Dr Thérèse Coffey (The Secretary of State for Work and
Pensions): I am announcing the proposed social security
benefit and pension rates for 2020/21.
More than 10 million people in receipt of working-age benefits
will see their payments increase at the rate of inflation next
year.
2.5 million people on Universal Credit and claimants on legacy
benefits will receive a 1.7% rise in April. This includes people
receiving Jobseeker’s Allowance (JSA), Employment and Support
Allowance (ESA), Income Support, Housing Benefit and Universal
Credit.
The basic and new State Pensions will increase at the highest
rate for eight years, by 3.9%, boosting the retirement incomes of
13 million people. Pensioners receiving the full new State
Pension will get an extra £344 a year. The basic State Pension
will increase by £263 a year.
The Pension Credit standard minimum guarantee for a couple will
be £265.20 a week, the basic State Pension will be £134.25 per
week, the full rate of the new State Pension will be £175.20 per
week, and the Universal Credit standard allowance couple one or
both over 25 will be £507.37 a month.
The annual up-rating of benefits will take place for state
pensions and most other benefits in the first full week of the
tax year. In 2020, this will be the week beginning 6 April.
A corresponding provision will be made in Northern Ireland and
the Scottish Government will lay its own statutory instrument in
respect of increases to Carer’s Allowance in Scotland.
The annual up-rating process takes into account a variety of
measures:
- The basic and new State Pensions will be increased by the
Government’s ‘triple lock’ commitment, meaning that they will be
up-rated in line with the highest of prices (CPI), earnings or
2.5%. Consequently, they will be up-rated by 3.9% (the May-July
Average Weekly Earnings figure).
- The Pension Credit Minimum Guarantee will also be increased
by earnings in line with legislation. The Pension Credit Savings
Credit maximum amount will be increased in line with CPI (1.7%).
- Benefits linked to the additional costs of disability, and
for carers, are increased by the annual rise in prices (1.7%). A
number of other elements – including Non-Dependent Deductions –
will also be up-rated in line with prices.
- Working age benefits will be increased by CPI (1.7%) from
April 2020. Those linked to child tax and working tax credits
will be up-rated in line with those benefits.
- Universal Credit Work Allowances will be increased in line
with CPI (1.7%) from April 2020.
The full list of proposed benefit and pension rates will be
placed in the Libraries of the House in due course.
This will increase expenditure on social security benefit and
pension rates by £5 billion. This includes £3.9 billion more to
be spent on pensioner benefits. From April 2020 the yearly basic
State Pension will be worth over £1900 more in cash terms than in
2010. £1 billion more will also be spent on working-age benefits,
ensuring that we continue to support the most vulnerable in
society.
