Benefits to rise with inflation

Business Secretary Vince CableBusiness Secretary Vince Cable has signalled the Government would raise benefits in line with record high inflation.

September's Consumer Prices Index (CPI) figure hit 5.2%, the highest since the measure was introduced in 1997 and significantly above the Bank of England's 2% target.
The September measure is the rate at which ministers increase the state pension and Jobseekers' Allowance from the following April.

Raising benefits in line with the current CPI rate would force the Government to find more cash.

But scrapping the planned rise would spark criticism the coalition was attacking the most vulnerable.

Mr Cable quashed suggestions benefit increases could be limited, saying: "Of course they will go up with inflation."

He insisted the Government was committed to helping poor people through the economic crisis.

"We believe the most vulnerable people in society should be protected in these very difficult conditions," he said.

"There is no doubt; of course they should be indexed and that's fully understood."

But speaking to BBC1's Politics Show, the Business Secretary admitted there were "issues about timing and detail", and said Chancellor George Osborne would outline the position in his autumn statement to MPs on November 29.
© 2011 Press Association
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