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Since April 2013, there have been two main factors used to increase benefits. Benefits aimed at disabled people and pensioners will increase in line with CPI inflation (1.2%). Most benefits and tax credits for working age people are being increased by 1%.

The Government has introduced a ‘triple guarantee’ for uprating the basic state pension, meaning that it increases by the highest of the increase in earnings, prices (as measured by the CPI) or 2.5%. For the purposes of the 2015-16 uprating, 2.5% was the highest of these three benchmarks.

The Pension Credit standard minimum guarantee is required to be increased at least in line with earnings; the relevant earnings benchmark rose by 0.6%. However, for the fifth year in a row the Government has decided on an above-earnings increase so that recipients of Pension Credit Guarantee Credit get the same cash increase as those on the Basic State Pension. This is again being paid for by cutting the value of Pension Credit Savings Credit.

The main elements of Working Tax Credit have been uprated by 1% in 2015-16. Child Benefit will also be increased by 1% from April 2015.


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