BBC Pension Increases
On 20 January 2021 the inflation figures for December 2020 were announced by the Office for National Statistics. The rise in the Retail Prices Index (RPI) was 1.2% (up from 0.9% in November 2020); and the rise in the Consumer Prices Index (CPI) was 0.6% (up from 0.3% in November 2020). CPIH was 0.8% (up from 0.6% in November 2020).
Under the Rules of the BBC Pension Scheme pension increases are based on the December RPI and CPI figures with the increases taking effect from the following 1 April.
This year inflation has been within the guaranteed increases provided for under the Rules of the Scheme. Therefore, Old, New and CAB 2006 Benefit Members are likely to receive an increase to their pensions next April of 1.2%, whilst CAB 2011 Members are likely to receive an increase of 0.6%. No increase will be awarded on any previous pension exchanged for a higher, level pension as a result of the Pension Increase Exchange (PIE) exercise.
The BBC and Trustees still need to consider the increase to be awarded in April and this may take a little while. The announcement of this year’s pension increase will be confirmed in due course on the BBC My Pension website at: https://www.bbc.com/mypension/pensioners/
Under current rules, the State pension is increased by the ‘triple lock’ which is the highest of earnings growth, price inflation (CPI) or a 2.5% minimum guarantee.
The September inflation figure (on which the State pension increase is based) was 0.5% and so the State pension is expected to increase by the minimum guarantee of 2.5% next April, marking three years in a row where it has increased by more than inflation. This means that the new flat rate state pension will rise by £4.40 a week to £179.60 and anyone on the old system will receive £3.40 more a week at £137.65.
The Government confirmed on 25 November 2020 that the RPI will be aligned with the Consumer Prices Index including owner occupiers’ housing costs (CPIH) from February 2030. The change will see RPI continue to be published as an index but bring the methods and data of CPIH into RPI.