The DWP has responded to a petition calling for a state pension in line with the National Living Wage saying there are “no plans” for such a change.
A petition called for the Government to increase state pension payments to the same as 35 hours a week on the National Living Wage for people aged 23 and over, which it stated would be £16,919.99 after tax and National Insurance was deducted.
The National Living Wage (NLW), which is the minimum a person can be paid, is currently £10.42 an hour for people aged 23 and over, or £364.70 a week, while the full new state pension is currently £203.85 a week.
In its response, the DWP said it would be inapproriate to have a state pension in line with the National Living Wage as the twqo payment rates have “different purposes”.
The group said: “The NLW aims to protect low-income workers and provide an incentive to work by ensuring that workers benefit from being employed.
“However, this is not appropriate for pensioners, most of whom have left the labour market. Comparisons made in this petition between headline state pension payments and the NLW do not consider the full package of measures available to support people in retirement.”
The petition had more than 33,900 signatures at the time of writing. It said: “Surely, a ‘living’ pension should, at the very least, be equal to full-time work on the minimum wage.
“Please respect those in society who have contributed, and treat them equitably for what they have contributed to our society.”
The state pension increases each year in April with pensioners getting a record 10.1 percent increase last year due to high levels of inflation when the triple lock triggered.
The latest figures for the increase in average earnings were at 8.2 percent, which is now above inflation, suggesting this could be the metric that decides the increase in state pension payments next year.
Some analysts have predicted payments could go up by seven percent or more next April providing hundreds of pounds more in payments over the course of the year.
Neil Rayner, head of advice at True Potential, told Express.co.uk the triple lock policy may soon become unsustainable.
He said: “With longer-term issues plaguing the UK economy such as slowing economic growth and a falling birth rate, the triple lock may be unsustainable for the Government to afford in the long run, as those in retirement make up a larger proportion of the population.
“The Gen Z and Gen Alpha may face higher retirement ages and should ensure that they have a personal pension to augment their retirement – particularly if they want to retire before the state pension age.”
For the latest personal finance news, follow us on Twitter at @ExpressMoney_.
