State pension payments will rise next year thanks to triple lock
Millions of older Brits are on course to receive a second bumper state pension rise next year thanks to the triple lock.
The triple lock was introduced by the Conservative-Liberal Democrat coalition Government in 2010. It guarantees that the state pension rises every April by whichever is highest out of: inflation (using the previous September rate of Consumer Prices Index inflation), wages (average growth between May and July), or 2.5%.
It now looks like the state pension will increase by 8.5% in April 2024, in line with average wage growth, after earnings data was released today. This means state pensioners are set to see their weekly payments rise by as much as £17.35 a week.
However, neither the Conservatives or Labour have committed to keeping the triple lock in their next manifesto. How much state pension you get all depends on when you reached retirement age and if you get the full amount.
The state pension age is 66 but this is gradually increasing for men and women, and will rise to 67 for those born on or after April 5, 1960. A further increase to 68 is due to happen between 2044 and 2046 for people born on or after April 5, 1977.
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There had been speculation that the increase to 68 could be brought forward to the 2030s - but a decision on this is now not expected until 2026. Your state pension is separate to any private or workplace pension you may have.
How much is the state pension?
There are two different types of state pension - which one you claim depends on when you were born.
You claim the new state pension if you’re:
- a man born on or after 6 April 1951
- a woman born on or after 6 April 1953
The full new state pension is worth £203.85 a week - but you may get less than this, depending on your National Insurance record. You need 35 qualifying years on your National Insurance record to get the full new state pension, and ten years to get anything at all.
If the state pension does rise by 8.5%, then the full new state pension will increase to £221.20 a week.
You claim the basic state pension if you’re:
- a man born before 6 April 1951
- a woman born before 6 April 1953
The full basic state pension is worth £156.20 a week - but again, it depends on your National Insurance record. You need 30 qualifying years on your National Insurance record to get the full amount. The minimum number of years is usually 11 for men born before 1945, and 10 years for women born before 1950. The full basic state pension would rise to £169.50 a week if it goes up by 8.5%.
In April 2023, the state pension went up by a record 10.1%, in line with the previous September measure of inflation. You can check your state pension forecast online to find out how much money you’ll get.
Are you worried about the Tories abandoning the pensions triple lock? Vote in our poll HERE to have your say.
Tom Selby, head of retirement policy at AJ Bell, said: “Retirees are set to receive their second blockbuster state pension increase in a row. With price rises seemingly on a steady downward trajectory, it is almost certain – barring a major inflationary shock – that today’s 8.5% earnings growth figure will be used for next year’s state pension rise.
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“For those in receipt of the state pension, the protection provided by the triple-lock is extremely valuable. Had the new state pension been linked to the highest of average earnings and inflation – rather than having a 2.5% underpin – it would be worth around £180 a year rather than over £200 a year today.
“From the government’s perspective, the policy means the state pension system costs the Exchequer around £11 billion more versus a ‘double-lock’ to earnings and inflation, according to the IFS. By 2050, the policy could see state pension spending rise by anything between £5 billion and £45 billion a year in today’s terms.”
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