Hundreds of thousands of retirees won’t see their State Pension uprated on April 6 due to where they live. The payment changes take effect in the fourth month of the year under the Triple Lock guarantee, which ensures that the State Pension rises based on either increased average earnings, the rate of inflation or 2.5% – whichever is highest.
This year, it will rise by 4.8% based on earnings growth, while additional elements such as deferred rates will increase 3.8%. As a result, those on the New State Pension will be getting £241.30 per week (up from £230.25), while those on the maximum Basic State Pension will receive a weekly payment of £184.90 per week (up from £176.45). These represent annual incomes of £12,547 and £9,614, respectively.
However, some 453,000 pensioners living abroad won’t be due the increase despite having paid the necessary amount of National Insurance Contributions to get the state Pension, The Daily Record reports.
This is because the State Pension is frozen at the point of emigration people living in a wide range of counties, many of which are Commonwealth nations.
Your State Pension will only increase each year if you live in:
Retirees won’t get yearly increases if you live outside these countries. However, your pension go up to the current rate if you return to live in the UK.
Many of the affected pensioners (49%) are are getting £65 per week or less.
Other groups living the UK will see smaller increases overall, such as those on the old state pension, and deferred state pensioners, as the triple lock only applies to their core state pension, as per Birmingham Live.
*** Ensure our latest personal finance headlines always appear at the top of your Google Search by making us a Preferred Source. Click here to activate or add us as Preferred Source in your Google search settings. ***
Steve Webb, partner at pension consultants LCP said: “It often comes as a surprise to people that the different elements of their state pension can go up at different rates.
“The famous ‘triple lock’ promise applies only to the old ‘basic’ state pension and the new flat rate pension, but not to other elements of the pension such as the state second pension (often known as Serps).”
Mr Webb notes: “In a year when wages grow faster than prices, the triple locked elements of the pension will rise by slightly more than other elements.”
Those who opt to defer their state pension also don’t get triple lock-related benefits on the extra amount paid to them for deferring.
The state pension rises by 5.8% for every full year you delay received it, if you reached or will reach state pension age on or after April 6, 2016.
This extra amount then rises annually in line with CPI inflation, not the triple lock.