State pensioners are set to benefit from a larger-than-anticipated increase in their payments next year, thanks to the Department for Work and Pensions’ (DWP) Triple Lock system. This mechanism guarantees that state pensions rise by the highest of three measures: National Average Earnings, the Consumer Prices Index (CPI) inflation rate, or a minimum of 2.5%.
Currently, projections indicate a 4.8% increase, primarily driven by wage growth. This means the full new state pension is expected to rise from £230.25 per week to £241.30 starting in April 2026. Meanwhile, the old basic state pension should increase from £176.45 to £184.90 per week.
Introduced in 2016, the new state pension amounts to roughly 24% of long-term national earnings. While the Triple Lock aims to ensure retirees maintain their living standards, some experts caution that its continuation could eventually lead to pensions outpacing average earnings.
The Pensions Policy Institute noted that the Triple Lock, while effective as a short-term measure to gradually boost pension generosity, lacks a clear long-term framework or defined objectives. They stress the need for a comprehensive pension policy that clearly defines the role of the state pension within broader retirement income strategies.
Helen Morrissey, head of retirement analysis at Hargreaves Lansdown, added: “State pensioners can expect their payments to increase slightly next April. For those on the full new state pension, weekly payments could rise from £241.05 to £241.30, while full basic state pension recipients may see their payments increase from £184.75 to £184.90. Final inflation data, expected next week, will confirm which metric completes the Triple Lock calculation, but current inflation rates suggest wage growth will determine the increase.”