Wealthy pensioners should consider returning the extra £ 1,000 from an inflation-linked state pension increase, said the cabinet minister overseeing the policy.
Labor and Pensions Secretary Thérèse Coffey said on Wednesday it was “very easy” to return the money to the government as it rejected criticism of the increase.
The comment came after Lord Clarke, the former Conservative chancellor, said the government’s focus should be on the poor instead of the wealthy pensioners like him.
Downing Street and the Treasury faced new scrutiny over their decision to increase state pension and benefits due to inflation, but refused to do the same for public sector wages, a stance that has partly led to this week’s rail strikes.
Chancellor Rishi Sunak defended the position, saying that wage increases are more likely to drive up inflation than pension increases. He argued that firms that pay higher wages could, in turn, raise their own prices, known as the “wage price spiral.”
The prime minister’s spokesman also reiterated his position, saying it would be “reckless” to give public sector wage increases in line with inflation, arguing that these same people would suffer if this were blocked by a sharp rise in prices.
Inflation forecast will reach 11%.
On Wednesday, it was announced that inflation in May was 9.1%, according to the National Statistics Office, compared to nine percent in April. It is expected to reach 11% this year.
The spokesman declined to say whether the increase in the state pension next April – which could mean an additional £ 10bn in Treasury spending – would fuel inflation.