State pensions could increase by 10% next year as the "triple lock" guarantee returns.
The triple lock is a government commitment, over and above the statutory requirement, to uprate the basic and new State Pension by the highest of earnings, prices or 2.5%. Its introduction was announced by the Coalition Government in its first Budget after the 2010 election.
Historically, the triple lock has been driven by either the Consumer Prices Index or the 2.5% minimum threshold. However, it was suspended last year due to the coronavirus pandemic.
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Work and Pensions Secretary Therese Coffey has confirmed the triple lock will soon be reinstated. However, following the cost of living crisis, Ms Coffey has been forced to defend plans to rise the state pension in line with inflation while public sector workers are likely to face real-terms cuts.
She told the BBC's Sunday Morning show: "We are going back to our policy of the triple lock, we suspended it for one year because freakish statistics would have given pensioners a particularly odd earnings relation in terms of rises.
"I formally have to make a decision in the autumn so I can't predict that but do recognise the average income of pensioners is very low.
"So potentially a 10% rise or matching inflation, whatever the appropriate rate would be at the time ... would be, I think, a measured approach recognising that their opportunity for people to earn more income is very limited, if possible at all."
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