Liz Truss has committed to maintaining the pensions triple lock at PMQs this afternoon. It comes after a series of economic U-turns, prompted speculation around whether the government may be forced to ditch the triple lock on pensions.
She told MPs: "I am completely committed to the triple lock and so is the chancellor."
More than 12 million Brits receive the state pension, many of which even depend on it entirely. It comes after inflation soars back to double digits, creating uncertainty around the future of many households' budgets.
Read more: When people will get the DWP Pensioner Cost of Living Payment and who is eligible
As the government prepares a statement on October 31, its tax and spending plans have been thrown into question, with ministers previously unable to answer whether Ms Truss would stick to her commitment of keeping the triple lock. On Tuesday, she sat in silence as Chancellor Jeremy Hunt scrapped most of her previous economic commitments.
But why is the triple lock important and how could it affect you?
What is the triple lock?
The triple lock is a guarantee that the state pension rises every year in line with either inflation, earnings, or 2.5 per cent - whichever is highest. Because of this, September's inflation figure at 10.1 per cent would usually be part of the calculation.
However, the triple lock was frozen last year due to wages being affected by the coronavirus pandemic. This year, pensions rose by 3.1 per cent.
What is happening with the triple lock?
There have been indications from ministers that the Prime Minister's previous commitment to sticking to the triple lock could be ditched as the Chancellor finds new ways to fix markets turmoil from the mini-Budget.
If this does happen, it would be an additional U-turn from a government that has already had to backtrack on the majority of its economic policies. It would also leave some of the most vulnerable in society with less money, especially those on a fixed income.
However, the PM told MPs today that she remained committed to it.
What will happen if pensions rose in line with earnings next April instead of inflation?
If pensions in line with earnings (5.5 per cent), the new weekly state pension would be £193.34. However, if it rose in line with inflation at 10.1 per cent, it would be at £208.85.
This would add up to a difference of £442 over the course of year in pensioners' pockets.
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