounts to hundreds of millions.
However, this would mean that UK pensioners would lose out on around £75 a year. Mel Stride, UK Work and Pensions Secretary, commented that the government was committed to retaining triple lock but suggested that he is currently considering using the lower earnings figure as an option instead, as in the long-term, the lock was unsustainable.
In the UK, workers concerned that the state pension will not be sufficient to provide adequate provision for them when they cease employment can consult specialists in retirement planning in Chester, Birmingham and other cities. Wealth managers assist by helping people prepare with effective strategies like protective policies, investments and personal pension advice.
