Earlier this month, it was revealed that wage growth – analysed by the Office of National Statistics (ONS) – sat at 4%. Under the triple lock, this meant state pension payments would rise by 4% next April
State pension payments are set to rise next year – here is everything you need to know including how much they’ll go up by and who could miss out.
When it came into power this summer, the Labour government confirmed it was keeping the Tory “Triple Lock” promise. First 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 the Consumer Price Index for September, the average growth for wages between May and July, or 2.5%.
Earlier this month, it was revealed that wage growth – analysed by the Office of National Statistics (ONS) – sat at 4%. Under the triple lock, this meant state pension payments would rise by 4% next April as inflation is currently sitting at 2.2%.
However, we will not know the figure officially until October 16, as this is the date for September’s inflation figure. When this is announced, the government will likely confirm any rises. It is likely things will not change, so if the Triple Lock Promise remains in place, here is how much state pensions will rise next year.
How much will the state pension rise in April 2025?
The Department for Work and Pensions (DWP) pays out two different pensions – the new style state pension and the old basic-style state pension. Which one you get depends on when you were born. If you’re a man born on or after April 6, 1951, or a woman born on or after April 6, 1953, you’ll claim the new state pension. The full new state pension is currently worth £221.20 a week or £11,541.90 a year. If you are born before those dates you will get the basic pension which is currently £169.50 a week and is worth £8,844.27 a year.
If the state pension is to rise by 4%, then the new state pension will go up by £8.85 a week to £230.05 – an increase of £461.78 a year. This will take the yearly worth from £11,541.90 to £12,003.68. However, only one in four state pensioners (3.4million) get the new state pension while around 9.3million get the old, lower one.
The old state pension is expected to go up by £6.78 to £176.28 a week. That will take it from £8,844.27 to £9,198.04 a year, a rise of £353.77 compared with now.
Who will miss out on the state pension uplift?
There is another group of people who will be missing out on the state pension uplift next year. These are people who have had their state pensions “frozen” after moving away from the UK to certain countries.
If you live in the UK, Gibraltar, Switzerland or the European Economic Area – which is the EU plus Iceland, Liechtenstein and Norway – your state pension will rise every year because of the triple lock. However, this does not include Canada or New Zealand, even though they do have similar agreements in place.
If you live in any other country, such as Australia, South Africa or India, your state pension will be frozen. This means it will not increase unless you move to a country where the state pension increases are awarded. If your state pension is frozen, it will remain at the rate from when you first emigrated. This means state pensioners living in certain countries will not see their payments rise next April.
What is the state pension?
The state pension is a payment made by the Department for Work and Pensions (DWP). The state pension is paid for through National Insurance contributions, which come from the wages of people working today. As it stands, each working generation pays for the older generation above them so those who are working and paying taxes now, fund the current state pension payments.
Currently, you can start claiming the state pension once you turn 66 years old – although this is rising to 68. To be eligible to claim, most people need to have at least 35 years of National Insurance contributions, some will need more, and ten years to get anything at all.
