The state pension is expected to increase by more than £574 per year starting in April following the release of the latest inflation data today. This rise is based on the triple lock guarantee, which adjusts the state pension annually in line with the highest of three factors: earnings growth between May and July, September inflation rate, or a minimum of 2.5%.
Initially, wage growth for May to July was estimated at 4.7%, but the Office for National Statistics (ONS) later revised it upward to 4.8%. With the current inflation rate standing at 3.8%, the wage growth figure is likely to be used for the upcoming state pension adjustment.
According to analysts at Hargreaves Lansdown, the full new state pension is anticipated to increase from £230.25 per week to £241.30 per week in April 2026, resulting in a yearly rise from £12,547.60 to £13,122.20. However, this amount is slightly below the personal allowance threshold of £12,570, meaning many individuals may face income tax on their state pension in the 2027/28 tax year.
The old basic state pension is set to rise from £176.45 per week to £184.90 per week (£9,615 annually). These figures represent the maximum state pension amounts, which may vary based on an individual’s National Insurance contributions.
To be eligible for the new state pension, individuals born on or after April 6, 1951 (men) or April 6, 1953 (women) typically need 35 qualifying years of National Insurance contributions. For the old basic state pension, the number of qualifying years required varies based on gender and birth year.
The current state pension age is 66 for both men and women, but it is scheduled to gradually increase to 67 between 2026 and 2028, followed by a further increase to 68 in the mid-2040s.
Helen Morrissey, head of retirement analysis at Hargreaves Lansdown, emphasized that the state pension adjustments are subject to confirmation in the upcoming Budget. She highlighted the need for ongoing reviews regarding state pension age in light of increasing life expectancy and the growing pensioner population, suggesting potential future changes to the state pension age and the triple lock mechanism.