Earlier this month I was pleased to support the Pensions Minister in the House of Commons announce that the state pension will rise by 2.5% for 2015-16.
This is a direct result of this Government introducing the triple lock for pensions – ensuring that the basic state pension will increase each year by the highest of earnings, inflation, or 2.5%.
I recently raised the issue of pensions in Parliament with HM Treasury and received confirmation that pensioners in Crawley, and across the country, will receive around £560 more in 2015-16 than they would have done under the policies of the last government.
This works out that since 2010, the basic state pension has increased by around £950 a year.
Since 2010, the government have committed to spending £10 billion more on the basic state pension over the course of this Parliament, than would have been so without the triple lock in place.
The poorest have been protected with the over-indexation of the standard minimum guarantee, so they will also benefit from the triple lock. Additionally, benefits that cover the additional costs of disability maintain their value in line with CPI.
Personal independence payment, disability living allowance, attendance allowance, carer’s allowance and incapacity benefit will go up by the statutory minimum of 1.2% from April next year, as will the ESA support group component, and those disability-related premiums that are paid with pension credit and working age benefits.
There will also be greater flexibility over how people can spend their pension pots. Everyone with a defined contribution pension will be offered free and impartial face to face guidance, on the various options available to them at retirement.
I was also in Westminster when the Chancellor give his Autumn Statement recently.
I was pleased to see the announcement that the 55% death tax, that currently applies when you pass on an unused pension fund to a loved one, will be abolished.
Additionally, people who pass away before the age of 75 with a joint life or guaranteed term annuity can pass that on, tax free, as well.
In April, the ISA limit will be increased, to £15,240 and a new pensioner’s saving bond has just been introduced with an interest rate of 4%.
Currently, when someone died, the savings in their ISA lost their tax-free status, and their spouse starts paying tax on their money. The Chancellor announced that ISAs will be passed on, and remain tax free. ISAs and pensions, passed on, without tax.
These are the right actions for pensioners and savers across Crawley.