Rt Hon Dr Thérèse Coffey MP (Secretary of State for Work and
Pensions): I have concluded my statutory annual review of benefit
and State Pension rates. The new rates will apply in the tax year
2021/22, and come into effect on 12 April 2021. The Social Security
(Up-rating of Benefits) Act 2020 enables me to increase the basic
and new State Pensions and the Standard Minimum Guarantee in
Pension Credit by providing a discretion to increase them for one
year even though there has been no growth in earnings.
State pensions will be increased by 2.5%, in line with the
Government’s manifesto commitment. The full rate of the new State
Pension will now be worth £179.60 per week. The Standard Minimum
Guarantee in Pension Credit will also increase by the same cash
amount as the basic State Pension, rising by 1.9%.
All other benefits will be increased in line with CPI - which was
0.5% in the relevant reference period. This includes working-age
benefits, benefits to help with additional needs arising from
disability, carers’ benefits, pensioner premiums in
income-related benefits, Statutory Payments, and Additional State
Pension.
Separate to the uprating review, I can confirm that the increase
to Local Housing Allowance rates in April this year will be
maintained in cash terms in 2021/22. The assumption in the
forecast is that rates will remain at these levels in future
years, subject to the Secretary of State reviewing annually in
the usual way.
All of these pensions and benefits are transferred to Northern
Ireland, and corresponding provision will be made there. Some of
these benefits are devolved to Scotland; in respect of these, the
Scottish Government will bring forward corresponding legislation
in the Scottish Parliament.
The statutory annual review is separate from the temporary £20
per week uplift to Universal Credit and Working Tax Credit, which
was announced by the Chancellor as a temporary measure in March
2020, and enacted for one year under different legislation to
support those facing the most financial disruption as a result of
the public health emergency. As the Government has done
throughout this crisis, it will continue to assess how best to
support low-income families, which is why we will look at the
economic and health context in the new year.
