Millions of state pensioners will be denied the full Triple Lock increase next year despite the state pension rising by 3.1%. The major blow affects older retirees due to the complex way the pension system calculates payments.
Seven million pensioners will miss out on the benefits, according to Birminghammail. Those primarily affected are people on the Basic State Pension - women born before 1953 and men born before 1951.
Financial impact hits hardest
The affected pensioners will lose out on £551 each from the triple-lock boost, dailymail reports. This significant sum represents money they won't receive despite being eligible for state pension payments.
The i reports that 6.9 million people drawing from SERPS (State Earnings-Related Pension Scheme) and one million on protected payments are specifically affected by these calculation differences.
Complex pension system creates disparity
The disparity stems from different pension systems operating for different age groups. The Triple Lock mechanism, introduced in 2011, ensures pensions rise by the highest of earnings growth, inflation, or 2.5%.
However, older pensioners on legacy systems don't benefit from the same calculation methods as those on the newer State Pension introduced in 2016. This creates a two-tier system where newer pensioners receive more generous increases.
Former pension minister Steve Webb emphasises the importance of checking pension forecasts and spotting National Insurance record errors. He warns that many pensioners may not realise they're missing out on money they're entitled to receive.
Sources used: "Chronicle Live", "Yorkshire", "Birminghammail", "The i", "dailymail"
Note: This article has been edited with the help of Artificial Intelligence.
