Some good news for pensioners at last, with a 5% increase due for April despite flat inflation . State pension increases are based entirely on inflation figures from the September before, when prices were escalating swiftly. Once of the main measures of inflation, the retail price index, is currently at zero.
However, despite the good news for elderly state pension scheme holders, the real cost of living may be far higher than inflation takes into account . For instance, with pensioners largely not benefiting from low mortgage rates and seeing savings rates slump, many will still face financial hardship .
Furthermore, those goods of particular value to pensioners such as food and fuel continue to rise in price. A spokeswoman for Age Concern reportedly commented: "The cost of food is still rising. Fuel prices might have fallen recently, but gas and electricity prices are still higher than they were a year ago."
The director general of Age Concern, Gordon Lishman, was reported in the news as saying: "Falling headline inflation will do little to help older people's finances . The real rate of inflation for many pensioners remains far higher than the rest of the population. In addition, any income they relied on from savings has been completely blown away, leaving many more people just above the breadline."
Despite low inflation pensions rise
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1998 - 2009 UK Pensions - Planning before, at the onset and during retirement.
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