Monday 13 March 2023
After an exceptional period of high inflation that has put a significant amount of financial strain on low-income households, the Committee for Employment & Social Security has submitted a Policy Letter proposing an interim increase in the rates of benefits and allowances. Increases have been proposed for most benefits including, but not limited to, the States Pension, carer's allowance, and income support.
The most recent increase in benefit rates, applied in January 2023, was based on inflation as at 30 June 2022. Therefore, the current rates of benefits and allowances do not take into account current prices. The Committee is proposing that an increase is applied in line with RPIX between 1 July 2022 and 31 December 2022 (2.9%) to reflect that inflation levels during this period were exceptionally high compared to previous years. If the proposals are approved by the States, these changes will take effect from the first week of July 2023.
The proposals are an interim step between the ordinary uprating of all benefits and associated rates that took effect in January 2023 and the rates that will be proposed to take effect from January 2024. As per usual, the proposals for January 2024 will be brought to the States for debate later in the year.
Deputy Peter Roffey, President of the Committee for Employment & Social Security, said:
"The proposals in this Policy Letter will not have any impact on 2024 benefit rates, which will be the same regardless of whether the States approve proposals for a mid-year increase. It does mean some £3.5m of additional expenditure between now and January, and we are extremely conscious of the pressure public finances are under right now. We do need a solution to the sustainability of those public finances but in the meantime we must also recognise that this has been an extraordinary period of increased costs for those islanders who were already struggling. This additional support is very badly and urgently needed and we will be making that case to the States.
At the same time, I encourage anyone who is struggling to make ends meet to contact Employment & Social Security on 01481 222500."
