Divorcees to see payouts rise as inflation passes 10pc

TENS of thousands of divorcees will be forced to give bigger payouts to their former spouses as inflation has risen past 10 per cent.

Law firm Weightmans said those who pay maintenance to their ex-partner could see annual payments go up by thousands of pounds. Ex-partners are often ordered to pay “spousal maintenance” to their ex, usually over a large disparity in their income and the recipient may struggle with day-to-day costs.

Tens of thousands of people have spousal maintenance orders that are linked to inflation, experts warned. Courts settled the finances in 50,000 divorce cases in 2020-21, according to the latest Ministry of Justice data.

Mark Heppinstall of Freeths, another law firm, estimated that 20-30 per cent of the financial remedy orders the firm deals with include spousal maintenance, which must be issued by a court.

Fiona Turner, of Weightmans, said historically there had been many maintenance orders in divorce cases. For those required to up payouts every year, inflation poses a major risk.

Index-linked spousal maintenance payments are tied to either the retail price index or more commonly the consumer prices index rate of inflation. CPI inflation is running at 10.1 per cent inflation while RPI is 12.6 per cent, so a double-digit rise in the amount paid.

Ms Turner said while maintenance orders are often about £500 to £1,000 per month, a 10 per cent rise “is potentially another £100 on top of already more expensive energy, fuel and food bills, at a time when income is likely not to have increased by the same amount”.