Boris Johnson under pressure over ‘bonkers’ £1,000-a-year state pension increase

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Work and Pensions Secretary Therese Coffey defended plans to spend billions on a double-digit boost for retirees next year after the Treasury vowed to reinstate its 'triple lock' pledge.


Rich pensioners were told to return a £1,000 state pension hike if they don’t need it today, amid a row over plans to up the payment while telling workers to cool pay rise demands.

Work and Pensions Secretary Therese Coffey defended plans to spend billions on a double-digit boost for retirees next year after the Treasury vowed to reinstate its ‘triple lock’ pledge.

The bumper rise could amount to nearly £1,000 a year extra at the same time that ministers are insisting that public sector workers like train staff, teachers and nurses temper their demands to cool rampant inflation.

Former chancellor Lord Clarke became the latest person to attack the increase, telling the BBC’s World at One today the government needed to ‘protect the poor – stop giving me money to pay my power bills’.

But Ms Coffey told the same programme the government was thinking about ‘people who are worried they won’t have enough money to heat their homes’.

On Monday a new report revealed around one in seven 65-year-olds were in income poverty in late 2020 due to the state pension age rising from 65 to 66.

‘Of course there will be people like Lord Clarke who have substantial amounts of money, I am conscious of that, but nevertheless in order to  deliver this payment effectively it is a comprehensive payment and frankly I will ask Ken Clarke to send a cheque to HMRC if he feels that strongly against it.’

Asked if she would encourage others to give the riser back, she added: ‘I am always encouraging people who seem to feel they don’t need money given from the government to (return it). 

‘There is a very straightforward way they can return that, and of course other people often give it to other charity donations as well.’

The headline CPI rate increased from an annual rate of 9 per cent in April to 9.1 per cent in May – a 40-year high, new figures revealed this morning. 

It is expected to hit 11 per cent this year and it is this massive surge that is fuelling the pension increase thanks to the triple lock – which means they rise by the highest figure out of inflation, average pay growth or 2.5 per cent each year. 

A 10 per cent rise would add £18.50 increase to the single-person’s state pension, taking it from £141.85 to £160.35, or a £962 rise annually.

Work and Pensions Secretary Therese Coffey defended plans to spend billions on a double-digit boost for retirees next year after the Treasury vowed to reinstate its 'triple lock' pledge.

Work and Pensions Secretary Therese Coffey defended plans to spend billions on a double-digit boost for retirees next year after the Treasury vowed to reinstate its ‘triple lock’ pledge.

Government insiders and Tory backbenchers attacked the 'bonkers' plan to give retirees a double-digit boost next year after the Treasury vowed to reinstate its 'triple lock' pledge.

Government insiders and Tory backbenchers attacked the 'bonkers' plan to give retirees a double-digit boost next year after the Treasury vowed to reinstate its 'triple lock' pledge.

Government insiders and Tory backbenchers attacked the ‘bonkers’ plan to give retirees a double-digit boost next year after the Treasury vowed to reinstate its ‘triple lock’ pledge.

This morning former Treasury minister Lord O'Neill - now a crossbench peer - attacked ministers' refusal to scrap the triple lock.

This morning former Treasury minister Lord O'Neill - now a crossbench peer - attacked ministers' refusal to scrap the triple lock.

This morning former Treasury minister Lord O’Neill – now a crossbench peer – attacked ministers’ refusal to scrap the triple lock.

Chancellor Rishi Sunak defended the plan, telling broadcasters today: 'The slight difference with pensions is pensions are not an input cost into the cost of producing goods and services we all consume so they don't add to inflation in the same way.'

Chancellor Rishi Sunak defended the plan, telling broadcasters today: 'The slight difference with pensions is pensions are not an input cost into the cost of producing goods and services we all consume so they don't add to inflation in the same way.'

Chancellor Rishi Sunak defended the plan, telling broadcasters today: ‘The slight difference with pensions is pensions are not an input cost into the cost of producing goods and services we all consume so they don’t add to inflation in the same way.’

Pizza, energy bills and pump prices heap woe on Britons’ wallets  

Households are continuing to be hit by high energy and fuel prices, new data shows, but the costs of other products, like pizza and quiche, rose more rapidly between April and May.

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The cost of filling up a family car with petrol last month was around 30.4 per cent higher than a year ago, the Office for National Statistics (ONS) revealed.

Meanwhile, the cost of using a gas-powered boiler has risen by 95.5 per cent, and the prices of liquid fuel, electricity and diesel have also soared.

But energy prices had already spiked in April and were little changed in May, the figures show.

Bigger changes between the two months can be seen elsewhere.

Potatoes had previously avoided some of the high inflation figures that other food items saw in recent months.

However, in May they started catching up as the rate of inflation for potatoes more than doubled to 5.1 per cent.

Pizza and quiche prices had risen by 3.1 per cent in the year to April; a month later this had increased to 12.3 per cent.

The ONS has a list of goods and services which households across the UK regularly buy. In order to calculate the inflation rate, statisticians measure if the prices

of these items have changed and by how much.

Those products that people spend more on, such as petrol, count more towards the inflation figures than smoked meats, for instance.

This morning former Treasury minister Lord O’Neill attacked ministers’ refusal to scrap the triple lock.

The ex-Goldman Sachs economist told BBC Radio 4’s Today programme:  ‘It seems to me pensioners, given the pressure on fiscal policies and these inequality issues now for the past decade and beyond, the constant protection of pensioners seems ludicrous in itself and, in these circumstances, particularly crazy.’

But Chancellor Rishi Sunak defended the plan, telling broadcasters today: ‘The slight difference with pensions is pensions are not an input cost into the cost of producing goods and services we all consume so they don’t add to inflation in the same way.’

And Downing Street expanded on this defence today after PMQs, with a spokesman telling reporters: ‘I think the chancellor made the point about pensions in his clip this morning, I mean firstly, it’s important not to conflate two things when it comes to pensions.

‘The state pension is increasing 3.1 per cent this year, and obviously we don’t have a decision on public sector pay as a whole at this stage. 

‘And the Chancellor was clear about how it is not pensions that are likely to feed into that sort of inflationary spiral that we are concerned about …. however we know that wage growth in the public sector can have that effect. And we need to be conscious of that when making a decision.’

He added: ‘I think when it comes to public sector wages, we need to consider both our desire to reward hardworking public sector workers whilst also making sure that we don’t actually damage the sort of pay, their take home, each month by spiking inflation further.’

Mr Sunak suspended the triple-lock commitment for this year because it would have been abnormally high due to the post-pandemic rise in earnings.

The Government will spend an extra £10billion on state pension payments if inflation hits 10 per cent by September, when the next increase is decided.

But one insider last night told the Telegraph: I think this sounds bonkers. If you are going to stick to the line on inflation, you have to show restraint across the board.

‘People will start to see through the contradictions. If we confine ourselves to this gerontocracy, it obviously doesn’t have a very long lifespan.’

Deputy Prime Minister Dominic Raab defended restoring the pensions triple lock, which will see the benefit rise in line with inflation, at a time when the Government is arguing against wages keeping pace with rising prices.

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He told Today ‘They (pensioners) are particularly vulnerable and they are disproportionately affected by the increase in energy costs which we know everyone is facing.’

The Government had committed £37 billion to help people cope with rising costs, he said, but ‘at the same time we have got to stop making the problem worse by fuelling pay demands that will only see inflation stay higher for longer and that only hurts the poorest the worst’.

In a report on pensioner’s poverty this week, the Institute for Fiscal Studies think-tank. said a key effect of the rise, between late 2018 and late 2020, was that 65-year-olds missed out on pension income of £142 per week on average.

Deputy Prime Minister Dominic Raab defended restoring the pensions triple lock, which will see the benefit rise in line with inflation, at a time when the Government is arguing against wages keeping pace with rising prices.

Deputy Prime Minister Dominic Raab defended restoring the pensions triple lock, which will see the benefit rise in line with inflation, at a time when the Government is arguing against wages keeping pace with rising prices.

Deputy Prime Minister Dominic Raab defended restoring the pensions triple lock, which will see the benefit rise in line with inflation, at a time when the Government is arguing against wages keeping pace with rising prices.

The rate of absolute income poverty – less than £260 per week for a couple without children – for those this age rose by 14 percentage points to 24 per cent by late 2020. Emily Andrews, of the Centre For Ageing Better which funded the research, said: ‘It is crucial the Government gets serious on improving access to work for people in their 60s.

The report said: ‘The reform caused absolute income poverty rates (after accounting for housing costs) among 65-year-olds to climb to 24 per cent, some 14 percentage points higher than – or more than double – the 10 per cent, that we estimate it would have been had the state pension age remained at 65.’

Also today, Office for National Statistics (ONS) figures showed the average house price was £31,000 higher in April than a year earlier.

Across the UK, the typical property value in April stood at £281,000 in April, which was 12.4 per cent higher than a year earlier.

Some property professionals pointed to more recent figures indicating a softening in the housing market.

They also highlighted a nervousness about taking on debt when it is unclear when the living costs surge will start to level out.

The pace of annual house price growth accelerated in April from 9.7 per cent in March. In March, the average UK house price had been £278,000.

Inflation creeps up AGAIN to 40-year high of 9.1 PER CENT putting more pressure on families as ministers plead for wage restraint – with fears it will top 11 per cent by the end of the year

The brutal squeeze on families was underlined today after inflation crept up again.

The headline CPI rate increased from an annual rate of 9 per cent in April to 9.1 per cent in May – a 40-year high.

Petrol and diesel prices went up at the fastest pace since records began in 1989, at 32.8 per cent. But food and drink made the biggest contribution to the rise, with mounting concerns about the Ukraine standoff hitting supplies.

The official figures were in line with expectations, but will heap pressure on the Bank of England to cool the rises by hiking interest rates again. 

It has predicted that inflation will top 11 per cent by the end of the year, as the Ukraine crisis drives up energy costs and the economy stalls.

Chancellor Rishi Sunak said the authorities are ‘using all the tools at our disposal to bring inflation down and combat rising prices’. 

Ministers have been pleading for wage restraint to avoid a spiral developing that could plunge the country deeper into trouble.

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But rail workers are in the middle of a spate of strikes demanding huge increases, while there are threats that teachers and Royal Mail could follow suit.  

The headline CPI rate increased from an annual rate of 9 per cent in April to 9.1 per cent in May – a 40-year high

Mr Sunak said: ‘I know that people are worried about the rising cost of living, which is why we have taken targeted action to help families, getting £1,200 to the eight million most vulnerable households. 

‘We are using all the tools at our disposal to bring inflation down and combat rising prices – we can build a stronger economy through independent monetary policy, responsible fiscal policy which doesn’t add to inflationary pressures, and by boosting our long-term productivity and growth.’

ONS Chief Economist Grant Fitzner said: ‘Though still at historically high levels, the annual inflation rate was little changed in May.

‘Continued steep food price rises and record high petrol prices were offset by clothing costs rising by less than this time last year and a drop in often fluctuating computer games prices.

‘The price of goods leaving factories rose at their fastest rate in 45 years, driven by widespread food price rises, while the cost of raw materials leapt at their fastest rate on record.’

The ONS said average petrol prices rose by 4.1p per litre in May, compared with a smaller rise of 1.7p per litre a year ago. 

Diesel prices were up 3.6 pence per litre, as opposed to 1.5p per litre a year ago. 

Food prices added more than 0.2 percentage points to the inflation number.

Clothing and footwear prices helped keep a lid on inflation, while recreation and culture prices also pulled it downwards.

The news will add to the difficulties faced by many people across the UK. Energy bills rose by 54 per centfor the average household at the beginning of April and will remain at this level until October.

But forecasts released this week predict that the Government cap on energy bills could rise again from an already record high £1,971 to £2,980 in the autumn.

The Bank of England has predicted that inflation will peak at more than 11 per cent in October after the price cap is changed again.

Ukraine is one of the biggest grain producers in the world and the war has hit global prices and availability.

Inflation has been gathering pace in all areas of the economy

Inflation has been gathering pace in all areas of the economy

Inflation has been gathering pace in all areas of the economy

The price of flour and other cereals in the UK had been decreasing before the Russian invasion, but has been ticking up since.

Between February and April price rises increased from 2.3 per cent to 9.3 per cent. But in May prices leaped and are now 16.3 per cent higher than a year ago.

Price rises of olive oil also accelerated from 9.5 per cent in April to 18 per cent in May, the ONS said.

The retail prices index, which is used to calculate train fares, rose from 11.1 per cent in April to 11.7 per cent in May.

Shadow chancellor Rachel Reeves said: ‘Today’s rising inflation is another milestone for people watching wages, growth and living standards continue to plummet.

‘Though rapid inflation is pushing family finances to the brink, the low wage spiral faced by many in Britain isn’t new.

‘Over the last decade, Tory mismanagement of our economy has meant living standards and real wages have failed to grow.

‘We need more than sticking plasters to get us back on course – we need stronger, and more secure economy.



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