The day before yesterday, I spent some time printing out the two long documents being the ‘Letter from Madrid’ followed by the ‘Letter from Jakarta’ which I had written decades before. On one occasion the printer jammed but I am fairly used to this happening on occasion and I have some techniques for the removal of paper jammed inside. But although it seems to function correctly, a red warning light now seems to be permanently stuck on, for a reason that I cannot discern. It could be that the printer is now some 15 years old and nearing the end of its life and the machine s trying to tell me something but I will press on as long as I can and I still have adequate supplies of toner for it. Yesterday, there was a major internet outage as an Amazon web server located in North America had developed a fault and the problem rapidly escalated with, at one point in the morning, banks, airlines and even HMRC affected by the outage. This had me very concerned because my Droitwich friend was flying back from South Africa after the extended stay she has had with her family and I feared that the South African airport and the airline itself might be caught up in the wash, as it were. My texts did seem to be delayed in being delivered but I was very relieved to be informed that she was on her flight and seemed to have taken off on time. I have been asked to pick her up from the airport which I will willingly do but everything will still be dark at the time she is scheduled to arrive and picking up at Birmingham airport is always a bit nightmarish – still, I am sure that we will manage. I did not sleep particularly well during the night but got up before 5.00am and left the house just before 6.00am as my friend’s flight was scheduled to arrive at 6.40am. The roads to the airport were not particularly busy but I got to the airport in plenty pf time and loitered for a little in the ‘drop of’ lane where I ought not to have been to while away some minutes. Then I entered the premium zone for picking up passengers (£6 for the first 15 minutes), made my way to the entrance/exit of the arrivals hall and then my friend and I pinged texts to each other until we eventually met up and got on our way. By this time, it was starting to get light and the weather was not raining so we went straight to her house in Droitwich to have a welcome cup of coffee and an exchange of all of our news. Then my friend set to work straight away (as so much of her work is done online and at home) and I made my way back to Bromsgrove, eventually making contact with my two ‘Tuesday morning’ coffee friends and we enjoyed a coffee and a toasted teacake together. Whilst I was on the High Street, I took the opportunity to purchase a good quality (‘Van Heusen’) shirt from a charity shop which happened to be just my size. I always examine the collar and cuffs well in shirts that I buy like this and being a good quality make, it even had spare buttons supplied with it, as well as a breast pocket which many shirts do not have these days, perhaps as a cost-cutting measure. Then I got home, collected my thoughts a little and then went down to do my Pilates session for the week although, in all honesty I was feeling pretty exhausted by this time with having slept so little the night before. After I returned home, I finished off some curry I had in the fridge and then dozed whilst watching some of the liberal American media political websites railing against Trump and the MAGA crowd.
The attention of many financial commentators, as well as pensioners themselves will be fixed on the inflation rate due to be announced tomorrow. Inflation is tipped to come in at its highest level since January last year on Wednesday morning. A 4% figure is expected to be revealed by the Office for National Statistics- up from the current 3.8% rate. Inflation measures the pace of price shifts across different sectors of the economy on a rolling 12-month basis. Those shifts are then used to create a headline figure. The increase in the consumer prices index measure this time, economists say, is likely to have been driven by fuel prices rising last month when they fell sharply during September 2024. Other factors may include rising prices for second-hand cars. The UK state pension is expected to rise by 4.8% from April 2026, driven by average earnings growth. This increase is based on the triple lock mechanism, which uses the highest of CPI inflation, average earnings growth, or 2.5%. As September’s inflation figures are not yet available, the 4.8% average earnings growth figure is the likely basis for the rise. The Average earnings growth (including bonuses) for May to July was revised up to 4.8%. The so-called ‘Triple Lock’ will be used in the calculations. The state pension increases by the highest of three measures: the September CPI inflation figure, average earnings growth (May-July), or 2.5%. A 4.8% increase could take the full new state pension above the income tax personal allowance of £12,570 for the first time, meaning some pensioners may have to pay income tax. Now there are a couple of things that need to be noted about the rise in pensioner incomes over the past decade or so. It is undoubtedly true that the triple lock has helped to improve the lot of pensioners as a group to the point at which the rise in their income has proceeded at a faster rate than the rise of public sector incomes as a whole. But politically, the triple lock is proving to be very hard to either abandon or to modify – the elderly are the biggest source of support for the Tory party so they will always look after their own. Similarly, after the ‘winter fuel’ debacle, the Labour party does not have the elderly in its sights (although expensive cars may be removed from the ‘Blue Badge’ scheme) However, the Labour government could decide to honour the rate of increase for next Spring but to alter the rate for subsequent years by taking, for example, the average of the three measures or only basing their calculations on the second highest figure. I would be amazed if the Labour Party did not attempt a reform like this in their November budget. I suspect that when the definitive economic history of the past decade or so comes to be written, it will be documented that quite large transfers of wealth took place when more affluent pensioners help to draw the sting of university fees or to help their grandchildren with a deposit for their first home.